The month of November was ‘Financial Literacy Month‘, and after an introduction to some key family budgeting ideas from Interac, I spent the entire month thinking. Ruminating. Feeling guilty that I have never really had a handle on my finances.
Today as I sat down to pay those credit card bills (and the Black Friday stuff isn’t even there yet) I have decided to put all of my thoughts over the past month into a serious action plan. Our family has homework routines, we try and reduce our carbon footprint and have developed healthy exercise habits so there is no reason why we all can’t have a solid financial plan. I know.. your eyes are rolling back in your head. But I’m not even going to touch stocks, bonds and mutual funds in this article. Deciding to get in shape doesn’t start with a biathalon. (Thank goodness). So let’s take some baby steps. And yes. I’m about to talk about finances in public. My mom will freak. Politics and religion next?
Here’s what I currently do:
1. Allowance: The kids get $9/week. They can spend 1/3, save 1/3 and 1/3 goes to charity. I ‘keep track’ in my head, which is good because they don’t spend anything, but I’m not teaching them much about handling money.
2. Credit cards: Do I have to talk about this? I have 2 personal cards and one business. I pay pretty big fees on two of them in order to get travel points, and am so busy that sometimes I don’t pay on time. I could probably just buy flights with the accidental interest I pay. My mailbox is a community box that I don’t check enough, so other bills also tend to get missed. Once I called hydro to report a power outage but I hadn’t paid the bill…
3. Bank Account: I bank with two different institutions (one for business) and leave the statements unopened. I don’t want to see the fees, and don’t want to feel guilty and stressed when I have to write a cheque for the kids’ school and pay whatever the cheque fee is. The kids each have accounts, and each time I clean out purses we roll coins as a math exercise and march them down to the bank. Plus, I love that scene from Mary Poppins.
4. Savings: Given that there’s a banker in the family, we’re pretty good on this. We have RRSPs for us, RESPs for the kids (the government gives you money to put in so this one’s important), and TFSAs for any extra money we are able to save.
5. Budget: My life is so busy, crazy and unpredictable that budgets have always made me hyperventilate. What calms me, however, is having some savings. One area where I’m strong is hunting deals, buying only on sale and being able to be creative in the kitchen with sale items – which also means that, no, I have no meal plan.
My Financial Future:
1. Interac Debit: The slogan ‘Be in the Black’ as apropos. Black Friday is thusly named because businesses typically go from running a deficit to declaring a profit (in the 48th week of the year…). I vow to start my year in the black from January on. Paying on my debit card is not only safer (the chip and pin technology are amazing and you don’t need one of those RFID wallets – even if someone replicates your card they need your pin for it to work) but I’m using my actual real money. In addition, when I shop at the local merchants I love, they pay WAY less in fees than when I use a credit card so it’s better for the community. I will keep one credit card just for car rentals and emergencies.
2. Allowance: The kids have bank accounts, but unlike when I was a kid, there’s no bank book, so they have no clue what’s inside until I show them on the computer. The plan going forward is to get them each a debit card, and every month they are allowed to spend $18 (1/3 of their allowance) on this card. At the end of the month they can look online at where they spent the money, and yearly we will donate to charity from their accounts.
3. Bills: Every bill that can be paid directly from my bank account will get set up that way. While I’m at it I’ll request electronic bills to save the planet a bit. I’ve been using Interac e-transfer much more lately, and will see if I can broaden this – maybe I can setup the school’s PAC donations there instead of with archaic cheques.
4. Budget: This isn’t a recommendation for you, but I have to try baby steps. I will continue to seek out deals, but really try and budget where it will count. Readers know that I travel often, and simple things like setting a trip budget, taking public transit and using services like Priceline’s Name Your own Price can be significant over the year. Also, getting better luggage so I don’t have to replace it every year!
5. Meal Planning: This one gives me a rash too. But on the other hand, planning meals will help the family sit together at the table more often, and can also save time and stress. I’ve always been great at cooking dinners on the weekend and keeping two extra family meals in the freezer for weekdays. A plan will help me remember to defrost those, and also to balance our diet.
6. The Little Stuff that adds up: No more coffee out. ‘Disposable’ clothing purchases because I’m too hot in the summer are dumb. Figure out what’s better to make at home instead of buying. Stop going to a restaurant to kill time while the kids are at soccer practice.. maybe I should just coach the team.
Disclosure: This post was generously sponsored by Interac, but all of my deep, dark financial secrets and admissions of guilt are my own.