Credit Canada

Kim knows all about "love money." That's borrowing from family and friends, when tough times hit.

For 62-year-old Butch, who's worked as a tool maker his entire working life, the future looks grim. Very grim.

Since 2005, its's been a flurry of pink slips, with long bouts of unemployment and no money coming in. Though Butch is now working again, his hourly rate has been slashed by 30% and he no longer has medical benefits. Every day he sits in fear that the axe will fall again.

Yippee! My MasterCard credit limit has been extended to $34,400, and I didn't even ask for the increase.

Consider: I can transfer any account balances to my MasterCard for a nominal interest rate of .054767%. Sounds cheap except for the fact it is 19.99% on an annualized basis. I get the same low rate for purchases.

Among the more insidious ways lenders have devised to get consumers to spend more is the prepaid credit cards.

These look like ordinary credit cards but are preloaded with a certain amount of cash up front. There are no interest charges, so there's no way of spending more than the preloaded amount.

Young people just want to shop till they drop. Old-fashioned thrift is in short supply in North America. Savings rates in Canada and the United States have been - 1% since 2005, a phenomenon known as "dissaving".