Yes the most special day for amorous lovers of Personal Finance is coming on Sunday. Now all good Financial Bloggers know that Saint Valentines is actually the patron saint of all finances, or something like that, and keeping that in mind in this post I will make some suggestions for that special someone that you want to show Financial Servitude too.
This list while not exhaustive is in fact the first such list compiled (this year, on this blog) and should be held with great reverence:
Yes, I am having you on (this is what happens when I go on training and the course gets a little dull, and I also listen to Stephen Colbert while stuck in traffic).
What I am saying is that bankrupting yourself buying a dozen roses and fighting your way into a reservation at a swanky restaurant, while somewhat romantic, can have it’s down side as well.
Quicken is a useful tool for me, to track my family’s spending habits, but last week was an interesting week for me.
I started working full time in 1986, so some might say more than a generation ago (depending on how you count), and when I was first hired, I was paid a reasonable wage (not an exorbitant one, but reasonable). My wife and I lived on this income in a reasonable apartment, and we lived a frugal but reasonable life.
Flashback to last week, where in two purchases I eclipsed my yearly gross income for 1988 (2 years after I had started working full time). What did I buy? A house? A yacht? Nope, our orgy of spending was on:
That’s it, yes a fairly big expenditure, but remember this is more than I made gross (before the CRA got a hold of a lot of my income). The knee brace is actually about the price of 3 months rent from back then, but it is a necessary purchase (and I will be reimbursed (I hope) in some way from my health plan).
Other interesting factoids from these purchases:
Lots of interesting factoids (where factoid means things interesting to me, and most likely me alone).
After yesterday’s epiphany of the Financial GPS, I think I have streamlined the concept and gone to exactly what might be needed with today’s chronic over spender, the Financial Shock Collar.
This device, will look like a fashionable necklace for the ladies or simply a gold chain around the neck for men, and when it is activated 10,000 volts are instantly activated from a small power source (at milli-amperage levels) causing sudden and excruciating pain for its’ wearers, until they stop the spending which activated the collar (yes I borrowed this idea from a Star Trek episode, but aren’t all the best ideas from Star Trek?).
Is this a severe and dangerous tool to use? You are darn right that this is a ludicrously severe tool, but given some folks ability to completely lose their minds when it comes to:
This may be a useful “last hope” type of device.
Don’t like my shock collar idea? A much less severe idea (depending on how you look at it) would be the self-destructing debit/credit card. Given most new cards come with a great deal of “smart card” technologies this one may be simpler to implement (and much more fun to watch).
The concept is quite simple, if the consumer attempts to use the card by either swiping it or “tapping” it, the card receives a simple message destruct and the card emits a high pitched alarm sound and 5 seconds later the card explodes, with a small charge embedded in it, when it was manufactured.
This makes the whole scenario of the credit card company rejecting a purchase and asking the vendor to seize the card a much simpler scenario, and it makes stolen cards that much more lethal for the thieves as well. If a card is stolen, it will automatically self-destruct when it gets near ANY credit card terminal.
Sure, there will be occasional glitches where cards may self-destruct without warning, but those small glitches and maiming of their owners are assumable risks for those who wish to have the privilege of carrying a credit card.
An added side-effect might be less people wanting to carry around credit cards with them, for fear of the occasional random self-destruction as well. Think of someone carrying around 6-8 credit cards, what might happen if one goes off accidentally? The chain-effect might well be complete destruction of the owner.
More interesting new “outside of the box” (unless the box is a coffin) ideas for financial safety may come, as I think of them.
This is getting a little repetitive but Bank of Canada’s key overnight rate remains at 1/4% unchanged again this month. The overall Bank Rate remains at 1/2% as well, which means cheap money continues in the market place.
The statement from the bank is mostly that the recovery continues and we should be out of this whole mess some time near the end of 2010 or the beginning of 2011, but the important line to read is:
Conditional on the outlook for inflation, the target overnight rate can be expected to remain at its current level until the end of the second quarter of 2010 in order to achieve the inflation target.
The end of the second quarter is June, which means interest rates will be going up this year, and you are running out of time to take advantage of these cheap rates to pay down your debt (assuming you are not paying Credit Card debt, in which case, this has no effect on you). If you have a variable rate mortgage can you lock in, or has the bank already altered it’s rates so that locking in might not be as attractive now?
Remember if the bank raises interest rates to say 2.5% somewhere along the line, that is a huge percentage increase compared to where they are right now.
To confirm the Bank of Canada’s inflation statement, Stats Canada will be posting the CPI numbers for the end of 2009, which should be a very interesting statement. With gas prices inching their way back to $1 per liter, I suspect inflation is back it’s just how bad is the question.
In the past few days there have been a few headlines that most folks who knew about the subject would say, “Well that was obvious wasn’t it?”:
In contrast I was surprised to see that my Secured Line of Credit and my Unsecured Line of Credit have the exact same interest rate (currently). For those unaware typically a secured line of credit has a lower interest rate because it is secured against something of higher value (e.g. a house), and an unsecured line of credit is simply the bank figuring you are a reliable enough person to loan money (and presumably pay it back in a timely fashion).
My guess is this is a fiduciary anomaly, and will soon be remedied by my bank, but given I don’t use the unsecured loan vehicle, maybe it won’t be? I’ll keep watching to see if and when my bank notices this interesting situation.
What will I be surprised by next? Free Banking?