# Fun with Numbers

A good friend, who is known as “Mr. Rules”, but is also “Mr. Arithmetic” once pointed out the dangers of making off-hand remarks about your pay cheque to folks.

About 4 or 5 years ago, we were having a beverage, and I mentioned that this was my last pay cheque where I had to pay CPP and EI in full. He turned and said, “Do you realize you just told me how much you make in a year?”. I was surprised and then thought about it, and yes, I had.

How? Well first you need to know what the CPP and EI rates are on your gross salary, which you can find for 2007, on the link. From that we can surmise:

• The CPP rate is 4.6% up to a maximum of \$2010 or so
• The EI rate is 1.80% up to a maximum of \$584

### The Real Fun With Numbers

So if this is September, and you know that I get paid every two weeks, so this should be around my 19th pay cheque (or we are 9/12 of the way through the year, either calculation can be used):

• If we assume I have finished paying EI, so I have reached the \$584.00 maximum, let’s see if we can estimate my Salary (gross):
• EI Max = Number of Pay Cheques * Bi-Weekly Salary * 1.8 %
• -> \$584 = 19 * Bi-Weekly Salary * 1.8%
• -> Bi- Weekly Salary = (\$584) / (19 * 1.8%)
• Thus Bi-Weekly Salary = \$1700 or Yearly Gross Salary of \$44,000 or so

Fun with numbers, but also keep in mind what you are telling folks when you mention little tidbits like that too! Sometimes a little bit of discretion is a good thing.

### Past CPP & EI

Yes, it is a topic I write about, as it is important to me. Here are a few from the past years, to compare and contrast (hint see how much CPP has gone up).

## Feel Free to Comment

1. … and if I’d look closer the actual max for EI is \$720 not \$580… sorry folks, another miscalculation, hopefully no particle accelerators were running on the basis of that!

–C8j

2. You can get a fairly close estimate of any of us who are in the employ of government, large comnpanies, etc, by looking up the pay scales on the published union agreements. For example if you Wish to learn the salary of a nurse in British Columbia, it is fairly easy to find. So, while the numbers that you discover may not be linked to a particular individual, you’ve a pretty good idea. Similar wage scales can be determined for many trades and professions as well. For most of us, our wage scale is far more public than we realize.

To a certain extent, ‘so what?’ we have all seen examples of folks livibg far beyond their means, and know of others who through a decision to live a frugal lifestyle, are living far below their income, so visual cues are inaccurate.

In addition, your mathematician friend know only your salary from the paycheque you discussed. He has no information on other sources of income you may derive.

Frankly, I really don’t care if someone learns my income, however, I choose not to broadcast it!

David

3. From what I can tell that is a real hot button for a lot of people and a complete no-op for others. I never knew how much my parents made, and was told to not ask, it was rude. My wife knew exactly what her parents made.

Does it matter? Well, don’t tell strangers how much you make, seems to be a good rule of thumb to go with. If you are the kind of person who cares about such things, then this is another area where someone could “snoop” your yearly salary (but only if that matters to you).

–C8j

4. OFF TOPIC:
Hey Cajun,
Would you like to get involved with the Canadian Tour of Personal Finance Blogs?.
This is the same as the Carnival of Finance except it’s purely Canadian bloggers and Canadian Content.

I thought it would be cool to show case Canadian personal finance bloggers!