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Use a Debt Repayment Calculator to Build Your Payoff Plan

Stop Guessing. Start Calculating. Knowing you have debt is one thing. Knowing exactly when it will be gone — and how much interest you'll pay along the way — is something entirely different. That's where a Debt Repayment Calculator earns its keep. Whether you're carrying a credit card balance, a car loan, a student loan, or a combination of all three, a repayment calculator takes the guesswork out of your payoff journey and puts you in the driver's seat. What Does a Debt Repayment Calculator Do? A debt repayment calculator takes three simple inputs: Your current balance — how much you owe today Your interest rate — the annual percentage rate (APR) on the debt Your monthly payment — what you're paying (or plan to pay) each month From there, it instantly tells you: Your payoff date — the exact month and year you'll be debt-free Total interest paid — the real cost of carrying that balance Interest saved — how much you'd save by increasin...
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How to Prepare Your Investments for Rising Rates in Canada

 

On October 25, the Bank of Canada made a decision: they kept the interest rates steady at 5%. This means that investors need to adjust their portfolios to cope with the new normal of higher borrowing costs and lower bond prices. Here are some tips on how to do that:

1. Reduce your exposure to long-term bonds. Long-term bonds are more sensitive to interest rate changes than short-term bonds, so they will lose more value when rates go up. You can switch to shorter-term bonds or bond funds, or use bond ladders to stagger the maturity dates of your bonds.

2. Diversify your income sources. Interest income from bonds will likely decline as rates rise, so you may want to look for other sources of income, such as dividends, real estate investment trusts (REITs), or preferred shares. These assets can provide steady cash flow and may also benefit from economic growth and inflation.

3. Consider adding some inflation protection. Higher interest rates often come with higher inflation, which erodes the purchasing power of your money. You can protect yourself from inflation by investing in assets that tend to rise in value when prices go up, such as commodities, gold, or inflation-linked bonds.

4. Review your asset allocation. Higher interest rates may affect the performance of different asset classes, so you may need to rebalance your portfolio to maintain your desired risk-reward profile. For example, you may want to reduce your exposure to growth stocks that rely on cheap debt to fund their expansion, and increase your exposure to value stocks that have strong cash flows and dividends.

5. Seek professional advice. Adjusting your portfolio for higher interest rates can be complex and challenging, especially if you have a long-term horizon and multiple goals. You may want to consult a financial planner or advisor who can help you create a personalized plan that suits your needs and preferences.

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