Now that the Christmas shopping frenzy is over and the new year is just around the corner, it鈥檚 a good time to take a close look at a subject that is too often overlooked 鈥� household debt.

In buying homes or cars simply because interest rates are relatively low right now, the debt-amassing public is rolling the dice, hoping that rate hikes either won鈥檛 come soon or won鈥檛 affect them.

Commenting about Canadians鈥� growing level of debt, Bank of Canada governor Mark Carney said interest rate changes, when they come 鈥� and they will, eventually 鈥� can be brutal and far-reaching.

鈥淐heap money is not a long-term growth strategy,鈥� he said last week. His words hinted that Canada, and other countries, could be heading down the same road that set off this most recent global financial crisis.

As Carney says, we鈥檙e not out of the woods yet, folks. That means we as consumers 鈥� especially those paying down mortgages 鈥� need to combine fiscal restraint with common sense. Setting aside money to cover off the initial pain of a rate hike isn鈥檛 a bad plan, and if you feel a binding urge to buy that big-screen TV on Boxing Day, make sure you can pay cash or at least cover most of it.

Even a half-point jump in the Bank of Canada rate can have dramatic effects on the amount people pay out. And don鈥檛 forget that Canada鈥檚 annual inflation rate was higher in 2010 than it鈥檚 been in two years, at 2.4 per cent. Even if interest rates go up, the price of things such as gas and groceries won鈥檛 come down.

While levels of personal debt are growing, the picture isn鈥檛 all bleak. Investment firm BMO Nesbitt Burns says net worth is growing at a faster rate than our debt 鈥� people are saving more and investments are growing again.

Nonetheless, personal debtload is a barometer of financial health. Getting it under control before interest rates rise could be the best new year鈥檚 resolution consumers can give themselves heading into 2011. 颅鈥� Goldstream Gazette