Canadian Personal Finance Blog

Personal Finances and Consumer Concerns, essays, stories, examples and how to articles with a distinctly Canadian Point of View
August 21st, 2008

Consumer Price Index For July 2008 Rises Again

Consumer Price Index at 3.4% for July

All I can say is “Uh Oh”, with the CPI numbers for July
being released by Stats Canada.

July saw the highest 12-month increase since March 2003. A climb in gasoline prices was the primary source of higher consumer prices in July. The 12-month variation in the Consumer Price Index (CPI) and the gasoline price index have been increasing at a faster pace over the past four months.

Inflation without gas prices included in it, is at 2.1%, which isn’t as bad, but it is still startling to see these numbers jumping up like this.

On Going Consumer Price Index Graph

On Going Consumer Price Index Graph

This means other prices are going up but not as dramatically, but this is very worrying and I wonder what the Bank of Canada may do about this? Gas prices seem to have plateau’ed for now, but what is going to happen this fall?

More information after the BIG table :-)

Consumer Price Index and major components
(2002=100)
Relative importance1 July 2008 June 2008 July 2007 June to July 2008 July 2007 to July 2008
Unadjusted
% change
All-items 100.002 115.8 115.4 112.0 0.3 3.4
Food 17.04 116.5 115.8 112.3 0.6 3.7
Shelter 26.62 123.3 122.3 117.0 0.8 5.4
Household operations and furnishings 11.10 104.4 104.3 103.2 0.1 1.2
Clothing and footwear 5.36 93.3 92.5 94.6 0.9 -1.4
Transportation 19.88 125.7 125.8 118.5 -0.1 6.1
Health and personal care 4.73 108.5 108.7 107.5 -0.2 0.9
Recreation, education and reading 12.20 103.2 102.9 103.0 0.3 0.2
Alcoholic beverages and tobacco products 3.07 127.6 127.7 126.0 -0.1 1.3
All-items (1992=100) 137.8 137.3 133.3 0.4 3.4
Special aggregates
Goods 48.78 112.1 111.6 108.6 0.4 3.2
Services 51.22 119.4 119.1 115.3 0.3 3.6
All-items excluding food and energy 73.57 110.4 110.3 109.1 0.1 1.2
Energy 9.38 169.1 165.3 139.6 2.3 21.1
Core CPI3 82.71 111.7 111.6 110.0 0.1 1.5
1. 2005 CPI basket weights at April 2007 prices, Canada : Effective May 2007. Detailed weights are available under the Documentation section of survey 2301 (www.statcan.ca/english/sdds/index.htm).
2. Figures may not add to 100% due to rounding.
3. The measure of Core Consumer Price Index (CPI ) excludes from the all-items CPI the effect of changes in indirect taxes and eight of the most volatile components identified by the Bank of Canada: fruit, fruit preparations and nuts; vegetables and vegetable preparations; mortgage interest cost; natural gas; fuel oil and other fuel; gasoline; inter-city transportation; and tobacco products and smokers’ supplies. For additional information on Core CPI, please consult the Bank of Canada website (www.bankofcanada.ca/en/inflation/index.htm).

Leading Indicators Remain Flat

The composite leading indicators remained unchanged for another month, for July. This is the second straight month this is happening, but the actual results are quite mixed. The Housing Index seems to be the biggest drop and is the heaviest anchor keeping the index from rising (which is a good thing, I think), and New Orders in manufacturing is up too (i.e. people or companies are buying more).

Humor: And You Can’t Even Rely On Teenage Sex Either!

Yup Stats Canada put out a study that says that Teenage sex in Canada is on the Decline.

In 2005, 43% of teens aged 15 to 19 reported that they had had sexual intercourse at least once, down from 47% in 1996/1997.

The decline was due to young women, among whom the proportion who reported having had sexual intercourse fell from 51% to 43%. The proportion of young men who had had intercourse remained unchanged at 43%.

After doing the simple math in my house, I am going to go ground 2 of my three daughters!!!

August 20th, 2008

Best of: Cancer, now that I have your attention

Busy week, so I am taking a break and publishing one of my favorite posts, about Risks and dealing with Risks.

Cancer, Now That I Have Your Attention

Yup, I am really talking about that, as Cancer’s ability to kill Canadians is rising, and Canadians are taking care of Cardiovascular issues more. Six out of every 10 deaths in Canada are caused by these two issues. Cancer is becoming more of a killer, is the bottom line for now.


So what the heck does this morbid topic have to do with Financial Planning issues? Maybe I’m just feeling morbid? No, but, if you look at this data, maybe you need to ask yourself the following important financial questions:

  • Do I have enough life insurance so that my family can survive my death? Same question for your spouse too?
  • Can my family survive financially a prolonged illness (as Cancer is capable of being)? Do I have any disability insurance?
  • Do I have a will?
  • Do I have enough health insurance to deal with a catastrophic illness?

If you are young and single, no it doesn’t matter that much, but if you are young and just married and planning on having kids, NOW, is the time to do this kind of stuff in place. No I am not selling insurance (and I am not advocating whole life insurance at all), but I am saying, go find out about what you need to deal with these concerning numbers about Cancer.

Hope for the best, and plan for the worst! (a wise saying).

August 19th, 2008

Back to the Bank

As I have said, as part of my financial clean up for my severance package I must go to my bank and attempt to get them to actually help me, and possibly earn their exorbitant fees (although after reading on Nancy Zimmerman’s blog about the Citizen’s Bank, maybe I need to reconsider who I bank with).

RESPs How Do You Withdraw Money?

This question continues to confound me on the TD web site.  I know I need to do an Educational Assistance Payment from the RESP, so that I can take advantage of the CESG payments made by the government. It is simple to pay money into the RESP, but extracting money from the RESP is a much more interesting thing to do, so I must now figure out how this works, and will have to fill in a bunch of forms.

Locked In Retirement Account (LIRA)

Given I will be extracting funds from my pension, it must go into a locked in retirement account, so I must now find out about how TD Canada Trust does this kind of account. I have one with SUN Life, which is of no bloody use to me (so it will be folded into whatever I create for this side of things). Hopefully this is a self-directed type investment creature and I can take advantage of one of the Lazy Portfolios that the Canadian Capitalist has spoken of previously.

RRSP For Me

As I have said previously most of my RRSP money is in spousal RRSP’s, because I thought I was going to have a nice pension (silly me), but now I have a bunch of devices that I was collecting at work that I must now transfer over to a single RRSP in my name. 

No Fee Banking

I am paying $12.95 a month again for my banking, so I will be pointing out what the Citizen’s bank has to offer, and what PC Financial offers as well, and how I’d like to have free banking again, given all the business I will be bringing with me. Not sure if I will get it given to me this time, but we shall see, this time.

I look forward to the 4 hours I will have to spend at the bank.

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