WHERE ARE THEY NOW?

 

Tina and Patrick Part 2

Proper Preparation Prevents Poor Performance.

A lot has happened since we bought our home with the help of Tessa all those years ago. We are now less than a year away from renewing our mortgage and we have accomplished so much in the last four years.

Patrick proposed to me the day we walked into our home for the first time and after we dried our tears and drank the champagne we knew we would need to visit with Tessa again very soon. And we did, we met with Tessa to figure out how we could have the wedding of our dreams. We made the sacrifices we had to over the next two years in our new home to have the wedding we wanted and to insure we wouldn’t have any debt from it. So unlike most new home owners we didn’t feel the need or pressure to furnish our entire home at once. And as Tessa would say on several occasions all a young couple needs is a bed and a kitchen table. We furnished our home with hand me downs and modest new furniture slowly and when our wedding came and went we were ready for the next stage in our lives without any debt.

Now the wedding was over but the honeymoon continued because we were in such a wonderful place in our lives, newly married, fairly new home owners, so what’s next for us? The answer was clear for both of us; it was time to start a family. So it was time to revisit our finances with Tessa. As a self-employed RMT we knew we needed to save for all the money I wouldn’t be making and discussed with Tessa the benefit of opting into paying EI because it was important to both of us that I could be home with our little bundle the first year. That was step one, step two was still saving to have a little cushion for when baby arrived for any extra expenses that come along with a baby. With all that said and done we knew we could comfortably try to start our family a year after our wedding. And we ended up having the best one year anniversary gift by finding out we were pregnant that very day!

On top of saving and preparing for a baby we like most home owners had things to do around the house we had had a flood but took our time refinishing the basement ourselves to save money and make it work for us. We finished what needed to be done by the fall of 2014 so we could start the nursery for our baby arriving in February 2015 again doing all this without creating any debt because of all of Tessa’s help and the emergency account we had established as soon as we bought our home.

Now our son Kieran is here and 5 months old! Where has the time gone?! Our babymoon has been amazing and fairly stress free because we were mentally and financially prepared for our son. But there is more to do, it is time to get that minivan, so we have literally just met with Tessa to find out what we can afford comfortably and should be able to purchase a brand new car by the fall.

We are so amazed at what we have been able to accomplish with a little sacrifice and hard work. On top of all of these goals that have been reached we have been continually working towards another goal of ours, to be mortgage free by age 40. And with Tessa’s help that goal is becoming more and more attainable with every passing mortgage payment. There is still a lot we want to do both in our home and personal lives. From renovations, to expanding our family again, travelling, saving for Kieran’s education and our own retirement all of which we know we can and will accomplish with all that we have learned from Tessa. Everything has its own account and we have set up automatic transfers so there are no excuses and saving is practically on auto pilot which reduces stress.

I truly believe that part of the reason we have been so successful is our semi-annual financial check-ups we have with Tessa. It makes us accountable and it helps to put everything into perspective. Just like your annual physical with your doctor or cleanings with your dentist or maybe even your regular treatments with your massage therapist you’re able to identify a problem before it becomes a serious concern. So just like preventing high blood pressure, cavities or chronic back pain you’re preventing financial hemorrhaging which can lead to debt.

Patrick and I cannot wait to see what the next four years has in store for us but one thing we are confident in is that debt is not in our future.

I HAVE BEEN THERE – PART TWO

I noticed that the attitudes shifted and the body language changed, some of them were staring at me as though I had two heads and one eye. I asked them to put away their blackberries, their red berries and their yellow berries, which made them laugh. Finally, everyone settled down.

“Today, your topic is saving on a low income. I have changed the name, just for you, to SAVING INSPITE OF A LOW INCOME.” You see, although I have changed the name I am still not able to change the destination of your choice”, I said.

“I would like everyone to tell me what they would like to learn about saving money today, write your answer out and then you can read it out loud one by one”, I said.

There were eleven women; they read out their responses, which fell in two categories:

1. How much should we save each month?
2. How do we stop from dipping into our savings account?

I wrote those questions on the board and asked if this was what the group wanted to learn and whether there were any additional questions.

