The Frugal Canadian

10 days into the new grocery store regime

2010-09-10T15:38:00.003-04:00

I am now 10 days into my new grocery shopping habits. In 10 days our family has spent $175 which puts us on track for a $525/bill for the month. I did very good in week one, doing only one shop and this has done the majority of our groceries for the entire week and a half. This week though has been a busy one and I've found myself running out of a few items and having to make a few extra trips. This no doubtedly would have been solved had I made the Sunday shopping trip at the beginning of the week.

Meal planning has really helped me get better use of my groceries and reducing waste.

Kraft gave me some great ideas on buying one bag of groceries for five dinners. Although I didn't follow all the dinners, it certainly gave me some good ideas. Here's the link: http://www.kraftcanada.com/en/recipes/dinner/1bag5dinners/main.aspx

Reducing our Grocery Bill

2010-08-31T08:14:00.002-04:00

I used to be very good at managing our food budget, but it has increasingly become a larger and larger expense each month. A recent analysis of our expenses showed that for a family of 3 we're spending close to $900 a month on groceries. This includes our 2 year old son, who at this point, really just eats scraps. I've set a new budget of $500/month initially and would like to get it down to $400.

I plan on doing this by setting a weekly menu and do one big shop. Our busy lifestyle has left us with last minute meal ideas and many trips throughout the week to the grocery store. Without a plan, we often would pick up convenience foods, or buy a few items on our way home without a real plan. The result is a higher cost for prepared foods which are undoubtedly higher in sodium and less healthy and a lot of wastage food. We'd buy items on a whim without any plan for them only to find them waste away in our fridge. We once thought that picking up a few items each night for dinner would help reduce our bill but it's had the opposite effect. We often pick up extras adding to a higher bill and it doesn't address existing leftovers in our fridge. So what I'm hoping to do is set a weekly menu which will list out all ingredients for the entire week. This means that if I have a stirfry on Monday which has broccoli, I'll plan later in the week to have another meal with broccoli so I don't let half a head of broccoli go to waste. This will help me know exactly what i'm spending on each week and also eat a better diet. Also, once I have a spreadsheet of prices, I'll be able to better budget as I'll know exactly what items are costing me. Wish me luck!

I'm back

2010-08-31T08:11:00.003-04:00

It's been over 2 years since I've made a post but I'm finally reviving this blog. Much has changed over the past couple of years and I've been kept very busy with our 2 year old. Over the past two years our family has been not so frugal, focusing mainly on convenience for our changing lifestyle. My husband and I are expecting our second child in January at which point will be looking to upgrade our house. I'll be on maternity leave leaving my husband to cover most of the bills, so I'm looking for ways to reduce our monthly costs and return to the life of frugality.

Waiting for T3 slips to file your tax return?

2008-02-24T14:40:00.002-05:00

By now, many Canadians will have received a number of T4 and T5 slips and are just about ready to file your tax return. If you hold mutual funds, some ETFs or trust units however it could be well over another month before you receive your T3 slips. While T4 and T5 slips must be issued by the end of February, T3 slips do not have to be issued until 90 days after their year end, leaving most slips being issued around March 31st. Last year many of these slips did not often arrive in people's mailboxes until mid April. This is often a hassle if you want to file your return early, especially if you're expecting a large refund in the current year.

There is a solution to enable you to file early without receiving your T3 slips. Trusts and fund companies are required to report the tax information on these units by Feb 28 2008. This information will be publicly available on CDS Innovations Inc.'s website. Currently information is posted up to the 2006 year. 2007 numbers will appear shortly.

Here's how to access this info: From the main welcome page, click on the Tax Breakdown Posting link, select your language preference and then choose the type of slip you are waiting for - T3/T5013 or if there is a late T5 you're still waiting on these will also be available. The slips are filed by security name and there is an excel spreadsheet available for download which shows each month's distributions on a per unit basis.

As an example, let's say during 2006 you held Pengrowth Energy Trust units for the entire year in 2006. The month of January shows that a distribution of $0.25/unit was paid out to unitholders, of which $0.23750 is taxed as interest income and the remaining $0.01250 is taxed as return of capital which reduces your adjusted cost base. Based on this information you can then take your distributions that you received and allocate the total distributions to 95% other income and 5% as return of capital and report this as if you received your T3. It will take a little bit more effort on your part and if you hold a large number of funds, this could be a time consuming process. However, this can be very helpful if you're willing to spend the extra time and effort.

2007 Tax Software Reviews

2008-02-02T13:53:00.001-05:00

It's that time of year again when many Canadians are starting to buy personal tax software packages. It can be confusing for many people and each year the number of software providers is increasing. I personally find the most popular tax program QuickTax to be the most expensive and most confusing. This year they've come out with about 4 different versions. For most Canadians, they are buying a software package to make the tax filing process easier. QuickTax however, starts off by making the process more complicated than needed. They offer many different versions raning from a Basic to Business Version leaving the taxpayer with questions about which product is best for them. When I first looked at the options this year, I thought I may have mistakenly ended up at the Windows Vista page. Given the wide array of products out there for Canadians, I recommend looking around at other alternatives. Many of the new programs allow you to download the program and try it out before purchasing. My top picks for the 2007 tax year are StudioTax for Windows and TaxFreeway for the Mac. Here's a chart to help you wade through your options.

Tax Software for Macs

2008-01-28T12:53:00.001-05:00

Up until 2007 there have been very few options for Mac users wanting to file their tax returns electronically. Users could use web-based programs such as U-file and QuickTabWeb but there haven't been many downloadable options.

I switched to a Mac late in 2007 and was wondering what I would do during tax time. I happily made the switch to a Mac and have had no need for Windows programs up until now. For the past few years I have used the Windows version of TaxFreeway which I have been quite happy with. Much to my surprise they have come out with a version for the Mac! While the windows version is $9.95 for up to 20 netfiled returns, the Mac version is $14.95(for a limited time before it increasing to $19,95). While I'm unhappy about the higher price, I test-drove the Mac version on the weekend and once again it meets my needs. I was happy to see that I could carryfoward information from my 2006 Windows version into the Mac version so I did not have to re-enter all this information. For most people, I think TaxFreeway is an excellent choice. While it may not have as many bells and whistles as QuickTax, it definitely gets the job done at a very affordable price.

Another program available for Macs is TaxTron. It is a little pricier especially if you have a need for multiple returns. The price range from $19.99 - $39.99. You can also download a version for free to try it out.

For a complete list of your tax filing options, see Canada Revenue Agency's site. While many tax providers are already claiming that are Netfile certified for 2007, CRA doesn't officially certify providers until the end of January.

Happy tax filing!

Mortgage and House Update

2007-03-22T08:16:00.000-04:00

A while ago I wrote about whether or not or not we would prepay a mortgage and how much our downpayment would be. We decided on putting 25% down, under a 5 fixed rate mortgage with bi-weekly payments. As new homebuyers, we weren't really sure what we were getting into. The house that we purchased is an older home and we knew that we could have have some unforeseen repair bills. We ended up putting half of our net worth into the house and have kept the the other have invested in a diversified portfolio including RRSPs. Keeping some cash outside the mortgage ensured we would not be cash poor and have some flexibility. We plan to make aggressive prepayments every year. Our goal is to be mortgage free on this property in 7 to 10 years.

Fighting the urge to spend money

2007-03-21T18:13:00.000-04:00

I desperately want a new computer. My existing PC is extremely slow and increasingly becoming less reliable as I see the blue screen of death more and more these days. I've decided to make the switch to a Mac and am looking at a model which retails for $1699($1937 including tax).

Maybe I've been completely swayed by Apple's clever ads. The "restarting" ad is a personal favourite at the moment. Although it is more expensive than a comparable PC, most of my computer time is spent on multimedia activities and after checking out Macs failry extensively I decided to make the switch. Still, I'm not going to rush out and buy one. I've set a goal of raising enough money from sources of income other than employment. I've been working hard since January 2006 and I'm getting pretty close.

Poker winnings - 890US ~$1000CDN
BestBuy gift card - $100 CDN - from a poker bonus
Focus Group Stipends - $200 - for attending marketing research group sessions
Side Business Income - $335
Pending Business Income - $250

Total - $1,885

I'm so close but still short $50. I should reach my goal by the time Leopard comes out.

2007 Federal Budget

2007-03-19T18:55:00.000-04:00

Here's a quick highlight on the 2007 Federal Budget relating to personal income tax matters. Other than the new child tax credit, there are not many significant changes. See here for full details. While there are many corporate tax measures, I've limited my summary to individual taxpayers.

Working Tax Benefit - A 20% refundable tax on income over $3000 to a maximum credit of $500/individual or $1,000/family as an incentive to get into the workforce and get off welfare
New Child Tax Credit - $2000 tax credit per child under the age of 18. Amounts to a $310 tax savings per child.
RESP limit upped to $50,000 lifetime with the Federal Grant raising to $500 from $400 per year. Keeping the grant rate at 20% this means you'll need an annual contribution of $2,500 to maximize your federal grant. In addition, part-time will be eligible provided that 12 hours a month are spent on studies.
Personal credits - The 2007 basic exemption is $8,929 with an increase to the spousal credit to match the basic exemption. 2008 basic exemption will be indexed plus a $200 increase and 2009 will be indexed with a $600 increase.
Increasing the age limit to 71 for RRSP and RPPs. Currently the age limit is 69 before it requires to be transferred to a RRIF to be withdrawn as an annuity.
The age credit is increasing by $1000. Low to mid income level seniors will save $155 per year. In addition, pension income splitting will allow for lower taxes for seniors.
Registered Disability Savings Plan - It will be based on the RESP structure where contributions are eligible for a federal grant and earnings are tax deferred. To me this one doesn't make a lot of sense. The feds are recognizing the financial hardship that many families are faced with when dealing with a disability. Most of these families don't have the savings to participate in such a program in the first place.
Transit Passes - Weekly passes will be eligible for the credit
Lifetime Capital Gains Exemption - increase to $750,000. Unfortunately this does not apply for publicly listed shares. This applies to qualified small business corp. shares.

