Thursday, 31 January 2013

Best $50 I Ever Spent

The best $50 I ever spent I spent while I was in Elementary school.  I can't remember my exact age but I do remember the purchase, the fall out, and exactly how hard I worked for that $50.  The first thing that you must understand is that I worked for my money as a child.  To earn money I had to read a book (a new one, you couldn't read the same book twice) and do a book report that had both appropriate length and depth for my age.  Then I had to sit down with my mother and have the report corrected for spelling and grammar.  For every four books I read one had to be a language other than English, and no English books would be paid for until there was a non-english book to fill the void.  The going rate was 10 cents a page.  Once the amount owed was calculated 40% was deducted for long term savings (my university fund) and 10% was deducted for charity.  Needless to say, my money was hard earned.

This was the time when GameBoys were all the rage.  All the kids had to have one, so eventually my older brother wanted one as well.  Then I wanted one.  I remember saving up my money and going with my parents and siblings to the store.  We agonized over the choice of which game to buy, as we could only afford one each.  Eventually I settled on a game based on the Disney movie Mulan.  We all got home and immediately started to play.

I hated it.  For the life of me I could not get past the second level, not to mention that every time it took me at least 10 tries to get past the first.  It frustrated me to the point of tears.  Eventually (in less then 2 weeks) I stopped playing it.  I could count on my fingers the number of times I played that game and still have plenty of fingers left over.  As soon as I figured out that the game frustrated me instead of giving me enjoyment I felt cheated.  I mean, come on, 50 bucks was a big deal back then, do you know how much ice cream I could have bought?

I sat down at the time and tried to figure out why I had bought the game in the first place.  I came to a startling conclusion.  I wanted one because my big brother wanted one, every one wanted one.  It was simply the thing to do.  Now that I'm older (and marginally wiser) I think that that $50 was the best I had ever spent.  As hard as it was at the time it taught me some very important lessons.

1) I stopped listening to what everybody else was doing (and buying) and did my own thing.  This is such a great freedom to have.  I don't worry that needle work wasn't what most of my co-workers (mostly male) do in their spare time.  It is my spare time and I do what ever I please.

2) I thought seriously about major purchases.  After that day I always slept on a purchase before making it.  I can safely say that before making a purchase of more the $25 will probably spend a week thinking about it and deciding if it is really what I want to do with my money.

3) I entertain myself on the cheap.  Library books are my main entertainment, free shows on the internet, crafts.  (Yes crafts can be expensive but the last $75 cross stitch I got took me 8 years to finish, so about 78 cents a month.)

4) I preview what I'm getting.  I never buy a movie without watching it first.  There are only 3 authors on the planet who's book I will buy before having read it at least 5 times from the local library.

Most people are astounded that over 4 years at university I averaged less then $10 a month on entertainment.  The best thing is that I never felt deprived, I honestly enjoyed my spare time and I was seldom board.  "Wasting" that $50 in elementary school taught me invaluable lessons about money management, and I am richer for it today.

Tuesday, 29 January 2013

My Philosophy on Emergencies

Over the last week I have taken you through some simple steps that will help you be prepared in the case of an emergency.  Making sure that you are prepared for a disaster helps to minimize the damage to both your wallet and your life. 

I distinctly remember during my last year of nursing two back-to-back lectures.  One was for my complex care class and the other was for my community health class.  Both of them were on the role of a nurse during a natural or man made disaster.  After 6 hours I walked away with one message; be afraid, be very afraid. 

Fortunately I had the chance to muse over what I was told and eventually decided to take a somewhat pragmatic view of the matter.  Yes, there is the chance, even the likelihood, that disaster will strike within your lifetime.  On the bright side there are many things that you can do to prepare for and mitigate the outcome of a disaster.  The question is how much is enough? 

When allowed to our imagination will run wild with all the awful things that could possibly happen and soon it will seem that you are only safe if you have a million dollar emergency fund and a nuclear bomb shelter in the basement.  I can’t give you exact number to keep in the bank though I’ll ball park the normal 3-6 months of living expenses.  I also can’t tell you if you should stop at a panic bag or go further.  My advice is do what you need to do to sleep at night. 

With that in mind remember the following.  You need never face a disaster alone.  When you lose your job or your house burns down your family and friends will be there.  Maybe not with an open checkbook but with help in your job hunt or a warm bed for the night.  Some of the most devastating natural and man made disasters in history have also resulted in the most generous and amazing shows of human compassion and aid.  While friends, family, and community will not remove the need for a good emergency fund and an emergency plan; neither will an emergency fund or an emergency remove the need for friends, family, and community.  How can you be sure that people will be there in your time of need?  By being there for them in their time of need.  

Monday, 28 January 2013

Panic Bag - Part 2

If you don't know what a panic bag is or if you want to know how to start one please read yesterday's post, aptly entitled Panic Bag - Part 1.

Today we will continue with the miscellaneous items that should find their way into a panic bag.

1) Water bottle and snacks.  Obviously you're going to chose snack that will last a while in your bag (no a banana probably isn't a good idea, even if it has potassium).  I went with protein bars.  I would suggest staying away from high sugar snacks, they may give you an initial rush, but you will crash and burn just as quickly.  If you don't want to keep a full bottle of water in your bag I would recommend an empty bottle that can be filled up.  

2) Money.  Personally I recommend cash in small bills.  I have enough in my bag to buy myself a one way ticket to my parent's home (they are my closest relatives).  I have heard the recommendation of keeping an unused credit card in the bag.  This does have the advantage of giving you access to more money then I would be comfortable with laying around in cash.  I do however have 2 problems with this idea.  People who haven't got the discipline not to touch it may use it for "emergencies" that it is not intended for.  In a natural disaster or similar wide spread disaster there may be problems with power outages and such making a credit card useless.  If you do want to keep a credit card in your panic bag I would also recommend some cash as well.  I've never met any one who turns down cash.

3) Soap, tooth brush, and tooth paste.  Pretty self explanatory.  To keep costs down I used a toothbrush that is almost ready for the garbage and toothpaste that has maybe a weeks worth left.  Travel sized toothpaste/toothbrush is also an option.

4) Feminine hygiene products.  If you need to ask go ask your parents please.

5) Paperwork.  I have a list of the names, addresses, and phone numbers of all my close relatives.  At least keep a list of phone numbers, if you lose your cell you don't want to have to try and remember all the important numbers.  This also has a photo copy of all the important documents in my wallet.  Health card (government and Veterans Affairs), drives license, bank card and credit card, bus pass, and insurance card.  This also serves the dual purpose of giving me a list of numbers in case my wallet is stolen or lost and I need to start cancelling cards.

6) Key and flashlight.  I keep my spare house key in the bag (if you have a car you should keep a spare in here as well).  The key chain is actually a small flash light who's batteries can be recharged with a wind up key on the side.

7) A map of the local area.  Yes, guys should probably have one packed too.

8) Medications, glasses, hearing aids, etc.  I don't have any necessary medications so there are none in the picture.  However, if you do have a medical condition make sure that you have a week supply of your medications and/or medical supplies

That is the whole content of my panic bag.  These bags are highly individual, however I believe that my bag is fairly typical.  There should be one for each member of the family; some people also prefer to keep more than one bag, ie one at home, one at the office or in the car.  Most resources also recommend that the bags be labeled so each family member can find their own.  (Though if the house is burning down I would expect you are going to help grab all of the bags not just your own.)

Is there anything not on my list that you would add to your panic bag?  

