CalendarBudget Blog

Personal finance matters as they pertain to saving money, living within your means and using CalendarBudget to solve your personal finance problems and to manage your money online.

The root of all evil

The root of all evil

I've been thinking a lot lately about what truly makes me happy. Of course there are the obvious things like family, friends, being engaged in work that I enjoy and knowing that the decisions I am making are in line with the course I want for my life. But something unexpected crept up - Money!  This lead me to wonder if I'm somehow evil, since, of course, money is the root of all evil.

You've heard the old saying "Money is the root of all evil". Well, it actually goes like this: "The love of money is the root of all evil." Money itself is not intrinsically bad. Money can be used for good or bad. Its when we lust after money that problems begin. Why do I bring this up? Well, I don't think I love money, but, I do love the security that earning money brings. When I earn money, I feel like I'm doing my "manly" duty to support my family. So does this count as a bad desire? Somehow I don't think so. As long as it doesn't compromising my morals or drive me into spending inordinate amounts of time earning money, sacrificing essential or other important things.

Are you in love with the root of all evil?

[evil voice] Muuwaaa ha ha haaaa!

Let CalendarBudget tame the number of the beast!

P.S. I found this clever math equation that proves (using the principle that money is the root of all evil) that women are problematic... funny stuff!

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Materialism and Money

Materialism and Money

The following joke satirizes the problem of focusing on possessions/material things while disregarding the more important things in life. Hopefully your perspective is better than this!

The Lexus

A very successful lawyer parked his brand-new Lexus in front of his office, ready to show it off to his colleagues. As he got out, a truck passed too close and completely tore off the door on the driver's side. The lawyer immediately grabbed his cell phone, dialed 911, and within minutes a policeman pulled up. Before the officer had a chance to ask any questions, the lawyer started screaming hysterically. His Lexus, which he had just picked up the day before, was now completely ruined and would never be the same, no matter what the body shop did to it.When the lawyer finally wound down from his ranting and raving, the officer shook his head in disgust and disbelief. "I can't believe how materialistic you lawyers are," he said. "You are so focused on your possessions that you don't notice anything else."

"How can you say such a thing?" asked the lawyer.

The cop replied, "Don't you know that your left arm is missing from the elbow down? It must have been torn off when the truck hit you."

"Oh no!" screamed the lawyer. "Where's my Rolex?"

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Saving on Groceries - Part 1

Saving on Groceries - Part 1

Food is a must buy for everyone. We often fall into bad habits at the grocery store which end up costing us lots of extra money in the long run. Here are some ideas to consistently save you money at the grocery checkout.

Some of these ideas are taken from a great article (Fifty ways to save on groceries) from the Toronto Star on Aug 23, 2007.

  • Never shop when you are hungry. This is the #1 rule for controlling impulse purchases. (everything looks delicious when you are hungry!)
  • Shop alone if you can. If you have to take children, let them prepare their own list of products they can actually pick up and put in the basket. Let them select a special fruit or vegetable they really like
  • If possible, grocery shop at a quiet time so you can compare prices. Tuesdays and Wednesdays are best.
  • Ask for rain checks if a sale product is out of stock
  • Stock up on basics when they are on sale
  • With meat, figure cost per serving instead of cost per pound. A pound of ground beef or boneless meat will make more servings than a pound with a lot of bones or fat.
  • Look beyond eye level on the shelves. Manufacturers pay for this prime space. Look high and low for comparable items.
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StatsCan report on Personal Debt

StatsCan report on Personal Debt

I found this very interesting article from StatsCan (from Jan 2007) on the differences in trends between US and Canada regarding Personal Debt. Its a great read. Take a few minutes and give this 7-page document a read. Where do you fit in with the trends?

Personal Debt - Stats Canada

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Working with what you've got

Working with what you've got

There are certain purchases you deem are NECESSARY things to buy. For us, one of those things was a vehicle. We had to purchase a new vehicle before we got married because my previous vehicle had, how shall I say it..., "given up the ghost". After we were married and had our first child we realized one thing we should have taken into consideration - the difficulty of getting a baby in and out of the backseat of a 2 door vehicle. But we decided to put up with it, that it wasn't enough of a reason to purchase a new vehicle.Then as time went on the next pregnancy brought twins and we didn't see any way to be able to get 3 car seats in our little car. Although I never wanted to be a van guy, we switched to a nice family minivan, also taking into consideration that we wanted to have more children.

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Standing out from the crowd

Standing out from the crowd

It is so easy to get caught up in the flow of what everyone else is doing. It's easier in the moment to follow the crowd rather than doing what's best for you (assuming they may be 2 different things :) ).

