For those of you who haven’t had as many financial plans and projects fail as I have, I’d like to share with you the most important variable in all of your plans, and that is Time (no not the magazine, the passing of moments). Time is the most important financial variable , unfortunately.

Time will fix many things, but assuming you can do things quickly is usually the problem that trips up most plans and projects.

Typically a repayment plan will be quite simple:

Payment per Period = Debt / # of periods

However, there are two things wrong with this plan. First is you aren’t taking into consideration that your debt will grow with an interest rate, look up Future Value of Money on-line or look up the PMT() function in Excel to figure out what the debt is going to grow. The other major variable here is the # of periods, and that is where most plans fall over.

Time
If you invested this dollar in 1967 what is it worth now? Time heals all wounds.

People are always optimistic when they start debt pay back schemes (this is my opinion, but based on observation of many friends) and think it will be easy to pay things off quickly, without taking into consideration that Life, Karma, or Sh*t, happens (depending on your religious point of view). If you are overly optimistic with any plan (speaking as a Project Manager now), you will fail, or you will spend all of your time attempting to catch up.

If you are much more conservative in your planning, time can be your friend. This is not to say that you should amortize your car over 10 years, or your house over 50 (if you could), however, don’t get too aggressive in your plans.

Microsoft Canada

Rules of Thumb

A good rule of thumb is to make up a plan initially, and then walk away from it for a day. The day later look at it and ask yourself

  • Can I live with this payment plan? Is this going to hurt a little or be agonizingly painful and will make me miserable?
  • What other sh*t is going to happen? (the realistic answer is “I don’t know”) Plan for bad things, give yourself a little slack (I didn’t say let it fall on the ground, but a little slack)
  • Have I tried this before and succeeded? The answer is most likely Yes and No, since you are doing it again (if you are really good at building up debt and then just as good at paying it off, good on you, but why are you living on a roller coaster?).

Time, it passes very quickly plan accordingly. Time is the most important financial variable , plan accordingly.

Redux

I wrote this about 10 years ago, and I can assure you, Time is an ever dwindling resource in your financial plan.

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Financial Year That Was 2020

The year 2020 is a year to be remembered. Unlike 2008 where there was a financial apocalypse, 2020 gave us a Pandemic. The pandemic has caused a financial apocalypse of its own. Whether there will be a quick recovery from it, remains to be seen.

In previous years I have written over 200 articles in a year. In 2020, I wrote a great deal less than 200 articles. I continue to have a huge backlog of unfinished titles, but 2020 was an interesting year. Here is the entire list, missing my #MoneyTalk compilation posts.

Estimated reading time: 5 minutes

CPP and EI Maximums for 2020, was my most read and searched article all year. I have done these every year for a while, so not sure why it was so popular, but here it is. I have in fact already published CPP and EI for 2021 to see if it is as popular.

My CRA Account another highly searched article, outlining how to set up your on-line CRA account. You really should set that up.

When to Put Money in RRSP I created a step by step reasoning, and naturally someone complained it wasn’t a waterfall. Seems there is no pleasing some folks.

Save up to 50% on life insurance.

Miscellaneous

The Hidden Cost of Land Transfer Taxes is a rework of a much older article. Funny I never hear about this being part of the purchase of a home. This is not an insignificant lump of money.

Moving Expenses for Students are things to remember if you have just graduated. These costs can help lower your initial tax bill.

What to do with Found Money (update) with some added ideas. Remember to wait before making any big money decisions.

Not Asking is Rejection by Default is a simple yet very true statement.

The Financial Echo Chamber is a dangerous place. Many of us live in bubbles, that really don’t help. You need to see opposing opinions, to understand the whole picture.

I Like My Money Like I Like My Coffee a bit of click-bait, that no one seemed to think was funny. Nice photo of a cup of coffee though.

Free Credit Bureau Access sounds lovely doesn’t it? Unfortunately the reasons for it, are not so lovely.

The Dangers of Automatic Reloading I have written about this before. Keep this in mind, when you automate things. The Perils of Automatic Payments is also an area you should audit regularly. If you pay bills from PayPal or a Credit Card, make sure you restrict access to only those bills you want paid.

Credit Card: One Time Services can help if you are late paying your bill. This only comes into play, if you are a customer who normally pays things off on time.

RESP – Registered Education Savings Plans

RESP withdrawals and Taxes was a guest post by a chap from UFILE, a little thin in spots, but still interesting.

A Guide to Understanding the Tax Considerations When Cashing out an RESP was a guest post, that was OK, but missed a few aspects of things, as well.