Sunday, 27 January 2013

Panic Bag - Part 1

I have dedicated much of the past week to emergency preparedness.  Something that most people don't start thinking about until it's too late.  

I'd wager most people don't know what a panic bag (or a go bag) is.  Basically it is a pre packed bag of essentials that you grab and run with in a bad situation.  For example, your house is burning down, there is a natural disaster in the area and you need to evacuate, the mafia is after you, or the planet is being invaded by aliens.  (Ok a panic bag probably wouldn't help with alien invasion, but not much would soooooooooooo . . . we'll leave that out of the planning process.)  

Panic bags are highly individual, but basically they should help to sustain you until help can arrive, or you can get out of the area.  Make sure you keep it in an accessible place, preferable near the exit that you are most likely to take, mine is in my front closet.  I'll take you through my process of putting together my bag with the whys of the items so that you can decide what would best fit into your bag.  

1) The bag.  I use an old book bag that I had in the house.  It's worn but still functional.  Make sure the bag is big enough to carry everything you'll need but don't get carried away.  If you end up having to carry it a distance you won't want it to be too large or awkward to carry.  

2) Under clothes.  One change.  Do I really have to explain this?  I didn't think so.  

3) Pants and shirt.  I've packed stuff that I don't wear and won't miss.  Here you have options.  You can either repack with the seasons or pack something that should be acceptable in a variety of climates.  I choose the second.  That way I don't have to remember and will be prepared for unseasonably warm/cold weather.  

4) Shoes.  I chose old runners that I had laying around.  They are still serviceable but were retired after a couple seasons of cross country.  

5) Outer wear.  I struggled a bit with this choice.  I didn't have an old coat hanging around and didn't want to buy a new one just to see it sitting around in my panic bag.  I went with a sweater that I don't wear and my old military wind breaker.  I can layer them in most cold weather to be adequately warm.  Since I keep the bag in my front hall closet with my winter coat I should be able to grab my heavy duty coat (without losing time) if the weather is sever.  (Technically I'm not to suppose to wear my old military wind breaker with civilian clothes, but if my house just burnt down I pity the poor soul who comments on it.)  

6) Touque and mits.  Optional in some countries, but not if you live in the true north strong and free and cold and wet and icy. . . 

Every thing is wrapped in plastic milk bags to help keep them dry, any one who's camped knows this trick.  

That wraps up clothes for the panic bag, tune in tomorrow for part 2!

Saturday, 26 January 2013

Going Budget-less

I apologize to my regular readers (Hi Mom and Dad!) for the brief intermission from my emergency preparedness articles.  I promise you that the articles will be back and the series will be completed this week.

I really and truly appreciate the usefulness of a well made budget.  What financial fanatic wouldn't?  I do have to say, at the risk of a Virtual Gail Smack, that one can have enormous financial success with out one.  In fact, that is how I have operated most of my adult life.

When I started university at 18 I was committed to keeping a tight rein on my finances.  I was in the fortunate position of being able to work for the military while attending university.  As a result, my tuition and books were paid for, and I brought home a salary of $1,200 net a month.  This was quite a step up from the couple of hundred dollars a month I earned lifeguarding in high school, and I wished to use my new found wealth wisely.  I sat down to budget my first year at university and came to a shocking realization—I had no idea what it would cost living in dorms.  Determined to overcome this obstacle, I began a spreadsheet which tracked my every expense.  I was never quite sure if I had captured a "typical" month, so I continued to track instead of budget.

Eight months later every thing changed again.  I moved into an apartment with my sister and living expenses changed.  So I continued to track instead of budget.  Eventually I came to a shocking realization; even though I spent as much as I wanted I was still had 30-50% of my paycheck left over every month.  This ended up as savings and was either put in a high interest savings account or invested in mutual funds.  For the rest of my university career, I continued without a budget.

One summer, near the end of university, I ended up teaching one of my fellow students how to budget and manage her money.  She was confused and felt somewhat betrayed when she found out that I didn't budget.  I explained to her why I didn't have to.

At the time my life was a wreck.  I was on the verge of losing my job with the military due to a knee injury.  Even though I was about to complete my nursing degree, I was doubtful that I would find a job since I could not stand more than a couple hours at a time.  Despite that I was safe.  Even without a budget, I had accumulated over $40,000 in savings.  If I could not find a job I would be able to pay for a degree in Social Work and support myself with my savings without breaking a sweat.

Life was good to me, and I managed to find a job that my knee could handle.  At age 22 less than 6 months out of university, I used my savings to buy myself a home with 20% down.

Budgets are great.  I have been using one since I bought my house and generally encourage their use.  However, I believe that they are not nearly as important as knowing where very single cent of your money is going.  For the vast majority of my adult life simply tracking spending kept me in a very comfortable financial position.  For those who earn a decent salary (given their situation), are non-materialistic, and have low living expenses budgeting may not be a necessity.

Friday, 25 January 2013

FP - Reducing Food Waste

I hate throwing out food.  Always have, I mean I paid for it so either I'm not planning properly or I'm not following my plan.  I'll admit, when I lived with my sister it was a bit easier to get away with.  If leftovers got thrown out it was obviously her who was suppose to eat it.  That excuse doesn't work so well now that we are living in different cities.  I am now committed to 0 food waste.  If it gets bought it gets eaten.

Simply Being Mum
The first big challenge I had to deal with was what to do with two containers of plain yogurt that had reached their expire date.  (I mean just reached their best before date, they hadn't actually gone.)  Usually I stock up on the stuff when it is on sale since I generally go through it quickly.  Unfortunately the week that I stocked up my eating habits changed slightly.  Due to my knew and unfortunate habit of sleeping in until the last moment I haven't had time to fix a proper breakfast, instead I just wolf down dry granola and pack a morning snack to hold me to lunch.  (I know gotta fix this but back to the main problem.)

What does one do with two full tubs of plain yogurt?

Freeze them of course!  Ok, I know what you're thinking.  That stuff is going to have a really weird consistency when it thaws.  I bet it does to (haven't thawed one yet) fortunately that won't be a problem.  Every weekend I make up a weeks worth of (healthy) smoothies and have one each morning at work for a snack.  Included in the ingredients is plain yogurt and ice cubed, two birds with one stone.

The plain yogurt was portioned out into 1 cup portions and placed in old (rinsed) milk bags.  Then slipped in to the freezer.  I now have enough for a month of smoothies.  How do you reduce food waste?

Wednesday, 23 January 2013

Getting where you need to go

For those of you who are new, I live in Canada.  It has many charms including it's natural beauty.  Its vast natural beauty.  Canada is the second largest country in the world and in certain areas is sparsely populated.  Unfortunately this can make emergency planning a bit more difficult when it comes to seeing to your transportation needs.

When I had a vehicle I had a rule, the gas tank always had to be at least half full.  This covered 2 possible emergency situations that I may have faced.  First off it was enough gas to get me and my sister where we needed to be for at least 2 weeks in the event of a fuel shortage.  If it looked like the shortage was going to last for a while we probably could have made it last a month or longer since we lived right down town.  Secondly, it was enough gas to get us to our closest relatives in case the area had to be evacuated or if our apartment burnt down.

