Tag Archives: Preet Banerjee

Apr 6: Best from the blogosphere

By Sheryl Smolkin

As I write this on March 31st, it is for the second time because I closed the completed document the first time without saving it. I can only attribute this oversight to an early April Fools’ Day joke from cyber space!

Here are some interesting blogs I read this week:

For those of you who prefer cash back credit cards over travel cards, Tom Drake on the Canadian Finance blog rates the Best Cash Back Credit Cards of 2015. Top of the list is the Scotiabank Momentum VISA Infinite Card which offers a full 4% cash back on gas station and grocery store purchases. You also receive 2% cash back on your recurring payments and on drug store purchases. All other purchases earn a 1% cash rebate. 

The Big Cajun Man aka Alan Whitton writes on the Canadian Personal Finance blog about his daughter’s experience trying to find a student line of credit to attend Chiropractic College. The only financial institution willing to fork over enough money was the National Bank of Canada. However, by mistake they set up the loan as a personal line of credit. As a result, the very next month there was a demand for payment. Although the error was fixed, Whitton had to co-sign on the loan.

Five unconventional ways to get your financial act together from Kerry K. Taylor aka Squawkfox resonates with me. She suggests we can save money by throwing out fewer grocery products and curbing our collecting. We just renovated our kitchen cabinets and I couldn’t believe the number of stale-dated packages we pitched and how many marginally useful kitchen gadgets we have collected. Did we ever really need  six sets of barbecue skewers?

Why “Healthspan” trumps “Lifespan” by Dan Richards is a guest blog on the Financial Independence Hub. Financial advisors spend a great deal of their time with clients who ask, “Will I run out of money?” But Richards says according to new research, an equally pressing question is “How can I enjoy life in my 60s before health issues creep in.?

RRIFs 101: Using your nest egg by Preet Banerjee on Tangerine’s Forward Thinking blog fills in the blanks for readers who understand how RRSPs work but were not aware that they must be converted into RRIFs at age 71 and that beginning the year after, minimum fully taxable amounts must be withdrawn.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

 

Apr 7: Best from the blogosphere

By Sheryl Smolkin

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Do you have a spring or summer wedding coming up? Squawkfox aka Kerry K. Taylor discovered H+M now has a Grecian style wedding gown on sale for USD$99. This happily married lady says if she were looking today she would say yes to this dress! The 38 comments (the last time I checked) are even more interesting with lots of great ideas on how to save money on a beautiful dress you may only wear once.

Whether or not to tip the people who provide you with services and how much is a perennial dilemma. On When Life Gives You Lemons Add Vodka, Sarah Greesonbach discusses how much it costs to get a massage and why your tips may be an important part of your massage therapist’s compenstation. Money saving idea: If you need a massage for therapeutic reasons, make sure you see a registered massage therapist in case you can claim all or part of the cost on your employee benefit plan.

In a recent Globe & Mail column Preet Banerjee had some great information on discounts for seniors and you don’t always have to be over 65! For example, by signing up for a membership with the Canadian Association of Retired Persons (CARP), you can get an annual gym membership to GoodLife for $400 per year (plus tax) as long as you are 45 years or older. The cheapest CARP membership is $14.95 per year.

Tim Stobbs writes an interesting blog on Canadian Dream: Free at 45 about adjusting to having a higher self-worth as your savings grow. He says the first most obvious change is that you gain the ability to self-insure for more minor events. For example, you don’t have buy the extended warranty on your appliances because if something stops working you can just buy a new one.  Later on when you have even more saved, you can raise your home insurance deductible since you can comfortably handle greater risks.

There has been considerable press recently about the number of illegal, unpaid interns in both Canada and the U.S. However Cait, a Blonde on a Budget says that an unpaid internship, writing her own blog and writing posts for other blogs she is really passionate about have led to her current full-time job with RateHub.ca.

“My boss saw that I could manage numerous projects with multiple deadlines, I obviously want to learn new things, and she loved that she never found any spelling mistakes in my posts.” Of course, Cait had been trying to build up her writing portfolio, but until that job offer came along she wasn’t conscious of the fact that her blog was a portfolio in itself.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere. Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

Book Review: STOP OVER-THINKING YOUR MONEY

By Sheryl Smolkin

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In his new book “Stop Over-thinking Your Money,” Globe and Mail personal finance columnist and television personality Preet Banerjee says personal finance is a lot like physical fitness. In order to be in better shape, everyone knows they have to work out and eat well. A personal trainer delivers results, not by showing clients a new way to perform sit-ups, but rather by simply making sure the sit-ups get done.

Similarly, in this book Banerjee discusses in five simple rules how to think about money and focus on the 20% of what you really need to know in order to be in top financial shape.

Rule 1: Disaster- proof your life 
Investing is only one of many factors that affect your personal finances. If you are going to retire well at age 65 you have to put away money for a long time. But if you die, lose your job or become disabled before then, your long-term plans could go up in smoke. That’s why he says disability insurance, life insurance and an emergency fund should be the foundation of your financial plan. Wills and powers of attorney must also be taken care of early on. 

Rule 2: Spend less than you earn 
Spending less than you earn is the cornerstone of financial stability. It allows you to eliminate money stress and begin creating wealth. Here’s where you learn how to budget. Banerjee highly recommends Kerry K. Taylor’s electronic spreadsheets on Squawkfox.com. By starting with your old or current budget, the many undesirable things you spend money on like take-out coffee, fast food breakfasts and debt repayments will jump out at you. Then you can create a new budget and start tracking your spending more diligently. Surplus can be allocated to savings. 

Rule 3: Aggressively pay down high interest debt 
Thou shalt not carry credit card balances! When you have high interest debt, the amount of cash flow it ties up on a monthly basis is painful to calculate. Banerjee shows how you can transfer high-interest balances to low interest balances using a line of credit. Then he recommends developing a plan of attack for paying down your debt. While he acknowledges that changing spending patterns to alleviate debt is easier said than done, he says the only way to keep your finances on an even keel is to save more before you spend. 

Rule 4: Read the fine print 
From today forward, he instructs readers to read every word on any document they put their signature on. Gym memberships, cellphone contracts, loan documents. You name it. He gives the example of a friend whose wife could not collect on his mortgage insurance because the policy was underwritten at the time of death. The policy said it was invalid if he had any alcohol in his bloodstream while operating a motorized vehicle (a snowmobile in this case) when he died. In contrast, a life insurance policy underwritten at the time of purchase paid out within two weeks. 

Rule 5: Delay consumption
The fifth rule is simply an extension of the first. Stop worrying about keeping up with the Joneses. As you earn more money or get a bonus don’t get caught up in lifestyle inflation. And avoid the monthly payment trap. Think seriously about whether house renovation is actually an investment and if the personal gain from expensive hobbies is really worth the cost.

Throughout the book Banerjee keeps returning to the message that if you wait to make a perfect plan you may never start. And in the beginning, building up lots of money depends more on putting money away than making money grow because of smart investment decisions. You can control how much you save but you have almost no control over market performance, he says.

This book is an accessible, quick read but like any guide, it is up to you to buy into Banerjee’s five financial rules and implement them. He calls them the roadmap to an easy “A” in personal finance.

But when you are ready for a more sophisticated “A+” strategy he would be happy to provide additional guidance along the way. Who knows? That could be his next book, But until then, you can find him on twitter @preetbanerjee. He is looking forward to hearing from you!

You can buy a hard copy of Stop Over-thinking Your Money online at Chapters/Indigo for $13.68. An ebook from Kobo can also be purchased and downloaded.

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