Everyone agreed.

1. How much is the correct amount or percentage to save each month?

“The answer to question #1 is = There is no fixed amount or percentage that will work for everyone.   Each person or family has a number that is unique to him or her and what works for me or for your sister or cousin cannot work for you. Your circumstances and needs are entirely yours and yours alone.  The one thing that matters the most is to put your savings before, RENT, FOOD, CLOTHES and any other expenses you might have. Your savings must be first and the amount does not have to be hundreds of dollars, you can save one dollar a week or ten dollars a month, what is important is to do it regularly and automatically.”

“The bank would never take a $1.00 a week from my pay cheque and save, that amount it is too small.”   One of the women volunteered.

1. How much should you save each month?

There is no fixed amount or percentage that will work for everyone. Each person or family has a number that is unique to him or her and what works for me or for your sister or cousin may not work for you. Your circumstances and needs are entirely yours and yours alone.  The one thing that matters the most is to put your savings before, RENT, FOOD, CLOTHES and any other expenses you might have. Your savings must be first and the amount does not have to be hundreds of dollars, you can save one dollar a week or ten dollars a month, what is important is to do this regularly and automatically.”

“The bank would never take a dollar a week from my pay cheque and put it into my savings account, that amount is too small,” volunteered one of the women.

“Yes, they will. All of our dollars are important to the bank and they want it. You see, this is how it works: the bank promises to pay us .25% on our money every month and they then take it and invest it in your brother’s mortgage at 3% which he pays every month. They give us the .25% on our money and the rest belongs to the bank. So yes, our money is very important to the bank.”

“My message to you is to begin small and have the bank make an automatic transfer from your chequing account to your savings account for the amount you want and on the date you want.  This method is called the automatic millionaire and with consistency you may actually become a millionaire one day.”

2. How to stop dipping into your saving account:

Give your savings account a name and have a purpose for saving the money.  Throughout our lives, every one of us in this room has heard our parents say, “SAVE YOUR MONEY.” They were only able to teach us what they were taught.  They passed the same information to us and we are doing the same thing they did, we save today and we use it tomorrow. Now if we begin to name our savings account and have a purpose it, it has been proven that we will not touch the money, because we have a reason for saving that money.  The Government of Canada is an awesome teacher. They have a name for every type of savings account they recommend:

1. REGISTERED RETIRMENT SAVINGS ACCOUNT
2. REGISTERED EDUCATION SAVINGS ACCOUNT
3. TAX FREE SAVINGS ACCOUNT

Savings accounts have no particular identity and can be used for different purposes by giving them a name we give them an identity.

You see, they all have a name and we know what we are saving for. We would be hard-pressed to take the money out, not because we can’t but since the purpose for the money is staring us in the face, our memory for saving the money will contribute to us leaving it alone.  Name your accounts, all the banks allow you to give your accounts a name that helps you identify the purpose of the money. Use that method and see whether it works for you.

The ladies were pleased with the workshop. The woman who first spoke stood and told everyone this was the best workshop they have ever had. They received tips they could try knowing that I too had to do it the way they now have to.

Sometimes, you have to do what you have to do to take your message across rough seas.

Tessa-Marie

I HAVE BEEN THERE – PART ONE

When I am asked to facilitate a workshop, I am prepared to facilitate whatever subjects the coordinator requests for their group.  There is the odd occasion when I arrive and meet members of the group then realize the topics requested are not going to work for them. I may know that, but the customer is always right so I stick with what was requested and deliver with all the passion and knowledge I can offer.

Last Tuesday was one of these occasions. The moment I arrived I could sense that these ladies were not happy to be there and were not interested in anything I had to say.  They sat with their cell phones on the table directly in front of them and their hands folded across their chest or holding on to their chins.

Great, I thought when I walked into the room and observed the situation, I really need divine intervention; I took a deep breath and silently said, “I need guidance to be able to reach these ladies.”