My mother-in-law's family has dinner together every Christmas, which ends up being a very large gathering, about 25 to 40 people. 5 years ago they decided to have a Secret Santa gift exchange to make it a little more fun for everyone. We were okay with the extra purchases, even as our family grew in numbers, which would increase our gift purchases (each family member is assigned someone else to give a gift to) - we're up to 7 now...)We could find a way to keep cost low since most of the children we had to buy for are under age 7 (dollar stores fills that ticket easily with some nice, budget items).

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Tooth Fairy Income

Tooth Fairy Income

So recently, my daughter's tooth came out, right in the middle of class (Grade 1) on the second day of school. Everyone wanted to see it. They were probably just curious about it, since most of them haven't lost a single tooth yet. They were also probably too young to look at the tooth and see a golden nugget. After all, we all know that teeth are like gold because the tooth fairy will exchange lost teeth for coins while you sleep. She got her magical $1, then not a week later... #2 came out and another $1 came.

We've been trying to teach our kids, at a very young age, about proper money management. We give our oldest daughter (age 5) an allowance; $1/week. We sat down with 10 dimes and explained what happens with her $1/week.

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The Credit Card Trap

The Credit Card Trap

 

Its a new school year. Among other things, college students around the world will be bombarded with credit card applications, offering instant credit. It feels like free money. Low introductory rates make us feel like we earned some bonus money by being accepted to our prestigious institution. Its not until months/years down the road that the real pressure comes to bear. Once those introductory rates disappear the debt will still be there and will start to crush you.

Credit Cards are useful financial tools if you pay off the balance at the end of every month. Otherwise, its a trap that will hold you hostage for years. Below is some helpful advice in selecting a card (and help you avoid the credit trap):

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Avoiding the technology trap

Avoiding the technology trap

Futureshop and Circuit City are the adult candy stores of today.

For many people (mostly male) who walk into these stores, our eyes widen with excitement... I find myself asking "Which items most badly want to come home with me?" So many new toys, gadgets and .. oh ya, they cost money... lots of money. But surely my pleasure and bragging rights will compensate for the high price, right? Maybe for a few days, but then you have to face the bill, or the other need that you now cannot afford.

I find when I go into those stores, I go with a purpose and item in mind, and go directly to that item and then make my purchase and leave. Otherwise, the temptation can be too great :). 

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What goes around, comes around

What goes around, comes around

Having a goal to become debt-free doesn't mean you stay home and don't do anything. It just means you keep your eyes open for ways to save while enjoying the good things of this earth. I keep an eye open for any sales, hand-me-downs, or other ways to get things at a discounted rate or free. Without expecting anything in return, I offer what I can to others in service or tangible items when I have something to offer. This has the nice effect of increasing my circle of friends and as is so often said, the goodness I send out comes back at me.

On the September long weekend we had the opportunity to help my cousins pack their moving truck for a long move. They were moving such a great distance they wouldn't be able to return to pickup any items that were left behind... everything that was in the house had to go. Whatever didn't make it to the moving truck was going to the dump. Of course, as moves usually go, they were strapped for time and were still packing things as we helped them load the truck. Some of the items being left behind were things their children had outgrown or other large items that just wouldn't be enough space for on the truck or in their new house. Being there to help them move was a teaching opportunity to show our children how fun it can be to give service to other people and not expect anything in return, but be pleasantly surprised when it does happen.

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Cashing in on Reward Points

Cashing in on Reward Points

Every time I buy diapers for my baby or any everyday purchase, I accumulate points that will eventually get me a free movie ticket. (thanks to Scene.ca) On top of that, one of the department stores I purchase the baby items from also has it's own point system which again I use to buy things out of their points catalog. My mother-in-law was recently surprised to see that she had accumulated a large number of points that she then redeemed for a $130 gift card. She used it to purchase clothing for her new job and a birthday gift for our daughter. I have redeemed my gas station points periodically for a car wash. You do have to be careful to keep the use of your points cards current. A few years ago I hadn't used one of my department store points card for a while, the department store put it in dormant state and I lost the points that were on there.

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Saving the World (and my money) with Freebies

Saving the World (and my money) with Freebies

Often, our first thoughts on the topic of being more environmentally friendly are "How much more is it going to cost?" since energy saving items typically cost more. One way to help save the environment, and save your wallet at the same time, is taking advantage of hand-me-downs.

Since we have a large family (5 children and 2 adults), our family has benefited tremendously from hand-me-downs. My wife recently attended a back to school clothes exchange. Somebody was kind enough to bring in some ladies clothes as well so she was able to build up some of her wardrobe too. 

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Do you eat out too much?