Talking Tax

2007-01-04T20:48:00.000-05:00

Over the holidays, I discovered a television show on Report on Business TV which has some pretty good tax information. Talking Tax airs twice a week on Tuesdays and Thursday mornings at 11:30am. The half hour show invites a tax expert every day to answer emails and telephone calls from the public.

Various topics are discussed ranging from very basic to intermediate tax issues. Here are a few of the topics discussed over the past week:
- Automobile expenses and what documentation you need to claim them
- When to claim income on option writing and how options are taxed
- Pension splitting for seniors
- Various RRSP contributions questions
- Travel medical expense as an allowable credit

Since the personal tax season is creeping up on us all, it might help you out if you've got a tax question. You can email them at TalkingTax@robtv.com or call them at 1-877-667-6288 or locally at 416-957-8199. You can find the archives for the past couple of weeks here

To Prepay or Not to Prepay?

2007-01-02T08:29:00.000-05:00

We've started to look at entering the housing market and my husband and I are both torn on the idea of prepaying our mortgage and the size of our down payment.

With respect to our down payment, we are definitely putting down 25% to avoid mortgage insurance. We are questioning however, whether it's better to put a larger down payment such as 30-35% down. The opportunity cost of the larger down payment are forgone returns from investing. For example, on a house price of $300,000, we could put down $100,000 and benefit from lower monthly carrying costs or put down $75,000 and invest the additional $25,000 in the markets.

We've been pre-approved for a five year, fixed rate mortgage of 5%. From an investment standpoint, as long as we net 7.7% pre-tax, we'll have a better return on our investment with a smaller down payment. The extra down payment would leave us with monthly carrying costs of roughly $150/month, which is not a huge amount to us. Given that the S&P returned approx 15% in 2006 as well as strong historical equity returns, it seems silly to even be pondering a larger down payment. Yet, we are both debt averse, even though I consider the mortgage to be good debt. The idea of having a larger debt hanging over our heads is a bit unnerving.

Then there is the issue of prepaying a mortgage. We have always discussed prepaying a mortgage, being keen on the the idea that if we are aggressive, we could be mortgage free in 8 to 10 years. While this is hugely appealing from an emotional standpoint, we question whether it is in fact a smart financial move given the opportunity for larger equity returns.

The biggest risk I think most people fall into is that without prepaying the mortgage, people just aren't saving and end up spending the money. As long as we "pay ourselves" first, I see little financial benefit in prepaying a mortgage.

We are probably at least a few months away from purchasing a home, so we have some more time to think about it. What are your thoughts?

Moving to E*TRADE

2006-12-19T20:44:00.000-05:00

We've decided to switch our discount brokerage services from TD Waterhouse to E*Trade Canada mainly because of the trading fees.

- E*Trade offers $9.99/trades for accounts with balances greater than $50,000 OR for active traders that place 30 trades per quarter. Waterhouse has a fee of $29.99/trade unless you make 30 trades per quarter or have $500,000

- In addition the launch of the Cash Optimizer Investment account on both Cdn and US taxable accounts is highly attractive. They are currently offering 4.15% Cdn and 4.75% US.

Our applications are currently being processed and we should have our taxable accounts up and running by the end of the year. I've decided to keep my existing TDW RRSP account until I am certain I am satisfied with E*Trade.

Canadian Capitalist just made the decision to go with Waterhouse over E*TRADE because of wash trades on US stocks. I was told by E*TRADE today that they will be implementing a service similar to TDW's USD wash facility in RRSPs, likely in the first quarter of 2007.

Currently, you can hold US stocks in your RRSP at E*Trade but your funds are automatically converted to Canadian dollars. For an active trader, the converting back and forth between currencies, gets really expensive.

If E*TRADE does make this move, I'll quickly be moving all of my accounts over to E*TRADE.

I'm back!

2006-12-15T17:22:00.000-05:00

I'm back after a long hiatus and am now enjoying married life. With our new marriage comes the need to re-examine our finances to ensure we meet our long term financial goals. Over the next few weeks, I'll be posting on the following topics that will help us meet our new goals:

- Updated net worth snapshot
- Examination of our joint portfolio
- Analysis of YTD investment performance
- Setting new financial goals
- Deciding on the benefits of prepaying a mortgage
- Mortgage affordability and closing costs
- Switching to a new discount brokerage firm
- Setting a 2007 budget

Zipcar and AutoSharing

2006-10-17T22:13:00.000-04:00

Every where I seem to go in Toronto, I’m seeing signs for Zipcar, an auto-sharing plan. I was curious to see what a casual driver such as myself what pay a year to Zipcar rather than own a car.

For an occasional driver, its $11/hour which includes gas, insurance and 150km/day. There’s a $30 application fee and if you want no minimum driving commitment there’s a $55 annual fee. Additional km are $0.25/km

Based on my driving patterns, I estimated I use my car 4 hours a week. This would let me drive to my weekly Rec sports game, allow for grocery shopping and another errand.

This would mean: $2,288/year plus $30 application fee plus $55 annual fee or $2,373

In addition, I might drive out of town on average one weekend a month, which would mean $70/day(the daily cap) X 2 days = $140 X 12 = $1680, giving me 300km for the weekend.

So on the year, I would spend $4,053 in Zipcar fees. I’d also have the ability to sublet my parking space which is included in my rent, giving me a savings of $80/month or $960 on the year. This leaves a one year net cost of $3,093 to use a Zipcar

Let’s compare that to my current car expenses:

Car Insurance $1200 annually plus car maintenance & gas of $75/month(actual run-rate) gives me a cost of $2,100 per year.

Also, my car cost approximately $25,000 brand new, let’s say it lasts me 10 years= $2,500/year

Actual net car costs on the year are therefore: $4,600

From this it looks like the Zipcar would save me $1500/year. My car is fully paid for and although I could probably sell it for $8,000, I don’t think I’m entirely convinced on switching to Zipcars. I think my car still has 5 years left on its life, so if I were to sell I’d get about $1600/year - the entire savings from using the Zipcar at $1500/year. For now I’ll stick with my existing car, but I think it’s could be a wise choice for those that currently don’t own a car and are casual drivers.

Autoshare is another service provider. The simple plan is $9.50/hour plus a $25 annual fee. But the upfront costs seem a little steep. There's a $25 application fee, a $100 joining fee plus a $250 deposit. Presumably if you really like the service, the $250 is a sunk cost.

Has anyone used either of these services? I'm curious whether users are content with the companies.

Keeping my Grocery Bill Low

2006-10-17T21:54:00.000-04:00

So what exactly am I eating? Some of you had made comments about Kraft Dinner and surviving off crackers and water. While I do enjoy the occasional box of Kraft Dinner, I eat at most 2 boxes a month. Also, I eat it because I like it not because it’s cheap. I will fully admit, I definitely don’t eat the most well balanced diet, but I think I do reasonably well.

Some highlights
- Water – I buy 18.9L jugs of water from a local water store at a price of $3.50 per jug. It usually lasts me on average 3 weeks. The same jug at Dominion costs $10 and if you buy individual water bottles the cost is far greater. I was given a water cooler as a gift about 3 years ago and it has really made a difference. I rarely buy bottled water and instead use a Nalgene bottle for travelling/at the gym or other sports activities
- I don't eat meat. While I do eat fish and eggs and other dairy, the price of a block of tofu at $3.29(which generally gives me at least 4 servings) is a lot cheaper than buying chicken, steak or other meat products. Some would argue that produce can be quite expensive but if I stick to in season produce, my costs are generally reasonable.
- I make bulk purchases at Price Choppers and No Frills. I rarely shop at more expensive stores such as Loblaws and due to proximity I often make smaller purchases at Dominion. Unfortunately I do not live close to a Price Choppers or No Frills, otherwise these would be the only stores I were to visit regularly.
- Friday nights I generally eat out with friends. As I’ve disclosed in the past, I consider these costs to be entertainment costs
- Normally one day on the weekend, I’ll visit my family or inlaws for a family meal. I’ve learned not to eat breakfast from past experience since the amount of food that is put on my plate is absolutely insane. I always take home at least one plate of food as leftovers and I generally don’t need another meal for the day. This is a great way to save on some expenses and also win some points with family members.
- This month, I had some friends over for dinner which added to my grocery bill. I served them a spring mix salad, veggie and regular hamburgers and Peach Melba as dessert with a side of ice cream. Liquor costs are not included in groceries but rather included in entertainment costs.
- I generally hit the discounted produce area in the more expensive grocery stores for some items. I started doing this a few months ago when I was shopping for eggplant to make a stirfry. The only eggplant they had was in the clearance section. For non-premium produce, I was able to get 2 eggplants for $1 and 4 small zucchinis for $2! (They were a little seedy). They also have bruised apples/oranges which I steer clear of although they could be great for baking.
- I have a vegetable garden on my balcony which provides me with green beans, snow peas, tomatoes and peppers throughout the summer months. The initial cost of this was probably quite high. I’ve had it for about 4 years and probably spent close to $50 buying soil, pots and seeds. I didn’t have any costs this year associated with the garden since I’ve had leftover seeds from the last year.

