New Year’s Financial Resolutions

Every year, I make resolutions about the areas of my life that I would like to improve. The changes often never even get started and rarely make it to December 31.  I’d like to help you be successful if your goals are financial.

In a recent Sun Life Financial survey, 66% of Canadians said their debt level was the same or worse than a year ago.

Step 1 – Make a Goal.

It doesn’t matter if it’s saving 10% of your gross (or net) income, saving $1000 so that next Christmas the expenses do not need to go on your credit card (due to lack of cash flow), paying off your credit card every month, putting aside 3 months income for a rainy day, or saving money for a special vacation.  All that matters is that it’s your goal and that it means something to you.

Step 2 – Determine your Cash Flow

You cannot save even $50 each month, unless you know where that money is going to come from.  So this step involves reviewing your income and expenses.  Most experts suggest that 3 months is a good snapshot.  Note: If you pay for items such as insurance on an annual basis, you need to average those costs and add them to your 90 day expenses. 

Usually, a good start for this review is by looking through your bank and credit card statements.  Remember – all you bank statement says for cash is that you withdrew it, it doesn’t tell you whether you spent that money on giving your children money for school pizza lunches or on $5 Starbuck coffees.

If you would like a spreadsheet to use for this exercise, let me know and I can supply you with one.  Alternatively check out the one available on the Hello Life website. 

Step 3 – Review your Income and Expenses

So now that you know where your money comes from and where you spend it – you need to determine what you can adjust.  Is it exchanging Starbuck coffees for ones you brew at home or buy at Tim Hortons? Is it decreasing your clothing or eating in restaurants budget?  Does it require an entire review of all of your spending habits?

If you need help with this step, contact me. I can either help you or send you to a professional who can.

Step 4 – Implementation / Action

Money that doesn’t “exist” is easy to save.  If your goal is to pay down credit card debt, you can set up an automatic payment from your bank account to the credit card to occur as soon as your paycheck lands in your bank account.  If your goal is savings, I can help you by setting up an account for the savings and arrange the same automatic transfer.

As we all know, nothing actually happens unless you have an action plan.  Let’s work together to implement your financial goals.

web sites of general interest

I am so tired of winter (and I assume that you are too), so I   thought I would do something different in this month's e-newsletter.

While browsing the web, I came across a few interesting sites.

The first one is 33 Amazing Ideas that will Make your House Awesome.  While none are particularly practical, I really like #5 - Beach sand under your work desk; #6 - spiral staircase slide; #14 - a wall that plays music when it rains; and if you live in a condo or apartment building, #33 - balcony pool.  Perhaps you prefer the pirate ship bedroom or the hammock over the stairs.  There's something in these pictures for everyone (even your cat). 

If Chris Hatfield turned you onto space, you can check out the photographs taken from space by Guy Laliberté, the founder of Cirque du Soleil. I saw some of these photos at the Thompson Landry Gallery in the Distillery District. They are works of art and some you need to stare at for a while before you can translate them to the map that you're used to seeing.  

Finally, for those of you who have a Bucket List and are curious what other people have put on their list, here are some popular ones. They range from drawing faces on all the eggs in your fridge; to go bungee jumping; to eat kangaroo meat (I think kangaroos are too cute); to put a piece of gum on the Market Theatre Gum Wall in Seattle (that I didn't know existed); to throw a dart at a map and travel to where it lands.

If nothing else, these web sites will make you forget that it's January in Toronto for a few minutes and put a smile on your face.