Monday, 29 August 2011

Money Saving Monday - Be SMART!

Here are some more good tips that may allow you to squeak out another $50/month for savings.

Look for Recreation Instead of Entertainment - Movies, shows, concerts and theme parks are not only expensive but also only last for a few hours or one day. If you shift your thinking to recreational activities such as hiking, camping, skiing, beachcombing or low cost hobbies, you’ll find many of these activities offer a no (or low) cost alternative to high cost entertainment.

Skip the chai tea, pizza deliveries, lattes, specialty shops, and gourmet aisles - Ok, weve heard that speech before but we also know that life is meant to be lived and enjoyed. So as Ben Franklin advised, use moderation in all things even moderation. Though, dont deny yourself too many treats or youll never stick to that budget.

How about giving two lattes a week for a savings of $10 and one pizza delivery for a savings of another $20? Start a rotation of items which break the budget and dont give them up all at once but instead just buy some or a few on occasion as a treat instead of making each one a weekly ritual.

One of the most important things you can do to really get ahead is to Set Savings Goals and be Smart!
When it comes to setting your savings goals, be SMART --- Make goals that are specific, measurable, achievable, realistic and can be accomplished on a timed basis. Its your money so have some fun with the process and above all, be creative!

Monday, 22 August 2011

Money Saving Monday - Seven BIG Money Mistakes to Avoid!!!

There are more than enough mistakes to make with money but here are seven that can stop you from achieving financial freedom.

These mistakes are commonly made, and, almost every delivery of junk mail, ad on television or magazine offers an enticement to take one of these paths.

Some money experts may even offer these as the way to getting out of trouble.  The problem is that each of these approaches can lead to even more money problems so they are best avoided.

1-     Carry credit card debt.  Credit card debt is extremely expensive and interest costs can add significantly to the original amount.  If you can’t afford to pay off your credit card balances every month, there is a problem with how much income you have and the money you are spending.  You need to increase income and reduce expenses to leave a balance to pay off the credit card debt.

2-     Borrow from a payday lender.  Payday loans are so expensive they should be criminal.  The fees and interest charges can easily add up to 400% interest.  There has to be a better option for you.  Contact a financial advisor before you ever take out a payday loan.

3-     Live above your means – buying a house.  It is all too easy to buy a house these days with interest rates being so low.  The problem comes because most people don’t allow any ‘wiggle room’.  They want the biggest house they can get because they feel they deserve it.  If you can’t afford a mortgage payment that is up to 40% higher, than what will happen if rates rise and you find yourself renewing at a much higher rate.  Look carefully at the next five years before you buy a house that might be too expensive.  Buy a smaller house or consider renting for a while.

4-     Borrow to buy your way out of debt.  It would be nice if a consolidation loan or second mortgage could fix everything but they rarely meet the borrower’s expectations.  You may make some savings on interest payments and stretch the payments over time to help with cash flow but, in the long run, you will probably end up paying more interest overall.  The best fix is to repair your income and spending imbalance in the first place.  Make more and spend less is the formula that works.

5-     Fail to save an emergency fund.  Unanticipated costs are a significant cause of personal bankruptcy.  It is so difficult to live life on the edge where one missing paycheque pushes you into financial crisis.  Saving an emergency fund of 2 to 6 months income will not only give you coverage in case something happens it will also give you peace of mind.  That peace of mind is worth a lot.  Peace of mind will reduce tension and stress and make life much more pleasant. 

6-     Let your fixed living costs increase.  Adding obligations to the monthly bills make it harder and harder to make ends meet.  Basic obligations include rent or mortgage, utilities, transportation, insurance, food, child care, child support and minimum loan payments.  Do your best to not add to the burden and to reduce those that you have. 

7-     Use your retirement fund to pay off debt.  This is similar in principle to the idea of a consolidation loan only it costs more now and in the future.  Penalties on withdrawing from RSP can easily cost 25% to 50% of a withdrawal.  And you are losing the future earning power of that money if it were left in the account drawing interest.  This approach is a heavy mortgage on your future that you will probably regret.  The only guarantee is that you will have less money when you retire – if you can.

If you can avoid these seven mistakes, you are well on your way to a successful financial future. 

Monday, 15 August 2011

Money Saving Monday

The habit of saving money is essentially the skill of spending less money than you earn. It can also be practical and enjoyable to review money saving ideas and follow through on them. When you consider money savings as a game, rather than a self-imposed discipline to survive economic challenges, it becomes easier to practice doing those things that make a difference. 

 -  Stay organized and pay your bills on time. By either missing payments or paying late, you accumulate late payment penalties. These are a total waste of money. You can easily avoid unnecessary expenses by organizing your bills when they come in and by marking your calendar when they are due.

- Buy more stuff online. You not only save on time and gas, but you may also get the products at a cheaper price because online retailers have less overhead than brick-and-mortar establishments.

Monday, 8 August 2011

Money Saving Monday

With summer vacation half way over, some of us are happy and some of us are wishing that summer lasted longer.  Whichever you happen to be, here are a couple of things to consider that will ultimately save you money.
Turn off the television. One big way to save money is to watch less television. There are a lot of financial benefits to this: less exposure to guilt-inducing ads, more time to focus on other things in life, less electrical use, and so on. It’s great to unwind in the evening, but seek another hobby to do that.

Invite friends over instead of going out. Almost every activity at home is less expensive than going out. Invite some friends over and have a cookout or a potluck meal, then play some cards and have a few drinks. Everyone will have fun, the cost will be low, and the others will likely reciprocate not long afterwards.

Monday, 1 August 2011

Money Saving Monday

Let’s talk about your homeowner’s insurance.  I find that many people get their annual renewal notice, complain about the increase and just leave it at that.  If you haven’t had your policy reviewed in the last couple of years – it’s time to get it done.   I recommend using a Broker (like Ontario West Insurance Brokers in London – ask for Traci or visit ).  Brokers have your best interest in mind and can shop for the best rates around.

If you don’t have someone to help here are a couple things to consider:

Raise the deductibles on your homeowners insurance. For example, raise it from $250 to $1000 and save up to 20% a year on your premiums.

Secure your home with smoke, carbon monoxide and burglar alarms, dead bolt locks, and/or a sprinkler system. Many insurance companies will discount homeowner’s premiums for these safety features.