Some typical meals that I’ve eaten this month with the estimated cost

Breakfast
- No name Cheerios with milk or Bagel with Butter; Estimated Value = $0.50
- Tetley Tea – $0.034 a cup (I buy when on sale)

Lunch
- Pita Pizza(pita, cheese, mushrooms, green peppers, tomatoes, pineapple) - $3
- Soup and Salad - $3
- Kraft Dinner - $0.50
- Pasta with Tomato Sauce and Veggies - $1.50
- Tofu Nuggets with Salad - $2
- Eggs/Omelettes with Hashbrowns - $2
- Family Leftovers – free :)
- Veggie Burger - $3
- Yogurt – generally every day - $0.40
- Fruit – one piece generally every day - $0.50

Dinner

- Probably my worst meal on the day. Friday night I eat out, one weekend night I’m at a family members. 2 nights a week I play rec sports and usually don’t have time to eat before the game. After the game, I generally resort to a snack such as toast with peanut butter, frozen pizzas or a piece of fruit or some cheese and crackers.
- Meals I’ve had this past month are:

Tuna Casserole(can of tuna, 2 cups pasta, mushroom soup mix, frozen peas, 1 cup shredded cheese) - $5 for 4 servings
Falafel with couscous and side of veggies - $5 for 4 servings
Veggie Chili(ground tofu, kidney beans, chili mix and can of tomatoes) - $8 for 6 servings
Veggie Stirfry with block tofu, green beans, , mushrooms served with potatoes and yams - $6 for 4 servings
Frozen Pizza – Equality brand - $1.27
Cheese and Crackers - $4 (an expensive item contrary to most people’s belief)

Drinks

I buy milk in bags and generally buy Skim Fine Filtered milk at a cost of $4.49. It’s a bit more expensive than regular bagged milk but it has a much longer expiration date and 3 bags lasts me 3 weeks. I should drink a lot more milk than I do but mostly I put milk on my cereal for breakfast.

Juices or Punch– I always buy frozen juice/drinks from concentrate no name for about 0.60 a can unless a really good sale is on. While I’d love to buy Tropicana orange juice, the cost is outrageous compared to a can of concentrate orange juice which can range from $0.99 to $1.39. If for some reason, I can’t find juice on sale, I don’t buy it that week. The exception is V8 which I buy on occasion. I generally can’t stand the taste but it’s a good source of veggies/fruit.

Sodas – I used to buy a case of month but I stopped. It’s now too pricey for me to justify buying on a regular basis, not to mention unhealthy.

Below is a summary of my last 2 grocery bills which I started tracking early in the month when readers expressed an interest. It doesn’t reconcile in total my September grocery bill because I didn’t save all my receipts. I think it is a good representation of my eating habits.

Grocery Item	Cost	Servings	Venue
Frozen Drinks	0.57	8	Price Choppers
No Name Cheerios - double bag	5.29	4 weeks	Price Choppers
Primo Pasta	0.97	8	Price Choppers
Kraft Dinner	0.97	2	Price Choppers
Hashbrowns	1.17	8	Price Choppers
Orange Juice - Frozen	1.37	8	Price Choppers
Hamburger Buns	1.89	8	Price Choppers
Crackers	3.94	12	Price Choppers
Pancake Mix	2.17	10	Price Choppers
Tuna	2.47	2	Price Choppers
Mushroom Soup	1.23	2	Price Choppers
Bagels	2.69	6	Price Choppers
Butter	2.77	4 weeks	Price Choppers
V8 Juice	3.27	6	Price Choppers
Cheese - 560 grams	5.99	10	Price Choppers
Yoplait Yogurt	6.47	16	Price Choppers
Frozen Pizza	6.97	2	Price Choppers
Mushrooms	0.88	6	Price Choppers
Fresh Cranberries	1.47	4	Price Choppers
Potatoes	1.28	4	Price Choppers
Yams	0.97	4	Price Choppers
Onions	0.45	3	Price Choppers
Oranges	1.5	3	Price Choppers
Apples	1.75	5	Price Choppers
Trail Mix	2.99	6	Price Choppers
Tomato Soup	0.57	2	Price Choppers
Kidney Beans	0.99	3	Dominion
Kidney Beans	0.99	3	Dominion
1 lb Ground Tofu	3.99	6	Dominion
Chili Mix	1.49	6	Dominion
1 lb Ground Tofu	3.99	6	Dominion
Baby Carrots	1.69	8	Dominion
Can of Tomatoes	1.29	6	Dominion
Mushrooms	2.49	6	Dominion
Bagels	1.99	5	Dominion
Frozen Veggie Pizza	$1.27	1	Dominion
Omega 3 Eggs	3.29	6	Dominion
Skim Milk Natrel Fine Filtered	$4.49	3 weeks	Dominion
Multi Grain Bread	2.49	6	Dominion

September Net Worth & Savings Update

2006-10-17T18:37:00.000-04:00

First off - Sorry I've so late with my posting and responding to comments. For the next 6 weeks, things aren't going to get much better but I'll do my best to get back up to date.

September was not a good month for me as I acheived a savings rate of only 36% on the month. High entertainment costs mainly due to upfront sports registration fees and a lot of going out with friends led to entertainment expenses of $750!

Luckily I had a good month with investment returns adding $1100 to my net worth. These are all paper profits.

My income includes $500 of poker profits which I cashed out of my online sites. These are all realized profits which will not be put into back into the poker sites. I have an additional $700 on poker sites which is excluded from my net worth.

I opted to invest 7K into a TD money market fund for the short term fund which is yielding 3.6% . I was sitting on this cash in my self-directed RRSP and therefore couldn't use my PC financial account for these funds(since withdrawing them would trigger an income inclusion). Also, I wanted to steer away from any other external mutual funds that have redemption fees attached to them. While the rate is pretty poor it's better than the low interest that I was earning in my discount brokerage account.

Over the next month or so, I'll be changing this monthly post to more of an expanded Net Worth report. I will still disclose my savings rate, but as my expenses are pretty constant from month to month
, I feel that there will be more relevant and interesting information disclosed from a Net Worth perspective. I'll also at some point be consolidating results with my very soon husband to be. This will probably take me a few months to get our financial positions fully integrated.

August Savings and Net Worth Update

2006-09-13T13:18:00.000-04:00

It was a strong month for me both from a savings standpoint and net worth position. I had monthly savings of $2,890 on the month and a net worth increase of $3,484. I also reached my goal of saving $25,000 in one year in just 11 months.

There is nothing large to report on the expense side of things. On the income side, I prepared a few tax returns for individuals adding $200 to my income. I'm also now averaging $150 per month in dividend and interest income. This continues to grow as my savings and net worth increase.

As mentioned in my last savings update, I had sold some underperforming mutual funds and had yet to reinvest these funds. I bought a position in Proctor and Gamble. I'm still looking to invest another $7,500 but have yet to decide where to invest this.

I must admit when I started this blog 11 months ago I really did not think I'd be able to save $25,000 in one year, but once I got started and changed a few bad habits it became easier and easier.

My key success factors were:
- Limit dining out. I now on average eat out once a week. A year ago, I was probably going out 2-3 nights a week for dinner/drinks with friends.
- Reduce existing monthly bills. For me this included calling the cable company and getting a reduced price, using Skype for internet long distance and shopping around for insurance rates. While it doesn't add up to a huge amount, I save on average an extra $40/month based on changes I made here
- Using PC financial reduced my bank fees and gives me a sizeable amount of interest each month. The more I save, the more money I make whether it's interest or dividends from investing in stocks.
- Blogging my progress. After I started this blog I became much more conscious of my spending and saving because I felt accountable for my results. Each month when I was getting close to my maximum spending levels, I'd tighten my discretionary spending in an effort to meet my goals. Knowing that I was reporting to readers on a monthly basis gave me the discipline to not overspend.

Credit Card Comparisons

2006-08-06T18:47:00.000-04:00

I've had a number of comments a few posts back on credit cards and the different rewards that they offer. I decided analyze what I think are some of the more commonly used credit cards. While I've analyzed 18 different cards, I am sure this does not cover all of my readers' cards. While your individual card may not be covered below, I believe that the message will be the same. You must spent a lot of money for these cards to be worthwhile.

I've based the analysis on my average monthly credit card bill spending of $700. For each card analyzed I have also indicated a break even spending level. If we take TD's Gold Travel Visa as an example, an individual would need to spend $8,000 just to cover the cost of the annual fee.

There are a number of limitations with the analysis.
- I've excluded interest rates on the cards, since I pay my bill every month
- The analysis excludes differences in the cards such as insurance coverage, flight change options, upgrade options, waived banking fees associated, free auto clubs with a particular card etc. While these may be very valuable to a frequent flyer, I feel that for the average consumer they are useless.
- The analysis ignores booking limitations such as must have a Saturday stayover or must be booked 14 days in advance
- Since many of the cards use a point system, I determined an implied rate using Air Canada flight prices published on their website. I took 2 September flights: Toronto to Vancouver($539.90) and Toronto to London, UK($969.21) as my base fare price and used these prices to calculate an average implied rate.

How do your cards rate? My vote would be for the PC Financial Mastercard or the CIBC Dividend Card. While one reader pointed out that Loblaws is expensive and therefore the rewards for the PC card may have a lower value, No Frills is a cost-effective grocery store where points can be redeemed. I also rank the CIBC dividend card higher than Scotia's Moneyback card because of the monthly payouts vs Scotia's annual payout. Some of the other cards do have a higher rewards rate, but I personally prefer cash/near cash(groceries) than a travel reward.