Currently I depend on public transit to get to work and could handle a hike in price if there was a fuel shortage, in a pinch I could work from home 75% of the time.  If I needed to get out of the area due to natural disaster or because my house burnt down I have my panic bag.  A panic bag is also commonly referred to as a go bag.  I will talk about it in detail in another post, but the general idea is that it is a pre-packed bag of essentials that you grab if you need to get out of your house/area quickly.  To cover transportation I have enough cash in my panic bag to buy myself a train ticket to my parent's house (who are currently my closest relatives).

The arrangements that you make for emergency transportation are highly individual.  I would suggest that you make sure you can answer the following questions comfortable:

-If there is a sudden fuel shortage how will you get to the places you need to be for the next 2 weeks?  The next month?
-If you lose your house can you get yourself and family to a safe place to stay that you will be able to afford (friend's or family's house perhaps) in the light of the emergency?
-In the case of a natural disaster could you get yourself an appropriate distance away?

Tuesday, 22 January 2013

Emergencies and Insurance

Most of the blogs that I have read talk about insurance of some type at some point.  Life, health, disability, house, car . . . the list goes on.  In the spirit of Emergency preparedness let me speak to you of one of the cheapest forms of insurance I have ever found.  You want to know what the great thing is?  It covers life, health, disability and house in one fell swoop.  This insurance has two parts.  Part 1 is $20 flat rate and a yearly cost of maybe $5.  Part 2 is a $50 flat rate, no maintenance required.  Part 2 can even be used to cover your car!  Is that great or what?

Ok, so where do I get such a great deal?  Try your local hard ware store.

I'm sorry . . . what?  Oh you were under the impression that this was typical insurance.  You know, the kind that pays after your house burns down, or you have medical bills, or you're dead.  No, this is much better, this is the kind that helps to prevent any of that from ever happening.

Meet Plan 1

His name is Clive, his brother Jobb lives upstairs.  (Ok, so I named the smoke detectors, why not show a little appreciation to them?)  I have always considered myself a stickler for fire safety.  In fact during my four years in apartment buildings (always on the 11th or higher floor, a couple of which had faulty fire alarms) I was always one of the 5% who evacuated the building.

So when I bought my first home the first thing I did was check out the smoke alarms.  The one downstairs had been removed (not sure how long ago) and I promptly replaced it.  Up stairs was a different story.  There were two of them side by side.  Unfortunately the one that was suppose to be hard wired into the house had been hung but not connected.  Not a big deal, I figured that they had hung a stand alone unit next to it because it was the cheaper (and no less safe) solution.  The stand alone unit looked fine, until I found out that no one had ever bothered to put batteries in it.

I was shocked.  Honestly?  We spend hundreds of dollars on house insurance and we can't be bothered to put batteries in our smoke detectors?  Do you want the insurance company to have to pay up?  Worse, the family who sold me the smoke detector-less house had 4 kids.

Check Your Smoke Detectors People.  

Every. Six. Months.

If you're lucky they won't have to save your life.

Meet Plan 2

I'd love to say that I am impeccably safe in all things.  That would be a lie.  Truth is I knew that I needed a fire extinguisher for my kitchen.  I knew that fact for almost three years.  But going out to buy one . . .

Why I'd have to go into a store!  YEWWWWWWW

I'd have to pay money!  GASP

It got put off, and off and off.  I'd forget it for months on end, then it would end up on my to-do list and just never get done.  What changed?  There was a fire in the apartment building next door.  As in glass-popping-due-to-heat, flames-shooting-out-the-windows fire.  As in damage two floors down and five stories up, the whole apartment had to be gutted fire.  This made me realize two things.

1. No matter how careful I am accidents will happen, I need to do my best to make sure that they don't turn into major incidents.

2. No matter how careful I am other people will happen.  I can't guarantee that somebody who lives around me isn't going to do something that will endanger me and mine.

Protect your life, protect your possessions, and save the money I would cost you if your house burned down.

PS. I'm still thinking of a name for the fire extinguisher.  Alfred has a nice ring to it.  Suggestions?

Monday, 21 January 2013

Emergencies - The Financial

At the moment there are three fire trucks and one ambulance on my street.  Just a couple doors down something has obviously gone wrong.  It's kind of funny, we all know that such things happen but we all seem certain that it will happen to some one else.  Unfortunately we are all "somebody else" to the rest of the world.  So begins a series of posts that will leave you a bit less scared by emergencies and a whole lot more prepared.

I'm sure you've all heard of an Emergency Fund.  It is a pot of money reserved to tide you through absolute emergencies.  (Like losing your job or your furnace cutting out in the middle of winter, not that great sale down at the sporting good store or not having a matching purse for your new favourite shoes.)

The general rule of thumb is to have at least 3 months worth of required living expenses.  I would recommend 6 months eventually, especially if you are in a profession where it will take a while to find a job.  EVERYONE should have an emergency fund for the following reasons:

1. Bad things happen to good people.

I'm sure that the people down the street are perfectly lovely, they've still got emergency vehicles outside their house.

2. Bad things happen in threes.

Ok, maybe not in threes precisely, none-the-less when one thing goes wrong there is an uncanny trend of all hell breaking lose.  Make sure that you have the financial means to take care of multiple disasters.

3. Emergencies are expensive.

What can I say?  Most emergencies will come with a large price tag.

4. The other option is credit

Some people will justify a spare credit card or a line of credit as an Emergency Fund.  I disagree completely.  When disaster strikes and you start calling on credit you are adding financial strain to the situation.  In fact when the disaster is finished you will likely find your self in a larger world of hurt since you have dug yourself a hole of debt.

So, where do I stand for my emergency savings?  I have a grand total of $480.43 in my savings account.  (Give me a bit of a break while I explain to you the why's and what for's).  The biggest emergency for me right now would be anything that would cause me to lose my job.  Fortunately for the next 2 years I am covered by disability insurance.  Any decrease in pay will result in an increase to my disability check which, if necessary, will cover my entire pay check.  I have my savings planned so that at the end of 2 years I will $5,743.11 set aside, which is three months of essential living expenses.  I don't need much more since I could easily find part time nursing work that my knee could handle.

The second largest emergency I could face would be a problem with my house, for that I have over $4,000 dollars set aside for house maintenance, and more is being set aside each month.  In the case of smaller emergencies I have $1,705.32 every month that could be reassigned at a moments notice without skipping bill payments or cutting essentials like food and health care.

I know what could go wrong and I have a plan in place that will allow me to deal with the major problems in life.  That gives me control of my life even when things go wrong.  There is no reason why you shouldn't put such plans in place too.

Sunday, 20 January 2013

A New Set of Wheels

It has arrived!  That special day in a young person's life when they get their first set of wheels.  I am very proud of mine, it's cobalt blue and handles wonderfully.   I'm even considering naming her.


All joking aside I am glad to get my hands on some reliable transportation.  My grocery store is a good 20 min walk away and carrying a week's worth of groceries on my back really aggravates my knee.  Basically after standing for an hour (20 min there, 20 in the store, and 20 back) AND carrying several pounds of groceries for a third of that time I can't stand for the next 48 hours with out pain.  Investing in a wagon will help drastically reduce the load on my knee and make life a lot easier.  If you've missed my previous posts on why I've decided agains a car you can see them here and here.

I found the wagon on my local Kijiji for $45, new this would cost me in the area of $100.  Half price for a wagon who's colour hasn't even started to fade.  Not bad in my books.  Plus it is only 0.045% of what it would cost for one of these.

