Posted by Frank Wiginton on Fri, Apr 15, 2011
This is a great video from the New York Times of an interview with Elmo!
Sesame Street is stepping up to help with Financial Literacy in the wake of the economic crisis!
Now this is a guy (?) you can really take advice from! Listen to what he has to say about 'Wants' vs 'Needs'!
Posted by Frank Wiginton on Sat, Jan 01, 2011
Failure is not in setting our aim too high and falling short - it is in setting our aim too low and achieving it! -Michelangelo
I always find it interesting that the beginning of the New Year has almost everyone making resolutions and setting goals!
Why is it that you need a new year to begin to set goals? Why don't people set goals at the beginning of every month? or for that matter every week or every day?
I believe that the answer lies in peoples underlying motivation to achieve.
There was a survey done in one University that asked the graduating class which of them set goals and who wrote them down. Only 15% of them could even describe any goals they had for themselves, and even fewer 3% not only had them but also wrote them down. The statistic that really had an impact was that many years later the 3% who wrote their goals down were worth more than the other 97% combined.
I believe that that those that have a passion and drive for something will set goals and achieve them. They set annual, monthly, weekly and daily goals to ensure success.
If you are setting goals for the year to come take a few extra minutes to ensure they are achieved by following some simple steps:
WRITE IT DOWN!
1. Define the goal. - I want to take a trip Egypt
2. Quantify it. - 14 days costing $4000 a person
3. Put a Deadline on it. - in October of this year (10 months)
4. Develope achievable milestones. - I will save $100 a week starting this week. I will research and book the trip by the end of March. I will ensure I have everything for the trip by the end of July.
5. Share your goal with everyone! Blog about it, post it on facebook, twitter, etc. Tell your friends and share your milestones!
If you don't write it down you will forget about it and your likelyhood of success drops tremendously. Get a small book or journal and write your goals down. Every month, every week, every day take the 30 secounds to read over your goals.
Define your goals - it's very difficult to hit a target you can't see. The more clearly you define the goal the easier it is to hit it!
Quantify your goal - leveraging your definition pull out the variables that need to be quantified.
Put a deadline on it - without a deadline nothing gets done! There will always be other things that come up that consumes your time and prevents you from achieving your goal. By putting a deadline, it forces you to make it a priority and your goals are achieve. Don't put it off using an excuse like "I'll do it when I feel better!" DO IT - YOU'LL FEEL BETTER!
Develop achievable milestones - by clearly being able to see your target, quantifying what you need to hit it and having a deadline of when you have to hit it, you can now start determining smaller steps that need to be completed along the way to reach your target.
Share your goal with others - this is the greatest motivator to achieving your goals. By sharing them with others they can help you achieve the goal and hold you accountable. It mentally encourages to achieve as you do not want to let them down or look bad in front of them.
A great book to help you stop procrastinating and achieve your goals is called: Eat That Frog! by Brian Tracey
So go out and dream big!
"If you can dream it, you can do it." - Walt Disney
Posted by Frank Wiginton on Tue, Dec 21, 2010
The federal government wants to bring in a the new Pooled Registered Pension Plan. It will force all employers to offer it but they do not have to contribute to it. You the employee can contribute to it but you are not forced to participate.
I wonder how this is much different than group RRSP's or regular RRSP's for that matter.
My question to you is: Just because there is another retirement savings option - Do you have extra money to put towards it?
Take the poll!
Posted by Frank Wiginton on Mon, Nov 15, 2010
Peace of mind and a better quality of life are simple answers.
I have been asked many times “Why should I get a financial plan? What questions can I get answers to?”
Many are not even aware of the array of questions they have when it comes to their personal finances. When I sit and chat with people about finances and mention some of the area’s to address they frequently respond with “I never thought of that before!”
To get a start here are just a few of the questions that can be answered by preparing a proper financial plan.
A financial plan will give you the answers and solutions to the following questions:
- When can I retire?
- Will I run out of money?
- What should I invest in?
- How much do I need to save?
- Should I participate in my company’s pension or RRSP plan?
- Should I pay down my mortgage or contribute to my RRSP?
- Should I contribute to my RRSP or the TFSA or both?
- Should I borrow to invest?
- Should I have a fixed or variable mortgage?
- What can I do to reduce my taxes?
- How much and what kind of insurance should I have?
- What is the most effective way to transfer my estate to my children?
- How should I set up and or structure my business?
- What is the most effective way to give to charity?
- Am I on the right track?
- Am I taking too much or too little risk with my investments
- and many more!
To start your financial plan or to learn how we may be able to help you please contact me.
Posted by Frank Wiginton on Wed, Oct 13, 2010
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Posted by Frank Wiginton on Thu, Sep 02, 2010
You have all heard or read it before: the best way to build wealth is to pay yourself first! Made popular back in the 1920′s it really didn’t take off until the 1990′s with David Chiltons book The Wealthy Barber . With advancements in technology and payroll systems, the ability to automate this process has helped to make it a very simple and successful way to reach your goals. You can easily set up to have 10% of your earnings go towards your goals. Retirement saving, buy a house, new car fund, children’s education etc are all good examples.
