Financial Literacy Month in Review
That’s it, November is over which means we have made it through another Financial Literacy Month! We’ve been busy sharing information on TV, local radio, and right here on our blog! In case you wanted to catch up, you can check out all of our Financial Literacy Month posts here.
We’ve mentioned before that it’s all about income, assets, and credit, and we’ve talked a bit more about each of these.
In the first week, we talked a bit more about Income. We focused on self-employed Canadians but the information is helpful if you’re considering buying a house. You can view our post on Intro to income here! We also talked a bit about Debt-to-Income ratios and why they are an important part of your mortgage approval process.
Regardless of your income type, more and more Canadians are becoming self-employed and it’s important to know how that can impact buying a home. Generally speaking, the golden rule is 2-years of income for verification. If you’re thinking about becoming self-employed it’s worth speaking to an unbiased mortgage professional to help you plan in advance.
In the second week of November, we talked a bit more about assets. An asset is a term that is thrown around a lot lately, but understanding what assets you have are another important part of the mortgage approval process. We talked a bit more about the difference between tangible and intangible assets and understanding what each of these means. You can read more about this here.
There are good and bad types of assets too. Depreciating assets like vehicles and boats are seen as worse than appreciating assets such as rental properties or dividend-paying investments.
In the final week, we spoke a bit more about credit. Credit is probably one of the more familiar topics, focusing a bit on the types of credit that your score is made up of. Credit is a big part of the kinds of terms you will receive when applying for a mortgage. This represents your ability to repay a loan (which the lenders want to know), and financial responsibility.
Checking your credit score and keeping up to date with changes can be a bit nerve-wracking, but it’s important to keep on track when planning on financing large purchases (like your first home). It’s never been easier to start than now, with the growth in online credit monitoring services, you can flex your financial literacy muscles and stay on track!
Winter is Coming
As we head into the holidays, it’s always a good time to pause and review with your family. While the topics may be sensitive, the outcomes can be very positive and help family members deal with issues that could come up in the future.
If you have any questions about financial literacy month or planning your finances into the future, Get in touch with us here!