Do you eat out too much?

I used to be a McDonalds junkie. According to the video "Super Size Me", McDonalds would have considered me a heavy-consumer, frequenting a McDonalds restaurant more than 3 times a month. Fortunately for my budget (and health!) I've reduced my eating out habit to almost nil. One of the most common budget-breakers is eating out too often. This occurs for a number of reasons.

  • We make ourselves so busy, we can't (or won't) find the time to prepare a quality meal.
  • We don't grocery shop and meal plan very well so we end up with lots of the same thing night after night. Eventually we get same-meal fatigue and want to eat-out for variety.
  • We are either too tired or lazy to prepare a meal. Even if we have the time, we'd rather watch TV, or do a myriad of other things.

The above graph shows dollars spent on eating out (in Canada) over a number of years. Clearly the trend has been increasing. Judge for yourself where you stand.

Because I've been using CalendarBudget to track my finances since 2002, I can calculate exactly how much I would have saved by not eating at McDonalds ... a whoping $965.82! If I had invested this money, it would be worth almost $2000 today.

How much money would you save if you didn't eat out so often?

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Emergency Funds

Emergency Funds

Last year, an unexpected complication happened in my wife's pregnancy which ended up with her hospitalized for 2.5 months and I had to take an unpaid leave from work to care for my other children. That left us with no income, living off our savings for that time.

Luckily it all turned out well in the end, but while it was happening, we were fortunate to not have to worry much about the finances, because we'd heeded counsel to have a "rainy day" or emergency fund. We kept about $4000 in this account, which we had saved over a period of a few years, along with our regular retirement savings.

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Can I afford to work for myself?

Can I afford to work for myself?

Good question. Having just grappled with this, let me share some pointers.

Being an entrepreneur, especially starting out, is challenging. Much has been written about startups. This blog entry is about how to afford it.

Chances are you are a bright, self-moivated individual, working for some large corporation or a mid-sized company, earning a reliable paycheck, but frustrated. You are frustrated because you don't have enough time to focus on your own business ideas and you just can't build momentum with your full-time job taking so much time. Furthermore, you are noticing that management in your full-time job are not as competent as you once thought and this too is frustrating you, making you start to dislike your job.

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Accelerating Mortgage Payments - good or bad?

Accelerating Mortgage Payments - good or bad?

Answer: It depends.

If you have extra money, reducing your debt is a great idea for several reasons.

  1. You never know if interest rates will go up and thus your mortgage payments may become unmanageable.
  2. Having no debt is one of the nicest, freest feelings available. You will be much happier.

There are several ways to do this.

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CalendarBudget demo video

A short, 4 minute video describing CalendarBudget's features has been posted and is available from the main CalendarBudget homepage.

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Doubling My Money with the Rule of 72

Doubling My Money with the Rule of 72

I was excited to hear recently, that with my modest savings of $65,000, that I'll have 1 million dollars in 36 years (without saving anything else). Thank you compound interest and the rule of 72!

For those needing a refresher on the rule of 72 (or if you've never heard of it), it goes like this. Take the interest rate you are getting on your savings (investment) and divide it into 72. The result is the number of years it takes for your money to double in size.

In my case I estimate 8% (I estimate low for my interest rate - probably it will be between 8%-12%). So this gives me 72/8=9. So, my money doulbes every 9 years, untouched.

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Mortgages and Interest Rates

Mortgages and Interest Rates

Interest rates recently went up again, and are expected to go up again next quarter. Studies show that people are living so tight with their money, that if interest went up 1 full percent, 25% of people would lose their home.

That is a scary thought.

Canadian interest rates recently went up again, and are expected to go up again next quarter. Studies show that people are living so tight with their money, that if interest rates went up 1 full percent, 25% of people would lose their home. That is a scary thought and makes me wonder how close I am to that outcome; how close is my extended family. Will they expect help from me if their personal finances go downhill and if so, what strain will that put on me and my family?

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Regifting

Regifting

We all do it, so lets stop thinking about this as being cheap. Its simply a fact of life. At some point you are bound to get a duplicate gift or a gift you don't need (or want).

Rather than return the gift, simply keep it in a special location, called the "regifting pile". Next time you need to give a gift, always consult the regifting pile first to see if there's something convenient there to give as a gift. (Just be sure not to give it back to the original giver or close family!).

My regifting pile has probably saved me $100's, and many trips to the shopping center. Also, I reuse all those gift bags I get since they are easily resuable. No wrapping paper needed. No fuss. Hurray Regifting!

I've regifted things like crock-pots, trinckets, clocks, tool sets. Whats' your favirite regifting story? Or are you an anti-regifter?

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