Category Archives: Budgetting and Cash Flow

“Maxed Out” – CPP and EI

Sabine Lay Money Coach in Burlington ONby Sabine Lay

Recently, a client asked me why her income increased throughout the year when she didn’t get a pay raise.

The answer is CPP (Canada Pension Plan) and EI (Employment Insurance) contributions.

CPP
As Canadians, anyone who earns employment income is required to contribute to the CPP program. If you are employed, your CPP contributions are deducted at source from your payroll until the maximum annual amount is reached. Once this amount is reached, your take-home pay will increase. Continue reading →

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October 29th Event – Is Money Keeping You Stuck?

MONEY MONDAYS

Save the Last Monday of the Month for Money

Money Mondays with your local Money CoachJoin your local Money Coach on the last Monday of each month for an informal, lively discussion about money – how it works, how to manage it and how to gain control of it.

Bring a friend, come with questions and build your knowledge and confidence in personal money management.

October’s Topic: “Is Money Keeping You Stuck (in a job, a relationship or in anxiety)?”
When: October 29th, 2012
Time: 7:00 pm – 8:00pm local time
Cost: FREE
(Information….PRICELESS!) Continue reading →

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Paying Yourself First

by Annie Kvick, BEd, CFP

Annie Kvick Money Coach in Vancouver BCThink saving is just too hard?  The secret to saving money and accumulating wealth is to “pay yourself first”. The first bill you pay each month should be to yourself. Regular and consistent contributions to savings go a long way toward building a long-term nest egg, and also allow you the freedom to realize your short term goals.

What does “pay yourself first” mean?

Paying yourself first simply means putting money into your savings account first – as soon as you get paid and before you spend money on anything else.

When you pay yourself first, you are mentally establishing saving as a priority. You are telling yourself that your future is important too.

Are you waiting to save until something changes – you get a raise, the kids are done hockey, or gas prices go back down?  There will always be reasons not to save and the longer you put saving off, the harder it is to create good financial habits and to achieve your goals.

Paying yourself first creates sound financial habits.  Most people prioritize their spending in this order: bills, fun, saving. In most cases there is little left over to put in the bank. If you pay yourself first – saving, bills, fun, in that order – you set the money aside before you find other reasons to spend it.

Paying Yourself FirstLet’s be honest: Regardless of how much you earn, you likely feel there is not enough to start saving. If you don’t implement the saving habit now, there will always be reasons to put it off; car repairs, dental work , or the “must-do” trip to Mexico.

Start small
Don’t be afraid to start small. You can increase the amount you save as you begin to feel more confident in your plan and/or your income increases. Try starting with $50 each month or 1% of your paycheque. As you feel more comfortable in your ability to save, try increasing your saving rate to 3% or even 5% of your income and build from there.

Automate
The easiest way to develop a pattern of saving is to set up an automatic transfer on pay day from your bank account directly into savings. Automatic saving can be set up online or by contacting your investment/savings provider.

Next Steps
Once regular savings has become a habit, you can use this magic for your short term goals as well.  Do you want a yearly vacation, an emergency fund, a new car, or a new house? Open free online savings account at your bank. Nickname the accounts “vacation”, “car” etc. and start saving with regular automatic deposits. Most institutions allow 5-10 free online savings accounts.

Before you know it, your money will accumulate and you will have saved for things that are important to you. Whether you are saving for retirement or a vacation, this simple technique will help motivate and empower you to achieve all your financial goals.

Paying yourself first gives you the freedom you deserve and opens a world of opportunities – try it!

Annie Kvick is an educator with the Women’s Financial Learning Centre and Money Coaches Canada’s “Retirement Expert and Lifestyle Protector”

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Podcast – Back to School

Back to School

Featuring: Christine White and Karen Richardson: Family Money Experts from www.moneycoachescanada.ca

Back to school season is almost here! Christine and Karen, both moms and Money Coaches with Money Coaches Canada, talk about back to school shopping, managing kids activities, and ongoing school costs throughout the year!

Listen in for great tips and helpful information to get your kids back to school while staying on track with your family finances.

