Back to Basics

A few years ago, my parents urged me to read a book on personal finance: The Wealthy Barber. The book would teach me about money, they said. I wasn’t interested; as far as I was concerned, I wasn’t making money at the time and didn’t have any to save much less invest. RRSPs, RRIFs, RESPs and GICs were just a jumble of alphabet soup sloshing around in a bowl at the back of my mind. I told my parents I’d figure it out when I needed to. Well, that day came and went a while ago. Told you so’s aside, I do wish that I had gotten my sorry behind in gear and read the book a little earlier.

In the spirit of financial literacy month (seems like there’s a month for everything doesn’t it?) in Canada, let’s take a step back and cover some things that may not seem interesting but will be useful when that moment of reckoning comes. With fresh start and a clean slate, who knows, maybe we’ll learn a new thing or two.

First up: Tax-Free Savings Account basics. Continue Reading

Why create a budget in the first place?

It began about the time we graduated from university. I was researching methods to track my income and expenses with the intent of paying off my $30K student loan as quickly as possible. I read about this hot new start-up that was making waves for its ability to gather information from various financial institutions and display trends and based on transactions. It was a great idea but at the time, Mint.com was only available in the US so I took to spreadsheets to calculate my numbers.

My budget tracking started out strong but eventually the tedium of entering receipts ate away at my resolve. My ad hoc tracking resulted in an inaccurate representation my financial status. At the end of the day, I was satisfied with my financial situation as long as my expenses didn’t exceed my income. Shortly after Emily and I wed, Mint finally made its debut in Canada. We eagerly signed up and set off to meticulously track our joint expenses. We were much more successful this time around since the tracking was directly linked to our accounts. After a few months, we learned that we were spending more than expected on seemly small things, like an astonishing $300 on eating out each month! Obviously, some changes were in order. Continue Reading