The coordinator introduced me and I began by telling the participants a little about JVS Toronto. The moment I was done, one of the ladies said, “What can you teach us that we do not already know, you come here with your high and mighty attitude and think you can teach us how to survive on a low-income when you have no idea what living on a low- income is like.  You people come here and speak from your pulpit and expect us to go out there, do what you say, and our world will suddenly be ok.

Thank God for yoga and deep breathing. I did my breathing exercise, smiled and said, “Who told you that was what I am here to do? If they did, I am extremely sorry to say I will have to disappoint both you and the person who gave you this information.”

“You see, I am a Financial Advancer, my job is to take you from where you are and advance you to where you want to go.  I am not able to do that unless you first tell me where it is you would like to go financially, think of me as an airline company: it will not take you to Montreal when you paid to go to Disney.  The customer is always right and I aim to please.”

Let me tell you a story about a young woman I met 37 years ago.  This young woman was 22 years old when she got married. At that time, she worked for the Government of Ontario, Ministry of Education and every six months the Government gave them a $3.50 rise in pay. Her philosophy then and even now is that she did not have it last week so she is going to pretend she did not have it this week and would save it.  Now this young woman and her husband wanted to buy a home so she decided that she would save every  pay raise they received until they had sufficient funds for a down payment to buy a home.  She went to the Credit Union on MacDonald Block and opened an account. She then asked the clerk to have $3.50 come out of her pay cheque every two weeks.

The young woman had to have her lunch right in front of the clerk as this transaction took an entire hour since there were no computers. Today, it would take one minute to put together. This continued and with each raise she or her husband received she would go back to Credit Union to increase the amount.  At the age of 29, the bi-weekly amount had grown to $80.00 and they now had a savings of $7,500.  They were able to purchase a home with a down payment of $5,000.00.  They did not buy new appliances; they went to Queen West and purchased a used stove, used washing machine and a used fridge. They did not buy a dryer; instead they went to Honest Ed’s and bought a ball of twine, a package of clothes’ pegs and a small packet of nails. Her husband picked up a couple of stones to use as a hammer to knock the nails in the walls of the basement to use as their clothes’ line.  Three months later their daughter was born, so they took the dresser drawer and padded it to use as her crib for the first two months of her life.  No matter where this family ended up they cannot deny the beginning of their financial journey.  If this young woman did not start that very small savings plan they could not be where they are today and she would not be standing in front of you today.”  There was an audible gasped. I continued, “The reason I wanted to tell you this true story is to let you know that, I do not want you to believe because a person comes to facilitate a workshop that they have never walked in the shoes you are wearing today.  Are we ready to begin the workshop?”

To Be Continued…

Tessa-Marie

 

 

LIVING FRUGALLY

My friend asked me the other day, why I teach people to live frugally and to save money, when I do whatever I want, whenever I want?

When my friend asked that question it made me realized that perhaps I should better explain what frugal living is all about.

I have always been a frugal person while I believe in living frugally; I never   deprived myself of needs or of some wants. Living frugally meant I had to always have a smart plan, which I followed until I met that particular goal.

Living frugally does not mean you have to wear the same clothes over and over or lower the temperature in your home to just above freezing.  It does not mean that you have to sit in the dark and keep the lights off.  Frugal living does not mean that you never go out to dinner or to a show.

Frugal living is always working on your goals; create a plan to find out what you really want.

It is being able to have financial choices. The choices may give you a chance to find some level of happiness and contentment.  It allows you to say no or say yes with ease.

My decision to live frugally has caused me many small family frictions. I remember my brother – in – law saying “Tessa-Marie wants me to turn off the lights whenever I leave a room so she can save ten cents worth of electricity.”  Yes I did, because it was my ten cents not his, it just made no sense to me leaving the lights on when no one was in the room.  Today, Toronto hydro has all types of incentives to encourage the consumers to save on the cost of electricity.  As an example they have provided us with a chart, which explains the peak period and the non-peak period of the cost of electricity.  So as far as I am concerned I was way ahead of the curve on saving small amounts and that made me a trailblazer.