Monthly Savings and Net Worth Update

2006-08-02T21:59:00.000-04:00

I had a savings rate of 43% or $2,162 this month. I overspent across the board this month. Some large spending items included:
- Renewal of CAA membership of $60. In May I killed my car battery. CAA arrived within the hour when I called and I had a new battery installed in minutes. While I am sure I was overcharged for the battery by approximately $40, the alternative would have been to have 3 hours of lost work which was worth the cost to me and justified me renewing the membership.
- Close friends birthdays, family gifts and baby gifts cost me $150.
- Other night outs with friends and other entertainment costs over spending $225.

My portfolio rebounded by gaining $869 vs last month. I sold my mutual funds which I've been meaning to dump for a long time now. They have had mediocre returns with high MERs. I'm now looking for a Canadian index ETF(likely XIU which I'll buy on a market dip), and likely will get into some US defensives.

I've changed my net worth statement to reflect only my Tangible Net Worth. As a result, I've excluded my vehicle and diamond ring as these items really have no tangible net worth to me. I'm not planning on selling either ever and my car will be driven until it has no value and is depreciating rapidly.

PC Financial launch new Interest Plus savings account

2006-07-12T02:08:00.000-04:00

I went with a friend today to a local PC Financial kiosk to have him set up with a new bank account to earn a better interest rate on his cash savings. When we got there, the sales rep informed us of a new Interest Plus Savings Account.

The account pays 4% interest as long as there is a balance of $1000 or higher. If the balance falls below $1000, the interest earned is 1%. It has the same no fee structure and like the Interest First savings account, an individual has access to the funds at any time after one business day. A new nationwide marketing campaign is being launched July 15th to promot the new account

I immediately opened an account and transferred my cash from my existing Interest First savings account. I was just about to send in a cheque to Altamira to take advantage of the High Interest Cash Performer earning 3.75%. From what I can see the new Interest Plus Savings account has the best interest rate offered on any Canadian bank accounts and also beats 1 year GIC rates.

Second Quarter in Review

2006-07-01T11:57:00.000-04:00

3 months since my last post. Not exactly what I envisioned but I've been pretty busy. Despite the end of personal tax season, I have been extremely busy at work working on corporate year ends and in my spare time I've been wedding planning and enjoying the summer.

Here's what I've been up to over the past 3 months
- A savings rate of 43%, excluding wedding expenses a savings rate of 53%

- My investments have lost 5.5% or $2,400 since March 31st. This actually had been closer to 10%, but thanks to the late week rally after Bernanke's 25bps rate increase, I recovered some of the losses.

- I've got $20,000 in cash, earning 3.1%. I'm looking into improving this by considering the Altamira Cash Performer which Canadian Capitalist talked about this week. I won't be using my brokerage account but rather will invest directly with Altamira by linking to my chequing account, so I am not concerned about the redemption fees. I am also considering the GIC ladders but for my very short-term time frame I don't think it will be worth the hassle.

Federal Budget 2006

2006-05-02T17:51:00.000-04:00

The federal budget was announced today and since the personal tax season has just wrapped up, I thought I'd give a highlight of some of the bigger items announced concerning personal taxes. It will be interesting to see this budget actually passes.

- GST was cut was cut by 1%. I spend on average $2300 a month. This includes gst-exempt items such as rent and insurance. After removing these items, my expenses run about $900 a month. So on the year, I'll save at most $108. Clearly nothing to get excited about. For the rich that spend about $40,000 on taxable items, they'll save $400.

- Rise in basic federal income tax rate from 15% to 15.5%. Additional taxes for me to pay $375 :(

- The new Canadian employment credit. $250 @ 15.5% = a whopping $38.75 savings for employees this year.

- Basic tax exemption an average of $8,839 on the year. Up from 2005 at $8,648 but a reversal of the Liberals exemption of $9,039. This means I'll save about $30 from 2005 but it's costing me $60 from the Liberals plan

Other items not affecting me personally but interesting developments:

- Pension income credit increased by $1000 to $2000. I'm quite happy to see this for the elderly, tranlating into a $155 savings/year. Given that I see a lot of elderly managing on only OAS and CPP this is a big savings for them.

- $1200 child care benefit to children under the age of six, taxable to the lower spouse income if you make more than $10,000 a year.

- New 15.5% tax credit on annual or monthly transit passes. It will be interesting to see how this will work. I'm assuming it will be another attachment to the tax return such as donation receipts or medical receipts which will inevitably make my life a little more miserable next tax season but good news for transit users especially here in Toronto. I hope it encourages more transit use and puts the 905-ers on the GO Trains, make a modest impact on our clogged streets and highways.

- Kids fitness programs will get a tax credit of $500. I find this one interesting because over the past couple of years, I've seen more and more accountants put hockey costs as a child care expense on tax returns. The argument used is that it's the equivalent to after-school day care which is deductible. Interestingly enough, for those that have been audited, 60% of the time the hockey costs have been allowed. The income tax act clearly has stated that they are not eligible, but the auditors have been lenient in the past couple of years.

- Students will now get a $500 credit for textbooks and this is a big one: All scholarship, fellowship and bursary money will now be income-tax exempt, compared to the current exemption limit of $3,000 a year! This will have a huge effect on PHD students that have their primary source of income in the form of scholarship and fellowships. While their tuition costs mostly will wipe out most of the taxes owing, the big benefit is that without this income being taxable is that the tuition can be carried forward to years when there is employment income resulting in future tax savings.

1st Quarter 2006 Report Card

2006-04-06T19:09:00.000-04:00

My portfolio had a return of $1,039 in the first quarter of 2006 or an annualized return of 7.48%. This is a combination of price appreciation of $811 and dividends of $227.

Holdings in natural gas dropped nearly $500 this quarter. It still has a good dividend yield 3.7% and the drop in market value is largely a reversal of prior period gains. I continue to reinvest the dividends and I am sitting on a sizeable capital gain since I bought the stock. I believe it is still a good long term hold but will monitor it closely.

My telecom holding remains largely unchanged, however a record dividend has been announced and I will receive the annual distribution in Q2. The dividend yield of 4.75% was the primary reason I originally purchased the stock. The stock is sitting at a loss but the dividend will bring it back up to it's original cost base(essentially I'll have a 0% return on the year for this one)

The real estate trust unit continues to perform well. I receive one additional unit per month from reinvesting distributions and while I had expected the price to remain stable since I bought it, the trust has also had some decent price appreciation.

I have a high allocation to cash and equivalents which is sacrificing my overall return. Unfortunately this is a necessity to meet some liquidity needs over the next year. I will continue to keep it invested in a 3% interest savings account.

I'm looking to make a small investment($3,000) into international equity. In most of the funds I've seen so far, Japan seems to have a heavier weight than I would like. I'd specifically like to find a ETF or index fund investing a high percentage in China.

March Update

2006-04-02T11:59:00.000-04:00

It has been a long time since my last post. I've been working far too much lately and with what little spare time I've had left I've spent it shopping for a wedding venue. With such little spare time, I was scared to look at my budget this month and how things ended up. The less time I have, the more I indulge in convenience purchases. Luckily my tax refund came through just before the month closed to offset some of my overspending.

Entertainment includes a $280 gift for my mother's upcoming birthday. This is a group gift and I'll be reimbursed $185 of this which leaves me at overspending of $345 which is still really bad compared to prior months. I looked back through the category using MS Money which was quite helfpul. It's my first full month of using MS Money and it made reporting on my monthly results very easy. Money revealed that I went out for dinner with friends quite a bit this month which is the main contributor to the overage. Groceries were lower as a result, but it's a clear indication that eating out will kill my budget pretty quickly.

On a positive note, this month was my first month of a reduce cable bill which saved me $43. The credit applied to my account included 1.7 months of service. A normal month should total $150 which includes cable, internet and my phone bill. I recently bought a new cellphone which I haven't yet sent in the rebate, so next month this cost will increase.

April is going to be a challenging month for me. Next week, we're putting a deposit on a hall for the wedding. I'll have a little bit of extra income from doing extra tax returns on the side and will submit a mileage claim at work, but this will not entirely offset the cost. I think I'll go grocery shopping now and stock up on frozen convenience foods. While these will cost more than fresh groceries, they are still far cheaper than eating out.

More Tax Software Reviews

2006-03-07T08:21:00.000-05:00

There is an interesting article by Rob Carrick at the Globe and Mail discussing some additional tax software programs that are available.

It discusses that the number of returns filed via Netfile has increased 14.3% in 2004, to a total of 3.5 million the number of returns and a 50% increase from 2001.

Not surprisingly, it highlights QuickTax, TaxWiz and Ufile as one of the 3 products to buy.

It does however list some newer cheaper programs such as

- Studiotax(Free! Financial donation suggested)
- myTaxExpress at $6.08,
- CuteTax at $8.98
- My personal favourite TaxFreeway at $9.95,
- T1Filer at $8.99
- EachTax at $5.99.
- GenuTax $34.99 BUT free updates every year after

Awhile ago, a reader inquired about a Mac version. The article suggests TaxTron which is $12.99

While I haven't tried any of the above programs other than TaxFreeway, they are all Netfile certified by CRA which means that they should produce accurate returns. As the article indicates, the probably are not as "slick" as QuickTax but I think they are worth a shot. Most programs allow you to download for free and try them out. Purchase is only required for printing or Netfile purposes.