Listen to our Let’s Talk Money Podcast by clicking the link below

Back to School

You can download the Activities Worksheet Christine talks about here: Activity Worksheet

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Christmas in July

Melanie Buffel Money Coach in Vancouver BCby Melanie Buffel, BA Psych

Once upon a time, I used to dread the coming of the holiday season. Don’t get me wrong, I love the traditions surrounding Christmas; the gingerbread house, the tree and all the family cheer.

What I dreaded was the need to squeeze hundreds of extra dollars from my December paycheque to fund these traditions; not to mention gifts worthy of childhood expectations, fueled by the media and peers’ determining what was new, cool and absolutely necessary!

Now you may be saying to yourself, “Why is she talking about Christmas in July?” Well, I will tell you.  Back in those days I would manage the holiday season with the help of my best friend, VISA. I was convinced this was exactly what VISA was designed to do – pay for things that I could not afford! After a couple of years of this same strategy and an ever present VISA balance, I decided things needed to change. I learned my lesson – a little planning ahead can help me survive the holiday season without a painful credit card hangover. This is how I did it:

First, I made a list of all the people I wanted to buy gifts for and how much money I would spend on each. (download our Gift Worksheet) I considered this list carefully with an eye to not only reducing my costs, but also considering what sort of gifts would be most meaningful to each recipient.

Gift Then I did the following:

  • I reduced the focus on ‘stuff’ and opted for one really cherished gift and a stocking full of practical items instead of a bunch of little things my kids didn’t need and may not even want.
  • I shifted to buying one gift for a couple or family instead of individual gifts.
  • I began to give many people on my list a specially prepared gift basket with homemade jams, jellies and cookies that were specific to their individual tastes, and far more appreciated than less personal store bought items.
  • I also considered the costs of extra activities and an increase in the food budget for the month to account for the extra hosting duties.

By starting this planning months ahead, (like July – or better yet in January – well maybe next year!), you can incorporate these expenses into your regular monthly spending instead of running around in a panic in December.

How do you figure it out?

  1. Total up your Holiday expenditures
  2. Divide by the number of months before December arrives. For example, if you plan to spend $600 at Christmas and there are six months to go you will need to save $100 a month to have a debt free Christmas.
  3. Start saving that amount each month

Sounds simple! It can be, but the key to success is to put it into action by opening a separate no fee savings account and labelling it “Christmas”, “Hanukkah” or “Gifts” (check out the options at your bank or try one of the online banks like Tangerine or Ally). Treat this savings like a bill by setting up an automatic transfer to the account on the same day each month soon after you get paid. Don’t attach this account to your debit card so you won’t be tempted to spend it on unrelated impulse purchases.  By the time the holidays are here you can transfer the money to your chequing account so it’s easily available.

This bit of savings magic can help make the season a lot less stressful and maybe even a little more magical! For our family it means the focus of our holidays is once again on spending time with people we love instead of hitting the mall, and we are all the richer for it!

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Your Child is Off to University. Will Your Savings Last?

by Tom Feigs

The acceptance letter has come in from a far-flung University!  It’s a proud moment.  Then immediately, you wonder if you and your scholar-to-be are ready to tackle the costs that lie ahead.

Dangers lurk if you avoid doing your “homework”.  Unexpected costs – difficulty distributing funds among children – running out of funds too early – endless demands on the “bank of Mom and Dad” – overspending goes unchecked – scholarship/grant application deadlines are missed – frustration!

Post-secondary education is an investment of time, energy and money that pays dividends down the road.  It’s best to carefully manage this investment to encourage a positive learning experience while making efficient use of funding.  Involve your children in the education funding planning process right from the start.  Sheltering them from the money realities won’t serve in anyone’s best interests.  You may well face a “deer in the headlights” reaction initially but start early and be persistent.

First, create a year-by-year forecast of education funding vs student costs for all children aspiring to attend university.  Do this in one comprehensive table, using our Education Funding Worksheet to get you started.

  • Identify all current and future income sources available such as Registered Education Savings Plan (RESP), scholarships/bursaries, provincial/territorial assistance, student’s summer employment, student loan, grandparents, etc.  http://www.canlearn.ca/eng/planning/after.shtml
  • Expect the first year to be the most expensive as you learn the ropes and cover some initial setup and moving expenses.

Next, formulate a semester-by-semester income and spending plan using a simple table of monthly income and expenses.  Keep it up-to-date and ensure everyone involved is engaged.  Use this Education Month-to-Month Worksheet to stay on track.

