December 4th, 2013
If you haven’t started your Christmas shopping yet, you probably will in short order, I know I’ll be starting this week. Its a frightening time of the year to be shopping with Black Friday, Cyber Monday and a whole slew of Sales not to mention the mildly rabid crowds. Its easy to put the holiday shopping off and even harder to shop around for a good deal. In the past I would figure out what gifts I wanted to buy for people and then have a backup plan and hit the mall in a whirlwind tour, typically a day or two before the holidays; yep I was the quintessential guy last minute shopping.
I know I’m not the only one who did this, the malls were always full and as Christmas eve approached there were more maniacs like me frantically getting everything in one shot. There was a certain efficiency about it from a time perspective but I paid the price for it. I never took advantage of sales, deals or anything of the sort. I wanted to be in the mall and out as fast as possible so I could do more enjoyable things. Comparison shopping was not an option.
Fast forward about 5/6 years and its much more complicated, well I wouldn’t say complicated but there definitely are more gifts and more events/parties as we get older and our daughter grows up. Comparison shopping is now a reality in my life and so it should be. So in order to help those more frugally minded this holiday season here are my tips on comparison shopping this holiday season:
Do it On-line!
This is unfortunately a no brainer, its so much easier to go “Shopping” from your couch with the TV on in the background than it is to fight off the rabid mob of zombies at the mall. If you’re smart about your purchases you can even get cash back and free shipping while taking in substantial discounts. If you missed Cyber Monday, there’s a good chance you can still get some pretty good deals.
So not everything can be bought on-line, let me rephrase that: not everything should be bought on-line. There is something to be said for looking at a product you’re going to buy and physically holding it and looking at the craftsmanship before spending money. Thankfully most stores now have websites with prices and on-line catalogues.
So there are few steps to planning ahead:
- Know what you’re going to get. Put some thought into it and actually give a shit – not gift a shit. When you put some thought into a gift the person getting it will appreciate it more. But on a more practical note if you know everything you’re getting it’ll be easier to get in and out.
- Have comparable backups. Don’t delude yourself into thinking that you’ll get everything on the list (Unless you go the smart route and do it on-line). Make sure you have a few things you can fall back to so you don’t end up stuck panicking in the mall.
- Check prices on-line and know which stores even carry what you want. This way when you get to the stores you can easily identify deals and stores to go to.
The Sneak Attack
If you’re in a position where you simply have to comparison shop at the store then I would suggest a sneak attack trick I used. The day that you’re planning on shopping be the first person in the mall. Seriously, its a lot easier when you get to the mall and the stores are just opening up. Chances are the shelves haven’t been picked clean by the mob and the staff while maybe still tired and waking up haven’t been dealing with manic shoppers all day. You might even be able to ask for a discount(works more often than you think). If you can do it in the middle of the week just as the malls open up it makes it that much easier.
Stick to the List
If you’ve planned, like you should have, then you’ll know what to get and won’t be distracted. I know its not really a tactic for comparison shopping but if you know what you’re getting it will help you stay on budget. If the item you want is too expensive go to the fall-back.
Don’t be that Asshole
Finally this has nothing to do with comparison shopping but don’t be that asshole at the mall, not in the parking lot, not in the stores and not in the food court. Really there’s going to be enough shit-heads out there so stay calm, its not a race and if you can’t get the exact gadget you’ll find something else. Spending extra money for the sake of spending it just isn’t worth it.
Personally I’m going to try doing most of my shopping online; I’m setting a gift limit of about $50-70 for family members (thought my wife and daughter may get a bit more) and everyone else will get something smaller. I’m going to check the major e-tailers and shop around where I can.
December 2nd, 2013
Every year around this time you hear news stories about holiday spending and how its going to be more than last year. This year is no different; the BMO (Bank of Montreal) survey results were published a few weeks ago and they’re pointing to a pretty significant increase in a lot of areas. Overall the results were interesting and really point to a strengthening economy, if you ask me.
The average person in Canada is expecting to spend about $674 on gifts this year up from $583 which is a lot. I wonder if the new PS4 and XBOX One had anything to do with these numbers? The other question that comes to mind is how much of this will be hitting credit cards instead of being planned for and paid in cash? There have been years where I spent too much on gifts but it was mostly planned and very intentional. The sums that we’re seeing here are pretty high, my guess is that a lot of gifts are increasing in value and there must be more of them.
Personally I try to have some funds set aside for the holidays and try to keep the spending between $350-400 though this year its going to be smaller due to our current cash flow. I always try to plan out the amounts even if the gifts are often purchased just before the actual holidays and most of the purchases will now be on-line so I don’t have to go to the mall and witness this insanity.