The reason why these automated programs are successful is that once it is running you learn to live without that money and it starts to really add up!
For example if you make $55,000 a year and you put 5% towards retirement every year (ignore raises and inflation): in 35 years at 6% return you will have saved $326,500! @ 8% = $525,680!!!! Would you really miss 5% of pre-tax income!
TIP: If you are going through a period of financial difficulty (laid off, medical leave, etc) you may want to stop any and all savings programs until your income comes back. I would rather you avoid accumulating debt at 7,10,12,18,26% while saving and earning 2,4,5,8%. The math will never make sense.
TIP: If you currently have a fair bit of debt and little savings you need to get aggressive and get rid of the debt! Once you have paid it down then get started on your savings. Read this article on how to effectively pay down debt.
Watch for my book “One Day A Month To Financial Success” due out October 2011!
Posted by Frank Wiginton on Fri, Aug 27, 2010
If you have debt and are currently reading this you have already accomplished step 1.
Step 1 – Make the decision to tackle your debt once and for all!
This is a critical step to getting your debt under control. In our consumer based, got to have the latest STUFF, no matter what the costs, society it is no wonder many are living beyond their means and racking up the debt. So if you are ready to truly deal with your debt and give yourself a better quality of life repeat after me: I have more than enough stuff! I want rid of my debt, high interest charges, stress, and frustration! I AM READY FOR A BETTER QUALITY OF LIFE!
Now repeat it again!
Step 2 – Make a list of ALL your debt!
Gather up all your bank statements, credit card statements, store credit, car loans, personal loans, lines of credit, mortgage, etc. Now on one piece of paper (if it is a long list use legal length paper) or in a spreadsheet list each creditor, the amount outstanding, the minimum payment, outstanding available credit, and the rate of interest. If you don;t know or can’t figure out how much interest you are paying – then pick up the phone call them and ask them to tell you! If you have a “DO NOT PAY FOR 18 MONTHS” kind of loan then learn how much the interest is and be sure to pay it all off before it comes due.
EXTRA: If at this point you have debt payments that total more than 40% of your gross income, you should contact Credit Canada at 1-800-267-2272 or visit their website at www.creditcanada.com . They can help educate and organize you to pay off your debt. They will show you how to communicate with your creditors to stop interest charges and reduce your payments. They can also help you to protect your credit rating and prepare to the future.
Step 3 – Organize the debt from highest interest to lowest interest
Rewrite or sort the spreadsheet from highest interest to lowest interest. Example:
| Creditor |
Amount Outstanding |
Minimum Payment |
Available Credit |
Interest |
| Department Store Card |
$ 2,200.00 |
$ 66.00 |
$ 300.00 |
28.0% |
| MBNA Card |
$ 4,850.00 |
$ 145.50 |
$ 250.00 |
24.5% |
| Master Card |
$ 3,300.00 |
$ 99.00 |
$ 700.00 |
19.9% |
| Visa |
$ 5,275.00 |
$ 158.25 |
$ 725.00 |
19.5% |
| Personal Loan |
$ 11,000.00 |
$ 220.00 |
$ - |
12.5% |
| Line of Credit |
$ 8,850.00 |
$ 265.50 |
$ 1,150.00 |
9.5% |
| Car Loan |
$ 14,825.00 |
$ 450.00 |
$ - |
6.5% |
| Mortgage |
$ 248,000.00 |
$1,250.00 |
$ 12,000.00 |
4.8% |
Step 4 – Pay out highest interest debt first!
Be sure to make the minimum payment on all debt first. This will help to protect your credit rating. Then any money you have left over take and put it all against the highest interest debt to pay it down as quickly as possible. Now look at the bottom of your spreadsheet where you have listed the debt with the lowest interest rate. Do you have any available credit at these lower interest rates? If so I want you to max out these accounts to pay off the higher interest debt as soon as possible.
Step 5 – Close your credit!
For many once you have paid off the debt it is far too easy to rack it back up! Once you have paid off the debt (highest to lowest interest) close the credit. This will help you in the future to qualify for other credit, improve your credit score and make it easier for you to stay on track for debt elimination.
Be aware that for many it may take four or five years to payout debt. The secret is that once you do start and you see those balances going down rather than up it will make you feel better and help motivate you to stick with it. By using the services of a credit counselor you may be able to save thousands of dollars in interest and having someone to talk to and work with you to accomplish this goal can make all the difference. Call or go to Credit Canada’s website www.creditcanada.com to learn more. Be sure to check out a number of great tools they have on their site that can help you to pay off your debt faster and save you more money http://creditcanada.com/financialtools.asp
Watch for my book “One Day A Month To Financial Success” due out October 2011!
Posted by Frank Wiginton on Wed, Aug 25, 2010
There are two sides to a budget – Income and Expenses.
Many when they build a budget will take their most recent pay and use it to determine how much income they have coming in every month. This will start their budget off by several hundred dollars!
First many get paid on a bi-weekly (every two weeks) basis. So simply multiplying by two will have you underestimating your income by 8.3%! This could represent your retirement savings!