Saturday, 19 January 2013

Books - Save $20,000 With a Nail

Welcome to my first book review.  Any one who knows me will tell you that I am an avid reader.  Often I'll have more then one book on the go as well, usually one that is fiction for when I just want to relax as well as more informative books on history, finances, home maintenance, or child psychology.  Often the mood will strike me that I do not know enough on a particular subject, so I will race out to the library, raid their supplies, and spend the next month educating myself.  I hope to introduce you to some of my favourite (and most informative) reads over time.

Save $20,000 With A Nail - over 1,900 Practical Tips for Every Homeowner
By Reader's Digest 2011 - Available in Hardcover or Softcover

Of all the home maintenance books that I've read (and there have been quite a few) this has been my absolute favourite.  So much so that instead of continually borrowing it from the library I got a copy myself, which is rare.  The best thing about this book is that it is not just about how to fix major problems, it goes strait to the source and tells you how to avoid them.

It starts right with the basics, which is a God-send for beginners.  Beginning with clearly outlining the must haves for tools and supplies to take care of your home, the book then takes the time to break down the different types of tools and their uses.  It expands to talk about nice to have tools suitable for those who are enthusiastic about DIY projects.  There is basic advice on how to talk to trades persons as well as a seasonal checklist of maintenance that should be done around the house in order to avoid damage.

You are taken step by step through your house as the book covers; the inside the house (walls and ceilings, floors and stairs), the outside of the house (siding, doors and windows, roof, masonry, weatherproofing, house extensions), the home's systems (electrical, plumbing, heating and cooling, major appliances) the property (lawn and garden, outdoor structures) and threats to the home (safety and security, natural disasters).

Each section, for example carpets, gives at least half a dozen ideas for maintenance and then half a dozen ideas for do it yourself repairs.  Frequently these sections include details on the pros and cons of a variety of products available.  It is clearly written out in several sections (especially electricity and plumbing) what projects should not be taken on by a person who is not a qualified professional.  The fact that they draw a line of what should not be done by the average joe gives a fair bit of faith that all the other projects suggested are suitable for the average home owner.

Over all the book is an easy read.  The writing is clearly and illustrations are provided to help with some of the more complicated instructions.  Only about a third of the book is applicable to any one house, however this book will cover the various aspects of almost any house.  I would recommend this book to any home owner, be it your first home or your fifth.

Friday, 18 January 2013

As If Money Didn't Matter

Interesting title for a blog that focuses on personal finances, isn't it?  I recently (within the last couple months) found the following advice on one of the blogs that I follow.  "Live as if money didn't matter.  When you do what you love money will follow."  It's an interesting concept, it has a certain go-with-the -flow, it-will-all-work-out mentality to it.

So I thought about it a bit and eventually had to conclude that my currently passion costs money and has very little (read absolutely no) potential to bring in an income.  The passion of which I speak is raising children through foster care/adoption.  Let's just say that I'm not going to quite my day job any time soon.

At the same time I think that doing what you love is part of a rich life and the pursuit of all things financial can only enrich your life to a limited point.  I think that the important lesson should be not to utterly dismiss the ideas of sound financial management and more that the pursuit of wealth should never eclipse the pursuit of what you love.

How does this affect me?  When I bought my house originally the plan was to rent out rooms, and I may have a colleague stay with me for three months this spring.  I don't need a renter to pay my mortgage, the idea was to be able to double up payments every month in order to pay down my mortgage faster.  The funny thing is that I wanted to pay down my mortgage faster so that I could afford to bring children into my home.  I was faced with the question: Am I willing to put off having kids in my life for 2-5 years in order to pay off my mortgage faster?

I waffled on the issue for over a month.  Instant gratification vs. a rock-solid financial plan with plenty of cushions.  The joy and challenges of having kids around vs. 2-5 years of an empty house which is much too big for one person.  I want to have my cake and eat it too.  So I have come too somewhat of a compromise with myself.

I have constructed a financial plan that will allow me, in 5 years, to pay off all except for $20,000 worth of my mortgage.  This does not include renting out my rooms at any time in the next 5 years.  I am looking at ways to fill the $20,000 gap over the next 5 years, and I'm sure that I will be able to whittle it down somewhat.

I have sent an inquiry to the local Children's Aid Society about becoming a respite foster parent.  I am hoping to provide respite a couple of weekends a month, which will not drain me financially, will allow me to pursue my education, but will also (hopefully) allow me to make a difference in the lives of kids. (Oh yeah and I get to spend time with kids which usually makes my happy.)

Thursday, 17 January 2013

The Piggy Bank

I'm an adult (most of the time) and yes I still have a Piggy Bank.  A cute one too, I've had it since I was very young.  So what is the practical point of my piggy bank?  Why did it make it onto the blog.  Well I've still got a use for it albeit most people my age go with a jar.

I've seen old cans, jars, you name it, used for collecting tips or spare change.  Usually this change is being put aside for some reason or another.  In "The Money Jar" by Grant Sylvester he talks about emptying his pockets of change every night for a couple of months and eventually having enough to buy a beautiful gold watch.  I've seen people who earn tips counselled to put all the tips into a sealed container and deposit it at the bank once a month.  I've had colleagues who would save every toonie that came there way in order to save up for a cruise.  All of these are valid methods to painlessly save for various wants.  In fact I think that for somebody who is getting started on saving any of the above are great ways to learn how painless it can be.

The question is what to do if you are on a tight budget and every penny is accounted for?  Do you reallocate $1.35 from your grocery budget to your Vacation budget, because that is what the cashier hands you back when you buy groceries?  Or is all cash in the "Miscellaneous" section?  The first option would be hard for most people to keep track of.  The second option runs the risk of too much becoming "Miscellaneous" when it really belongs elsewhere.

I use two methods to save up spare money.  Amounts over $10 generally fall under the "Found Money" category (which I will talk about at a later date) under $10 goes in the piggy bank.  Most of the money saved up in my piggy bank has come off the streets, literally.  I see a quater as I'm walking along, I pick it up put it in my pocket and (after a few rounds in the washer) it goes into my piggy bank.  What's this going to accomplish?  You may ask.  Quite a bit actually.  Every 3-4 months or so I am tempted to peak into my piggy bank and end up counting my change.  I last emptied Ms. Piggy 6 months ago and there is currently $9.05 in her.

What are you going to do with 10-20 bucks a year?  Anything I want.  I might get a book I've been dying to read or I could go to 4 Tuesday night movies.  The big point is that none of this comes out of my budget so I can do what ever I want with it.  For me half the fun is watching the change grow and plotting how best to spend the cash.  It's also great to have a night out and not have to worry about where the money is coming from.

The piggy bank is a bit strange, but it works for me.  How do you handle spare change?

Wednesday, 16 January 2013

Jan Mid-Month Check Up

Ever since since my first full time job with the military I have had the habit of checking my finance twice a month, once on the 15th and once on the 30th.  This made sense for a number of reasons.  First and foremost these were my pay days.  Eventually I found that there were a number of other benefits as well.

-It made sure that I paid off my credit card on time.  Most financial gurus will gasp when I say I have no idea when my credit card payment is due.  It actually doesn't matter because my credit card is paid twice a month religiously.  As a result I have never missed a payment and never paid a cent of interest.

-Updating my financial spread sheet every two weeks is a much less onerous task then only doing it once a month.  If I did it once a month I would probably put it off and it would become two . . . or three.  Needless to say I need to keep on top of stuff.

-Knowing where I am financially keeps a lid on my anxiety.  One of the reasons I am so interested in finances is a deep seated fascination of the subject.  The other is a fear of what would happen should I run out of money.  It's never happened to me.  Even when I lost my job I had cash to see me through.  Despite that I have a somewhat irrational fear of running out of money, so I keep a close eye on where I am.