Microsoft Money Review

2006-03-05T19:01:00.000-05:00

I just finished test-driving 2006 Microsoft Money Deluxe version(US). I was thinking about getting the Canadian version, but was offered this for a trial period so I thought I'd try this out first. As an accountant, I've used a number of packages such as Quicken, Quickbooks and Simply Accounting all of which are geared towards owning a business. I've always used an excel spreadsheet that I had developed for my personal finances and to date have been happy with it. My brother however has been a long time user of Microsoft Money and raves about it.

I found the setup to be fairly lengthy. Setting up the bank accounts was quite easy despite the fact that I have 5 active bank accounts. I was able to easily import the activity from the financial institutions and then I had to go through each transaction since the beginning of the year(the date of my first imported transaction) and allocate it as an income/expense category. This was a somewhat lengthy task, although I am told that in future months, the program will recognize recurring items and automatically assign them the previous month's category. I'm looking forward to see if this is the case.

I had a difficult time getting my investments setup. I already have my adjusted cost-basis calculated for my investments and since I could not import the transactions from my brokerage account, I simply wanted to enter the original cost basis. This caused a few problems because I had transfers from my bank account for recent purchases which needed to be allocated somewhere otherwize they would should up as an expense. I'm sure there was an easier way to deal with this, but I ended up creating a "dummy" account to deal with my transfers.

The other problem I had was with my Self-Directed RRSP account. My account has a number of stocks, ETFs and index mutual funds. Some of the stocks are US stocks but are converted into Canadian dollars in my brokerage account. Money automatically tagged these stocks as USD stocks and kept them in USD even though I entered them as Canadian dollars. In the end, I was able to reflect them in Canadian dollars. Money will automatically get the USD quote and convert it at the current exchange rate which I am quite impressed with. I question whether the average consumer would have the patience to set up such an investment account, but perhaps the average consumer would not have a self-directed RRSP plan.

Now that I am setup I think it will be quite a useful program and it should save me a lot of time compared to my excel template that I had developed. There are a wide array of reports that are used and these can all be exported to excel if I wanted to do additional analysis. I have set up my budget within the program which will speed up my monthly budget review. I am curious to see how the program will handle DRIPs. I also have not used any of the tax features since they are all US based. I will continue to use Money until my trial period is up. At that point, if I'm still happy with, I will purchase the Canadian version.

Too Much Cash

2006-03-01T19:39:00.000-05:00

I have $10,000 in my savings account right now. I'd like to keep at most $5,000 in cash realizing that I am sacrificing a potentially higher return if I keep more than 2 months of living expenses in cash. The consequence of saving $2100 each month is that every 2 months I need to look for an investment option that is going to earn me a decent return. In the next 6 months to a year, I am expecting to have some large purchases as I get closer to buying a home and will have to start shelling out some cash for my upcoming wedding. I'm therefore looking for a liquid investment, with an investment horizon of 6 to 9 months. I'm not considering ETFs other other equities given the short time period, and there is a great risk that I wouldn't even recover $29 in and out brokerage fees.

Some options I have:
- Current PC Financial Account - paying 2.9% interest - no liqudity restraints
- ING Savings Account - paying 3% interest - no liquidity restraints
- 90 Day ING GIC - 3.4% - low liquidity restraint
-180 Day ING GIC - 3.5% - medium liquidity restraint with only a 0.1% benefit
- Bankers Acceptances - 0 to 90+ days - 3.25% to 3.55%
- T bills - 30 to 90 days 3% to 3.4%
- Corporate Bonds - GM Mtge Note Bond, 3.8% 9/22/06 with a yield of 7.314%.
- Other corporate bonds with Dec 2006 maturity - 3.6% - 3.8% yield

Basically, on what I would call the "safe" investments I'm goign to get 3 to 3.5%. Clearly nothing to get excited about. But, I'm getting nervous even thinking about investing in GM even the yield is definitely attractive. It has a BBBl DBRS rating and Ba1 Moodys rating. Do I think they are going to go bankrupt by September? Probably not, but I don't think I'm willing to take the risk. For now, I will put the money into my ING account and continue to look for a better alternative.

February Savings Update

2006-02-28T22:01:00.000-05:00

I saved 48% of my income this month for a total of $2,128 and overall have saved $10,630 since I started the 25K challenge.

While my expenses were pretty much on target, there are some room for improvement. I noticed this past month that I did the majority of my grocery shopping at D ominion which is much more expensive than the local NoFrills or IGA.

My excuse is that I'm working a lot of overtime(yeck - no overtime pay) during tax season and Dominion is just down the street from me. I think I easily could have cut about $20 out of my grocery spending if I had spent the extra time going to NoFrills or IGA. I'm not sure if this is exclusive to my local IGA store but there is a great "fast sale" produce section in the store. For the most part, there is good quality produce with only a few minor bruises for ridiculously low prices. It's not uncommon to get a package of vegetables such as eggplants and zucchini for $1 to $2.

I thought I'd do a chart to visualize where I'm spending my money. Not surprising, but discouraging, is that I spend 51% of my total expenses each month on rent. Rent also represents 27% of my after-tax income.

Entertainment, at 15%, is my second largest expense and something that I could control but also find the hardest area to find ways to cut corners. Statistics Canada has some interesting numbers of the average household expenditures. Based on Toronto's 2004 figures reported, I've estimated that the average household spends 12% of expenses on entertainment. I've derived this number to exclude personal taxes and pension contributions to compare with my figures.(1) The report also indicates 18% for transportation costs, so I'm clearly not an average household income. Still I'd like to find a way to reduce these costs slightly.

(1) - My income figures are net of tax and therefore incorporate taxes as income not as an expense.

Poker Bankroll Management

2006-02-21T21:56:00.000-05:00

My poker winnings are up to $725US and I'm getting apprehensive about leaving money at the various sites due to ambiguity of the legality of online poker. In all likelihood I'm being paranoid, but I'd hate to see my hard earned winnings disappear with a couple court rulings or if one of the sites goes bankrupt. Also, since I've only been playing $0.25 no-limit tables, I really only need to maintain $200 at any given site to weather a bad streak.

I already use a Neteller account so that I can easily transfer funds back and forth to the different sites for bonus whoring. But, Neteller funds are not insured by CDIC and as my bankroll keeps growing, I'm looking for an alternative to protect my winnings. Although I can transfer funds from Neteller to my bank account, I am hit with foreign exchange fees which can be costly. I will need a US chequing account so that I can do electronic transfers as needed.

So far, I have found that TD has a US daily interest chequing account. While deposits into the account are free, withdrawals are $1 per debit unless $1,000 is maintained in the account. It also pays a dismal 0.05% interest on balances less than $5,000. What I found interesting, was that this account is not insured by CDIC either. I would think(hope!) that TD is reputable enough to not have to worry about being insured. I was hoping I'd be able to use my brokerage account, but Neteller apparently can't send ETFs to these types of accounts. I'd like to be able to find something that pays a little higher interest, so the search is on. Any suggestions?

I've also signed up for rake back at Rake Break. This will give me 30% of the rake that I pay back to my poker accounts. I've decided that at my limits, chasing bonuses is quite time consuming and this will be a better option for me. I'm estimating that this will generate $15/month. Admittedly, it's a small amount but it's nice to have a hobby that puts money into my wallet rather than empties it.

Tax Software Reviews

2006-02-12T19:46:00.000-05:00

If you're like most people, you haven't thought much about your taxes yet. After all, they aren't due until April 30th, so there are still nearly 3 months to file. If you're thinking about buying a tax software package this year, I've reviewed some of the more common programs which I hope you'll find helpful.

TaxFreeway
This is my favourite program which I found a few years ago and it was available for the bargain price of $8. This year, the price has risen to $9.99 but it’s new interface and ease of use has increased dramatically. While, it’s wizard/interviews and tax planning ideas are not as good as the other programs I’ve reviewed, it contains all the forms needed to file your tax return. The new interface should help most users complete their returns with ease. What I like best about TaxFreeway is that you can prepare unlimited returns, it’s small to install, quick and easy to navigate through the schedules and forms.

TaxWiz
TaxWiz is my second choice. It is an Intuit product which I used for a number of years prior to finding TaxFreeway. It’s basic, uses an interview process and reasonably priced for what you get. The main drawback for me is the 5 return limit.

Ufile
This is is my least favourite program. It’s cheap and great for simple returns, but I find the the wizard interview process is extremely frustrating. Self-employment income is a nightmare to enter in this program. The user is essentially forced to go through a series of questions and at no point do you actually see a completed tax return until you are ready to print the return. Maybe this will appeal to some users, but I find it difficult to find if I’ve missed anything and hard to review for accuracy.

QuickTax
The software remains the most user friendly and most capable package yet also the priciest. If you have absolutely no tax knowledge it’s easier to use than TaxFreeway, but offers little benefit over TaxWiz and Ufile. The number of returns which can be filed is the lowest of all three packages and this is my main reason for not liking this package.

QuickTax has several different versions, each of which has a different price level with more bells and whistles. These are fun to play with, although, in my experience are not very useful. If you’re going to go with QuickTax, I’d recommend the Standard version as the Platinum and Unincorporated packages really have no additional “required” features to help you complete your returns. They have some neat features, but if you’re self-employed you’re better off getting a decent accounting package at the beginning of this year, so you’re in good shape for next year. In my opinion, these added features are not worth the extra $20.

Our Not so Frugal Valentine's Day Dinner

2006-02-12T18:31:00.000-05:00

My Valentine and I went out for a lavish dinner last night. Neither of us have never spent a lot of money on Valentine's Day. Over the past few years we have probably spent no more than $20 on each other. This year was a little different.

