In my opinion, 2023 will create the greatest wealth gap in Canadian history.
Housing will continue to fall, rates will remain high (until the end of the year), expenses will remain at top levels, taxes will stay high, new taxes will be born and the fear of it all will continue to create worry from coast to coast.
These are the moments however that create the best opportunities albeit not readily visible to the average eye. I will be focusing on the following financial tasks this year:
- Cut 10% of expenses – everyone can cut something from his or her own budget.
- Increase cash reserves by 15% – this can result in spending less, investing less, or generating more revenue although increasing revenue during a recession is no easy task
- Keep books EXTRA tight – CRA will be increasing its auditing efforts due to the massive overspending that took place during the past two years. I have recently hired a second bookkeeper to ensure that there are zero cracks in my financial affairs
- Portfolio overhaul – I will be reviewing my entire real estate portfolio to determine if any properties need to be liquidated to free up cash. Selling stocks now is simply not an option either.
- Don’t stress – I believe there is zero point stressing about things you cannot control ie: recession, interest rates, government incompetence, public attitude, etc. Stressing about things doesn’t change the existing of these very things. Keep your head on.
Those who act rationally and responsibly are going to skyrocket themselves ahead as recessions produce large amounts of opportunities for those who understand the cycle. The opposite is true for those who do the opposite.
Let’s go 2023!