But that’s just half the story! Christmas isn’t just about gifts, its about travel and entertaining and a lot of other small things. That same survey says that the average respondent is going to spend a whopping $1,810 on the holidays this year. I know its a time of year where you spend more money, at least for a lot of people, but holy shit that’s a lot of spending. When you look at a number like this its easy to see that this rampant consumerism is frightening. At the same time that we see these types of survey results we also hear that the average household debt is increasing. It seems that people don’t learn their lessons and this is a frightening trend. Crazy idea; trim the Christmas spending and maybe pay down some of that debt?
This year our holidays will be more muted, but even we will spend money. The good news for us is that we won’t be spending nearly as much as the survey results. We’ll come up with a plan for gifts and keep everything as low key as we can (more so than usual).
Are you planning on spending more or less this year? Do you have any tips and tricks to keep the spending under control?
November 29th, 2013
Ready! Set! SHOP!
Black Friday has descended and the race is on to spend as much money as possible in the US and to some extent now in Canada. Its the day that marks the beginning of the US shopping season marked by sales at most retailers. I was curious and searched up the origins of the day and surprisingly the term Black Friday seems to originate in Philadelphia (Wikipedia) in the 60′s where it was used to describe the foot and car traffic and congestion caused by the shoppers.
Every year it seems that the fanaticism grows bigger and bigger around this shopping day. Its even becoming more and more of an event up here in Canada. I understand that there are some good sales to be had but the craziness around the shopping and what some people are willing to do just to get in the doors astounds me. People become violent and get themselves arrested simply for the right to spend more of their hard earned money (or worse yet to be earned money on credit cards). We have taken commercialism to a new level it seems and I wonder if the rest of the world is watching North America and laughing or hoping to get in on the deals.
But to be fair this isn’t a new concept, there are concentrated sale days/weeks a lot of countries and cities, I know that there are weeks in Paris where most of the stores slash prices causing the same kind of fervour for buying. In Canada we have boxing day. Whatever you call it if you need to buy something then these sales are when to do it. My caution would be don’t spend for the sake of spending, know what you need buy it and get out and remember Cyber Monday deals are often better than Black Friday deals and you can do it online!!
Good Luck shopping!
Some Black Friday News (Sigh Really?):
- Violence flares as shoppers slug it out for the best Black Friday deals
- Black Friday 2013 deals: Shootings, employee revolt and swarms of bargain hunters start the shopping frenzy
- Walmart’s Black Friday Going About As Badly As You’d Expect
November 25th, 2013
Back in April I posted about the fact that we were over-leveraged and fixing it. The whole idea is that we purchased a cottage a few years back and as life happened we were struggling to keep up with all of the financial aspects of this additional property. My wife and I didn’t realize this immediately, nor did we notice this would happen in advance, as we should have, but we realized this within a couple months. It wasn’t a dire situation but one that really needed to be fixed in order to not get over our head. We understood this and took steps to fix this by putting the cottage up for sale.
I wanted to give an update on this siltation, we did in fact sell the cottage and in fairly quick order. In about 5 weeks we were able to get the cottage sold at a price similar to what we paid for it. At the end of the day we ended up breaking even on the place. Now this is a bit of a misnomer because we put money into the place.
The good news is that selling the cottage allowed us to clear through a whole bunch of debt and pay off our car, removing the stress of being over-leveraged and struggling. This was a very relieving feeling and one that I really appreciated. This was the hardest real estate sale that I have ever gone through, even more than my first one. For the most part I’ve been able to be fairly detached from our previous house purchases, relatively objective and able to see the purchase for what it was.
I’m not delusional and think I am completely impartial with our house sales but I was never as attached to any of them as I was to the cottage. I finally know the gut wrenching feeling of an emotional house sale. I found the cottage sale extremely difficult and tried to rationalize keeping the place, which is completely irrational after running the numbers. But that is a story for another day.
At the end of the day we realized that we were treading water, even slipping backwards, financially and in a situation that was likely not sustainable in the long term; realizing this based on looking at the numbers we decided to fix the problem rather than trying to rationalize keeping on. It was a hard choice but the weight it lifted was extremely relieving and something I think a lot of people need to do more often.
November 21st, 2013
Its been a while since I posted and I wanted to give an update: I’m now officially unemployed!
So what happened?
The company I was with decided that they need to make some cutbacks and unfortunately I was one of the cutbacks. I got a small package and here I am finding myself out of work with time on my hands. Time to think, time to pause, time to get things around the house done and more importantly for me to figure out what really want to do and what is important to me.