MER : A Worm in the RESP Money Tree especially if you use the wrong Mutual Fund. Using low MER ETF’s or Index Funds is the way to go there.

RESP Only For the Rich ? There is an argument that this is how it ends up. The poor, don’t open accounts, even though they can earn money without deposit. Banks don’t market them to those with low incomes, thus, RESP’s are for the rich.

RDSP and Disabled Loved Ones

RDSP Statement of Grant Entitlement 2020 another yearly post. I get this document outlining how much money will received matching grants in my son’s RDSP.

Henson Trusts another way to save for a disabled loved one. Some good links to help out, if you wish to go in this direction.

More RDSP Talk in preparation for my chat with Tom Drake a few thoughts came to mind.

RDSP : Quick Points are the notes from my Chat with Tom Drake about RDSPs. As usual a little disjoint, but usable for research.

Specified Disability Savings Plan – SDSP – How Does it Work ? The RDSP is a very long-term savings plan, but there can be exceptions for early withdrawal of funds. The rules are very precise for these early withdrawals.

RDSP after DTC Lost is now much clearer in terms of what to do. The RDSP no longer must be closed within a year, which is a good thing.

Microsoft Canada Surface Book 3 English

Impact of COVID-19 on Small Business and Self-Employed was an excellent article written by my daughter. She is a small business member and COVID has impacted them a great deal.

COVID-19 Are we F*cked ? really was prophetic. The pandemic has made a mess of so many financial things. Interesting to see the comments as well.

Doomsday Finances was an old article I recycled. Whenever you can talk about Star Trek and money together, you know you have a winner.

Post COVID-19 Budget ? but when will you be able to use it? Soon, is the hope, but remember, right now, your life is different. Maybe you can bring some good habits forward, but maybe not.

How to Open a Kids Bank Account in the time of COVID was a lot more complicated than I thought it would be. Still had to go into a bank storefront to complete it, which was annoying.

The Year to Come?

As I have said, don’t count on 2021 being a complete turn around year. I can be better, but it could even be worse. If anything 2020 has taught us is, you can never guess what might be coming next. If you want try some New Years Resolutions, but don’t look too far ahead, you might trip on something in front of you.

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Not Asking is Rejection by Default

I have written many times about if you don’t ask the answer is always no, but the title of this post is also a good turn of phrase. Too many times folks feel they have no one to ask for help, so they just give up. Most of the time that is exactly what service companies want you to do.

Many times return procedures are convoluted, complex or just downright silly, but it is to stop you from returning things. If you keep it, but don’t want it, they have won.

A good example is, if you want to use TD E-series mutual funds, inside your TD Mutual Fund account, it is not an easy procedure. You must apply via a written form, and wait for the “OK” from them to be able to buy them. Once you are granted permission, you then must figure out which funds are the E-series funds. If you wish to cash the E-series Funds out of the account, you must first go on-line, transfer them to a Money Market account, and then go into a TD Branch, to do the cash out?

The best way to deal with this, is simply don’t use the TD Mutual Fund vehicle. Other reasons to be wary, will be the Risk Profile trade cancellation issues.

Show your love of The Times. Shop Now!

This example shows that the system seems to be set up to discourage you from doing what you want. Worse, to do nothing, when you should be rebalancing or other important investment tasks.

Why Not Ask?

This is the question. If you do not ask for what you want, you will rarely get what you want. You may sound like a pest, you may upset whoever you are dealing with, so be polite, but ask for what you want. The worst they can say is, No.

Not Asking is Rejection by Default

Unknown, but words to live by

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Covid-19, Stay Home and #MoneyTalk

Haven’t done this for a while, but I do have a little more free time as well. So let’s start with the best joke about this year so far.

I’d like to return this year (2020), I don’t like it and it isn’t doing what I want. It is within 90 days and I expect a full refund, or at least store credit.

The 2020 Dad Joke

How are you all doing? I hope you are doing well, and if you are still working, I say Thank You, for that.

If you are not essential, STAY HOME! This is what you can do for your loved ones and yourself, STAY HOME! I cannot visit my Mother or my Brother because I could kill them, I don’t know if I have been exposed or am a carrier, so I STAY AWAY. I want to go see them, but I know I could kill them, so I stay away.

Toilet Paper?

Stay home and don't hoard toilet paper

So the one thing I will remember about this vividly will be the folks who have hoarded Toilet Paper. I hope that they have to use all that toilet paper in a very short time. Remember COVID-19 attacks your lungs, it is not a stomach flu. On this date (March 27th) I continue to look for another pack of TP, but Costco was out.

