Does North America have a credit card debt problem?

Cardone does not think that overspending with credit cards is a widespread problem.

Nevertheless, considering the increasing levels of credit card debt in the North America, Ramsey’s guidance may still hold weight.

Credit card balances surged CAD$15.9 billion in Q4 2023 to CAD$116.2, according to a recent report from Equifax Canada3.

Additionally, the amount of Canadian consumers paying off the full balance fell from 66.1% in Q4 2022 to 65.4% a year later.

However, Cardone recognized Ramsey’s contribution to building up people’s financial health and trying to quell needless spending in favour of building up robust savings.

“I think Dave’s great for most people that just want to figure out how to get out of debt. He’s done a great job,” he remarked.

Savings accounts that can help your money grow

Are you looking to make the most of your savings? A high-interest savings account (HISA) gives folks the opportunity to stow away their hard-earned cash and have favourable interest rates increase that sum over time.

KOHO Essential: KOHO Essential is a free downloadable app that allows Canadians to manage their money and earn interest easily. The app connects with a pre-paid Visa card so that you can budget, spend, and save at the same time. Once direct deposit is set up, you will earn 0.5% interest on your balance. The bonus comes when you use your KOHO account to purchase groceries or pay bills. Then you’ll earn 1% cash back.

  • Regular interest rate: 3% interest, plus 1% cash back on select purchases. Earn up to 5% with KOHO's paid plans.
  • Minimum account balance: None

Laurentian High Interest Savings Account: The Laurentian High Interest Savings Account offers a reasonably strong 3% regular interest rate for its high-interest savings account. Keep in mind that this is the regular rate, not a promotional rate, and there is no minimum account balance required. There are no monthly fees, and account holders have access to an unlimited number of deposits. Furthermore, account holders with a balance of CAD$100,000 to CAD$5,000,000 have access to a 4% interest rate.

Neo Money: The Neo High-Interest Savings Account offers a 4% interest rate, unlimited free transactions, and no minimum deposit requirements. This account's offerings are pretty basic compared to some of its competitors, but Neo Financial could be a good choice if you have simpler needs.

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Building a real estate empire

Cardone knows a thing or two about real estate. His private equity firm, Cardone Capital, boasts a multifamily portfolio of assets under management valued at over USD$4 billion.

In such ventures, debt can be a useful tool.

“While it’s true that too much debt can be a bad thing, it can be one of the most powerful tools in a real estate investor’s arsenal,” Cardone wrote in a blog post4.

He explained that there is good debt and bad debt. Bad debt includes things that do not put money in your pocket, such as credit cards and car payments. Good debt, on the other hand, are investments that eventually help you build wealth.

“Real estate is the best example of good debt because it has the potential to generate both capital appreciation and cash flow,” Cardone noted.

These days, there are multiple ways to tap into real estate.

You can take on debt to purchase rental properties directly or buy shares of publicly traded real estate investment trusts (REITs). You can also explore crowdfunding platforms that allow you to own a stake in private REITs or a percentage of physical real estate properties, like apartments, commercial buildings and even plots of land.

Investing with confidence

While not everyone can afford to build a real estate empire like Cardone, investing is a diverse field to get into and can reap bountiful monetary benefits. Here are some great robo-advisor options to help build a portfolio and break into the investing market.

Moka: For the consumer looking for long-term investments without active management, Moka is a great option. It's designed for hassle-free investing, automating contributions to the S&P 500, known for its solid average annual return of 10% over 65 years. With a flat fee of just $15 monthly (plus 0.09% fees for the ETFs), it's much more cost effective than traditional managed funds, translating to significant savings over time.

Questwealth: When starting to invest with Questwealth, after filling out a questionnaire on your risk level, you are placed into either aggressive, growth, balanced, income or conservative portfolio category. Then you choose the type of account you want to invest in, such as a TFSA or RRSP. While it’s not entirely automated, the fees remain the most competitive.

  • Management fees: 0.25% first $100,000, 0.20% after that, plus administrative fees based on which account chosen for investment.
  • Minimum account size: $1,000

Justwealth: Similar to Questwealth, Justwealth is not entirely automated. The company prefers to see itself as more personal, with a hybrid approach that combines humans to talk to along with automated investing options. The platform has 70 different portfolios, with the main categories including global growth, Canadian growth, income, socially responsible, educational target dates and USD. With those are even more portfolios for those who like options.

  • Management fees: $4.99/month, $2.50/month for RESP, plus 0.5% annual fee and average 0.25% ETF fee
  • Minimum account size: $5,000, no minimum for RESP

1 BMO: "BMO Annual Retirement Survey: Millennials Believe They Need About $2.1M To Retire Compared to the National Average of About $1.7M"

2 CPA Canada: "Are we thriving or merely surviving? New CPA Canada study examines the state of Canadians’ finances in today’s turbulent times"

3 Equifax Canada: "Increased financial strains as credit deliquencies continue to rise"

4 Grant Cardone: "How to leverage debt as a real estate investor"


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Jing Pan Investment Reporter

Jing is an investment reporter for Prior to joining the team, Jing was a research analyst and editor at one of the leading financial publishing companies in North America. Jing has covered numerous aspects of the financial markets, from blue chip dividend stocks to small cap tech stocks to precious metals and currency. An avid advocate of investing for passive income, he wrote a monthly dividend stock newsletter for the better half of the past decade. In his spare time, Jing plays basketball, the violin and the ukulele.

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