Months ago, I recieved a $150 gift certificate for a swanky restaurant downtown from a couple of close friends as a birthday gift. At the time I found the gift wildly inappropriate. I had already found that birthday gifts were getting out of hand, and this was a step in the wrong direction. I put the gift certificate aside and figured we'd save it for a special occassion.

We used the gift certificate last night. We had 2 appetizers, 2 entrees, a bottle of wine, and 2 decadent desserts. I had also used a coupon from Toronto Life where you buy one entree, and get a free dessert. The bill came to $150 and we also had to shell out our own own money to cover the tip. The dinner was phenemonal, but it was absolutely outrageous. We spent my entire grocery budget for the month on one dinner! Thankfully only $30 came out of our pocket. We easily could have gone to the pub down the street and had just as nice of an evening. This spending will come out of my entertainment budget this month.

I hope you all are able to have a nice simple frugal Valentine's Day. It doesn't take a lot of money to let your loved ones know that you care. Don't give in to this commercialized day.

Reducing my cable bill

2006-02-03T19:44:00.000-05:00

As I mentioned in my last post, I had to make an attempt to reduce my cable bill. I was facing another price increase to an already hefty bill. After looking at various packages on Rogers website I finally mustered the strength to pick up the phone.

I had decided to cancel The Movie Network package and downgrade to the Ultimate TV pak. While my package was already a Digital VIP package where prices are not broadcasted on the website, I figured this was going to save me about $15/month.

The process took me 45 minutes in total. Here's a summary of the events
- Sales rep #1 told me I could save $12/month. He tried to switch packages and couldn't so I was transferred to customer service
- I was hung up on and had to call back! (perhaps this was intentional to avoid a bill reduction)
- Sales rep#2 successfully transferred me to customer service
- A large song and dance was performed by me telling them that while I really enjoyed my current package, I just couldn't afford it any longer
- After 5 minutes of being on hold, the customer service rep, offered me reduced overall rates of 10%, waiving the modem fee, waiving the digital terminal fee, waiving the system access and the final price was $93.76. After this a price increase of $6 would still apply as these rates are apparently going up across the board.

Below is a summary of my ending package.

I managed to save $8.23/month by keeping the exact same package. After the price increase, I'm technically saving $14.23/month. I have to call back in February 2007 if I want an extension to the reduced rate.

While I was at it I asked for an evaluation of my cell phone plan as well. I couldn't get much out of them. I'm already on one of the lowest rate plans and get a 10% discount because of my bundle package. I cancelled my Essential Value pack leaving me only with voicemail. This was a saving of $5/month.

I've been tempted for awhile now to sign up for a personal video recorder for $9.99/month. But... that's not going to help me save any more money so I'll resist the urge until the technology becomes more affordable.

January Update

2006-02-01T20:19:00.000-05:00

It was a good frugal month for me. I achieved a savings rate of 50%.

I'm displaying YTD numbers based on when I started my blog(October 2005) rather than a calendar basis. This way I can easily track my 25K challenge.

Food savings were my biggest achievement this month. I really made an effort to use my groceries that I bought before they reached the expiration date. It was tough at times resisting the urge to go and pick up some groceries when I wasn't in the mood for ingredients on hand but with a little bit of creativity I made it through the month with great savings and some pretty good meals.

Included in my gas costs is an oil change and some other air filter that Mr. Lube sold me. I need to learn more about cars so I don't get scammed every time I go to the auto shop.

Entertainment costs were also high. There were quite a few nights out with friends that I couldn't connect with over the holidays. Damn $7 martinis!

This month I have to call Rogers and reduce my cable and phone services. I just got a notice that my rates are going up $6. I'm already on their VIP bundle package and get another 10% off on my phone services with them, but the total bill is getting out of hand. Looks like I'll be missing the upcoming season of the Sopranos.

Keep on Track of your Finances

2006-01-29T18:15:00.000-05:00

I recently accepted a volunteer position in the capacity of Treasurer for a local non-profit organization. One of my first tasks was to work with the new General Manager to develop the organization's 2006 budget.

Since I'm new to the organization, I first wanted to look at the 2005 results to see what went well for the club and what needs improvement. As it turned out, the bookkeeping had not been done for the past 6 months and so results weren't available. After waiting for a few weeks I finally got the financial results this week. It turns out the club lost almost $25,000 this year when they were scheduled to break even. While the OLD general manager did a good job of growing the club and increasing revenue, he also spent a tonne of money on various expenses.

I should be clear that there was no impropriety. All of his expenditures were authorized and approved by the board of directors. What went wrong is that the board looked at all of the small expenses in isolation and had no idea what these amounts were totalling throughout the year. Their lack of review throughout the year, meant a big surprise at the end of year.

I have now implemented a monthly reporting process which should take the admin staff no more than 30 minutes to prepare each month. I've also outlined a report which is slightly more comprehensive to make sure there are no surprises under my watch. Let this be a lesson to us all. Look at where you're spending your money throughout the year. If you don't at the end of the year, you're likely to be well short of your savings target.

One Month Left for RRSP Contributions

2006-01-29T18:07:00.000-05:00

If you haven't already contributed to your RRSP this year, you have until March 1st to get the deduction on your 2005 tax return. For those of you that are just starting out here's some info for you:

What an RRSP gets you
- A deduction on your tax return which lowers your income by the amount of your contribution
- Tax Deferred Growth on your Investments. While invested in your RRSP you do not pay tax on the income the plan generates.

Where to get one
- Banks, Credit Unions, Brokerage Services
- You can walk into your bank and tell them you want to contribute to your RRSP. Even if you’re not sure what you want to invest in at that moment, you can make the contribution in cash and decide later how to invest it. This is commonly referred to as “parking” your RRSP.

Eligible Investments
- Cash, GICs, mutual Funds, ETFs, stocks, bonds, trusts

How much Can you Contribute
- Each year you can contribute up to 18% of your prior year’s Earned Income, subject to a maximum of $16,500
- You can find this amount on your 2004 Notice of Assessment from Canada Revenue Agency(the letter CRA sends after you file your tax return)
- If you cannot find this form, you can call CRA at 1-800-959-8281 to find out your limit. You will need your SIN, date of birth and line 150 of your prior tax return before they will release information to you

Withdrawals
- Any amount taken out of your RRSP is taxed 100% as income regardless of the type of income. Your bank will issue you a T-slip which you will need to report on your return
- Tax is withheld at source but depending on your tax bracket, you may have to make additional tax payments when you file your tax returns

Withdrawal Exceptions
- You can withdraw up to $20,000 on your RRSP under the Home Buyers Plan and Lifelong Learning Plan(annual limit of $10,000)
- You have to pay these amounts back over a number of years – HBP(15 years), LLP(10 years)

Borrowing Money to Contribute to your RRSP – Points to Consider:
- The interest incurred on your loan is NOT tax deductible
- For a $1 contribution you in almost all cases will NOT get a $1 refund. This means, if you contribute $10,000 you will not get a $10,000 refund.
- Do you have the ability to repay? What tax bracket are you in?

Profitable Hobbies

2006-01-29T17:51:00.000-05:00

It's been awhile since my last post. What have I been up to? At the risk of losing all credibility with my readers, I'll confess. I've been playing online poker trying to play enough raked hands to earn a $50 bonus.

In the summer after watching my fiance play online and having him teach me the game, I decided to deposit $20 into an online site. If I lost it, I vowed never to deposit another cent. It was an entertainment cost when I was bored one Sunday afternoon. Three weeks later, my poker bank roll was up to $200 and I withdrew my original investment of $20. Now that I'm getting a little bit more experienced, I've started to bonus whore. This means, moving money around from site to site, in return for the site granting me a bonus for the amount I deposit once I play a certain number of raked hands. My poker bank roll is now up to $600 of which $125 is from bonuses from a couple of sites.

I'm NOT suggesting that everybody go out and start playing some online poker. Many people develop serious gambling problems and it's not a reliable source of cash flow. Poker is however a good source of entertainment for me and as it turns out profitable. Instead of going out to rent a movie when I'm bored one night and shelling out $5 at Blockbuster, I am now more likely to play some poker and hopefully earn some money. I should also note that I'm excluding my entire bankroll from all investment and net worth analysis since I could lose it at any point.

Getting Into Good Financial Health

2006-01-15T20:50:00.000-05:00

I had a question from a reader about getting their finances in order and where they can seek help. The individual faces many challenges which many people are struggling with: recently starting a full-time job, student loans, credit card debt, future tuition payments and struggling to meet current living expense requirements. Also, the reader recently purchased a condo where mortgage payments will start in one year.

Not sure where to start? Here are some ideas to think about.

Cash Flow and Budget Analysis

You can’t begin to come up with a plan of attack on your debt and future if you don’t have a realistic idea of how much you can dedicate to your debt repayment. You need to determine where, when and how you spend your money. I would suggest, going back through your bank and loan records for 6 months to see what your spending patterns are. You can then see over a 6 month period, how your spending patterns vary, what percentage of your income is going to each category and really give you some perspective to how you’re spending your hard earned cash. When I first started my 25K challenge I was amazed and admittedly, somewhat disgusted at the amount of money I was spending on entertainment. Having a budget gives me the motivation each month to keep on track and it’s become exciting for me each month to sit down and see where I finished up.

Debt Elimination

I would consider paying a visit to the bank to look at loan consolidation. The credit card debt is likely around 20%. Emphasis should be placed on getting rid of higher interest rate debt first. Most individuals will qualify for an unsecured line of credit from their bank. The requirements to qualify are quite low, and the interest rate are much lower than credit card rates, usually prime rate plus 1-3% depending on your credit quality. At current rates, this could mean a rate as low as 6%. You can use your line of credit to pay off higher rate debts(i.e the credit cards). Future loan repayments will make a much bigger dent in your debt with the lower interest rates.