Being frugal enabled me to make a choice to publish my book “Controlling the Debt Monster”. I made the choice to have my book published and changed my career.  I am doing what I love, advancing others to financial independence.   When I discussed publishing the book, one of my co-workers told me why not continue to work for TD Canada Trust until I am 65 then publish my book.  It was tempting, but I knew I had saved and invested well so I could do something I loved while I had the energy to do so.

Being able to do what I am doing today was more tempting than continuing to work at something that had run its course.  I enjoyed my time at TD Canada Trust. I love that company and I am grateful. TD Canada Trust educated me and paid me a salary. The education I received from them I am using today to do something I love which does not feel like working. Even getting my education from TD Canada Trust to be a Financial Planner was living frugally since they paid to educate me. I did not have to pay for the training I received. Guess what, the education and training I received at TD Bank is mine to keep and use however I choose.

I know that my responsibility to serve others is to be the example they need.  I have walked in the shoes they are now wearing and I tell them my story.  Now I serve by enlightening, educating and encouraging others to follow a frugal way of life early in their career so later on they will be able to enjoy doing what they truly love.

The entire idea is to LIVE LIKE NO ONE ELSE WHILE YOU ARE YOUNG SO WHEN YOU GET OLDER YOU CAN HAVE THE OPPORTUNITY TO LIVE LIKE NO ONE ELSE.

Frugal living as a young person let you choose to winter in the Caribbean for six months of the year as a senior.  Frugal living means that you do not have to work because you have to. Frugal living is choosing to work in the flower shop because you always wanted to and now you can.  It also means that you can tick off all the things on your bucket list because you can.

Frugal living does not mean that every time an item is on sale you purchase it, whether you need it or not.  Frugal living is, knowing the difference between your needs and your wants. Frugal living is shopping with a list of the things you need to purchase, it is not entering a store and purchasing whatever is on sale. Frugal living is bringing your lunch to work instead of spending $7.00 on lunch and another $4.00 on coffee and a donut everyday.

Frugal living means knowing what you want and where you want to be financially in the future. Frugal living allows you to have many choices.  Frugal living is watching your savings grow year after year; frugal living is having your house paid off and being completely free of all types of debt.

Frugal Living equals Financial Freedom.

Tessa-Marie

WHAT YOU WANT VERSUS WHAT THEY WANT YOU TO PURCHASE

I had an encounter at the mall earlier this week. I needed to get a short, white jacket to wear with my summer dresses.  I entered a store, was looking around when this young lady came to assist me in selecting my purchase, asking whether she could help me. I explained to her what I was looking for and informed her that I had already looked around and did not think they had exactly what I wanted.  She said that she would check her stock at the back and, after a few minutes, came back with several ladies’ jackets. I looked at each one and kindly explained they were not what I asked for.

The young lady began explaining to me that the shorter jackets were out of style and these are the latest fashion. They were seen on the runways of New York and Paris.  I again told her that I wanted a specific jacket.  She said the benefit of having one of these jackets is that I could go from spring into summer and then right into fall. The colours she had were spring and summer colours.  I explained again, in case she had forgotten, that I wanted a short, white jacket. She then informed me that white, as a colour for spring and summer, was out and the popular colours were bright green and bright yellow, and if I got one of those jackets I would be the envy of my friends.  The price is great, she said,it is at 50% off today and if I had a friend who is a senior I could get an additional 15% off.

As a former sales person myself, I must commend the young woman; she new the benefits of her product, she did her best to sell them to me, she informed me that I would be right in the fashion of the times since this was seen on the runways of New York and Paris for the spring, and that I would be the envy of all my friends with my new runway jackets. Then, she went for the jugular by informing me of the price and the discounts.  Who in their right, impulsive mind could let that amazing sale pass?

The sales woman did not hear my needs, she wanted to sell these jackets and her job was to convince me that I needed the jackets even if I had come to the store for something entirely different.  My needs were completely forgotten. She had an agenda and it was to sell me those jackets. I love these encounters and when I get one of them I often try to put myself in the place of the impulsive shopper.  What would an impulsive shopper do?  Would she agree with the sale person and purchase the runway jackets?  What then would she wear with those summer dresses?  Would she now have to purchase something else to wear with these new jackets, I know she could not wear the jacket without a skirt or a dress?   So the impulsive shopper would leave that store with a bag full of unintended purchases, a maxed out credit card and a belly full of regret before even getting home.

