High on the list of financial behaviours that need to change in the postpandemic world is overspending on housing.
It’s now obvious that the financial commitment of owning a home left some people without savings that would have softened the financial effects of the pandemic-caused economic shutdown. What we need going forward is a more sustainable model of home ownership where people can pay for their homes and have money left over to save for retirement and enjoy in ways such as family holidays and meals out.
Our contribution at The Globe and Mail toward this goal is a relaunch of the Real Life Ratio calculator, an online tool originally developed at the peak of the housing boom to help people see whether a home is affordable. You can access it here.
The economic damage done so far by the pandemic shows the importance of saving cannot be overemphasized. Veteran mortgage broker Vince Gaetano found this out in recent weeks as he talked to clients who have lost a job or had their income interrupted.