So where am I exactly?

Mortgage - Successfully doubled-up
Retirement/Emergency Savings - On Track
House Maintenance - Savings are down to $121.01 I really need to cut back on projects around the house so I can build up a surplus in this account.  At the moment I would have trouble dealing with major repairs like replacing my water heater.
Housing Taxes/Insurance - On Track
Big Ticket Items - $238.88 in savings, most of that will get wiped out by the application fees for my Masters.  But I'll get through the month.
Travel - On Track
Health Insurance - Spent
Bus Pass - Spent
Cell Phone/Internet - Bills have not yet arrived
Car Savings - Had to reduce the amount by $25.  However, I won't be buying a car anytime soon so that is fine.
Gas - $49.89 left over and the van is gone.  So I look forward to folding this into another account.  I won't decide what I will do with this until the end of the month.
Utilities - Bill has not yet arrived
Food - $49.75 left.  This is going to be supper fun.  I'm running low because I stocked up on 6 months of granola making supplies at the beginning of the month (I had a coupon for 25% off that was only good for a couple days).  I was also out of meat at the beginning of the month, which put a real dent in things.
Miscellaneous - $4.87 left.  That should be plenty for the rest of the month.
Entertainment - $7.02 left.  Not quite enough for the book I want to buy, Oh well I can wait until my next pay check.
Social/Sports - Not touched
Clothes - Not touched
Gifts - All spent, but the next birthday isn't until March, so that's not a problem.
Financial Planning - Not touched

Overal things are going well for my first stab at budgeting.  The only tight part is food, but I'm stocked up on staples for this month and next so I should be fine.

Monday, 14 January 2013

The Transportation Issue

So, no car was the decision (see yesterday's post for an explanation of the why.)  The question today is what to do about transportation.  Let's break it down by destination shall we?


Got that covered already.  My monthly bus pass will get my to and from reliably.  Since I travel during rush hour it is even more convenient since I can catch the rush hour bus, which cuts my commute to 15 min.  The cost of my monthly bus pass is $68.25.

Parent's House

I greatly enjoy spending time with my parents.  Actually, since they've gotten back from overseas I've probably spent 95% of my weekend with them.  The freedom to pack a backpack and go see them is one of the things that I will miss most.  However, now that I've become a home owner I expect that I will see them less frequently and spend more time in my own home.  Still I will be wanting to see them.  Fortunately I can get a round trip to and from my parent's place on the local train for $51.98.  The cost of gas for the van there and back was about $50.  Hopefully any vehicle I get in the future will be a bit more fuel efficient then the van.  For now the train will suffice and is more economic then a car.


This is the most problematic.  The closest grocery store is a 20 min walk away.  I did the walk today, with a relatively small load of groceries.  Let's just say that my bad knee was pretty achy by the time I was done.  I was lucky in that I didn't have any standing chores to do (like shovel the drive way or clean the house) because if I had, it wouldn't have gotten done.  There is no way that I can do the trip multiple times in a week and I dread the idea of a trip that has a number of heavy things (like milk, and potatoes, and flour . . . ).  The solution . . .

Yes, you are looking at a wagon!  I'm still shopping around for a deal since my brother will be in town next week and can drive me to the store.  What better way to get a big load of groceries home?  I can lock it up on the bike rack in front of the store when I shop and then drag it home.  Don't get me wrong, an hour on my feet will still hurt, but that's life.  The wagon will help with the worst of it.

Fun Stuff/Extracurriculars

I hope to be out of the house at least once a week.  The bus will get me to most of these events, unfortunately the bus system pretty much shuts down at 6pm not to start again until 6am.  So getting home is a bit of a challenge and all my destinations are too far to walk.  That means that I'll need to take a taxi.  The estimated cost for a taxi from downtown to my house is $20.10.


Transport budget - $538.20

Bus Pass - $68.25
Train (to my parents twice a month) - $103.96
Wagon - None (besides the initial investment)
Taxi - $80.40

Left over - $285.59

If I set the extra money from my transportation budget aside every month I'll have $9,000 cash to buy a car in a year's time.  At that point I can reassess the situation and decide if it makes more sense to buy or not.  Hopefully I'll prefer not to buy and that will free up almost $300 a month to use as I see fit.

Sunday, 13 January 2013


It has arrived, that long awaited yet so sad day.  My parents are taking back their van, which was on loan to me for over three years while they were overseas.  Sob . . .  I will miss so many things about that van, like the turning radius and squeaking into parking spaces because my van is built more like a truck.  I'll never forget the warm feeling I got when I had to fill up it's tank from empty for a total bill of $120, knowing that it would guzzle it ever so quickly.  And oh that wonderful morning I got to spend with CAA because my sister ran down the battery.  Good times.

Ok maybe I'm laying it on a little bit thick.  It wasn't all bad.  I learned to drive in that van.  It let me get around for 3 whole years, vastly simplifying groceries.  With out it I wouldn't have been able to foster cats from the local humane society without it.  Not to mention a couple months ago I pretty much loaded my entire life into it so that I could move.  It's done a lot for me, I truly appreciate what it has done for me despite its difficulties.

So comes the question, should I replace it or not?  I've been waffling on the issue for a while.  So lets lay this out in a logical way.  15% of my budget is for transportation, which is about $538.20 a month.  $68.25 goes towards my bus pass.  That's not going to change, I need it to get to work and driving to work isn't an option.  The parking alone would be more expensive then my bus pass.  I would spend between $100 and $150 dollars a month on gas depending on if I go to see my parents once or twice a month.  That leaves me between $369.95 and $319.95 for all the expenses of a car.  Other expenses would be as follows:

Insurance (estimate) - $115 /month
Repairs, maintenance - $125/month

Which would leave $79.95 a month for payments.

I have savings set aside for a car to the tune of $5,692.79.  After speaking to my Grandfather I expect for a reliable used car, after taxes and registration the up front cost would be about $9,000.  Leaving me a deficit of $3,307.21.

I prefer to pay cash since I loath the idea of paying interest, and I'm not sure if I could get a payment plan that would make my payments less than $80 a month.  I could come up with the necessary cash up front, but that would mean pillaging the savings I have set aside to make extra payment on my mortgage, and it would take me 42 months to pay it back.

Pillaging my house savings account would mean that I couldn't double up my mortgage payments every month.  At least not until I start seeing whatever I will get from disability insurance and I have no idea when that will be.  The bottom line is that I want to pay off my mortgage as fast as possible and a dollar against it today is much more valuable then a dollar against tomorrow.  So for the moment a car is out of question.  So I'm just going to have to figure out the best way to get around without a car.

Any suggestions on cheap transport?

Saturday, 12 January 2013

The FP - Chicken Any One?

So here is the first official post for the frugality project.  It starts with the price of chicken.  (Inspiring or what?)  Before I moved a couple months back I lived in The Big City, not quite my taste but I will admit it did have its perks.  One of those was that Costco was available, thus big savings on meat.  Every three months I drive the extra distance and load up in bulk on all the meat that I ate regularly sausages, chicken, pork and ground beef.  All of these would be divided into meal size portions and frozen.

Since my move I've found myself shelling out for meat pretty much every week at a price that was a bit higher than what I was use to.  So I started really looking at my options instead of pulling the most convenient choice off of the shelf.  If you're grocery store is anything like mine you will have a number of choices when it comes to chicken.  Here are the options, and prices, at my store.