I politely told the young lady that I was not interested in the jackets and left the store.

When you go shopping, you should always be sure of what you are looking for and how much you plan on spending. Remember that the sales person’s job is to get you to buy what they have in their store. You must be aware that they are not your friend, you just met them and they are doing their job… and some can do their job very well.  Often, when we get into those stores and the sales person is helping you, they already know what has to move from the store today.  There was a sales meeting prior to opening and the manager gave them their target for the day or for the week.

When you enter a store you are swimming in unchartered waters.  Be careful as you might drown in a sea of debt before you know it. The bright, spring sunshine can push us into spending more than we plan this season… especially after the cold and snow-bound winter we just experienced.

Take your time and plan your shopping wisely. Take a friend who will tell you the truth no matter what and do not depend entirely on what the sales person has to say.

Tessa-Marie

 

APRIL 2^ND 2013

FIVE POWERFUL STEPS TO FINANCIAL SUCCESS

Interesting year we are in, 2013!  Commonly, anything with the number 13 generates fear and superstition.  Many people run away from this feared number. Buildings do not have a 13^th floor as it is so feared.  Do we have a choice?  Can we ignore the year 2013 or pretend it does not exist just because it has the number 13 in the mix?  No, we can’t so we are going to include 2013 in our lives.  We are going to do something different this year.  We are actually going to embrace the number 13; we are going to embrace the entire year!  A suggestion for our theme for 2013 is NEW HOPES, NEW DREAMS AND FINANCIAL SUCCESS!

Every year we make plans and set goals, which we refer to as RESOLUTIONS.  Let us scrap that word. We are setting New Goals for a New Year with a number that will surely improve our chances.  We will begin by naming “2013” the year my life changed for the better.

My first question; what do you want to ACCUMULATE and what do you want to ELIMINATE?  Take a few minutes and write your answer down.

In the past few years were you a MISSILE WITHOUT A GUIDANCE SYSTEM?  Were you just going about your business working, paying bills, spending and reacting to life instead of life reacting to you?  It’s time to change.  Give yourself a GUIDANCE SYSTEM. Where do you want to go and when?

Now what are those five powerful steps to financial success I am talking about?  Well here they are, you might have heard some version of them previously, but not described to you in the way I am going to do so now!

1.  SPECIFICITY

Key to meeting your goals is to know your goals. Describe your goals completely and entirely until they become something you can recite like a nursery rhyme. You want to pay off your Master Card then say I want to completely pay off my Master Card.  Do not only say I want to pay off my debt.  This non-specific statement does not completely describe your goal.  The specific statement you want to make describes which debt and the amount.  Generally, when a goal is not specific it is not attained.  Ask yourself which debt, the $100.00 you owe your brother, or the $3000.00 outstanding on your Master Card?  Be Specific.

2.  KEEP SCORE

What steps are you taking to meet those goals?  In other words, keep score of your progress towards your goals.  Your statement should be as follows.  I want to pay off my Bank Master card (name the bank) and I am paying $250.00 towards the card every month.  So I Keep Score every month of the total I have paid towards my Bank Master Card debt, which shows me the headway that I have made.

3.  PUT YOUR GOAL INTO YOUR LIFESTYLE

Now that I am paying this Bank Master Card off, I should not continue to use the card.  Making payments to eliminate debt every month and simultaneously incurring more of the same debt is counter-productive.  For example, one should not make efforts to pay $250.00 a month towards a Bank Master Card debt and charge $200.00 to the card just because there is available credit.  Create habits that will enable you to bring your financial goals into your lifestyle and eliminate the habits that work against you.  Modify your behavior.

4.  PROGRAM FOR SUCCESS

Now that you know the steps you need to take in order to meet financial goals, avoid the impulses and temptations that are a hindrance to your targets.  An immediate reward can produce long-term penalties.  A drink after work every Friday is no longer one of your pastimes.  Dinner out every weekend with your friends should be scaled back. Why not cook with your friends at home and everyone contributes to the meal.  A lovely homemade Tuscan soup and some fresh buns with a bottle of wine can make a lovely winter dinner with friends at home.  Try it!  You’ll it!

