Comments on: This & That: Crap Happens Edition

By: Susan

Susan — Sun, 14 Mar 2010 02:14:27 +0000

Love that calculator link Marie posted! Thanks!

By: coetsee

coetsee — Mon, 14 Dec 2009 17:09:18 +0000

1. Cash Making Opportunities – The Beginning The working life is already tough enough, but the worries of being out of work was even tougher. The unsecured working environment have prompted me to search the internet for an alternative source of extra income so that I could learn how to Make Money Work for me and be Financially Independent. I listed down a number of Free Internet Business Opportunity Ideas while researching ways how people earn money online while working-from-home…….

http://www.onlineuniversalwork.com

By: Melissa

Melissa — Sat, 28 Nov 2009 03:43:07 +0000

Taking responsibility of your debt and taking ownership on paying it down is huge. I’ve stopped using credit cards, transferred all outstanding balances to my line of credit (lower rate) and am working hard to pay it down. Christmas will be pretty slim pickings this year, but so be it. At least I will be with my family. No more Christmas on credit cards. What a feeling of liberation to use cash for all purchases I make. I still have debt but at least I’ve stopped digging. As for savings, I put what I can into RRSP’s so that I get a tax break. My refund will go towards my debt and seeing that paid down will be my reward for diligence with my finances throughout the year. I’m excited about my plan to go to work for me and not just so I can make my credit payments.

By: Anna

Anna — Thu, 26 Nov 2009 15:34:17 +0000

Great post Gail! Every few months I tally up all my accounts to and check how much liquid cash I have access to in case I lose my income. Your post was a good reminder to do that again. Twice in my career I was out of a job unexpectedly – the first time I managed out of sheer dumb luck. My expenses were low and I found another job quickly. The second time I had been preparing for over a year. From my own experiences I might offer a few suggestions –

In the event of a lay-off – understand your entitlement under the law. Is it two weeks pay minimum or a month? You’re also entitled to any prorated vacation pay that’s owed. If you have benefits such as a matched savings plans you are also entitled to that as well. An employer might try and pay just your wage for the two weeks owing but they also owe you anything else you might have earned from them in that two weeks –savings, pension etc.

Even if you don’t anticipate being laid off anytime soon start thinking about an emergency fund today. That could even mean keeping some lower risk money market investments in your RRSP that you could sell in a hurry if you had to. It can take a really long time to build a decent emergency fund so the sooner you start the better.

If you get severance from a lay-off I recommend looking for work right away instead of taking time off. My company’s HR coordinator once told me if he’s considering identical resumes he’ll interview the person who has been out of work for less time. When I asked why – he told me that in his opinion a company will keep a better employee for as long as they can and let go of a worse employee first. I don’t necessarily agree but it wouldn’t surprise me if other HR people feel the same way.

Just my two cents!

By: Saver Queen

Saver Queen — Thu, 26 Nov 2009 04:33:57 +0000

Gail, you answer each question so thoughtfully and carefully, with so much sincere attention to each request. Thank you so much for your hard work!

By: MaryL

MaryL — Thu, 26 Nov 2009 03:09:41 +0000

Thanks, Amelia.

I tried that match trick with RBC, but they wouldn’t budge. I hate opening up another credit card, and I’m not going to coast on paying it down, but I really needed the breathing space.

By: Megan

Megan — Wed, 25 Nov 2009 23:07:36 +0000

I really feel for the people out there who are in difficult financial situations and it seems to be a good chunk of Canadians right now. I work for the Oil & Gas Sector and we have laid off more than a thousand employees and were still not done. I was in a department that used to have 6 people, there are 2 of us left. I don’t think this poor economy is going to end later rather than sooner. Our company is projecting another poor winter which is when we usually make the bulk of our money. I am saving like mad incase I do get laid off after another slow winter. I am also building my skills. Taking courses part time.
I try not to worry too much. I already made a “just to see” budget in case one of us gets laid off and can’t find a job and has to go on EI. We could make it without having to dip into our emergency fund.

By: Amelia

Amelia — Wed, 25 Nov 2009 21:38:19 +0000

To MaryL: Sorry I wasn’t more specific, the LOC was at prime + 3% and they increased it to prime + 4%, so up 1% through no fault of my own. As for the 1.99% offer on a credit card I’ve received those as well and used them to get my current CC to match the rate. It was actually very easy, I called and said “I got offered 1.99% from someone else. I’d rather stay with you so could you please match it?” she said “yes” without hesitation and mailed it to me that day.