Seek Professional Advice

If you’re not a numbers person and struggling to make sense of your finances, I would suggest seeing an accountant. They can identify areas of improvement and come up with a strategy for debt elimination. As an alternative to an accountant you could see a financial planner as well. However, in my experience financial planners are more focused on getting you to invest in their products rather than investing in yourself. An accountant can take an independent view of your financial situation and recommend a strategy rather than recommend a number of products.

2006 Personal Budget adjustments

2006-01-13T10:35:00.000-05:00

I’m making a small adjustment to my budget based on my pay raise. I plan on saving my entire raise this year, so there is no adjustment to my expenses. My income has increased but due to tax deductions, I won’t be seeing any additional cash flows for the first 6 months of the year, while the Feds take off EI and CPP deductions. During the first six months, my new savings rate will be 49%. Starting in July when I’ve maxed out on these deductions I will jump up to 53%. These changes will be adjusted in my next monthly update.

A key initiative for me this year, will be to find a balance between RRSP contributions and my short term goal of buying a house. I would like to bump myself down to a lower tax bracket and tax advantage of tax deferred growth, but realize that since I’m currently above the home buyer withdrawal limit of $20,000, additional dollars contributed to RRSP are dollars that are truly locked in until retirement. This is a good thing, but I need to ensure that I am meeting nearer term goals as well.

Registered Education Savings Plans (RESPs) - What you should know

2006-01-03T18:45:00.000-05:00

Today was my first day back to work after the holidays: the official kickoff of tax season. This means I start to get phone calls from clients that have met up with friends over the holidays and learned about the greatest tax idea...

A client of mine recently had a baby and called me up to find out how much money he was going to save on his tax return for his RESP he just set up. He was shocked when I told him there was not a deduction. If you're thinking of setting up an RESP for your kids or a relative here's what you should know:

Advantages

Income generated on your contributions are tax deferred. This means, you do not pay tax on the income that's earned from the contributions while the funds are in the plan(up to 20+ years of untaxed growth)
Up to $7,200 of free money --The Feds give a 20% Canada Education Savings Grant matched up to $400/year. Additional incentives available for low income families and the Province of Alberta.
Payments of accumulated income are usually made to the child when they have little to no income(since they are a student) and therefore minimal taxes are due.

Limitations

Contributions to an RESP do not result in a tax deduction on the contributors return. This is a common misconception and is NOT the case.
Contribution limit is $4000/year for the beneficiary(aka. the child) to a maximum of $42,000 lifetime. This means that if you have grandparents that want to contribute you as a parent, have to share the $4000 each year. Overcontributions are penalized.

How do you get your money out of the plan when needed?

Payments can be made to the beneficiary to finance a post-secondary education and included on the income of the beneficiary
Payments of inital contributions - to the contributor(parent) or the beneficiary
Payments of accumulated income - to parent/contributor or child and included as income for tax purposes

What if the child does not go onto post-secondary school?

Your original contributions can be redeemed at no tax cost
You lose the CESG - $400/year
You're taxed on the accumulated income on your initial contributions. But, if you have RRSP room available you can carry over up to $50,000 into your RRSP.

Requirements to set up

The child must have a Social Insurance Number(apply early!)
Must be a resident of Canada

For more information check out CRA's publication for more information.

VOIP setup

2006-01-01T18:46:00.000-05:00

I setup a VOIP account today on Skype. I looked at Vonage and Rogers but was unimpressed with both their prices and the amount of setup/equipment required to get up and running. I am jealous of my American neighbours that have enough competition to keep prices low. With only a few Canadian companies, monthly prices are currently comparable to landline services. The long distance is definitely cheaper than traditional land lines, but Skype is still from what I can tell the best deal online.

Skype charges 0.017 Euro cents (approx 2 cents Cdn)per minute for computer to non-computer call and is free from computer to computer. It works on a credit system in 10 Euro increments. It would be nice if there was the option to buy in Cdn or US dollars but it's not that big of a deal. Hopefully, I'll be able to convince most of my long distance friends to get an account so we can talk computer to computer free.

I downloaded the software in just a few minutes and am nearly up and running. I need to pickup a microphone or USB phone. I'm hoping that my cellphone headset will work. It just needs an attachment to fit my audio input on my computer and I should be able to get one of these for a couple of dollars.

I tested the calls to other friends that are set up on Skype to make sure I was connecting properly(no voice yet) and have used the chat functions. Another great feature is the ability to send computer files. Since most email servers often have MB limits, sending large files can't always be done easily. I'm currently transfering a 500MB file from my brother who lives out of town and it's much easier than clogging up my email with files sent in bits and pieces.

This should save me about $10 a month in long distance bills. Not a huge amount, but if I like the VOIP experience, I may look at cancelling my cellphone in favour of a permanent VOIP service.

Adding US Exposure to my Portfolio

2005-12-31T12:16:00.000-05:00

Last month I decided to add some US exposure to my portfolio and was searching for a suitable investment.

I decided to put ~ $6000 into Vanguard Value Vipers (VTV). It will provide instant diversification on the US large cap value stocks. I also looked at the iUnits S&P 500 C$ Index Fund(XSP.TO) and the iShares S&P 500 Value Index Fund (IVE)

The iUnits ETF seeks to match the S&P 500 and is hedged to Canadian dollars which I'm not overly concerned with. It also primarily invests in the iShares fund. Because of this, its management fees are higher and performance lags both VTV and IVE.

IVE vs VTV has a slightly higher MER at 0.18% vs 0.11% and while the two securities are pretty close in terms of returns over the past 2 years, I decided to go with VTV.

I'm not expecting much difference in performance between the 2 securities over the long term, but the slightly lower MER and the lower current market price $57.17(VTV) vs. $65.05 make it more attractive for myself.

2006 Goals

2005-12-31T11:15:00.000-05:00

Happy New Year to everyone and I hope you're all enjoying your holidays.

It's been 3 months since I started my 25K Challenge and I'm quite pleased with my progress. I've increased my net worth by $5,600 in just three months and I must admit that the savings progress has become somewhat addictive. The more I save, the more I want to continue to save as I watch my funds grow.

I thought since the New Year was approaching I should develop some new goals for myself.

My 2006 goals are:

- Continue to save $2000 per month to meet my 25K challenge

- My salary increase(yet to be determined) will be directed to 50% RRSP savings and 50% to a wedding fund(Yay - I got engaged over the holidays!)

- When I think I need groceries, wait 2-3 days and use up items in the cupboards and fridge and cut down waste on produce and fresh foods (I am horrible at this!)

- Complete full evaluation of my portfolio quarterly to determine if it needs rebalancing and ensure it's achieving an appropriate return

- Put a significant effort into my tax preparation business that I run on the side. In the past couple of years, I haven't marketed this as heavily as I could have. At an average of $75 per tax return, it can really add some additional income

- Seek lower insurance rates by raising deductibles on my car

- Get VOIP set up. I generally don't make that many long distance calls, but because I only have a cell phone, they are very expensive.

December Savings Update

2005-12-31T11:00:00.000-05:00

This month wasn't pretty when I looked at the allocation of how I spent my money this month, specifically in food and entertainment costs.

Fortunately, due to a mileage reimbursement from work I was able to stay on track and saved $2121 this month.

With holiday parties, my entertainment costs were up. Also contributing to the large spending were my recreation sports team registration fees of $155 which covers me until the end of April. I'm also out of pocket $80 for one team member which hasn't paid me his fees yet. When I take out these fees my entertainment costs are down to $330 which is still excessive but understandable with the holiday season.

I also purchased a piece of furniture this month to give me some much needed storage in my apartment which contributed to the high household items this month.

Free Coupons Arrived Today

2005-12-28T16:45:00.000-05:00

A friend of mine recommended Save.ca as a good site for coupons on household items. Last week I visited the site and my coupons arrived today.

The process took about 2 minutes; I just selected the coupons I wanted, entered in my mailing address and clicked the submit button.The coupons are mostly from name brand suppliers - Proctor and Gamble, Nestle, Heinz, Gerber and S.C. Johnson and range from frozen pizza, laundry detergent, baby food and cosmetic items.

The coupons range from $0.50 to $2.00 off and have a 3 month expiry date. My only disappointment is that I had selected a $1.00 Noxema coupon, but did not receive it. When I checked back on the website, the coupon no longer exists.

The coupons rotate from month to month so it's a good idea to check it out monthly. Since you can use them also with items on sale, I'm hoping it puts a small dent in my monthly grocery budget.

Free $10 gift card for Sears Credit Card signup

2005-12-17T18:25:00.000-05:00

I was doing some last minute holiday shopping and got a free $10 gift card from Sears today. All that was required was signing up for a free Sears credit card and paying for my purchase with the Sears Card. The whole process took about 5 minutes and now I have an extra little gift to pass on.

I didn't think I would qualify since a year ago, Sears had a similar promotion where if you signed up for their free card you would get 10% off your purchase. Once I had signed up last time, I immediately cancelled the card after I had paid the purchase off. The only condition for me to be eligible on the current promotion was that I didn't have an active account for one year. I apparently made the cutoff by 2 weeks.

I'll cancel the credit card again this time so I'll be eligible for future promotions.