-Boneless Skinless Chicken Breast - 13.82 $/Kg
-Bone in Skinless Chicken Breast - 11.88 $/Kg
-Split Chicken Breast (Has the bone in and skin on) - 9.16 $/Kg
-Whole Chicken - 7.25 $/Kg

The most convenient choice of course is boneless and skinless, no muss, no fuss.  Lately I've been buying the bone in option.  Turns out that deboning the bone in chicken breast takes all of 5 min and a moderately sharp knife.  As for the skin, it is even easier to remove (if you want to be health, otherwise you can leave it on depending on your recipe).  So there you go, 5 min of work just got you 34% off your chicken.  But Elizabeth, you protest what about the bones!  You're paying for their weight and you cant even eat them.  And what about all that wasted meat that you just can't get off?  You're paying for that too!  This is where the deal gets even sweeter.  The packages at my store generally have 4 breasts to a package.  One breast will make a supper and a lunch for me, so one package of boneless skinless will give me 8 meals of chicken.  A package of bone in with skin will give me 8 meals of chicken and 2 of chicken soup.  Less money, more food?  What's not to love?

You're probably thinking that chicken soup from scratch is a big pain in the neck, I though so too at first.  Here's what you do.

1. Collect you're chicken bones (skin is optional) 4 breast bones should give at least 2 servings of soup. Personally I prefer to freeze the bones in an empty ice cream container and save up bones for a couple of months.  Then make big batch of soup that can be divided up and frozen for later.

2. Put the bones in a pot with some water and allow to simmer . . . and simmer . . . and simmer.  A slow cooker is really handy at this step because you can just turn it on low and leave it for the day.

3. Strain off the broth at this point the meat should be falling off the bones.  Go through the bones and collect the meat, this goes back in the broth.

4. Turn your broth into soup by adding veggies, spices, rice, noodles.  What ever strikes your fancy really.  It's hard to ruin chicken soup.  If you want a recipe to follow google chicken soup.  You'll find a hundred variations.

I must admit that I've not yet carved a whole chicken while raw.  I'm going to try that the next time I buy chicken.  From carving a whole cooked chicken I'm pretty sure that I can get 4 meals from the breasts, 4 meals from the legs, wings and other scraps of meat, and the bones should give me 4 servings of soup.  A total of 12 meals.

So . . . I'm pretty sure I can almost double the number of meals that I get for half the price.  Not bad.

Any butchers out there who want to offer advice on carving up a raw chicken?

Friday, 11 January 2013

Saving on the Big Ticket Items - Washer and Dryer

I must admit I've been putting this post off for a while.  In fact I almost had myself convinced that I shouldn't write this post.  After all I didn't really buy them, well ok I did buy them.  I just didn't have to pay for them.  They were a house warming gift from my parents.  I had originally planned to buy the washer and dryer at a local second hand appliance store in order to stretch my limited budget.  So, when my parents told me that they were paying for them we simply went along with my pre-made plans.

We picked out what appeared to be the nicest washer and dryer set at the store.  They were a set of Kenmore's that looked almost new.  I estimate that new they would have costed $1,300 after taxes, this set I got for $620 after taxes.  More then half price off didn't sound too bad, unfortunately the washer did sound bad.

When I ran the washer it gave off this not too comforting clunking sound.  Of course there is only one company who is able to repair Kenmore appliances and the second hand shop had a less then stellar repair policy.  I took me $73.44 for a 20 min appointment which basically consisted of the repair man telling me that it was going to cost me an additional $340 to get a washer that worked properly.

I didn't have much of a choice, the only place I would find a washer for $340 would be the second hand store where I bought the broken washer to begin with.  I preferred to take my chances with the repair man (who's company guaranteed the repair for a year).

So I paid up and got it fixed.  The final cost of the washer and dryer set? $1,033.44 a total savings of $266.56,  Was it worth the heart ache?  It's a bit of a tough call.  I wouldn't buy appliances from that second hand store again, simply because I do not like the way that I was treated.  Likely in the future I would only buy major appliances second hand if I new the person selling.  There is a lot of trust that goes into a purchase like that and there is simply no way to test it out in the store.

That said I don't regret my purchase.  (You will probably notice I don't spend all that much time with regrets, I prefer to learn and move on.)  While the total cost of the appliances was not all that much less then one would have paid for the same set new there was one major benefit.  Because I (unlike the previous owner to obviously dumped the broken set and ran out and bought a new set) took the time and the money to repair the washer that is one less washer in the dump.  It may seem silly, but I am a strong believer in the big R's (Reduce, Reuse, Recycle, Repair), and I am always looking for ways to make the Lorax proud.

Unless someone like you cares a whole awful lot,
Nothing is going to get better. It's not.   - Dr. Seuss, The Lorax

Thursday, 10 January 2013

Saving on the Big Ticket Items - Couches

I deliberated a bit on whether or not I should add couches to my list of big ticket items.  How the ones I currently own came into my possession is a bit of a funny story.  When I moved into my my new home I moved out of a two bedroom apartment that I had shared with my sister.  Because my parents were over seas when my sister and I first rented the apartment we had the luxury of furnishing our place with the furniture that otherwise would have gone into long term storage.

Included in the loaned furniture was a pull-out sofa bed and a one seater.  These were quite old so when my parents came back to Canada I was told I could keep the couches.  Conveniently I was moving into my house the same month that my parents were moving into theirs.  So to save money we had one moving company load up the contents of my apartment, drop off my portion of the furniture and then deliver the rest to my parent's house.

This was working out great until the movers tried to get my pull-out sofa down my stairs.  Let's just say that I preferred to keep the walls where they are for now.  Since I really didn't have anywhere to put the sofa upstairs I called my mom at work and said something along the lines of: "Hey mom, trade you a green pull-out for two brown love seats."

When my parents moved into their new place and were waiting for their furniture to come back to them (some of which was being held hostage in my apartment) they were given a set of love seats that the neighbours were trying to get rid of.  I'm not even going to try and guess when they were new, but they are solidly built and quite comfy.  So the pull-out sofa went back on the moving truck and the two brown love seats came to me.

I must admit I love hand me downs.  Why spend $1,000 on a sofa set when you can get one for free?  Granted I would at some point like to recover the sofa's (preferably by myself) but for now they are great.

Lessons Learned
-Don't be shy, ask around if you need something that a friend of neighbour might be getting rid of.  You could save them the cost of a trip to the dump.
-You get what you get.  Obviously it's a take it or leave it deal, if you want it to match your decor you will probably have to make some changes and it will cost you money.
-Be reasonable.  Obviously I didn't expect my parents to let me keep everything that they had lent.  (They were very clear about wanting the big screen back.)  On the other hand it wasn't over the moon to ask to keep the desk that was bought for my room as a teenager.  My parents didn't need or want the desks that they had bought for our rooms when we were teenagers.
-Be thankful.  Make sure you show your appreciation to the people who give you stuff.  My parent's neighbours have been over for supper or deserts a couple times since their initial generosity.  (I also provide my parents with free labour on request, but I don't think anyone is keeping track of who's done more favours for whom.)

(Please ignore the evidence of my needle work obsession on the coffee table)

Wednesday, 9 January 2013

Saving on Big Ticket Items - The Dresser

The latest on my list of BTI's was a dresser for my spare room.  I wanted to get it right away so that I could have the possibility of renting out one of my spare rooms to a colleague who will be working for my company for a few months.  I haven't heard anything back on that front yet, however it will get used since I plan on applying to be a respite foster parent.

