The best gift? Have no credit debt in 2022


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Dear Money Lady, I check my credit all the time – do you think it will go down in December?

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Dear Ken:

December marks the time of year when Canadians spend the most, whether it’s on food and household items or, of course, the Christmas season of small gatherings (due to COVID) and family gifts. Spending more shouldn’t hurt your credit unless you plan to not pay it off in full and carry a debt balance over into the new year. One thing we didn’t anticipate for this end of the year was the higher level of inflation, which will hit everyone’s wallet now and into 2022.

According to a survey conducted by Equifax Canada, 64 percent of Canadians have checked their credit reports in the past year.

“While there are still a lot of people concerned, it is encouraging that consumers are taking the time to better understand their relationship with credit,” said Julie Kuzmic, Senior Compliance Officer, Consumer Advocacy at Equifax Canada.

Credit has always been something most Canadians use during the month of December and this year will be no different; in fact, it will most likely be a necessity. Although we have recovered most of the jobs lost during the height of COVID, unemployment is still too high, which will make it extremely difficult for many Canadians this Christmas season. Supply chain issues have driven up costs for businesses and have now limited the supply of basic consumer goods. Add to that the high prices we see at the pump for gasoline, it’s understandable to see higher-than-expected inflation numbers, now at nearly five percent (the fastest increase in 2002 and 2003 ).

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The hardest hit people this season are those on low or fixed incomes whose incomes have remained stagnant, meaning their purchasing power has declined significantly as prices rise. When disposable income tightens, it doesn’t take long before it starts to force people to resort to credit to maintain their lifestyle. Be very careful here. Carrying over credit balances from month to month forces you to fall into a revolving credit cycle, and over time this will lower your credit rating. Plus, if you go over your credit card limit every now and then it will lower your score as well.

To learn more about how credit works, you can visit the Equifax Canada Education Hub.

My husband recently had issues with his credit and used Equifax to monitor his score (they send him updates and emails when he changes). He had a dispute with a credit provider that was eventually rectified, but the incident literally caused his credit rating to drop by 70 points. Even though it wasn’t his fault and the credit provider had given up, the damage was already done. Cybercrime and credit fraud have all been on the rise since COVID.

It is good to see that Canadians are now much more credit savvy. They want to know. And even as we enter “spending season,” I know most Canadians will still be careful with their credit.

So rather than going deeper and deeper into debt this Christmas, why not celebrate the true meaning of the season? This is the one time of the year when we are supposed to “give of ourselves, think of others, and bring happiness to others”. It’s really not meant to be that marketed version that retailers want, where you shop until you lose or burn your computer keys with online shopping? Yes, we want to support the local, but you know there should be a limit.

Why not give yourself a gift this year – don’t go into debt. Pay no credit for the New Year. It’s a great gift!

Good luck and best wishes

Christine ibbotson

Written by Christine Ibbotson, author of three books on finance and the Canadian bestseller “How to Retire Without Debt and With Wealth”. Go to, or send a question to


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