Feels like an episode of M*A*S*H when their supply lines got cut. I suppose that makes me Klinger (or Frank Burns). Lighten up folks, let’s let everyone wipe their derrières safely.

I also have heard from every place that ever asked for my email address (it is a HOTMAIL address which I usually ignore). Everyone is telling me how they are trying to help me be safe during these times. Thanks?


Past Writings

So it has been a long while since I have written one of these, so we have a long list to wander through.

  • COVID-19 Are we F*cked ? OK, so the title was a little click-baity but I had to write this down. Sometimes these thoughts need to be put in print to see where we stand. Apologies for the rant and salty tones.
  • RDSP Statement of Grant Entitlement 2020 yes another year has passed and the government has told me how little they will match in terms of my son’s RDSP. It’s free money, but it will increase over time.
  • Reflections on 15 Years means I have actually been doing this for more than 15 years. I am attempting to rewrite, edit and delete many of my older posts.
  • Impact of COVID-19 on Small Business and Self-Employed my daughter is a Chiropractor, and she offered to write a piece on the impact of this thing, on her financial and professional life. I think I may have a few more posts from her in the future.
  • Financial Disaster Plan would have been good to have one of these before all of this, but maybe it is time to write one anyhow?
  • Aging Family Members and How to Deal with their Real Estate was another Guest Post done for me, that I really like. Sean writes about things happening in my life right now.

There are more, but you can go check them out on the site. As you can see my writing rhythm may be returning (for good or bad). Hopefully more from me in the coming weeks.


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Financial Reads for Troubled Times

I give you an excellent reading list of articles to help you get through these troubled and worrying times.


Tweet of the Week

For those that have not noticed, Squawkfox has not been around much, and that is because she has been battling with Cancer. She is a friend, and I hope you all send her good thoughts and love. She is one of the reasons you should stay home!

Oh, and if you are on Twitter a lot please add The Canadian Cyber Center, they are the Internet Watchdog, so watch them.


Video of the Week

Speaking of our old amigo Preet B. here is a helpful video with resources for you to help you out, during these troubling times.

Thank you Preet B!

2019 Random Thoughts

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Financial Disaster Plan

I guess this is topical for these days (written during the COVID-19 pandemic), but let’s do a quick wander through what your Financial Disaster Plan might need to include.

Will and Power of Attorney

Doesn’t matter if you think this will not affect you, you need to have these documents in place. If you are single, OK it isn’t urgent, but if you have a spouse or more, do this first. Plenty of easy on line sites to do it with, or call a lawyer or notary.

For the Power of Attorney, different provinces have different rules, so make sure you set that up correctly too. I have learned too much about Quebec’s rules lately, thanks to a loved one still living there (and their POA).

Insurance

If you have a family you should have life insurance. It should at least pay out to leave your family debt free should you die. It would be better to leave them more money to help out given the loss of your income. No, not full life or any stuff like that, TERM life insurance (5 or 10 year terms) is fine.

Disability insurance should be considered as well, especially if you are the sole income earner for your family.

House insurance, Apartment Insurance and Car Insurance you should have as well (should have those things, of course).

Cash

A certain amount of actual cash available to you would not hurt. No I am not saying have $10,000 in cash hidden in your house, but a couple of hundred couldn’t hurt having around. Maybe a little US Cash too? If you live near the border, never a bad idea

Toilet Paper?

Dear Lord, why do people hoard toilet paper during a crisis? You are assuming there will be toilets (or something like that) during this crisis? Maybe some canned food, and some water would make sense, but bum wad? Really? COVID-19 is a respiratory sickness (i.e. your lungs not your bum).

disaster planning financially ?
Yes, this is a real photo from Kitchener

List of Critical Information

What if you become incapacitated, how will your designated helper do things without the hundreds of passwords needed to do your banking, or anything else? Who will scrub clean your Google and Search logs?

Somewhere, somehow but securely you will need to have that information available to the people you trust, to act for you. A list inside a safety deposit box? An encrypted Word document somewhere?

What about all of your insurance policy numbers, your pension information, and anything else loved ones might need should you find your untimely demise? How do they get at the “safety blanket” you left for them?

Debts and Emergency Funds

Yes, you should be paying down debt and have an emergency fund or plan on how to deal with your finances during an emergency.

Keep Calm and Plan

We are currently in an emergency, but if you are at home with not much to do, maybe it is time to start planning?

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