5.  TIME.  WHEN DO YOU WANT TO ACCOMPLISH THIS GOAL

This is one of the most important steps in accomplishing your goal.  A friend of mine always wanted to retire to Jamaica.  I’ve heard the following statement for the last 15 years. “I am going back home to retire.”  Now that is an incomplete plan.  My friend did not complete his statement; he should have said:  “My goal is to retire in 2001 at the age of 60 in Jamaica.” Now that is a complete goal!  We have the where, the what and most importantly, the when!  My friend is still in Canada, retired and only vacations in Jamaica.  He maintains his dream of one day living in Jamaica but his goal is still incomplete.  With no when, no timeframe, this is an incomplete and unattainable goal.

So there they are!  Your Five Powerful Steps to Financial Success!  Every three months take time to look at your progress towards meeting your financial goal.  If you are not on tract, then re-evaluate and make the necessary changes to get yourself back on tract.  It may not be easy, keep plugging away, do not abort the goal!

Happy New Year

Tessa-Marie

January 2 2013

HOLIDAY SHOPPING FOR KIDS

I am devoting this entire blog to Holiday Shopping for kids.  Why would I devote an entire blog to holiday shopping for kids?  I went through the holidays myself with three children two years apart and have a great idea of what it means to shop for children during the holiday season.

The first thing to remember the children are targeted during this time of the year, the commercials and all the advertisement are geared towards the children.  I attended a workshop on marketing once and the facilitator told us that when we are unable to get the adults to purchase for themselves that we should find a way to get them to spend on their kids.    Marketing to children is a multibillion dollar business and we are all allowing these companies to increase their bottom lines at our expense.

When shopping for children there are four things parents, grandparents, aunts, uncles and friends should know.  Children shopping should be divided in four categories.  It is also a good idea to make some prior decisions about who will buy the gifts for the children and what will be bought.  Plan ahead! Stay on plan and keep to the budget you have allowed for each.

Here are the four groups for shopping for children during the holiday season.

1. Buy something they want, children usually make a list of the things they want, take the list and go over it very carefully, look at what they have written down what they want or what they say they want, that list will change but only to add something new, never to take something out so choose something from the list that you can afford and stick to it.
2. The next thing should be something you know that they will wear.  That could be a new coat, or some other article of clothing. This is where shopping with a list is important; do not go holiday shopping without that list of the things they can wear.   Have the list and stick to it.
3. We now come to the things they need, or will need in the first three months of the New Year.  What will they need for the New Year, are they registered in, dance, hockey or some other activity.  This is your time to use the holiday season to take care of some of the needs that are coming up in the New Year.
4. Now what about something they should read, I know, you are thinking kids don’t read that much anymore they are all into video games.  This is very true but they all have an interest. What about purchasing a book about hockey for those who are lovers of hockey.  There are great books on baseball; a few of the last Olympians from the 2012 Olympics have written books on their journeys to become Olympians. If they are interested in video games get a magazine subscription that will pique their interest further

Now when you have a list of the four points, What they Want, What they will Wear, What they Need and What they should Read, circulate the list among family and let everyone choose from that list. In doing this the children will have a wider range of things under the tree.  This will also give you an opportunity to get some of the things they will need and will wear in the New Year.

January is a sad time to be spending money especially during the early months of the New Year when cash flow is running slowly.    Debt increases because of the lack of cash flow, by planning carefully during the following weeks will indeed give you a head start not only on the holiday spending but also on the post holiday spending.  If you did not have a special plan for the holiday you might have to use your credit card.  If you are going to do so make it as careful and strategic as you can. Remember, proper preparation prevents poor performance.

Let me know how the holiday shopping is going.

Have a Happy Holiday.

