Every Saturday morning, my husband and I perform our favorite ritual. We drop off our son for basketball practice, and then spend the next two and a half hours at Costco. We always leave the store loaded with stuff we didn’t even know we needed. But, it’s a great feeling… being able to spend some money relatively indiscriminately.
Of course, we’re not the only ones in Canada discovering the fun, as well as the trappings, of spending. The Spend Spend Spend mentality has shifted into high gear, and not only because of the holiday season. According to Statistics Canada, last year, the average Canadian household reached its highest spending rate since 1997.
In 2005, we spent more than double our average annual inflation rate of 2.2%. Granted, much of that money went out in smoke, and I mean that literally, to heat our houses and drive our cars. If only that was all we’d spent!
The Western provinces are leading the household spending boom. Apparently, the most popular purchases were fancy cars, cell phones, and electronics. While the overall spending rate in Canada rose 5.1% from 2004 to 2005, residents of the Northwest Territories, for example, spent 16% more for the same period.
Broken down by spending classes, Canadians’ wallets coughed up 6% more in personal taxes and property taxes, 22% for the roof over their heads, 14% for commuting, and 11% for food. Furthermore, we put 10% more money putting gasoline into our cars and 7% more buying new cars.
Spending on public transit rose by a measly 1%. It seems as though Canadians are developing the same kind of love affairs with their cars as our American neighbors have had for years.
Canadians also love their cell phones and all the bells and whistles they come with, as evidenced by an increase in spending of 21% on these gadgets from 2004 to 2005. In contrast, spending on traditional landline phones dropped 3% during the same period.
Also growing in popularity are computer gadgets, and DVD players and their paraphernalia, as well as the Internet.
I may be just as guilty as the average Canadian, if not more, of spending excessively, but the realist in me, to which I’ve been giving huge doses of tranquilizers lately, is already flashing warning lights.
It’s not a question of not being able to pay the bills; quite the contrary. The fact is that most wallets in Canada have become lighter in recent years. Income growth rates may be following inflation, but they are certainly no match for our spending habits.
I don’t think we’re flirting with disaster, at least not yet, but we are flirting with something dangerous. I’m just not the best person to be giving advice on how to curb this addiction…