FP – Not Buying

It is extremely hard to calculate how much money you save by not buying something.  That is probably why it is so often that we don’t notice it’s effect on our wallets.  It is so much easier to remember that you saved $5 on a $50 dollar sweater that was 10% off than to remember that you saved $50 by no buying it in the first place. 

Of course you can also go wild calculating how many things you could have bought and didn’t.  Kudos to me for not buying that book shelf I wanted or that car I was considering.  I’m sure you could find a hundred thousand dollars worth of stuff that you want that you haven’t bought.  I sure can. 

Often financial advisors tell us not to buy stuff, but the action of not buying is inherently abstract.  So I’ve come up with a small exercise to make the idea more concrete.  When I’m at home I will really look at the things that I own, and then making a list of all the things that I won’t replace when they wear out.  These are things that either I won’t miss since I rarely use or perform a function that could be done by something else.  While I could sell some of these things they have very low resale value and quite honestly aren’t worth the effort it would take to sell them. 

They are:

-My kettle – It was a need-to-have in my university dorm, but I rarely use it now and I can just as easily heat water in a pan. 

-My nick-nacks – Read my musing here.  

-About half of my kitchen utensils – I have a good number of duplicates.  I only really need one set of measuring cups, one ladle, one lifter . . .

-My microwave – I’m still musing about this one since it is pretty new still, but I’m thinking most things that I put in it can be done in the microwave oven or on the stovetop. 

-Desks – I own three, I really only need one. 

I’m sure as I continue to go along this list will keep growing.  Paying attention to what I don’t use often, or that can be replaced by another object I own prevents me from running out to replace something when it starts to wear out.  Try it.  The excess of stuff that you’ve got in your life might just surprise you.  

Goal Review End March

It’s Goal Time!  (For the hockey fans out there I’m sorry to disappoint you.  I’m not talking about that kind of goal.) 

Financial

- 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. CHECK [Savings are happening as planned.  The return of value is coming in about three weeks since they now have my paperwork.  However they have to snail mail it to another province that will actually cut the paper check and then snail mails that to my bank.  At which point I get my money.  Though my tax refund has been repurposed for another reason, but that’s a post by itself.] 

- Pay off house in 5 years.  I should be able to accomplish this by doubling up every payment and paying a 10% lump sum every year.  CHECK [Made my double up for the month.  Also managed to pay my first 10% lump sum, which was very exciting.  I am continuing to explore alternate income sources to make up the shortfall.]

Educational

-Start Masters of Science / Masters of Science in Nursing in the fall.  KIND OF [Ok, I’ve just been sitting pretty waiting for the acceptance letter.  But it should come any day now and I’m going to start speaking to supervisors in April, which I’ve been avoiding.]

Social

-Join two new clubs in the local area.  CHECK [I’ve paid been to the quilting club group twice a month and have just started going to a local writing group which has been a lot of fun.  I’ll probably drop the newcomers in favour of the writers.] 

Other

-Have my novel accepted to be published.  I plan to have it ready by the end of the month (January), so I can start sending it out. CHECK [I went to a writing seminar in March and have been working on the changes they suggested.  I plan to start sending out queries this month.]

-Become a respite foster parent. CHECK [I’ve submitted my application and spoke with a worker.  I will likely be loaded on the May course.  I’ve found a family doctor so it shouldn’t be too hard to get the medical forms filled out.]

-Take a big backpacking trip solo. CHECK [Saving is going as planned and I haven’t touched my vacation days yet.] 

-Finish my current crafting projects.  CHECK [I’ve been breezing through the gift I’m making, it will be done in time and my quilt has seen some progress as well.] 

Seven goals have seen good progress and one has been on the back burner so I’ll give my self 7.5 out of 8 or 93.8%.  Not bad.  Big things to concentrate on in April are 1. Get my investing done once my return of value arrives 2. Send out query letters 3. Keep up the good progress on my embroidery. 

Gotta Love no Waste

I am very pleased to announce to all of my lovely readers that this week has been a no waste week.  I’ll give you all a moment while you stand up and cheer with me. 

            Done now?  Great!  While I am extremely pleased that nothing made it to my compost there is an unfortunately large amount of food in my fridge (see the third shelf of my fridge).  Most of this food comes in the form of leftovers (though there is one partially prepped meal that never made it to the oven.)  The problem with this is that most of my leftovers generally get eaten as lunches over the weekend, and not only do I have more leftovers than usual I am also away for the weekend meaning that nothing is going to get eaten until Monday. 

 

            So the next week’s challenge will be to get though:

-       A container of refried beans

-       A large container of Spaghetti

-       The makings of four servings of stuffed peppers

-       Two eggs

-       A large bag of spinach

-       That misc container that is probably at the back that I’ve forgotten about

Anybody with teenage boys want to send them to my place next week?  

Paying Taxes

            Before I was born people paid taxes.  As a result, when I was born the doctors didn’t care about the state of my mother's finances.  They only worried about keeping us alive.  As I grew up I attended school.  Learning math, science, art and two languages cost my parents no more than their property taxes and some minor school supplies.  When I joined the military I began paying taxes myself, yet the money I paid taxes on first came from the other taxpayers in my country.  Now I research human movement with the tax dollars that come from all over my country (and some from other countries too.)  

            Because of taxes I never needed to worry about my health, there are hospitals and their staff to care for me.  I never had to worry about my safety because the police, prison officers, and military are paid with our taxes.  I’ve always had the choice to vote because my tax dollars fund a democratic society. 

            Yes my government sometimes does stupid things with the money I give them.  I make a fuss from time to time about how we are paying way too much for projects or politicians; and yes, I do take advantage of all the tax savings and rebates I can.  At the end of the day though, I’ll pay my taxes with a smile because I know that I have benefited far more from the taxes of others then I will ever pay in my lifetime. 

