Try this new retirement calculator.

The company that makes the financial planning software I use, recently put out this little retirement calculator. You’ll enter a few pieces of information and it will tell you how much income you might have during retirement, and how that compares to other Canadians.

It’s completely free. And there’s no obligation to purchase anything or talk to anyone. Try different scenarios to see how retiring earlier or saving more will affect your lifestyle.

If you want to talk further about your retirement plans or other money concerns, contact me . . . who knows you might even get a free coffee!

Building an Emergency Fund When You Can’t Afford Anything

a man holding his pockets inside to show they are empty

I was clicking through the headlines on MSN the other day, and I came across an article entitled “20 ways to save $1,000 a month.”  That sounds good – let’s check it out.  However, I only got through the first three suggestions before I gave up.  (1) Track your spending and see where your money is going.  Well, duh.  (2) Pack a lunch each day instead of going out to eat.  Not really helpful – I’ve done this for years.  (3)  Stop going out for dinner several times a week.  Seriously?  Several times a week?  Who does that?  And who writes these articles anyway?  I didn’t even bother reading the rest of the “tips” – they probably wanted me to trade in my Hummer for a more fuel-efficient car.

That reminded me of another article I read with the following scenario – “Let’s look at the case of a 56-year-old man named Leo.  He’s single and takes home $10,000 per month…”  and that was enough for me.  Honestly, how many people do you know who are single and take home $10,000 a month? 

I don’t know whose reality these articles are grounded in, but it sure isn’t mine.  That’s why I hate the financial sections of newspapers – those writers live in a different reality.  Their articles are written for people who are making six figures or more per year.  They are not geared towards people like me, who earn less than $45,000 a year (gross, not net) and have already cut their budget to the bone.  I would be happy enough to save an extra $50 a month to put away each month for emergencies.  And I think a lot of others feel the same way.  So in this article, I’m going to help you find some extra money to put into an emergency fund for unexpected expenses. (I call this my curveball account because sometimes life throws you a curveball – like when your fridge stops working and it needs to be fixed).

There are different ways to save money, but I will focus on some of your fixed expenses.  For example, do you still have cable?  Do you really need it?  Do you actually know what you’re paying for?  Are you paying for unlimited internet usage, when you are only using a fraction of what you’re paying for?  Are you paying for channels you don’t even watch?  You can probably save about $10 or $20 a month by carefully reviewing your bill and cutting out a few unnecessary things.

What about your land line?  I’m sure you have a cell phone.  Do you really need a land line as well?  Cutting off your land line should save you about $20 a month.

How about your utilities?  How can you reduce these costs?  There is one simple method that you can use to “reduce” your monthly costs – set up an equalized payment plan for your heat, water, and power bills.  Your provider will determine your yearly usage and then spread the cost equally over 12 months.  So if your annual heating bill is around $1,200, you will pay $100 per month for 11 months, and then on the 12th month, you will pay a “settle up amount”.  This means that if you went over $1,200 and used $1,300 worth of power, then you will pay $100 plus the extra $100.  The benefit of this arrangement is that now you know how much your bill will be each month.  This will allow you to set aside an extra $10 or $15 a month to put towards your curveball account.  If you do this for all three of your utility bills (heat, power, and water), you should be able to save a minimum of $30 per month.  A word of warning, however, – keep an eye on your monthly bills and make sure that you’re not getting too far in the hole each month.  You don’t want to end up with an $800 bill for heat in your settle up month!  If you notice that you’re running a deficit, pay an extra $20 or so when you have a bit of extra cash so you can stay on top of the bill.

So there you have it.  If you can cut four of your monthly bills by an average of $13.25 per month, you can save $50.00 per month to put into your curveball account for those unexpected expenses. 

Author: Sharon Skwarchuk

You Deserve a Financial Plan

Do you…

…want the peace of mind that comes with having a financial plan in place?

…need methods to reduce your debt and save more money?

…want to make sure your family is taken care of in the unfortunate case of disability or death?

…need to learn more about investing, but don’t know where to start?

…plan to give your child the best start in life as far as money is concerned?

…require a system of managing money with a partner?

…have dreams of early retirement?

If so, you deserve a clear, detailed money plan that will help you accomplish your goalsBook your first complimentary consultation now!

What does a comprehensive financial plan entail? Read all about it here.
Don’t need a full financial plan? Check out all my services.

Or have more questions? Don’t hesitate to contact me. I’d love to speak to you.

couple on a mountain

Are Coupons Worth It?

various groceries and cash register receipt

I’m sure most of you have seen the TV show where shoppers use coupons to get huge discounts and often end up paying $10.00 for $200.00 worth of groceries.  And they’ve managed to accumulate massive stockpiles of shampoo, toothpaste, energy drinks, etc.  No doubt this has inspired many of us to start clipping coupons frantically in order to reduce our weekly grocery bills.  Hey, if they can do it, why can’t I?

Well, I’ll tell you why.

First, if you pay attention, you’ll see that these people have created a list of items for which they have coupons – not a list of items they actually need.  They’re buying 30 energy drinks, 50 bottles of pop, or 15 tubes of toothpaste.

huge amount of groceries in cans and boxes on display in a store

 I have rarely seen anyone on that show actually buy real food – items like meat, bread, milk, fruit, eggs, etc – and come out with a grocery bill of less than $10.00.  

