Featured Friday – The Banker – Me Money


Hello again everyone! I know it has been a while since I have wrote a post but I thought that for my return I would write something that you might not expect to hear, especially coming from a person who makes his living helping people plan their finances. The topic of my post today is about spending some money on yourself!

First things first, I am not going against any of the great ideas presented in previous posts and comments, and I am not going to downplay the importance of saving for the future and for the unexpected. Nor will I denounce the need to pay down your debt as quickly as possible. I am actually writing about something that should be talked about alongside those ideas.

We live in a fast-paced, stressful world and spend so much time focusing on things like family, work, school, hobbies, the list is endless. These things can cause us quite a bit of stress and, combined with financial worries, it can almost make you feel helpless. As a financial advisor I see and hear stories like these every day. That is why I truly believe that part of any good budget has to be a little “me money”.

If you have been reading the past post and particularly the previous post (March budget) you can see that we from time to time have a large Miscellaneous or Date Night expenditures. I firmly believe that these expenditures, for example spending $225 to watch an NHL team that is mediocre at best (clearly I am not a Leafs fan) (rude-J). While perhaps they are a little bit much sometimes, they’re necessary for us to maintain a healthy balance. We often speak and focus so much on debt repayment and saving plans that we can forget about having some fun and relaxing. Everyone’s “me money” will be different; might be dinners out, tickets to sports or concerts, or shopping. Whatever it your “thing” may be make sure that you take some time, and money to enjoy it and relax.

Life is short and we never know what’s coming next, why not enjoy some of it!

Featured Friday – The Banker


Hey readers, today’s Featured Friday comes from The Banker himself! Hope you enjoy!

Hello everyone! I love the idea of this blog and I could not be more proud of my girlfriend for starting it and putting herself out there “on the line”(that is a reference to the movie “The Internship…underrated in my books), and share her triumphs and stumbles on her way to becoming debt free. High five babe! As for me, I have been working at one of the Big 5 Canadian banks for about 2 years now and have been loving every minute of it. I studied Finance at university and am thrilled to be lucky enough to use my education in my day-to-day life.

When I was asked to write my first guest post for the blog I thought about it would be best to talk about some common mistakes that I see from younger clients on almost a daily basis. So without further ado here they are:

No Budget

This could also be titled “no idea of how much they are spending”. When it comes to my younger clients, the thing I hear most often is that they have no money left over at the end of the month. I think one of the easiest and most effective ways to managing your finances is to know what you are spending and also what you are earning, you would not believe the number of people I see that do not even know the hourly wage they are earning.

 Making a budget is quite easy when you consider that it is basic addition and subtraction. You take what you earn and add it up, you then take what you spend and add it up and subtract the two numbers. The hard part is figuring out what you spend. Start by listing your fixed expense (rent, loan/credit card payments, car expense, etc), these are expenses that are necessary. Then consider your variable expenses (coffee, cable/internet, clothes, etc). The key is to separate a “want”from the “needs”.

 Once you have your budget, you are half way there; next you need to track your spending. You could create a spreadsheet in Excel and track it on your own, some banks offer programs to help you, i.e. RBC Financial Tracker, or you can employ one of many apps out in the market. I personally use an app called Mint, where you can input your budget and it helps you track your monthly spending, it will even email you when you over spend!


No saving plan

Another common thing that I see is that people do not have any kind of savings plan. Now I am an advocate of “paying yourself”but you also need to think ahead. There are so many things that can happen without any notice and when you do not plan ahead it have so many adverse effects on your financial wellbeing. Whether it is losing a job, a car taking a crap, or some other personal emergency, it is very important to have something put away for a rainy day.

This does not have to be sophisticated by any stretch of the imagination but you need to save something every month. Most banks offer a free savings account option and simple transferring $100 a month into one can be a start. Other options could be Tax-Free Savings Accounts (TFSA) or Registered Retirement Savings Plan (RRSP), but that’s a whole other post. Bottom line, I think that it is a necessity to end the month with something saved.


No (or very little) understanding of how credit works

Most young people come into my office and say something like “I need to build my credit,”but have no idea what that means. Credit is a very important part of your overall financial plan and it amazes me how many young people do not know how credit works. Whether it is not knowing how their student loans are structured or what affects your credit rating, younger clients tend to just be oblivious to how these debts can effect them down the road. Maxing out credit cards, missing payments, and even worse avoiding payments can cause problems that last years. My suggestion is always to be aware of your credit score and how certain actions affect your score. In Canada, Equifax (www.equifax.ca) and Trans Union (www.transunion.ca) are the two credit bureau companies in Canada and do have a free check option.