            Even if I do end up paying more in taxes then I use (I suppose that’s possible) then nothing could express my sentiment better than the answer of a Canadian when asked by an American interviewer.  “Why should someone else have to pay for your surgery?”  The answer being “Because I would help pay for his if the situation were reversed.  That's just how we do it here.”  Paying my taxes is not a chore, it is a  civic duty, and so is keeping an eye on the people who spend it.  

PS. The government just returned the $415.32 that I over paid in taxes.  Can you say shopping spree?  (Ok, you got me.  It's going against the mortgage.)  

Monthly Spending Recap

            A lot of the blogs I read, especially the ones focused on debt repayment, post weekly spending summaries.  I toyed with the idea of doing this for a bit and ultimately decided against it.  (Hence why you have yet to read a post on what I spent in the last week.)  The major reason behind this decision is quite simple.  I like all of you lovely readers and would hate to lose you to boredom.  Aren’t convinced my weekly spending is boring?  Here’s my spending for all of March: 

01 March – Health Insurance – $23.52

01 March – Bus Pass - $68.25

02 March – Food - $45.36

05 March – Writing Seminar - $44.00

05 March – Interact Fee – $1.00

06 March – Stamps - $0.63

08 March – Mortgage Payment - $1,422.56

09 March – Food - $20.94

12 March – Present for my sister - $11.27

16 March – Food – $17.65

23 March – Food - $31.71

23 March – Utilities - $347.80

23 March – Internet - $49.66

23 March – Cell - $28.25

I spent a total of $2,112.60 in March.  Of that $2,006.67 or 95% was on needs and $105.93 or 5% was on wants.  Six of the fourteen payments are regular bills that are either the same every month, or fluctuate predictably (utilities, based on heating requirements.) 

So now you know what you’re not missing each week.  I pay my monthly bills, I buy food on Saturdays and once every four months or so I splurge on a really fun big event. 

PS.  The only reason I paid the bank fee (read why I hate bank fees here) was because it was cheaper to pre-pay the seminar instead of paying at the door ($44 vs. $48) and the other prepayment option was mailing a check which would have cost me about a dollar worth of envelops, stamps and cheques.  

Kiva

            While I spoke yesterday of how great it can be to give your time when you cannot give money there is always need for charitable donations of monetary value.  There is a million worthy causes under the sun and how you spend your charity money should always be in line with your own values. 

            I would however, like to draw your attention to the organization that I have been supporting for number of years.  Kiva is a web-based charity that links entrepreneurs from around the world with people who are willing to help fund their small business.  In the traditional charitable format is that of giving a family a goat so that they can make and sell cheese.  Through Kiva you lend the family the money, which they use to buy a goat.  With the money they make selling cheese they pay you back. 

            Once your loan is fully reimbursed you can either withdraw the sum or you can either withdraw the sum or you can loan it again and help another family.  Loans can be as little as $25 and are administered on the ground by microfinance institutions, which are vetted by the Kiva team.  One of the big questions is how do I know that my money will come back?  Overall Kiva’s repayment rate currently sits at about 99%.  Personally I’ve lent over $20,000 dollars (which is possible because I lend out the money again once it comes back) and to date have only lost $75 (or a repayment rate of almost 99.6%).  In my mind I would rather chance losing $25 on a loan which I will be able to relend then give away $25.

The entire idea behind microfinance fascinates me.  Instead of giving people a hand out you are giving them a hand up.  The people taking the loans are accountable for what they do with the money lent and use it to build a business, which will improve their standard of living over the long term. 

The one draw back I can see associated with loans is that it is not considered a taxable donation, since you get your money back.  However, donations that are made directly to Kiva in order to support their infrastructure are eligible for tax receipts.  I invite you to take a look at what Kiva has to offer the world, and be a worthwhile venture.

Other ways to give back

Giving back was always a part of my finances as a kid.  The rule was 10% of everything that we earned went to charity.  You could save it up as long as you wanted and could give it to any cause you wanted.  But the reality was that that 10% didn’t belong to you.  It belonged to the rest of the world; you were just managing it. 

            I carried this habit over when I started working full time for the military.  As soon as my pay hit my account 10% was put aside.  Which is why when I was faced with losing my job one of the things that I struggled with most was giving up my charity money.  I knew that I had one maybe two years left with the military and then I would be on my own with dismal job prospects.  I might even need to pay for another degree.  My head told me that it made sense to hoard as much money I could put aside to help me weather the oncoming storm. 

            At the same time my heart told me that however bad my financial prospects might get I am much better off than most of the people on this planet.  That in cutting off my giving I was shirking in my duty to the rest of the world. 

            Eventually my head won out and I discontinued my charitable giving.  I felt awful and started looking for a way to continue making a difference.  I had no money to give so I started giving away my time.  I volunteered for a local community house and tutoring a couple girls in foster care.  It was one of the best things I have ever done.  Though the impact that my actions may have made were more localized they were no less important.  I didn’t know until about six months later, but my bi-weekly visits to tutor one of my students was a turning point not only in her academics but for her socially as well. 

            Showing up regularly and taking an interest in her life made a difference that could not be made with money.  It showed her that someone cared and that someone was willing to be there even on the tough days.  Though it may sound like I worked this miraculous change on the girl I tutored, the reality is she also changed me. 

            She is one of the strongest people whom I have ever met.  She taught me a lot about endurance and humor.  Watching her persevere in the hard times made it easier to face my own.  Nothing has given me greater joy then to watch her catch on to a topic that had been eluding her, or get caught up after years of not going to school regularly.  Working with her gave me so much more than mailing a check to a charity half way around the world.