Financial news and advice — March 2014

Recent studies shed light on trends in Canadians' financial behaviour, from credit scoring to online shopping.

What's the score?

Despite the growing level of personal debt across the country, more than 75% of Canadians say they have little or no understanding of how credit scoring works or that there are many different credit scoring models, a study by TransUnion finds. "While you do not have control over what scoring model a lender may use, you do have control over the credit behaviours captured in your credit report," says Julie Springer, TransUnion vice-president, who advises closely monitoring any changes within a single score.

No revenue rats

Seems Canadian taxpayers hold themselves to a higher standard than their neighbours, according to a survey conducted on behalf of income tax preparers H&R Block. Of the 1,500 Canadians polled, more than half (53%) say they wouldn't snitch on a tax cheat, despite one in five respondents admitting they know someone who short-changes the tax man. But when it comes to their own taxes, 72% claim they would notify the Canada Revenue Agency if they were overpaid on a tax refund.

Big spender gender

Canadians spent about 40% more money online in 2013 than in 2012, according to an Ipsos Reid poll. Eight in 10 Internet users in Canada made at least one purchase online last year, spending an average of $899 in 2013, up from $639 in 2012. Interestingly, men were the bigger online shoppers — averaging $1,080 in annual buys compared with $725 for women.

Freedom 55?

If you based your retirement financial plans on the idea that you'll work past the age of 60, you might want to go back to the drawing board. According to a US survey by the Society of Actuaries, more than half (53%) of workers plan to retire after 65 but, in reality, 30% of current retirees stopped working before age 55 and another 24% retired before age 59. Workers also overestimate the likelihood that they can work part time in retirement; 76% expect to continue with some form of paid work but, among retirees surveyed, 78% stopped working for pay all at once.