Tessa-Marie

 

MY MOST DIFFICULT WORKSHOP

Someone asked me few days ago, what is the most difficult workshop I have ever done?  I did not have to think before replying, “SAVINGS,” the look on their faces when I said, “SAVINGS” was incredulous, “Savings I cannot believe it would be savings, I really thought that it would be on managing debt and staying out of debt.”  She said. I smiled and said “when I facilitate a workshop on debt control or staying out of debt, everyone attending the workshop is ready to change or planning how to manage debt better than a family member a friend or someone at work.”

With savings I get attitude and comments such as the followingg:

• I have no money to save,
• I am living pay cheque to pay cheque,
• I can barely make ends meet with what I get paid.

The body language and expressions say the following:

• I am defeated and my situation is hopeless,
• The looks on their faces say, what can you do when I could not do a thing about saving money myself.
• Bring it on; I have trials and failures to tell you about.
• You think you know how to get me to save, well I have tried and I failed
• I am living proof that savings does not work it is for the rich and powerful.

These are just a few of the reason why a saving workshop is much more difficult to facilitate.

I now have a special way of facilitating a SAVINGS workshop.  This is how I began, I walk to the white board and write.

$3.50 Bi weekly

Invariably someone would ask “what does that mean” Can anyone guess  I reply?  Every head in that classroom will shake in the negative.   This! I reply was my very first savings, this was the amount I could save.     I was married at 22 so that was  the combined amount for both my husband and myself.

“You put the decimal in the wrong spot” someone shouted.  “No it is in the correct spot, the total we saved in those days was exactly that $3.50” The usual NO’s could be heard.

So here is the plan  we had.

1. We could only save $3.50 every two weeks that we already knew from keeping track of our income and expenses.
2. This was done automatically for us at my financial institution free of charge.
3. Every time I got a raise we  saved it, usually the raises were after taxes $3.50 every two weeks so we increased our saving by that $3.50 which meant we were now saving $7.00 every two weeks.  My husband’s raises went towards the increase in the cost of living.

We  kept increasing that amount and by the age of 29 that amount had grown to $80.00 every two weeks to a total of $7,500.00 in the bank.  Not a huge amount of money, but it was all ours.

To this day we both know and remember that our foundation or the beginning of our financial journey was that $3.50.  It was not easy at first but we had a plan and stuck to it, increasing it at every opportunity we got.

Everything we do the beginning is the hardest and it is no different with money or building the CN Tower, preparing the foundation is the most difficult; the glory is seeing the results,  like the morning you wake up with no bills or mortgage payment to make and money in the bank.

Savings need to have a purpose;  it is not the same any more we have so many distractions waiting to grab our money.  Can you remember when our parents told us those famous three words “SAVE YOUR MONEY.”  Today just saving, just for saving sake  is not good enough; savings without a reason is like emptying a huge bag of feathers in the middle of Dundas Square and coming back a month later expecting that they are still there, you would be lucky to find one soggy dirty feather.  Remember to always have a reason for saving, ask yourself this question.  WHY and WHAT am I saving for?  If you do not have a purpose for the money it will be used for whatever.

We are fortunate in Canada to be able to have as many savings accounts as we want.  I have a savings account for all the important things in my life.  Gardening, Vacationing, Holidays and Birthdays and the list can go on.  Having one savings account for everything is like an Irish stew, there are many ingredients but no distinct flavour.

Savings has its challenges but you can do it. Try it you will love the taste.

Tessa-Marie

SOME MORE SAVING FOR FAMILIES

 

 

In this section we are discussing Canada Education Savings Grant and Canada Learning Grant.

 

• Canada Education Savings Grant (CESG)
  The Canada Education Savings Grant (CESG) program provides grants to Registered Education Savings Plan (RESP) contributors until the beneficiaries reach the age of 17.

 

• Canada Learning Bond
  The Canada Learning Bond (CLB) program provides a $500 bond for children born to families who receive the National Child Benefit Supplement under the Canada Revenue Agency’s Canada Child Tax Benefit program.

 

Canada Education Savings Grant (CESG)

The Canada Education Savings Grant (CESG) is money that the Government of Canada will add to your child’s savings in a Registered Education Savings Plan (RESP).