  • Establish a reasonable cost-sharing arrangement with your university bound children and communicate clear expectations upfront.  An informed and involved student is more likely to make good spending choices and even complete their studies on schedule!
  • Offer to help apply for scholarships and bursaries
  • Explain the danger of using credit cards and the ugly consequences of debt
  • Most importantly, always offer guidance with open communication and positive reinforcement

Creating clarity in an educational funding plan mitigates the pressures of financing education and helps develop financial savvy young adults.  Remember to update the plan as things change and evolve throughout your child’s educational years.

Academic and financial growth are priceless; now is the time to learn and grow with your scholar-to-be!

Related Resources:

Podcast – Young People and Money

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Streamline Your System & Focus Your Finances

Karen Collacutt Certified Money Coach in Barrie ONBy Karen Collacutt, CFP, Certified Money Coach

Are your financial papers all over the place? Are bills and documents hard to find? Would you like more control over your household finances? Well, families and individuals who focus on their goals and dreams become more conscious about their spending and make better overall financial decisions.

If your papers are piling up and hard to find, your journey to empowerment and control with your finances will quickly get derailed. By setting up systems to automate and structure your money, and the never-ending paper that goes with it, you can get and keep your financial house in order.

Follow these three simple steps to increase control and confidence in Your Financial System.

1. Create a Money Spot
Choose a particular location for all financial information to land when it comes into the house. Try a three-tiered tray system or three baskets. Collect the tools you need to manage your family finances: stapler, sticky notes, stamps, paper clips, envelopes. Keep them handy at your Money Spot so you can complete your financial tasks in one sitting.

Basket 1: All incoming financial information. Teach your family (and yourself) that all financial documents and requests go to the Money Spot: bills that arrive in the mail, receipts from your wallets or your cars, your child’s field trip request… anything to do with money and the family finances.

Basket 2: Bills to Be Paid. Set up 2 file folders in this basket – Bills due to be paid during the 1st-15th and bills to be paid 16th-31stof the month.

Basket 3: All items to be filed. Place all paid bills, statements and information here; ready to be filed once you have dealt with them.

2. Choose a Money Day
Decide when you’re going to deal with your money. Book a time each week, or each pay day to handle your finances. It could be weekly – Money Mondays, Financial Fridays, or perhaps bi-weekly Pay Day Parties! Instead of trying to handle finances daily, choose the time and day you will sit down and deal with all of your finances for the previous week or two. Use My Money Day Checklist to keep you on track.

3. Create and Maintain a Financial Filing System
Get rid of that six-inch stack of papers that isn’t filed! Download our tool My Financial Filing System to organize your papers and know exactly where to find them. Use the third basket in your Money Spot to collect your papers to be filed. Then file them at least once per month. If you do it every Money Day, they won’t build up and you will have very little to file each time.

Setting up these three systems will completely organize your household finances. You will know where your documents are when they come in and long after you deal with them. A sense of order and peace will follow, allowing you to check on your finances periodically and easily.

Remember, staying on top of your finances doesn’t mean shuffling financial papers every day. Streamline your System and Focus your Finances today so that you have more time for creating and living the life you want tomorrow…

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Podcast – Credit Canada Debt Solutions

Credit Canada Debt Solutions

We hear a lot these days about debt and credit.  Canadians on average are carrying more debt than ever.  Are you wondering about your credit rating and your credit score?

Join Karen Collacutt, Educator with the Women’s Financial Learning Centre and Jean Riddell from Credit Canada Debt Solutions as they discuss your credit score and rating, how to maintain good credit, and what to do if things go off track.

Listen to our Let’s Talk Money Podcast by clicking the link below

Credit Canada Debt Solutions

Credit Canada Debt Solutions can be reached at (1-800-267-2272 ) or www.creditcanada.ca 

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Podcast – The Wealth Academy for Women

The Wealth Academy for Women 

Wealth Academy for WomenOur guest speaker this month is Tracy Theemes, a certified financial planner and co-founder of Sophia Financial Group and the Wealth Academy for Women.

The Wealth Academy for Women is a lively, dynamic, highly participatory day of workshops that covers everything a woman needs to know about her finances in one day.

