My Five Top Money Lessons

1. Love where I am. Be thankful and embrace what I have and where I am.

2. Love where I am not. Acknowledge where I would like to be but love that not being there gives me a destination for my next journey.

3. Plan giving. (I love donating to charity and giving gifts but need to make sure I can do so without using credit.)

4. If it ain’t broke, don’t buy it! Stop replacing things just for the sake of having something new and improved.

5. Being focused on the present and planning for the future. If I buy this, do I need it now or in the future? If I need it in the future, why not buy it then instead? If I needed this item one time 3 months ago, then I should leave it. (Especially important when faced with end of season sales.)

After using some of your calculators on the site I realize now that things add up very quickly if you don’t think and planning is the key. Seeing it right in front of your eyes is everything to making a conscious change.

Thanks,

Chris

2. Save (for a rainy day ~ emergency fund, vacation, retirement, big ticket item, etc.) so that you are not a slave to credit (the “banks”).

3. I don’t believe in ‘buy now, pay later’. If you have to finance a purchase, make sure you have the means to pay it off as quickly as possible. Otherwise, it’s just a slow leak of your financial freedom.

4. Have a balanced outlook – don’t go hog wild trying to scrimp every penny to pay off the mortgage, if it means not having any fun – such as a movie out now and again, a nice dinner in a restaurant. Invariably you’ll slip and feel deprived and end up spending more when you have a weak moment.

5. Do what is right for you. Keeping up with the Jones’ will only get you in a whole heap of debt if they are the family on the street with a new vehicle every few years, have fancy computers, cell phones, ipods, blackberries, etc. Fancy ‘stuff’ is often only an illusion of wealth as we are, after all, a society of consumers! As a previous poster mentioned, you just never know what income level someone is at, whether they received an inheritance or even possibly won the lotto to be able to afford new gadgets. Otherwise, my guess is they are really just debt slaves with stuff.

1. All my working life I never thought I earned enough to save. That was because I was living backwards. Spending first. What you have to do is pay into your savings first no matter what. If you don’t the money has a way of getting lost in the shuffle. Determine how much you want to save per month for emergency, and retirement. Whatever is left (from your net income) is what you have for your budget. This is how much you have to live on. You have to make it fit or earn more. How much you can save depends on your debt load but the minimum you should be saving is 10%. After your debts are paid off you have complete control and flexibility to increase savings and start planned spending.

2. Pay down your debts as fast as possible, doing whatever it takes to get the job done. This will mean sacrifices but you have to take the attitude that you already either had your fun (credit card debt) or got something valuable for your money (student loan debt). Once your debts are gone set up a planned spending savings account for the things you want and only buy/do these things when you have the cash in hand. It is really amazing how paying $1000 out to our debts every month did not seem to be noticeable and yet putting $1000 into a planned savings account adds up like you wouldn’t believe. We could not believe the day we had $10,000 sitting there just waiting for us to spend it. Stood in the vestibule of the bank looking at our pass book and giggling like window licking lunatics. We were rich!!!! And the thrill of buying something with a lot of cash is way thrillier than buying something on credit. I used to get a high from buying but when I used credit just underneath the high there was guilt bringing me down.

3. Make a budget and stick to it. Gail provides a ton of tools and they all work. Personally I love the percentage chart (housing 35%, transport 15%, debts 15%, savings 10% Life 25% etc.) This makes figuring out how much you should be spending in all categories a piece of pie so it is easy to figure out where you can cut and paste.

4. Keep your eye on the ball. The hardest and most time consuming thing is to get yourself set up (budgets, payout schedules, playing catch-up etc). After that it becomes simple and routine and if you just devote a little time each week to paying attention to the details you can’t run yourself off into the ditch again because you can’t pretend, deny or ignore what you know. We quickly found that we were accumulating a lot of not-spent jar money and so we started a second set of jars so that we eventually had all the money for the next month’s jars already sitting there come the first of the new month. Over the next year or so we set up our chequing account so that it was the same (on the first of the month all the money for that month was already in the bank). We did this by funneling extra money into the account (tax refunds, overtime, garage sale, gifts etc). until we had a whole month’s worth of expenses sitting there. This makes budgeting and planning so easy it is ridiculous and makes me feel ridiculous for living pay to pay and hand to mouth for so many decades.

5. Food is a huge item in anyone’s budget. Unlike a set expense like a mortgage payment it is very, very easy to go way, way over. Plan your meals, shop with a grocery list and stock up on sale items. We even have a separate jar for a Grocery Stock Up Fund. You can save a fortune over time. We normally buy a can of beans for $.99 when on sale. Just last week I ran out of beans (2 cans short) to make my infamous pot luck chili. We had to pay full price for the beans – $2.29 per can. $1.30 more per can. This pot of chili actually left a bad taste in my mouth. Oh and the most important thing about grocery shopping is to never ever shop with a hungry man. When the kids start throwing stuff into the cart and you say no they can whine but you can still win. Not so easy with a grown man. You say no, they whine, then disappear and it is only when you get home that you realize that they just snuck the Smokey Baby Back Ribs and Black Forest Cake out through the ten items or less check out and hid them under the spare tire while you were busy chatting with your long lost neighbour in aisle seven.

You could have a case of “undue hardship” that could reduce the amount of child support you have to pay. Here is a link that I hope will work and I hope will help you out.

http://www.justice.gc.ca/eng/pi/fcy-fea/lib-bib/pub/guide/step8-etap8.html

As I mentioned above, he’s been good with his money. I have been teaching him what I know about Real Estate just as I was learning it myself. When I purchased a duplex last year I asked him if he wanted to go in on it with me – partners 50/50. He reminded me that I always used to say “never go into a business venture holding less than 51%”. (Yeah! He WAS listening.) He also said that he isn’t in a hurry (he’s 23). He’ll buy his own income property when he can afford to do it by and for himself. He has just started his search and will have one by the summer. So, Dana, “kids” have a way of surprising us. Everything we say to them are seeds we plant. They do bloom when the season is right. While a gift is nice, they might get more satisfaction by doing it for themselves. Besides, we can always make our gift their 2nd property after they’ve learned how to handle their own.

To Amanda: You’re absolutely right. Bad things do happen to people. I just finished my fight with Cancer (prognosis great). Having my Emergency Fund and Rental Income took the stress out of my life during the past year. It also taught me to ENJOY THE WANTS IN LIFE GUILT FREE. Some of us have turned Wants into evil things. They aren’t – as long as you’re paying cash and all other financial obligations are covered. We still have to enjoy the juice in life. If buying something for ourselves or a loved one makes us happy we should be able to go for it. We shouldn’t work through our “Bucket Lists” only when life sends us a wake up call. It’s nice to take our “mad money” and just blow it sometimes.

To AM: glad I could help with the “buy day” vs. “no buy day”. Your children will have the pleasure of the anticipation an upcoming “buy day” brings. Many a time my son had a blast just searching for the right thing to buy. Adults do it too every time they buy a lottery ticket. It’s fun to dream.