I started, and ended my search at a furniture surplus store in town.  To be entirely honest the front of the store's prices were not all that much lower then, say waiting for a sale at a big box store.  Fortunately  the store also has a back area where they keep the scratched and dented furniture.  There were only two dressers in the section.  Both were rather nice looking, though not solid wood.  That said at the moment I am happy with a dresser that will get 10 years of good use and then can be down graded to a lighter task.

I was undecided weither to buy then and there or to shop around some more and see if I could find something better in another store.  Then I got talking to one of the sale's persons who noticed that the price on the dresser was lower then it was suppose to be.  He told me that he would honour that price if I decided to buy right away, but once I left the price would be corrected.  So I took the deal.  Instead of a regular price of $415 after tax I got it for $157 after tax, for a savings of 63%.  Not a bad buy considering the only thing wrong with it is a chip in the corner the size of a pea.

Lessons Learned

-Surplus stores have a slight markdown on prices but are not the cheapest way to go.  
-When it comes to the dented and scratched sections of a store you need to be patient and check regularly.  Often the selection is very small and there is no guarantee when new stock will come in or how much it will be marked down by.  
-Learn to be patient.  (I have trouble with this one.)  You need to take your time and look.  Preferably the scratch and dent section of a store should probably be one of a couple options that you are considering.  

On the bright side, my spare room is now fully furnished.

Monday, 7 January 2013

Saving on Big Ticket Items - Kitchen Table + Chairs

When it came to furnishing my first house I wanted a really good kitchen table.  I also didn't want to spend an arm and a leg on them.  (And let me be honest, I didn't have all that much left to spend on them.)  While in the strictest sense I didn't NEED a table and chairs, the idea of sitting at my desk on the one chair that I owned every night for dinner was even worse than the idea of being 23 and still sleeping in a twin bed that is part of a bunk bed set.

I did a bit more looking and research for the table than I did for my bed frame.  A new set was pretty much out of my price range, so I started my search in the scratched and dented section of some furniture stores.  While I did find some tables marked down for some minor cosmetic scratches there wasn't a whole lot of variety, so I expanded my search.

Enter Kijiji.  Truthfully this was the first time that I looked for something to buy on Kijiji, and it took a little getting use to.  I was tentative and not quite sure I was up for the idea of going to strangers' houses to look at furniture.  However, I was even more put out by the idea of paying lots of money for a table, so I sent out half a dozen inquires.

A few days later I went to check out one of the tables that I had asked about. (With my Dad-even though it was a perfectly respectable neighbourhood, you can never be too careful.)  I walked away with a solid wood table and four chairs for $75.  (Incidentally, the set was made the same year I was born, which is the same year my house was built.  What can I say?  1989 was a good year.)

I have since compared the table to what a new set would cost.  A similar new solid wood set would cost about $490 after taxes.  Which means that my set was about 85% off with plenty of wear left in it.

Lessons Learned

-Send out lots of inquires.  Make sure you are polite though; when you find what you need send an e-mail out to all those you had contacted and let them know that you are no longer interested.
-Be patient.  The best time to look is long before you need it, that way you can wait for the right one to come along and you won't feel like you are settling.
-Set criteria for what you want, it may be price, size, colour.  Have a good idea what you want.  At the same time don't be overly restrictive.  If you want a solid wood dark brown table that seats 8 and was built in the last 5 years for under $100 you are probably going to be waiting for a while.
-Safety first.  When it comes to furniture, obviously you can't meet the seller at the local Tim Horton's, but be sensible.  Go during the day, bring a friend, make sure people know where you're going and when you're going to be back, and for goodness sake, if any thing about the situation seems off make a quick exit.  A good deal isn't worth getting in harm's way.

I would use Kijiji again to find furniture: I had a great find with my table set.  Follow some common sense, do some research, and I'm sure that you will have the same satisfaction.

Sunday, 6 January 2013

Saving on the Big Ticket Items - Bed

Since buying my first home I have had the chance to make a number of large purchases.  As much as I tried to avoid going all out in the first month, buying stuff for the new home was reality, as I was moving from a two-bedroom apartment to a three-bedroom house.  Naturally, not everything in the apartment was mine; some was my sisters', and a large portion was on loan from my parents.  I was lucky enough to inherit a fair bit of furniture from the apartment, but there were some major gaps that needed to be filled.

When I first moved into my house I needed a number of things:

-Full sized bed
-Kitchen table and chairs
-Washer and dryer

I acquired these in a number of different ways, some saved me money, some less so.  Fortunately I managed to learn every step of the way.


Granted, I already owned a bed.  Actually, I owned two.  They are a detached set of twin bunk beds, and I have been sleeping on one or the other for the last 20 years.  (Same mattress too.) I could have kept on sleeping on one of the twins, but to be entirely honest, I really wanted to move to a full sized bed.

I shopped for the bed at a used furniture store, and I was on a bit of a tight budget.  I wanted to keep my spending under $300.  I ended up with an antique double bed frame that was plain and a bit worn, but that I loved.  It cost me about $280 after taxes.  I probably should have taken it as an omen when I got it home, tried to assemble it and the slats that held the mattress were too long.  (I could have cut them but I didn't want the second-hand store to not have the slats that they needed for the bigger bed, so I sent them back.  Ironically, the owner decided to trim them anyways and sent them back.  Unfortunately they didn't manage to trim them to the appropriate size, so I had to trim them again once I got home.)

Because the bed was an antique I had to order a posture board instead of a box spring.  Fortunately this didn't cost me any more.  Unfortunately I had been so preoccupied about getting the right depth and width of mattress for my lovely antique bed frame that I never considered the length.  Turns out my bed frame is too short for what is now a standard double mattress.

I didn't want to part with my bed frame (and I doubt that the second-hand store would have taken it back.)  So I had to come up with another solution.  I bought a metal bed frame that can have my head board and foot board attached.  This cost me another $100.  So at the end of the day I was $80 over budget, but I did have a bed to sleep on.

Lessons Learned

-Second-hand stores aren't always a cheaper solution.  The bed frames sold at Ikea can range anywhere from $60 to $800.
-Measure, write, and measure.  Measure every dimension of what you are getting, write it down and bring it with you and then measure all of the parts in the store before you go home.  I don't care if they think you are silly measuring things in the middle of the store.  It is a lot better to know ahead of time than to find out later.
-Shop and compare.  I did do a bit of looking but not nearly enough.  The Internet makes it much easier these days to get an idea of the cost of an item.  It pays to get a good idea what is out there.

At the end of the day I don't regret my purchase.  I do love my antique bed frame and am planning on keeping it for a very long time.  I hope you can learn something from my experience and avoid the less than pleasant surprises that came up for me.

Saturday, 5 January 2013

The Frugality Project

So five days into the month and every penny is accounted for.  In fact the city (finally) got around to informing me of how much (in general) my utility bill would be.  Unfortunately, it will be more like $300 instead of $200.  As a result I had to reorder my budget a bit in order to find $100.  The first $50 was easy; I had that left over anyways.  I did, however, have to pillage $25 each from my car savings and my planned spending.

I must admit I prefer to have a bit of a surplus in my budget.  So, here begins the frugality project.   Frugal - Sparing or economical with regard to money or food.  Ok, I have no intention of skimping on food.  I am, however, interested in seeing how I can reduce costs in an inventive manner.  So my attempt will to be to find one or two frugal projects a month and post them.  The only rules are that it has to save money, it has to be something that I would do/have/use anyways, and it has to be fun.

