How To Escape A Financial Mistake Without Selling Your Soul

Financial mistake bomb

 LIFE IS FULL OF FINANCIAL LESSONS   I’ve made a ton of financial mistakes over the years from buying a timeshare, to making bad investment choices, to refinancing to a bad mortgage. The reality is we all make bad choices with our finances at one point or another. My worst financial mistake came when I bought a $4500 timeshare on my honeymoon of all places because I thought it would be a great to force us to take a vacation every year. This lead into other financial issues when we decided we wanted to sell our timeshare and found out it’s next to impossible to sell them. We tried for over 2 years to sell our timeshare with literally no luck at all. Our lowest point came when we decide to sign up for a couple of timeshare resale companies and this only lead sticking $1100 into a losing battle. Finally, after 6 long years of owning this timeshare, paying maintenance fees, and losing our money to the timeshare resale companies, I was able to contact my resort and get a buyback option that allowed me to get out from under this black hole that had done nothing more than […]

Saving for retirement on a lower-income

saving for retirement lower-income

EVERY DOLLAR COUNTS   Let’s face it, saving for retirement is tough work. I mean, the concept is not difficult for us to wrap our heads around but finding the money, putting it away consistently and not spending it is challenging stuff. I suspect this is the case because money is an emotional subject and it’s easy to become attached to it; we work hard for it and want to reward ourselves with it. Saving for retirement takes discipline. When you’re not relying on paycheque to paycheque for living expenses, saving some money should be easy enough. You also have options on where to put your money for retirement, into Registered Retirement Savings Plans (RRSPs), real estate properties, Tax-Free Savings Accounts (TFSAs), non-registered brokerage accounts and more. High-income earners are often advised to contribute to their RRSPs in their highest-income earning years, and rightly so. This RRSP account is optimized when you contribute money when your income taxes are the highest, so monies can be withdrawn in the future when you’re in the lowest (or lower) income tax bracket, presumably in retirement. Low-income earners probably shouldn’t follow this advice, and they probably need different financial advice altogether. Today’s post will […]

To Take Or Not Take Early CPP

Happy Non-Retirement

CANADA PENSION PLAN DILEMMA   My husband just turned 62 and we’ve been in a quandary about whether he should take his Canadian Pension Plan (CPP) early (before 65) with penalty or not. We’re both still working and plan to be for the next 4 years while we pay off a whack of debt. Because of penalties introduced in 2012, the amount you receive by taking your CPP early is less than before this legislation was introduced. Let me try to walk through the peculiarities of our situation and how we reached our final decision.   The CPP Rules   While I can’t walk you through all the rules, I will highlight the key ones or ones that were relevant for us but refer you to the CPP website which is actually pretty clear.  I just want to point out that the Quebec Pension Plan (QPP) has a different set of rules, up front. Normally CPP was collected at 65, with penalties and premiums if you elected to take it anytime from age 60 to 65, or from age 65 to 70. Contrary to popular belief, with the new rules introduced in 2012, the age for CPP has not changed […]

Is there truth to less stress with financial freedom?

financial freedom

FREEDOM IS DEFINED BY YOU   Financial freedom means lots of things to many people and although everyone has their thoughts on what life is like without any debt for some it’s not all that it’s cracked up to be. What would it take in order for you to take your stress financially from one level to the next? Would you have to pay off your credit cards, all of your debt, your mortgage or simply just be able to live a comfortable life while paying off your debts? In a conversation with a colleague the other day he brought up a friend of his who just built a new house that he paid cash for, his wife doesn’t work and they have no debt. Top that off with a well-paying job so that must mean his life is all roses, right? Wrong. We don’t know that. He seemed jealous to be honest especially when he said “it must be nice to live a stress free life” which made me wonder why people think that debt=stress. I’ve had people we know think that I must make lots of money with the careers I hold but what they don’t know is […]

Parents tell son he will create credit card debt with rewards cards

credit card debt

CREDIT CARD BUDGET SAVINGS   I talk about credit card debt on CBB once in a while and I also talk about how credit cards can easily be your friend if you use them properly. Many people use credit cards today rather than carrying cash with them. It’s simple to tap, swipe or insert and enter a pin to pay for a purchase and in most cases it gets you through the checkout faster. We carry credit cards because of ease of use and of course there are perks to using Canadian Credit Cards if you use them wisely. Credit cards have helped many people get back on their feet because they knew money was on the way. One friend of ours was in between jobs and used the credit card to get grocery rewards which helped them to buy more groceries for the family every month. One of our current rewards cards the SDM Optimum has almost 500,000 rewards points which is equal to about $1000 worth of free product. We don’t own the Optimum credit card but if you did you could get even more Optimum points faster.   Credit card debt   How to pay off credit […]

Work more to work less with a compressed work week

compressed work week

DEPENDS ON THE PERSON…   Many of you might agree working a compressed work week would make your life easier but for others it’s not a perk they care too much about. Factor in the possibility that you might have to retire later in life because you aren’t working the amount of hours you are used to and it might deter you further. If you can picture yourself living the retired life how old are you when that happens? Getting up and going to work for everyone around the globe is a part of life as is earning an honest living. We all have employers with different missions and values and even some who look after their staff with such care that they worry about how their days outside of work will impact their productivity when they come back to work. Sounds too good to be true but some employers want their staff to come back to work refreshed and able to give them 110% rather than 50%. I know that what happens behind closed doors no one may ever know but if your employer takes extra steps to ensure they make your working days easier they may see a […]

Young adult teaches us about being house poor in 15 minutes

House poor

DON’T GET CAUGHT SINKING YOUR SHIP   Being house poor doesn’t necessarily mean that you simply have no money but it can mean that you have too much house you can’t afford. House poor can also mean you have too much stuff, no money and/or piles of consumer debt that you are struggling financially to make ends meet. The term “poor” means so many things to everyone that the only way to describe it from a financial perspective would be lack of money. Some people may not consider themselves poor until starvation kicks in and they have to go to the food bank or when they reach the point of bankruptcy. Others may take on a different view but no matter what poor means to you it’s not a place that people “dream” of.   House poor is not easy living   You might consider yourself house poor when you can’t pay your mortgage which could be for a variety of reasons. There are also plenty of poor people living in the ritzy part of town who are struggling to take control of their financial situation. I think there are many misconceptions of the word poor and the only person […]

Will signing a room rental agreement feel like moving home?

room rental bedroom

BEFORE RENTING A ROOM……   Signing a room rental agreement could feel like you are moving in with your parents but it could be worse, you could be moving in with Sheldon Cooper. Although renting a room is a great way to save money in the budget it also comes with pros and cons but it’s best to do your homework first before signing on the dotted line. Not all families or couples are the same so like the homeowner who may interview you to see if you are the right fit to move in you want to do the same. If you are someone who likes to live in clean, quiet environment then search out rooms for rent that fit that description. If you don’t mind kids and pets you can easily find a room for rent because lots of families are looking to supplement their income if they have a spare room in the house. Kids are costly after all. Today I have a fan question that came in that I was easily able to answer since I’ve been in his shoes before. I’m happy when the fans do their homework because not only are they saving themselves […]