By: Marie

Marie — Wed, 25 Nov 2009 20:50:38 +0000

Rose:
When? EVERYBODY wants to know.
Calculate your monthly payment using the fixed 5-year rate or the average historical mortgage rate. If you can afford this higher interest, you might be ok.

By: Rose

Rose — Wed, 25 Nov 2009 20:15:08 +0000

We are purchasing a property with a very low variable rate. I now feel scare about the rates going up. What could be a good way to know when the rates will going to increase? So we can move to fixed rate.

Thank you

By: Lilly

Lilly — Wed, 25 Nov 2009 20:08:33 +0000

a bit of info about credit rates
the Bank of Canada Rate is the overnight lending rate — what hte BoC will charge banks to borrow funds from them to cover any shortfalls in their settlements.
Each bank can set their own Prime rate based on the lowest rate they will offer their best customers. Because of competition these end up being the same rate 1.75% higher then the BoC rate.
Currentl the BoC rate si 0.5% — the bank Prime rate is 1.75% on top of that = 2.25%.
The BoC has stated that they are going to hold thier rate until late Spring 2010 — but if inflation creeps up to high they will need to adjust it sooner.
The caveat is bnaks could charge thier Prime rates at any time, sooner if they want.
This is the risk to all variable rate credit producs – loans, LOCs and mortgages. The rate can change at any time, but in order to mitigate their risks banks charge higher rates on fixed rate products.
If you see a mortgage rate quoted that seems low it is probably a variable rate product, and the rate is probably only eligible for the lowest risk customers.
If you get a letter stating your rate spread (amount over Prime) is increasing check to see if you can look it in to a fixed rate you may be better off in the long run. Also pull you credit score from one of the credit score agencies, if you have a good score (rull of thumb is beacon score over 700) then you should be able to switch to another bank who could end up offering you a better rate. If your score isn’t great but you own property then you may have the equity to get a lower rate through you mortgage, but try to keep that loan separate so you can ensure that you are paying it off at the same speed.

By: Catherine

Catherine — Wed, 25 Nov 2009 19:50:45 +0000

What am I missing? ‘A’ is being laid off before the end of 2009? Isn’t that in 36 days? How much can she get herself together in such a short time? Maybe this was an old letter? Guess I’m confused…..but wish her and the others the best!
There will be a lot of butt covering heading our way. Robbing Peter (those who pay their bills promptly and trying to get rid of debt) to pay Paul (those who default) so that revenue will not be lost.
Hang on! It’s going to be a bumpy ride (yes, I know it should be ‘night’…but I’m using unauthorized poetic licence)

By: Sparky

Sparky — Wed, 25 Nov 2009 18:14:06 +0000

ah yes, confusion cleared up…bank of canada does regulate the prime rate…the rate they set is what the banks use…unsecured lending is also based on prime…prime + …you can go variable or fixed on that as well…variable mortgages in the past have been prime -…so some folks are paying only 1% on their mortgages right now…cha-ching for them!!

By: MaryL

MaryL — Wed, 25 Nov 2009 18:09:47 +0000

Amelia, what bank are you with that is adding 4% to your LoC interest?

I’m divorced, taking over a mortgage on my own, and trying to get rid of stupid, stupid credit card debt ($11,000) accumulated over the years. I’ve got emergency funds stashed away for 8 months. I also have an open variable mortgage, currently at 3.25%, but I get the feeling I may have to move to closed and fixed interest soon.

I’ve got about $3000 left on my TD LoC at 4.75%, and have the remaining $7000 moved to a credit card offering 1.99% for 9 months. My old credit card company, RBC Visa, who I’ve been with for 20 years, just cannot offer me any deals for lower interest, after sending me their cheques for 2-4% for a couple of years.

I know I have about 8 months breathing space if everything goes to hell, but I can’t sit back and wait for things to get better. I’ve been getting a little work through new contracts and clients, but nothing really steady yet. But once I know that I have a couple of months steady work, that LoC balance is getting paid in full, and that credit card debt will be whittled down ASAP.

By: Fay

Fay — Wed, 25 Nov 2009 17:53:14 +0000

My husband’s LOC also went up by 1%. The bank also used the “economic times” as their reasoning and even gave themselves a pat on the back for taking this long to raise his interest rates.lol