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Just Because You CAN Should You?

That’s a very good point, given the Holiday Season is pretty much upon us, just because you have the ability to buy your children whatever their heart desires, should you?

The easy answer is of course NO, just because your daughter wants a pony, or your son wants an F-4 phantom jet, doesn’t mean you should buy it for them.  If your wife must have a new mink coat, perhaps just buy her two minks and tell her it can be her own little DIY project?

Turning Christmas/Chanukah/Kwanza/Holiday Season into a competition to see who can give the best and most expensive gift, is a recipe for a Holiday Hangover that is worse than the one I plan on having for January 1st (i.e. really bad).  Yes, everyone loves getting presents, but spending yourself into a huge debt load for a bunch of stuff that your kids may never remember is not the way to go. What does it teach your kids? Out of control spending is OK, and their parents are walking banks that can afford whatever their heart desires?

After watching football games on the weekend I came up with a better question, who the heck buys someone a CAR for Christmas? Seems like the thing to do, the only cars I got for Christmas were Hot Wheels. Anybody else buy someone a car for Christmas (or better still received one?). I did get a car from my wife one year, it was a Radio Controlled Formula 1 car (a Williams Nortel Car actually (how ironic)).

It is the season of giving, but not the season of GIVING UNTIL IT HURTS!

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Less Stuff Makes You Happy

Not really on topic about finances specifically, but an interesting talk from Ted about footprint, possessions and less stuff (and how much money you can save without that stuff).

I have this discussion with Michael James and other folks about how hoarding in general and the accumulation of stuff seems to be normal these days, when in fact maybe living in stark emptiness might be a better thing.

Writer and designer Graham Hill asks: Can having less stuff, in less room, lead to more happiness? He makes the case for taking up less space, and lays out three rules for editing your life.

I’d love to make room for MORE good stuff, that is for sure.

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Lead Us not into Temptation

I noticed that my youngest daughter had left her bank card on our front table, and asked my wife what was up with that? My wife gave me an explanation that made a cheap Father proud.

My daughter started earning money last fall, and is earning a bit more now with two-part time jobs, however, she has also realized that with all this new income, comes the temptation to spend it, so she decided the easiest way to not spend money is to make temptation not possible, by not taking her bank card with her, when she goes out.

Is this a good idea? Yes and no, yes, it is a great idea for her to stop discretionary spending (i.e. buy yourself lunch at school or at work, or buy something you see in a store that “catches your eye”), however, it is a little worrisome, since she then has no emergency money if something silly happens, but overall I am very impressed that she figured this one out (I know a great many adults who never figured that one out).

Taking temptation out of your spending life is a very commendable skill to master in your life, for those that can wander around with money and such and not spend the money, good on you, but for those of us who understand our shortcomings, findings ways around them are important in our life.

My only question is how do you reward that kind of cheapness or frugality? Any ideas? She does get an allowance as well, but how do you tell her she is doing a good job without sounding patronizing?

 

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New Loblaws Rule on Gift Card Purchases

An interesting change of Policy by Loblaws about the purchase of a Gift Card, evidently due to a high level of fraud with stolen credit cards, Loblaws now only allows you to buy these gifts with Cash or Direct Withdrawal.

The Police have warned retailers of the scam where someone steals a victims credit card (or complete identity), then uses it to purchase gift cards which then become effectively cash for the felon involved in the fraud. Sounds like a straight forward scam, except I have an odd question about this :

Every time I have purchased a “gift card” from a store, I have been told to wait 24 hours while the card is “activated” at the vendor in question (unless it is a gift card with the store in question). The card that I have purchased has an ID code on it, and if I use it the card itself is scanned or read in some fashion. If there is a fraud involved can’t this be stopped quickly? If the Credit Card is identified as fraudulent within 24 hours, then all of these transactions can then be voided too, can’t they?

This makes the assumption that the credit card fraud is identified quickly, which in most cases is not the case it seems. As long as the felon doing the defrauding is not too greedy or too obvious, the fraud typically is only discovered at the end of the month, unless the felon is doing spending that is flagged by the system as “out of the ordinary” for the card holder, no electronic alarms will go off, and it will be up to the consumer to identify the fraud (at which point presumably the gift card has already been activated and used).

Another interesting way to “launder” stolen money by the underworld, and the reaction by Loblaws is understandable, but what about stolen Bank Access cards?

CBC does point out the way this fraud can be cut down:

David Wilkes with the Retail Council of Canada said fraud can be effectively cut down once all retailers convert to credit card terminals that read security chips.

So the next time you are thinking about buying a Gift Card for a friend remember this new rule at Loblaws.

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You Can’t Afford That

Continuing on from yesterday’s discussions that spring from the statement We Can’t Afford That, let’s extend the discussion to how you react to someone telling you You Can’t Afford That. This doesn’t arise nearly as often as it used to for our parents, but there are still situations where this statement is used.

If you go to a bank and want to buy too much house, or you don’t make enough money to afford the house you want to buy, you can actually be told you can’t afford that, and how do most folks react to that? Most of the time I have heard stories recounting this kind of financial rebuff, the victims of the denial typically go off to prove to the denying institution that they are wrong. It is in our nature to prove a statement about ourselves that we don’t believe is wrong (even if the statement is correct).

The reason I ended up as a Mathematician was because a Grade 8 Math teacher who was irate at my boorish behavior once declared in front of my entire class, “… you’ll never be able to do math …”, but I proved him wrong, and it is that kind of negative motivational declaration that seems to drive some of us into doing some very destructive things in our lives (and many times financially).

If a car salesman told you that the car you were looking at was too expensive, how would you feel about that? Would you agree with them, and thank them for helping you from tieing yourself down to a too expensive financial obligation (yes this is completely synthetic since it is rare if ever that I have heard of a car salesman telling you that you can’t afford something)? No, you would prove that fill in your favorite expletive wrong by going out and finding someone who will sell you what you want. Two years later when you are in a financial bind, will you think of that first clerk who turned you down? Not likely.

These days we can buy pretty much whatever we want, on credit. The days of live now, pay later are here, but when is later? Ask your Member of Parliament when that is, because the National Debt needs to be paid some time, but when? Are you building up your own little version of the National Debt?

Does Anyone Say This ?

I think if I heard of a Bank or a Car Dealership that was sending potential customers away, telling them they can’t afford the things they want to buy, I might actually seek out them to do business with them, but that is only after years of realizing how bad my own spending habits were.

Have you ever had a situation where someone told you You can’t afford that? How did it make you feel?

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