ING Opening Bonus

2005-12-08T18:14:00.000-05:00

In the US, a lot of banks offer promotions giving away
free money if you sign up an account. I haven't found a
bank in Canada doing this, until now. ING direct http://www.ingdirect.ca/en/isav4/openaccount.html offering $13 free if you sign up with them. The only condition is you deposit $100 minimum. I'm sending my cheque tomorrow.

Low Management Expense Ratios

2005-12-05T18:59:00.000-05:00

I wanted to see how my management fees on my TD mutual funds compared to the TD's e-Series funds. I found that I can cut my fees in half.

TD funds	Current	e-Series
	MER	MER
Cdn Bond Index	0.91%	0.48%
Cdn Equity Index Pure	0.88%	0.31%
Cdn Equity	2.25%	na
US Equity	2.47%	0.33%

Searching through the funds wasn't an easy task and I found for some funds such as the Canadian Bond Index fund, there were 4 almost identical funds all with differing management fees ranging from 0.48% to 1.07%. I examined both the portfolio performance as well as the holdings and the differences amounting to less than 0.2% in favour of the e-Series.

My obvious choice is to sell my existing funds and switch to the e-Series. Since all the funds are held in my RRSP, I won't be facing taxes on my dispositions.

A listing of all the available e-Series funds can be found here:
http://www.tdcanadatrust.com/mutualfunds/prices.jsp

Portfolio Rebalancing

2005-12-04T21:28:00.000-05:00

As I mentioned in my last post, I'm sitting on some excess cash and need to invest it for a higher return than the 2.3% it's currently earning. I decided to look at my portfolio and determine how much rebalancing I need to do.

I was quite alarmed when I looked at my portfolio. Over the past year, I dumped a few poor performing expensive mutual funds in favour of some stocks which have been performing well over the past year. It left with me with almost 90% exposure to the Canadian markets. Most of the run-up in my cash holdings have been the result of my savings over the past couple of months.

It's clear that I have way too much cash and need some foreign exposure. For now I've narrowed my focus and will put my excess cash into US equity - preferably large cap. I'm looking at some index funds, ETFs and a few stocks, but am leaning toward ETFs for their instant diversification with low MERs. I also need to re-evaluate my remaining funds since the funds recently went through a reorganization. Canadian Capitalist mentioned TD efunds and I think these may be a good fit for what I want.

The main criteria I'm looking for are:
1. If ETF or index fund, low MER - specifically, less than 1%
2. If stock, 2-3% yield; if income trust 5-8% yield. I'm a strong proponent of cash yields, whether it's dividends or trust/fund distributions.

November 2005 Update

2005-12-04T10:00:00.000-05:00

Early Christmas spending blew my budget this month, however on a year to date basis I'm still on track with a savings rate of 46%

I also purchased a leather jacket for myself which took up nearly half of my clothing budget for the year. It is an item that I've been wanting for many years now and because I needed a new winter coat this year, I decided to finally break down and get a good long term jacket.

Next month I should stay on track but it will be tight with the holidays. While I have nearly finished all of my Christmas shopping, I'm expecting high entertainment costs because of the holiday season.

I'm now sitting on investable cash of $7000. It's in my PC Financial account currently earning 2.3% per month. My plan for the next month is to find a better alternative for this.

October Saving Update

2005-11-09T18:40:00.000-05:00

Well, it's one month into my 25K challenge and I exceeded my goal with a savings rate of 53%. Hopefully this will continue into the future.

Here's my monthly variance report:
This month I made a trip to Costco and purchased a lot of food and toiletries which put me over on my food category. I'm hoping my bulk purchases will result in some savings in future months.

I realized I have a major flaw in my budget by not allowing a provision for toiletries and cosmetics. I estimate that these expenses will run about $30/month and will incorporate into my next month budget.

My income is up due to CPP and EI deductions having reached the maximum deductions earlier in the summer. This will continue until the New Year when deductions will resume.

While I was able to save more than I was anticipating, October was a bad month on my investments. My portfolio lost approximately $1000 largely due to my heavy exposure to the banks, oil and real estate. So far into November, these stocks have started to rebound and I'm not worried about the long term effect on my portfolio.

Lower Banking Fees

2005-10-19T15:43:00.000-04:00

I’ve been a long standing customer at TD Canada Trust. I was tired of the standard $3.95 service charge for not maintaining a balance of $1,000. While $1,000 isn’t much to maintain, I find the concept itself absurd and knowing that I had an alternative at PC financial I decided to close my TD chequing account.

I set up a President’s Choice Financial bank account approximately 1 year ago. It took a while to set up but I am finally content to use it as my primary account. It has no service fees on the chequing account and the interest first savings account offers a 2.15% interest rate on my average daily balance.

Benefits:
- Ease of transfers to external financial institutions and brokerage account
- Essentially no fee banking
- Decent savings rate on emergency funds

Hassles
- Initial hold on deposit totals. I only have a cell phone(no land line) and the bank had difficulty performing a credit check on me. They initially held any deposits on my account for 5 business days before allowing me to withdraw any funds. They have since withdrawn the hold.
- Foreign Currency Difficulties – While the bank card can be used at ABMs in the US, you cannot obtain foreign currency on your account from a teller since no branches exist.
- Waiting time for bankdrafts etc – Obtaining a certified cheque or bank draft can be ordered online or via telephone, but takes approximately 1 week to be delivered via mail. I haven’t had to use this option but it would be a nice to have.

During the transition period, I maintained my TD account just in case the PC Financial didn’t work out. It’s been a year now and I was ready to close the TD account. I went to the branch to close my account and told the banker I wanted to close my account and switch to a savings account. The marginal balance I would maintain in the savings account, would provide some convenience if I did need foreign currency or a certified cheque. Since it is easy to transfer funds from one bank to another, it was a simple solution to maintaining my lower fees.

The banking rep immediately asked why I wanted to close my account. I replied with two words: "service fees." He asked if that was the sole reason and I nodded yes. He shut the door and said, "here’s what I can do for you."
He offered me a full serve account, unlimited transactions and free cheques, no minimum balance for 1 year at NO COST. When I complained that it was only good for one year he told me to come back in a year and he’d give me the same deal.

Then he offered me a savings account. I didn’t really need it since I was already set up at PC Financial. I told him this and he offered me a savings account with no minimum balance earning 2.1%. It normally requires a $5,000 balance to earn interest but he also waived that. I signed up since it cost me nothing.

So I’m staying with TD. I don’t plan to switch back entirely to TD as I am pretty content with PC Financial. It will be nice to have the comfort of knowing I have easy access to foreign currency and some face to face customer service should I need it. Even better, I’ll save $47 a year in service charges.

The 25K Challenge

2005-10-01T18:20:00.000-04:00

I'm 29 years old and up until this point in my life, I haven't exactly been living a frugal life. I have managed to acheive on average a 25% savings rate since I entered into the workforce 5 years ago and have so far accumulated a modest net worth of $55,000. I recently started reading some finance blogs indicating that an individual should strive for a 10% savings rate, so I initially gave myself a pat on the back. It wasn't until I looked at some other sites in detail, that I realized there were a lot of other individuals at my age with a much higher net worth ranging from 150-180K.

I currently rent an apartment in Toronto. The housing market has escalated to the point where homes boast a price tag of $300,000 for an entry level home in a somewhat decent, yet not desirable neighbourhood. With a near term goal of purchasing a house in the next year or two, I am challenging myself to save $25,000 per year. This represents a savings rate of 48% of my after tax earnings. To do this, I developed a budget and will track my monthly progress and report on it.

Notes and assumptions

Monthly income - net after tax with an effective tax rate of 30%.

Rent - The largest component of my spending budget at 54%; possibly subject to a 3% annual increase. I was able to convince my landlord to not implement the increase in 2005. This was achievable only because rental vacancies are high due to the ongoing housing boom.

Communications - includes monthly phone bill, internet and cable bill. Many of the financial blogs indicate one of the easiest ways to save money is to cancel the cable bill. This is not something I'll willing to compromise and consider these expenses essential. For me and my current lifestyle, a decrease in my internet or cable bill would be offset by an increase in entertainment costs. I have set myself up on a "bundle plan" and plan to try a cancellation tactic in hopes of a decreased price. There is a great post on how to achieve this: MyMoneyBlog. I'm just trying to gather the nerve to pull off this total bluff.

Insurance - Car, apartment and health insurance. I'm currently looking into increasing my deductible on car which should produces some savings. Unfortunately my employer does not offer a group health plan causing me to spend 2% of my budget on private health insurance

Gas - I walk to work everyday and use my car mainly for out of town trips, which I take approximately once a month to visit family and friends. I rely almost exclusively on foot and public transportation. On average, I need to fill my car with one tank of gas per month.

Food - An average of $45/week which will be a challenge. As a vegetarian I can save a little in this area without having the high expense of meat in my budget. This category includes groceries only. Because I live so close to my work location, I eat my lunch at home(the equivalent of brown-bagging it). Note that "eating-out" is captured in the entertainment category.

Clothing - A budget of $600 per year. I generally do a big shop twice a year in the spring and fall to maintain my current wardrobe.

Entertainment and Gifts - An average of $60 per week which will allow for 1.5 nights of entertainment per week. I play in team sports three times a week which helps keep these costs low. That is of course, as long as I don't go out for beer afterwards.

Vacation - One $1,500 vacation per year. If I'm going to save 48% of my income, I deserve a vacation at the end of the year.

Expected Results

If I am able to maintain this budget I will have saved $24,432 in one year. I hope to achieve a return on investment on my existing portfolio and new savings of 5% after tax which will put me over my $25,000 goal. My first progress report will be posted October 31st - the first full report of my new life as the Frugal Canadian.