Consolidation of Debt a True Way To Save $$$

With debt, all your eggs do belong in one basket

See video and research report (below)Consolidation may be a tried and true method of reducing interest costs but how many of your clients are actually doing it? And have you encouraged them to consolidate not only their debts but their short-term assets as well?Survey says . . .A survey recently conducted by Maritz Research* on behalf of Manulife Bank found that 55% of Canadian homeowners polled currently have some sort of household debt but that only 33% of those have ever tried consolidating it. Nearly 40% of these survey respondents said they had not consolidated their debt because they believed there is no advantage to debt consolidation but a new study by Professor Moshe Milevsky, an Associate Professor of Finance at the Schulich School of Business, York University and Executive Director of the Individual Finance and Insurance Decisions (IFID) Centre clearly indicates otherwise."While portfolio diversification is an excellent principle when it comes to your assets, it's not a sound practice when applied to your debts," says Milevsky. In fact, he points out that diversifying debt is actually harmful to Canadians because it costs them money each year.Recent study confirms itIn the recent study on Canadians' debt habits, Milevsky found that the average Canadian homeowner can realize annual savings by simply consolidating all of their debts with their savingsin one line of credit, at one low interest rate. The study emphasizes that, while consolidating debts is advantageous, even more savings are realized by using one's short-term savings to pay down the debt immediately. And a line of credit is ideal because the homeowner can take the money back out again to pay for monthly expenses and other costs as they arise.Together, we can help clients consolidate and saveOf course, Manulife One is the ideal product to help your clients consolidate and save and still have access to their money. However, changing life-long banking habits -- such as diversifying debt -- takes more than just a great product. It takes proper education and help from someone they trust.We've created a short video that explains the findings of the study and produced a summary of the report to help make it easier for you to explain the benefits of debt and short-term asset consolidation to your clients. Take a look at the items here and then contact your local Banking Consultant for support in referring your clients to Manulife One. It is important that you refer Manulife One only to your existing clients.
Professor Milevsky explains (1 1/2 minute video)
Summary of report (22 KB)
Full research report (105 KB)
Press release (25 KB)Go to manulifeone.ca for details about Manulife One and to try the online calculator.*The survey by Maritz Research conducted between September 15 – 21, 2005 of Canadian homeowners has a margin of error of +/-2.73 per cent, 19 times out of 20. The number of Canadian homeowners surveyed was 1,261.

Setting a Budget After Debt Solution

If you're the type of person who always has plenty of cash, knows exactly where every penny goes, and never has trouble paying bills, skip this chapter. You're either too rich or too smart to need it.
For the rest of us, unfortunately, making - and sticking to - a budget is the essential tool for ensuring that our money gets used the way we need it to. Even if you're in the happy situation of having plenty of income, the homework involved in drawing up a budget can be instructive, since you may find that you are spending more than you wish on items like DVDs, electronic gadgetry, or restaurant meals.
Drawing up a budget is usually pure drudgery enlivened only by the reality of staring your foolish spending habits in the face. In fact, one of the chief impediments to budgeting is that most people would rather not know how they really use their money.
It's bad enough to learn this kind of information on your own. It's even worse when a spouse or significant other finds out, since it usually confirms his or her worst fears - and provides new ammunition for future "discussions."
Take heart. Any spending mistakes you're making are probably common and not impossible to kick. Moreover, the bulk of budgeting's pains are at the beginning.
After you have a budget in place - and you've fine-tuned it with a couple of months of actual spending - tracking your expenditures becomes almost automatic.
If your boss at work were to ask you for an analysis of the department's spending, you'd figure it out quickly enough. Budgeting your household should be approached in the same businesslike fashion. A variety of electronic tools can make the process easier.