PS. Things like cable and cell phone bills do not show on your credit bureau but delinquencies and missed bill payments are seen by banks and do effect your ability to get approved for credit.

When was the last time you checked your credit score?

Featured Friday


Today’s post comes from my wonderful friend Carly. She’s the one that encouraged me to start this blog, and I love talking to her about personal finance. She is the same age as me, but seems so much more together! She and her hubby-to-be have full time jobs, their own house, and are saving for a wedding. She is incredibly knowledgable, and I thought she would be a great person to feature on my blog.
So, without further ado, here is the first “Featured Friday” post:

My debt story

Hello Interwebs. You have never heard of me before, but I am a long time reader of great personal financial blogs like Club Thrifty, Money After Graduation and Punch Debt in the Face. My lovely blogger friend (and pal in real life) has asked me to do a guest post.

I’ve always been extremely nosy about other people’s debt and how they are getting out of it. I’m fascinated by how young people of today are spending their money; I like to compare and learn things from them. Like how Vanessa is able to save a ridiculous amount of money and how Cait is able to calculate nearly exactly how much she’ll spend a month. Since I am a nosy nelly, maybe you are too. Here’s my story:

In high school, I had a couple jobs – mostly working for my dad’s company during the summers. I remember I got my biggest paycheque ever after working so hard for two weeks: CDN$505.00. I literally couldn’t believe how big the cheque was. Once I was 17, I worked in a clothing store to save money for a trip. I was the ‘cool girl’ (or at least, I thought I was) because I worked in the ‘cool’ store and made oodles of money. I spent it almost all on clothes from the very clothing store. How mature.

In grade 12, I decided I wanted to go to university. And not just any university, a big university, far away from home. I applied and was surprised I was actually accepted. Off I went to study for four years. My grandfather graciously helped pay for first year, and from year two to four, I relied on savings from my summer job in broadcasting and student loans. Each September, I got a hefty deposit in my account. I didn’t budget my money, but I know I gave myself $1,000 per month to pay for rent, food, fun, clothes and school supplies. I was actually pretty good with keeping myself to the minimum. If I ever needed more, my parents were always there to lend a hand, as long as I explained why I needed money and justified how it would be used. I lived like a student should (poor and frugal). I did make many mistakes, but that’s another post.

In fourth year university, I got a very hefty student loan disbursement. I scuttled away enough money to pay for my eight months in school and banked the rest. A few months before I graduated, I decided to take a trip to New Zealand! In my eyes, I had earned it (insert ‘me generation’ snark here). So many of my friends were going on trips, my sibling did the same thing and my parents and extended family put a huge emphasis on traveling. I had cash gifts, money ‘saved’ from my student loans and some cash that I made in the two months before I left.

My trip to New Zealand was amazing. I learned a lot, partied a bit and saw places I thought I’d never see. I remember having only two weeks left of traveling remaining and calculating out how much I had per day. I stayed in 16-bed dorm hostels and opted for the cheaper way of life. I only spent on events I really wanted to do like sky diving and zorbing and passed on things like chocolate tours. I did a lot of hiking and running to actually see the country instead of paying for city tours. I came back to Canada and realized I needed to further my education, so off I went to another big city and applied for more student loans.

Fast forward to one year later; I graduated from my budget-friendly college course and landed my first job in the corporate world, post-studies. I was finally making a steady paycheque and did some lifestyle inflation (hello nicer apartment, a real bed and nice throw pillows).

One day, I stumbled upon some personal finance blogs and because I’m a nosy nelly, I started reading people’s history with their debt. Something clicked and I started repaying my student loan before the grace period (my mom was so proud). Then I slowly started increasing my debt repayment monthly solely based on the inspiration of my now-daily rounds of personal finance blogs.

I now owe a massive CDN$13,623.26 on my student loan. It started at $$23,712.54 in April 2012. I still have a long way to go, probably another two years (maybe a bit less if I’m smart!). I also owe my parents a small amount on a no-interest fee loan that was a provincial student loan that they paid off so I wouldn’t be paying interest (thanks parents!) We have a mutual agreement (and it’s on paper) that after my student loan is paid; I will funnel those funds for a handful of months and pay off my parents rather quickly.

So there’s my story. Plain and simple. I’m not able to pay off my loans super fast like the ever-disciplined (and inspiring) Jordann, but I make every effort to balance debt repayment, savings and emergency funds.

What’s your debt story?