5 Year Bond Rate Hits 2008 Highs

Over the last 4 months, bond rates have increased by 1%. This means that we no longer have 5% rates; instead, we now have 6% rates.

The rates are currently at the highest point they've been since January 2008.

As for when rates will decrease, I have no idea. Even those who are considered knowledgeable in this area have been wrong. The Bank of Canada's predictions have been totally off. One Economist says rates will stay where they are, one says they will move down, one says we are in for more hikes. We are really in a "no one knows" situation and we all just have to wait and see. This wait and see is a difficult position to be in when funds are tight and the budget is being stretched. 

If you are feeling the squeeze, what should you do? Make sure you have access to liquidity. This may mean, restructuring your mortgage to pay out some high interest debts, selling recreational vehicles or toys, and living a bit tighter while we all ride this out.