I’ve taken some time to even post this up here but now I’m back; I’ve got the time and choosing to start posting again.
The biggest thing I’ve noticed so for is how much time I’ve gotten back, I know its a bit of an obvious comment being I’m not working. But being off has made me realize just how much we’ve been rushing through life for the past few years. There’s been no real benefit to being crazy busy other than getting older and missing out on the things that are important.
To take this a little further, we bought a new house in August of last year, and moved in in November with the house renovations still unfinished almost a year later. We were so busy that we couldn’t even fix up the drywall and paint the house. We didn’t even realize that the intense busyness was causing mild anxiety for my wife and I until I had the time, slowed down and finally fixed most things. We are again really enjoying where we live. Because I was able to slow down I solved something we didn’t even realize was bothering us.
And at the end of the day what were were financially okay at least for a reasonably amount of time and not in a drastic position with with only one income. So what’s next? At the end of the day time will tell, but figuring out what’s important and where we want to go will be key. Time to re-ignite passions and interests. Stay tuned – more to come!
April 29th, 2013
Its been a while since I submitted and managed to get one of my posts up at the Carnival of Personal finance but today I’m happy to pass along that I have done just this. My post from last week about being Overleveraged made it in. There are always some interesting articles so definitely go check it out:
A couple posts that caught my attention:
April 24th, 2013
Ever since moving into the new house we’ve been feeling the pinch, there are more costs and just keeping things going seems like a struggle. The first of the month feels like a punch to the gut and the worst part about it is that while our debt is going down it doesn’t feel like we’re making real progress and forget about savings.
We have entered the wonderful world of being “house poor”, but its not the house thats doing this to us; that wonderful new house is something that we love and shouldn’t be a problem considering our financial situation. My wife and I make good money and we don’t spend extravagantly on gadgets and things. You could find some room for improvement in our lifestyle but at the end of the day we also need to be able to enjoy life a bit. So what’s the problem?
At the end of the day we’ve come to the conclusion that we’re almost overleveraged as defined: .
Occurs when a business is carrying too much debt, and is unable to pay interest payments from loans. Overleveraged companies are unable to pay their expenses because of over excessive costs. (http://www.investopedia.com/terms/o/overleveraged.asp)
We make more than enough money and if we were more cautious and frugal with our spending it wouldn’t be an issue but we’ve already trimmed a bunch of fat from our spending and its just not worth trimming that much more without really changing our lifestyle. And since we moved in last fall we’ve been trying to find that happy balance between lifestyle and paying everything down. We don’t want to give up having a few drinks (at home because the bar is too expensive) or being able to keep the car.
As I’ve mentioned before we aren’t the epitome of frugality but we also don’t spend a poorly. We tried to balance it and when looking at everything at the end of the day we did find that there was a big money sink; The issue is simple – we have 1 property too many. We really looked at everything at at the end of the day keeping the cottage and our current debt load meant that we’d be stuck in a very slow repayment of everything for years. The culprit became clear as did the solution.
A couple years back we purchased a cottage because it was something we both wanted, we’ve used the place extensively and even made a bit of money renting it out. We didn’t overleverage ourselves to get the place and could keep it. But unfortunately there are a lot of hidden costs with owning a vacation home, insurance, taxes and even the cost of driving there are something that can be easily hidden. So while the mortgage itself isn’t that bad when you add everything together along with all of our other debt selling the place really is the best possible option.
So in order to fix that feeling of being overleveraged we’re going to sell the cottage, its sad but when you look at the numbers removing that financial hemorrhage we’d be out of debt in about 2 years and could start saving and investing a lot.
The emotional side of this – we really like the cottage and have wonderful memories from there; its just when you look at the cold hard numbers and take away the cottage things start looking very rosy; extremely rosy with a lot of possibilities of having no debt maybe paying down the mortgage sooner or gasp invest in something.
At the end of the day we’re going to net out about even on the sale of the place, there isn’t a lot of money to be made but what will happen is we’ll remove the monthly expenses and be able to pay down a lot of debt. Once the property sells it should average out to an improvement in monthly cash flow by almost $2,000 which is huge! So while the emotional side of this came into the picture seeing the numbers really closed the deal for us. We’ve listed the cottage and hopefully it sells relatively quickly. There is still some rental income that we’re likely to get this summer but not much. In the meantime we just need to keep everything paid and up to snuff.