The grant has two parts:

1. Basic Canada Education Savings Grant

The Basic Canada Education Savings Grant will give you 20% on every dollar of the first $2,500 you save in your child’s RESP each year.

Depending on your net family income, you could receive an extra 10% or 20% on every dollar of the first $500 you save in your child’s RESP each year.

 

Eligibility Information

Who can get the grant?

• All children under age 18 are eligible, as long as they are Canadian residents and an RESP has been opened for them.

1. Special rules apply if your child is between the ages of 15 and 17. See Special Rules for Children Aged 15 to 17 Additional Canada Education Savings Grant

Canada Learning Bond

The Canada Learning Bond (CLB) is $500 offered by the Government of Canada to help start saving now for your child’s education after high school.

Plus, you child could get $100 every year until he or she turns 15 years old to a maximum of $2,000!

 

Eligibility Information

• The child’s family must receive the National Child Benefit Supplement.

Children must meet the following criteria:

• have been born after December 31, 2003
• have a birth certificate
• have a Social Insurance Number (SIN)
• be a beneficiary under an RESP
• reside in Canada

Financial Information

• The children qualify for $100 Bond installments until age 15 for each year their family is entitled to the Supplement.
• The Bond is paid into an RESP established by the family.
• The first Canada Learning Bond payment includes an additional $25 to help cover the cost of opening the RESP account.

Application Information

• Visit the CanLearn Web site at Service Canada to get more details on CESG.
• Information on RESPs and CLB application procedures is available from banks, mutual fund and brokerage companies, insurance and trust companies, companies and foundations that specialize in education savings plans, and other financial institutions.

It is important and very simple to do.   Visit your financial institution and talk to a Financial Advisor, they will be happy to help you. Please take advantage of this opportunity to make your children’s education much easier.

 

Tessa-Marie

 

Related articles

• Tax-effective ways to get funds out of  RESPs (business.financialpost.com)
• Savings Plan – for Families and Children (controllingthedebtmonster.wordpress.com)

 

SAVINGS PLAN – FOR FAMILIES AND CHILDREN

While facilitating workshops throughout the city I am surprised at the number of  families, who do not take advantage of savings available for their children.   The Government of Canada continually sends out communications telling parents of the amount of money that is available for their children’s education.

This is done to encourage families with children to open Registered Education Savings Plan for their children’s education.

Today we will discuss Registered Education Savings Plan.

REGISTERED EDUCATION SAVINGS PLAN

Registered Education Savings Plan (RESP)
The Registered Education Savings Plan (RESP) allows savings for education to grow tax free in a special savings plan registered by the Government of Canada until a child named in the RESP enrolls in a post-secondary education program.

Eligibility Information

Applicants must meet the following criteria:

• have a Social Insurance Number (SIN)
• have a SIN for anyone named in the RESP as a beneficiary

 Application Information

• Information on the RESP application procedure is also available through financial institutions, such as a bank or credit union.  There are also other providers.  These institutions, planners and dealers are known as “RESP providers.”

It’s a good idea to ask some questions before choosing a Registered Education Provider.

Here are a few questions you should ask when talking with a RESP provider.

• Once I have opened an RESP, will I have to pay any fees?  If so, what are they for and how much will I have to pay?
• Do I have to put a minimum amount of money into an RESP?
• Do I have to make regular payments?
• What are my investment choices?  What are the benefits of each choice? Can the value of my investment go down?
• Can I withdraw money if I need it?  Are there any fees or penalties for withdrawing money early?
• Can I transfer the RESP to another person, or to another RESP provider?   What is the cost to transfer?
• What will happen to my savings in the RESP if my child does not continue his or her education after high school?
• Does the RESP provider limit the types of qualified educational programs that I can use my RESP for?
• What happens if I close my RESP early?
• What if my child decides to go to school part-time?
• Does the RESP provider offer all education savings incentives including the additional Canada Education Savings Grant and Canada Learning Bond?

Next week we will discuss all the other Savings available for families including the Canadian Learning Bond and the Canada Education Savings Grant.

Tessa-Marie