The big goal of the frugal project will be to reduce the amount spent per month by 10% of my take home pay.  This decrease needs to be sustainable by the end of 2 years without a decrease in quality of life.  I am not allowed to decrease savings to any account unless the savings accounts are up these respective amounts.

Emergency Savings - $10,000
Car Savings - $10,000
Big Ticket Items - $5,000

Retirement Savings and extra mortgage payments are off limits.

Let the experiments begin!

Friday, 4 January 2013

The Philosophy of Money

Reading my blog you will notice that while not all of the posts will be related to money a good deal of them will be.  Why write a blog almost entirely on finances?  Well if you are like me you will find the subject fascinating.  Some people will study botany, others study pottery I am a constant student of finance.  It is simply a subject that I enjoy.  However, it holds more importance than a simple hobby which can be set aside if there is not enough time.  I am a firm believer in the philosophy that those who do not control money are controlled by it.

It is easy to see the direct effects of poor money management.  A poor credit rating can lead to being being denied a loan for a car or a mortgage.  Running out of money before the next pay check can lead to credit filling the gap; and debt left unpaid can lead to bankruptcy.  But there is a more subtle, yet just as important, impact of poor money management.  It can lead to sleepless nights, strained relationships and sever limitations of opportunities, such as schooling.

While a careless attitude with money can lead to heartache, too much importance can also be harmful.  Money for the sake of money serves no purpose.  Expensive items and large investment accounts can not provide self-fulfillment or comfort.  Still so many people obsess on money for the sake of money: to see their name on Forbe's list of the richest people in the world.

So what is the correct way to look at money?  It depends.  (Big surprise there huh?)  I can only tell you why money is important to me.

Money for me is possibilities.  It gives me the capability to act as I see fit when I see fit.

Money gives me a modicum of security.  Owning my home completely and having a well stocked emergency fund helps to buffet the shocks that life will inevitable throw me.

In essence, I believe that all monetary goals should, such as saving a million dollars, be in the interest of furthering non-monetary and non-materialistic goals, such as having enough to stop working at the age of 65.

I have reached the monetary goal of being in a financial position to complete my Masters.  I will enjoy the process of earning my Masters, and this will move me on a career path that I want to pursue.

I want to pay off my mortgage in 5 years, to free up a good percentage of my income. Freeing this income would allow me to support not only myself but the children that I wish to adopt.

Saving aggressively now will not only allow me to retire in comfort but will allow me to retire earlier and spend more time and energy with my family.

By controlling my money I control a larger portion of my future.  Though my spending may seem somewhat restrictive to the outside viewer, it will give me the wealth necessary to live a life that I will find rewarding.

Thursday, 3 January 2013

Pay Day

Pay day.  A day that is dear to every worker's heart.  The trick is not loathing the week prior to pay day as you watch the balance of your checking account fall into the red.  In the past I haven't had a problem with this.  I am, by nature, quite frugal.  Yes, I know the f-word.  It's not that bad, really.

Through out my university career I was able to track my expenses without a budget.  I earned about $1,200 net a month and expenses were kept low since the military paid my tuition (ROTP program) and I shared accommodations with my sister.  I could comfortably spend what I wanted and have over $500 a month left sitting in my checking account which would eventually make it to a savings account.  It worked well for me for 4 years and I left University with over $47,000 in my bank account.  Which allowed me to put a downpayment on my first house this November.

Unfortunately this system no longer works.  Being the proud owner of a new house and living by myself has somewhat stretched my dollars.  To complicate things I get paid only once a month so all expenses need to be accounted for at the beginning of the month so that I don't run out.  I now have to work off a budget.

Here is how my pay check will be allocated for the month of January.  I allocate in two ways, by percentage and by importance.  Percentage wise I generally follow the Life Pie numbers suggested by Gail Vaz-Oxlade.  The only change is I spend 40% on required housing payments (regular mortgage, taxes, insurance, and maintenance) and only 10% on debt repayment.  The reason for this is that I have no debt besides my mortgage (no car loan or line of credit and my credit card never carries a balance).  As a result, the 10% allocated for debt goes against my mortgage.  (Leading to 50% of my take-home pay going to housing, but keep in mind I fully intend to be mortgage free by November 2017.)

-35% Housing
-15% Transportation
-10% Savings
-15% Debt Repayment
-25% Life

I also allocate based on importance.  The most important categories get allocated first and are generally first on the list.  These include fixed expenses like mortgage and taxes as well as important savings such as emergency and retirement savings.  Obviously this list is not perfectly ordered.  If I found that my food budget was underfunded for the month, I would reallocate from somewhere such as travel or big ticket items.  However, numbers such as my food budget are based on what I spent per month on average over the last four years.  The hardest part about this month's budget was how much to allocate for utilities.  I have yet to receive my first bill and as such had to make an educated guess.

This months pay check will be divided as follows:

Pay $3,588.02

Mortgage - $646.62
10% Debt (to double up mortgage payment) - $358.80
Retirement Savings - $358.80
Emergency Savings - $240.10
House Maintenance - $315.00
Housing Taxes - $182.50
House Insurance - $72.00
Big Ticket Items (Planned spending) - $100
Travel - $175
Health Insurance - $23.52
Bus Pass - $68.25
Cell Phone - $35.00
Internet - $50.00
Car Savings - $350.00
Gas - $120.00
Utilities (Electricity, water, sewer) - $200.00
Food - $160.00
Miscellaneous - $20.00
Entertainment - $10.00
Social/Sports - $15.00
Clothes - $10.00
Gifts - $10.00
Financial Planning - $15
Left over - $52.43

The $50 of wiggle room makes me comfortable and if all goes as planned this will eventually be spent on paying down my mortgage or padding my emergency savings.

Tuesday, 1 January 2013

The New Year

'Tis the season of resolutions.  Can't say I'm a big fan of making resolutions on New Years.  I have always been of a mind that if you come up with a goal there is no point in waiting for a specific month to start working on it.  So while I do have goals that I am working on they were decided on over time and most have already been started.


- Set up RRSP investments with my return of value pension from the military and contribute $359 a month for the year, along with any tax refunds.

- Pay off house in 5 years.  This is the term of my mortgage and the interest rate that I have is only going to go up.  I should be able to accomplish this by doubling up every payment and paying a 10% lump sum every year.  I have the numbers worked out for the next 2 years, thanks partially to my disability payments, and have a rough idea of how to come up with the money for the following three years.


-Start Masters of Science / Masters of Science in Nursing in the fall.  (I do need to get to work and get my application in order.)


-Join two new clubs in the local area.  (I currently have my eye on three, two quilting and the new comers club for my area.)


-Have my novel accepted to be published.  I have finished the first draft and am in the process of editing.  I plan to have it ready by the end of the month, so I can start sending it out.

-Become a respite foster parent.  I have wanted to do this for a while, and since I now have my own place, I can do it.

-Take a big backpacking trip solo.  I would like to see either mainland Europe or Australia / New Zealand.  I'm currently in the process of hoarding my vacation days and putting away $175 a month to pay for the trip.

-Finish my current crafting projects.  I have 1 quilt, 1 embroidered piece and a cross stitch in the works.  I have this really bad habit of starting new projects before I finish old ones.  (What can I say being perfect is boring : )