When you get into a situation like the one we found ourselves in the luxury of owning a cottage really became that a luxury. We took a hard look at the numbers and removed the emotion of the purchase; that helped us find the solution. Everyone situation is a bit different but in order to make headway and remove the weight of debt that we’ve got it became very clear. The numbers don’t lie; always go back to the numbers.
April 15th, 2013
All of a sudden April has crept up on us and hopefully the nicer weather comes with it. My daughter has been saying April showers bring May flowers and while she’s excited about seeing flowers I think about the yard that needs to be tamed. Now that April is here we’ve tabulated our monthly metrics for March and it was a great month from a net worth perspective as we were up another 5%.
This is a great result but its easy when the starting point was fairly small to begin with; its going to be pretty hard to keep this pace going for the whole year but if we do that would be fantastic. Now what this nice rosy number does not tell you is how challenging it has been to keep up with all of the debt load and mortgages and just life in general. The progress is going in the right direction but at what cost.
The question that comes to mind is are we over-leveraged? We’ve been into our new house for 4 months and 3 into the new year and I thought that we’d settle into an easier pattern but its still a struggle so I am thinking that the answer to the above question is yes and we’re doing something about it that I’ll post later this week.
In the meantime I’m going to enjoy the fact that our net worth continues to increase regardless of what it actually means from a cash flow perspective (even if for a day).
April 2nd, 2013
At the beginning of last month I challenged myself to brown bagging it for a month and I have to say that it has been an interesting month. I have to admit that I was very worried about the challenge because I would eat out for lunch pretty much every day. So this radical shift to brown bagging it was something I wasn’t sure was going to work.
The background here is that when I first started working I would socialize with my co-workers during lunch and it became a very ingrained habit. The results actually astonished me
My challenge was:
I am challenging myself to brown bag it as much as possible during the work week and then put the money I would have spent against one of my credit cards.
I managed to brown bag it every day in March! I didn’t go out once and in the process I’ve managed to get into a new habit of bringing in my lunch. I have also put that additional money onto one of my consumer credit cards.
My expectation was that I would be able to complete most of the challenge with a few trips out but it became a routine to make sure that I had food for myself during the day. I’ve been eating a lot more fruits and there are virtually no leftovers in the house now which is great. So this challenge was a complete success and has shown me that I can easily start changing habits that I thought were hard. I think i need to find the next challenge.
March 18th, 2013
When I was growing up there was always food in the fridge even on grocery days the fridge was pretty full. A lot of that food that was sitting in the fridge was on the verge of going bad or bits of leftovers that no one was going to eat. I still remember being asked by my mom to clean out the crispers of the fridge on the weekend when my parents were out of town so that my dad wouldn’t see and complain about the wasted food.
It was never really bad but there was almost always something going bad in the fridge and I’d love to tell you I learnt my lesson as a teenager seeing the wasted food. But if I had then I wouldn’t be writing this article from experience, it would be a theoretical piece.
Naturally with a small family of my own now we have to buy food regularly to keep ourselves fed and this involves the weekly trips to the grocery store to get food. And for a couple years the exact same thing started to happen as when I was growing up – once a month or so I would open up the fridge and think: “What is that in the crisper? It has to be bad by now” and inevitably it would be. The offending item and a bunch of other newly found items in need of a trip to the landfill would be taken out and disposed of.
I was always conscious of this on a few fronts:
- Why are we wasting food?
- There is so much money being wasted here
- Why did we buy this in the first place?
Now it is inevitable that some things will go bad in the fridge before they’re eaten. We’re not perfect so this will happen, but when our weekly grocery bills were approaching $200 per week and there was always something being wasted it was starting to grate on me.
Enter meal planning!
At the new house we got a nice new fridge as part of the kitchen renos – perfect a blank slate. I was going to keep moldy food out of this one once and for all which meant we couldn’t let food just waste away in the fridge. This is where some basic meal planning came in and saved us a small fortune in money.
Now before we go to the grocery store we don’t start with a shopping list but with a list of meals we want for the week. Its not planned out to every tiny detail but at least we’ve got an idea what 6 or so dinners we’re going to have during the week. Then we check if we have some of the components no point getting a bag of potatoes when we’ve got a mostly full one in the pantry.
We’re still not perfect but definitely getting a lot better. I think I’ve thrown out some leftovers that no one was going to eat but it’s a lot less than before. Both my wife and I are now more conscious of what we have in the fridge and cupboards and get what we need rather than something that catches our eye while we’re in the store.
My best guess is that not wasting food is saving us about $50 per week. I could be a bit off but if this is really the case then we’ve just saved $2,600 per year on our groceries and its making ends meet a lot easier as this is a variable cost.