Second Some of the deductions on your pay are considered expenses and should be put in the expense column. So you may end up double counting these expenses. Most common is retirement or pension contributions that come right off your pay cheque. Other items might be life or health insurance premiums, union dues, gym memberships, etc. These automatic deductions can skew your actual income.
Third – Depending on your income and the time of year that you run your budget you may have CPP and EI deduction being taken off or you may not. If you earn $44,000 or more you will max out your contributions to CPP and EI. Once you have reached this amount of income you will no longer have those deductions.
TIP: If you make more than $44,000 the easiest way to deal with those deductions is to take the max CPP and EI amounts for the year and divide them by 12 and subtract that amount off your income. (2010 MAX CPP premium $2163.15 /12 = $180.26, MAX EI Premium $747.36 /12 = $62.28 )
If you are self employed, commission income, or variable income; take the income from last year and give serious thought as to whether this years income will be more or less and try your best to estimate what you think you may earn. Speak with your bosses about what they think is realistic and then once you have determined a number take off 20% to be conservative on your budget. Any extra that you do earn can to a seperate fund to pay for your “Nice To Have” goals!
If you have two or more incomes contributing to the expenses you need to do this for each one and add them all together.
To help you identify other income sources such as dividend and investment income, rental income, alimony/child support, etc; it is easiest to take last years tax returns and go through the 100′s and 200′s section of the T1 General. This is where you list all income.
Watch for my book “One Day A Month To Financial Success” due out October 2011!
Posted by Frank Wiginton on Sun, Jul 25, 2010
The dreaded ‘B’ word! There is absolutly no reason to fear preparing a budget. I think the reason why many people do is that they feel it is a lot of work, they don’t really know how to do it, and those that have tried have never been able to keep it (likely because it was done wrong).
Yes! It does require some work. The good thing is that with today’s technology it is getting less and less.
So what is a budget?
Simply: a budget is a record or projection of all the money coming into the house and all the money going out of the house. Another name for it is a cash flow statement. This makes it easier to visualise. Money flows in and money flows out, and flows out, and flows out…
Why is a budget important?
A budget is paramount to financial success! You need to know how much you have and what it is being spent on to be able to prioritise spending and allocate funds towards different goals. Whether it is retirement, traveling, buying a new car/house/boat, the kids education, pay off credit card debt, or maybe a wedding – you need to understand where you will be able to get the money to pay for these things.
How do you get started?
First – prepare yourself that in order to prepare a good (i.e. accurate) budget you (and your partner) need to set aside 4-5 hours of time to complete it.
Secound – Gather up at least the last three months bank statements and credit card statements! ALL THE CREDIT CARD STATEMENTS! Not just the ones you tell your spouse about
.
Third – Use this Budget Worksheet as a guide to identify the various categories to seperate out your spending. It is important to understand how much you spend on various items so you can identify where you may be overspending and can cut back.
Forth – Start going through all your statements line by line noting the category that each one belongs.
Fifth – Start fillling in the spreadsheet to determine how much you earn and spend every month!
Sixth – Once you have tallied up the income and subtracted off the expenses ask yourself this: I SPEND HOW MUCH?!?!
Be sure to read The Most Common Budgeting Mistakes!
Watch for my book “One Day A Month To Financial Success” due out October 2011!
Posted by Frank Wiginton on Sun, Jul 25, 2010
1) Make a Grocery List and Save 10% - Like this one: groceries list
By going into a grocery store and just walking around randomly picking out items that look good will end up costing you a lot of money. By making a grocery list that is derived from a meal plan will not only save you at least 10% at the register but likely even more as you will throw away less food. You can probably save yourself 20 – 30 minutes as well.
2) Make a Meal Plan Based On What Is On Sale That Week! Save At Least 10%
When you are sitting down to make your grocery list, take the weekly flyer’s or go to websites such as www.flyerland.ca to see what is on sale. From that make a meal plan based on the sale items.
3) Avoid The Fancy Grocery Stores. Save 10%
By shopping at places like No Frills and Food Basics and avoiding the Longos, Sobeys, and big Loblaws; you can cut the cost of groceries by at least 10%. The cost making the store fancy and nice has to be recovered through the price of the groceries.
4) Shop At Your Local Fruit and Vegetable Stand. Save 10%
You will typically find that the produce at these small local venders is fresher as this is all they sell and they have huge inventory turnover. They usually have specials where if you buy multiples of something it is cheaper. There prices on most things are at least 10% cheaper and the money you spend stays within your community, not big corporate shareholders!
Bonus: Do You Ever Have Pizza Night?
Typically when you order in pizza for a family of four it will cost $30 or more! Check out your flyers for the frozen pizza’s! These have come a long way and many of them are very good. They always go on sale and you should be able to feed a family of four for $10 or less!
Extra Bonus: Starting eating up what you have in the house!
If you are like many, you have a pantry full of food. I would think a conservative estimate would be between $200 and $300 worth of groceries! So for the next 10 to 15 weeks eat around your pantry and save yourself an addditional $15 per week in groceries!
Have you come up with some great ideas to save you money on your groceries? Please let me know! Thanks
Watch for my book “One Day A Month To Financial Success” due out October 2011!