All proceeds are donated to Dress for Success, an organization that empowers women financially.

Listen to our Let’s Talk Money Podcast to find more about this life changing day!

The Wealth Academy for Women – an interview with Tracy Theemes

For more details or to register for the Feb 25th event in Vancouver, visit: www.wealthacademyforwomen.com or call Dress for Success (604) 408-7923.

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Our Favorite Money Resources

The start of a new year is a good time to review the resources that help you make your best money decisions. We know that money can be a scary topic but knowledge is power and there are many resources geared to letting you dip your toe in the waters.

You don’t have to become a financial analyst or a planner — you’ll simply learn a lot that will help increase your confidence in making financial decisions and help you to know what questions to ask.

To start on your “homework” for 2012, check out some of our favorite money resources. There’s something for everything and for every type of learner — whether you’re self-motivated, you prefer group learning or you’re looking for one-on-one learning opportunities.

Overall Favorite Money Resource

Globe Investor — This section, both online and in print, keeps you up-to-date on both the bigger economic picture and the financial markets as well as personal finance and investing news.  Find it online at www.theglobeandmail.com/globe-investor.

Our Favorite Books

What’s Good, Bad And Downright Awful In Canadian Investments Today. Rob Carrick, the Globe and Mail’s personal finance columnist, has written several useful books that will help you become more financially savvy. www.robcarrick.com

The MoneySense Guide to Retiring Wealthy, from the Canadian personal finance web site MoneySense comes with several guides, including this primer for a step-by-step financial plan. Find it at www.moneysense.ca/books.

Smart Couples Finish Rich: 9 Steps to Creating a Rich Future for You and Your Partner  (Canadian Edition) by David Bach, a bestselling author and financial coach. Bach and his ‘Finish Rich’ advice are found online, in books and in the news media.While Bach is an American and some of his advice is US-oriented when it comes to tax and other issues, many of the basic financial steps are those that apply no matter what side of the border you’re on. We also like Smart Women Finish Rich.

The Soul of Money: Transforming Your Relationship with Money and Life by Lynne Twist  A unique look at money that deals with our attitudes towards it. Your relationship with money is really a first step — until you truly examine your attitude towards it, it is difficult to start getting a handle on how to save, spend and invest.

Money, A Memoir. Women, Emotions and Cash by Liz Perle – While women would share stories about their most personal issues, Liz Perle tackled the one that remained a taboo — money. And more specifically our emotional relationship to money. Her book tells her own story and those of other women. You may see yourself in those stories; you’ll come away from reading it realizing that if you are to truly take control of your financial future, you have to be honest with yourself about the influence money has on you.

Our Favorite Workshops

Heads & Tails of Money Seminar
This 3 hour seminar will help you discover the impact of your beliefs on your financial behaviours and will show you how to align your spending with your personal vision.

Wealth Academy for Women
In this lively, dynamic, highly participatory day of workshops you will learn how to negotiate, make the most of your career, develop a financial plan and more. All proceeds are donated to Dress for Success, an organization that empowers women financially.

Smart Money Essentials
Whether you’re completely lost in matters of finance or simply seeking confirmation that you’re on the right track, this weekend workshop is the perfect start for taking control of your finances and creating a foundation for your ideal life.

Our Favorite Home Study Program

Smart Money Essentials with a monthly Question and Answer hotline
A comprehensive hands-on primer for people who are looking to learn more about managing their money and want to create their own basic financial plan. In addition to a learning guide, worksheets and downloadable audio learning, you also have access to our monthly question-and-answer hotline, which gives you a chance to ask any questions that arise as you take control of your finances.

Our Favorite Blogs and Web Sites

Boomer and Echo: www.boomerandecho.com
Gail Vaz-Oxlade: www.gailvazoxlade.com
Canadian Couch Potato: www.canadiancouchpotato.com
Daily Worth: www.dailyworth.com
Smart Cookies: www.smartcookies.com
Retire Happy – Jim Yih: www.jimyih.com
Steadyhand Investments: www.steadyhand.com/blog

More useful websites, podcasts, worksheets and articles listed in our Resources section

Our Favorite Professionals
Money Coaches Canada
Meet our Money Coaches Canada team. Our coaches are located in several cities across Canada and work with clients either in person or using teleconferences and on-line meeting tools.

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