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Budget 2015 What’s In It For Me ?

When I say, what is in it for me (the Federal Budget for 2015), I mean ME, the BCM, since you should really read it yourself and figure out what is good (and bad) for you.

What are the things that I (the Big Cajun Man) dislike about this budget? I am not fond of the “sleight of hand” accounting that is going on to claim the “balanced budget”, I am not that worried about it being balanced, and having odd pay outs on programs (and cutting programs without necessarily mentioning it), smacks of “Nortel-ian” accounting practices.

Budget Cuts

Budget Cuts

Image courtesy of nokhoog_buchachon at FreeDigitalPhotos.net

I’d also like to have all taxes abolished, if you were asking, but given that is not likely to happen in my lifetime, I guess I should get on to the things that I do like about this budget:

  • The TFSA limit is officially doubled to $10,000, I like that, even though I am middle class, and can’t use all this savings room just yet. I am concerned that the Liberals are already threatening to roll this back to $5000, never a good idea to take things away from folks in programs.
  • The “Family tax credit” for families like mine, where I can income share with my spouse is now officially in the budget (although I already have it for the last fiscal year). Wonder whether the Liberals or NDP will try to cut that as well, again, never good form taking money out of folks pockets. The UCCB is nice as well.
  • I am kind of baffled/curious about this statement:

    Making the Canada Student Loans Program work for families by reducing the expected parental contribution under the needs assessment process.

    What does this mean? I don’t know but it sure sounds nice.

  • Reducing EI premiums is nice, as it is a tax, no matter how you define it.
  • Another useful idea, that I think I like is:

    Extending Employment Insurance Compassionate Care Benefits from six weeks to six months to better support Canadians caring for gravely ill family members.

  • Seniors now have a less aggressive withdrawal schedule from their RRIFs as well, seeing as I will be thinking about that soon, I like it.
  • Another useful credit for folks with disabled family members, or seniors who need to add things to their house to make it a bit safer for them

    Introducing a new Home Accessibility Tax Credit for seniors and persons with disabilities to help with the costs of ensuring their homes remain safe, secure and accessible.

  • Another interesting and somewhat non-commital statement is:

    Launching a National Strategy to support improved financial literacy.

    but I suspect that means they won’t be giving me a subsidy for this site 🙂

  • Some good ideas for veterans, but still not enough, for someone who you asked to go into harm’s way.
  • Another point near and dear to my heart, but again, the wording is a bit odd:

    $2.0 million in 2015–16 to support stakeholder consultations on a Canadian Autism Partnership.

    I am not sure whom they will be consulting with.

There are a bunch of other measures, that you should read about, to see how it affects you. You could read the Tweets about it, if you want a really short version of the important stuff.

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What is Lifestyle Creep ?

A while ago, I asked Do You Make More than You Did 5 Years Ago . I got some interesting responses on the question. Let us delve a little deeper into what I call Lifestyle Creep ™ which seems to be one of the things that may cause the economy to fall over, all by itself.

What do I mean by lifestyle creep? In my interpretation, it is the same as “Feature Creep”, a term used in High Tech Development teams, where someone keeps trying to shove more and more into a release of software or hardware, thus slowing things down, and eventually making the whole thing unusable. This scenario is pretty much what happens with young folks these days:

lifestyle creep
You Deserve this don’t you?
  • Graduate with a debt load of student loans.
  • Still need to start saving for a house, and things, because that is what you need to do
  • You need a car to get around
  • That furniture you have is really crappy, after all you aren’t a student any more
  • The laptop stinks, it’s the same one from school, and it isn’t even supported any more
  • Must need a Big Screen TV
  • Good High Speed Internet access is important
  • Need to go out with friends, after all you aren’t a hermit, life is short let’s have fun
  • Man, this work thing is hard, must need a fun vacation
  • Getting married, you can’t scrimp on that, after all you only get married once (hopefully)
  • etc., etc.,
Save up to 50% on life insurance.

How Does this Add Up So Quickly ?

Isn’t it easy for all of it to build? Before you know it, you are now paying off student loans, credit cards, car payments, and rent and thus you have no money to save with any more, but you have great earning potential, you’ll get a raise next year, and it will all be good.

Speaking as a 59-year-old, Lifestyle Creep ensures you never make enough to live up (or down) to your lifestyle.

Image courtesy of  foto76 / FreeDigitalPhotos.net

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Cash is King as a Budgeting Tool

Written back in 2008 when GVO had one of her TV shows. Cash is King as a budgeting tool, is a message from many Financial Mavens.

My wife enjoyed watching Gail Vaz-Oxlade and her show where she helped folks who are in dire financial situations by helping them control their spending. The result, after Gail has studied the spending habits (and the family’s lifestyle), is she would give them their discretionary spending budget in Mason Jars, which held the cash for them, to show them just how much they had. The family was not allowed to spend more than what they were given, and that was Gail’s challenge (she rewarded them if and when they succeeded). From this we learned pretty much every week, Cash is King.

Cash is King

In a lot of businesses these days a favorite expression is “Cash is King” to point out that companies that have cash assets, are usually stronger companies, but for this argument, I believe that Cash is the King of budgeting tools.

If you are having spending issues, you must divorce yourself from your credit cards and especially your debit or direct withdrawal card as well. This is how I lived more than half of my life, since I didn’t have a credit card ’til I was into my twenties and the entire debit system didn’t come into play until my early 30’s, (heck Sunday shopping is a new thing to me, but let’s stay on topic).

Take care of your large bills on  your budget and pay them however you do (cheque, on line, or in the bank), but your discretionary spending like:

  • Groceries
  • Entertainment
  • Clothes
  • Mad Money (coffee, eat out, etc.,)

These (and others you can think of) you should use cash to control. The idea is  that once the cash is gone, you can’t spend any more.

Do I Practice What I Preach ?

This is how I lived as a student (and every other one of the folks I know of my age, tell the same story), if on Monday you looked in your wallet and you had $10 to last ’til Friday, you figured out how to live on it, and that was it. You couldn’t cheat, you couldn’t overdraft and you didn’t put it on a credit card for later payment, you lived with it.

I am attempting to live this frugal lifestyle now to slow down some of my “free spending” bad habits that I have picked up over the years, and it does seem to be helping out a little.

Remember, cash is the ultimate budgeting tool, whether you use mason jars, envelopes, your sock drawer or whatever, as your storage area.

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