Second, these are American shows.  There are a lot more grocery stores in the United States than there are in Canada.  Therefore there is more selection for everyone, which means more competition for the consumer’s dollar.  Many of these stores also have some type of discount card, which Canadian stores don’t have.  Discount cards issued by a particular store are one way to get customers to keep coming back.

Finally, and most importantly, these people devote their entire day to clipping and sorting coupons.  It’s their full-time job.  And they’ve said as much on the show – they can spend up to 30-40 hours a week clipping coupons, even with other people helping them collect coupons and organizing them.  Do you really want to devote that much time to couponing?

The big question is: Do you actually save any money with a coupon? 
The answer: It depends on both the coupon and the product.

For example, if you find a coupon for something that saves you $0.50 or $1.00 on something you always buy, then it’s worth it.  However, before you use the coupon, ask yourself:

  • Is this item is something I actually will use?; and
  • What is the price of the generic version? Usually the generic item is cheaper, even after you deduct the coupon amount from the brand name.

I think this is the biggest mistake that people make.  They think, “Oh, I have a coupon – I’ll save money!”  But it’s a coupon for something they never buy.  So be sure to ask yourself those two questions first before you use any coupon. You’re actually wasting money if you purchase something you don’t need or could have gotten for a lower price just because you had a coupon.

There are also a number of coupon apps available which eliminate the need to “clip” coupons.  I haven’t tried all of them, but I do recommend Checkout 51.  The app is free and it’s very easy to use.  The list of items you can save money on is quite varied – anything from diapers to alcohol to dog food – and they regularly add new items.  And if you claim certain coupons regularly, they will send you more of those coupons – for example, I use Pantene shampoo, so I get those coupons often.  It’s quick and easy.  However, the offers on the list are only valid for one week, and there are only so many offers to go around, so you have to claim them quickly!

So in answer to the question – is couponing worth it?  Well, if you’re happy enough to save $5.00 or $10.00 a week on your grocery bill, and you can then use that money for something else, then I would say yes, it’s worth it.  But if you’re hoping to save hundreds of dollars a month, you’re probably not going to do it by clipping coupons.  So the final choice is up to you.

Meena’s note: The only “coupons” I use regularly are the bonus points on certain products that I get from my PC Financial credit card. I like that these are on produce and other items I actually buy frequently. I don’t pay any special attention to them though. If I happen to buy the item that week then I’ll get the money back, but I don’t have a system in place. I am curious about Checkout 51. So if you have used it, or have other experience with apps or coupons, please leave your comments.

Author: Sharon Skwarchuk

Are Budgets Stupid?

A rant by Meena Kestirke

What does every money guru say?

  • Make a budget.
  • You need a budget.
  • Start with a budget.

No. Wrong. I disagree. I hate budgets.

Why do I oppose them so vehemently? I’m glad you asked, fellow human.

Restrictive Systems Backfire

Have you ever tried to not think about something?

You: Don’t think about eating those cookies, self!
Brain: Cookie, cookie, COOKIE! Just one wouldn’t hurt.
Cookie…cookie…and then…
Homer Simpson drooling

 

 

 

 

 

Yeah, it doesn’t work for me either.

I’m stubborn. Maybe you are too.
If someone (including myself) tells me to do something, without a valid reason that I believe in, I don’t want to do it. I want to do the opposite.
Giving yourself rules just gives you something to rail against. It’s not productive.

You are the Only Person Like You

  • Have you ever heard the boring old rules of thumb about saving 10% of your money, or spending no more than 30% of your income on housing?
  • Have you seen those stats about how the average Canadian or American spends their money?
  • Have you been caught up in comparing your grocery spending to others on Facebook?

Stop that right now!

  • Don’t give a damn about how other people are spending their money.
  • Don’t compare.
  • Don’t look at those stats.
  • Don’t use a budget tool that tells you how much to spend in each category.

(Oops, I should refer back to section 1 – sorry for telling you what not to do.)

You have your particular dreams, desires, preferences. They are ALL valid!
I’m not saying you can get everything you want whenever you want it. But I want you to get as much of what you actually want as possible. Not what other people say is right, or think you should be doing.

It’s your life. Take it back!

Budgets can Encourage Overspending

a pile of books

Huh? What’s that now?

When you create a budget, you’ve planned to spend a certain amount of money, whether by category or as a total. If you use the “pay yourself first” philosophy, then the rest of the money is yours to do with as you will, right? There’s no harm in spending it. (Or so they tell you.)

You’ve given yourself permission to spend up to $X on “mysterious item”. What if you don’t actually want or need “mysterious item”?
By having a regular budget, you can get into spending routines, and bad habits. You remove the consciousness from the spending process. I want you to be fully aware of each and every purchase you make, whether it falls within your budget or not.

Budgets Should Never Be the First Step in Improving your Finances.

Not even the second step. Probably not the third. And aren’t necessarily needed at all. Lots of successful, happy people save lots of money and have never used a budget.

If you are having trouble managing your money and decide to work with me, there are many steps before we will even discuss if a budget is right for you.

Interested in learning more? Contact me. I have a great December promotion right now. Check it out.