Canadian Personal Finance Blog

I guess the good news is that Gas is back to being more expensive than bottled water (but still much less expensive than Coffee at Starbucks). I had to double take when I saw that my fill up price per liter yesterday was $1.11 per liter, so the $20 I put in my car wasn’t very much (luckily it was in a small car, so it still seems not too bad).

More interestingly I see that the car I am currently driving (Toyota Corolla) has dropped in price in Canada to reflect the new stronger dollar, took them long enough to do that. I bought my car used, but it’s good to see I could get a new one much cheaper these days too. What if I had bought a new one in November, does Toyota have a rebate plan for the poor shmucks that bought last fall?

RRSP Clarification

Yesterday’s post about the RRSP Silly Season I wasn’t clear enough to point out that I do in fact put money away for retirement in a few different ways, I just do it directly from my pay cheque to ensure I do not mistake it for spending money and not put any money away for my retirement. This is really the best way for me to do this kind of saving, if I do not see it, then it is likely I won’t rely on having it to pay off bills and such.

Leading Indicators Up

Another confusing piece of data claiming to show that the Canadian Economy is just fine was published yesterday, with Stats Canada. The Leading Indicators composite index was up 0.2% in January after December’s no growth, so I guess this is a good thing. Another confusing set of data from Stats Canada you can mull over this morning too.

Buying Used Cars

Buying a car seems to really bring out the worst in people (me included). My Honda is about to “fall off the roof”, and I am looking at “new” (to me) cars, and have found one that my mechanic is selling. It looks like a good deal, it’s about the right price, and I trust my mechanic too (so there is no mis-trust involved), but my wife and I continue to have worries about whether we are making the right decision.

I think this is a natural line of thinking, because we are about to spend a not insignificant pile of cash on a consumable asset (with no real value). Some of the questions that we have asked ourselves:

• Do we need a second car? I think we do.
• Is this a good deal? I think it is as good a deal as can be expected, should I try to get a lower price? Maybe.
• Are we simply buying the first car we see? Maybe, but do I want to spend hours going to dealerships, and such?
• Is this the best deal? We really won’t know until we can look back on it, which is true of any investment.

It’s an interesting financial balance beam you walk in these situations.

Why is Gas Cheaper in Cornwall?

I got gas for 10 cents cheaper in Cornwall, and I have no idea why?

The Ottawa Citizen had an article last week about Wayne Gerdes alleged king of Automobile Mileage, that just had me scratching my head. I am all for saving a buck and trying to use as little gasoline as possible (just for the money savings alone, let alone the environmental impact), but this guy is beyond what I view as reasonable on some of his ideas.

Some of his more interesting ideas are:

• Wearing an “ice vest” to keep cool on long trips to save money on not running the Air Conditioning in your car. I will plead guilty that I have turned off the A/C a few times on longer trips (by myself, my family freaks out if I do this when they are in the car), but I open the windows and enjoy the fresh air.
• Coasting with the engine off in many different scenarios? That’s a little crazy in my book given the power steering and power brakes on my car don’t work as well when the POWER is off!
• He does not advocate “drafting” behind 18 wheelers because it might be dangerous, but admits he does it sometimes as well.

I want to save a buck as much as the next guy, but if it compromises my safety or my families, I’ll pay the extra money to ensure that as well.

The original article was from the Chicago Tribune, which did has a much shorter and sensible list of things you can do to try to get better gas mileage (without coasting out of your driveway and only starting your car when you get to the first stop sign you run into).

We don’t advocate that you drive like Wayne Gerdes — and neither does he. Shifting a vehicle into neutral to let it coast with the engine off is prohibited in many states, and it leaves the driver without power-assisted steering and brakes.
But hypermilers routinely follow driving practices that are safe and legal for all of us:
1. Obey speed limits, especially on highways.
2. Minimize braking and idling.
3. Check your oil level; overfilling is bad for fuel efficiency.
4. Accelerate and brake softly and smoothly.
5. Time stoplights, slowing down by letting up on the accelerator if the light is red, so you don’t have to stop.
6. Don’t accelerate toward stoplights and signs.
7. Minimize use of air conditioning.
8. Plan trips for fewer stops and to eliminate unnecessary driving.
— Chicago Tribune

That list is a bit more sensible in my books.

Bank of Canada Keeps Interest Rates the Same

The Overnight rate from the Bank of Canada remains at 4.5% which is a good thing for us who still carry debt. In their statement of yesterday they said:

Near-term prospects for economic growth outside North America appear to be slightly stronger than anticipated in the July Monetary Policy Report Update (MPRU), while near-term economic prospects for the United States are weaker than expected. It now seems likely that the adjustment in the U.S. residential housing sector will be more pronounced and protracted, exacerbated by recent developments in financial markets. On balance, this implies weaker demand for Canadian exports than had been expected at the time of the July MPRU.

Whoo Hoo, another month without higher interest rates, is a good thing. A better thing is not having to worry about this kind of stuff, say by paying off your debts.

Gas prices are up from last year, yet our consumption of Gas is also up, guess my statement that Gas demand is completely inelastic (i.e. price increases do not affect demand at all).

On this day where we are supposed to be thinking about the environment it suggests Canadian demand for fossil fuels is not dropping.