Canadian Finance Blog

Posted: 25 Sep 2011 02:00 AM PDT

Budgeting

Green Panda at GPT presents When Should You Have the Money Talk as a Couple?, saying “When is it time for the big talk? Will you ever be ready?”

DJ at The Family Wallet presents 6 Tips for Setting Your Budget Priorities, saying “Setting priorities makes budgeting much simpler. But even this is difficult for many household money managers. Here are some ways that you can make priority setting a little easier:”

Business

Jon the Saver at Free Money Wisdom presents Start-Up Marketing for Your Business Made Simple, saying “Let's take a look at some unique and innovative ways to promote your business without breaking the bank.”

Miranda @ Financial Highway at Financial Highway presents Creative Business Ideas, saying “Do you want to start your own business and make a little extra money? It can seem daunting at first, since there are so many others out there trying to get something started. The key is to find a niche and then fill it. Here are 4 creative business ideas”

Group Benefits Guy at Group Benefits presents Different Types of Group Financial Benefit Plans, saying “There are a number of different group financial benefit plans an employer can put into place.”

Alysse at Create Hype presents How to Build Your Brand Identity, saying “While creative business owners may not be packing arenas, they are definitely looking to develop a strong brand identity. Here are a few tips for identifying and developing brand identity.”

Career

Teacher Man at My University Money presents The Government Can’t Actually Create Jobs, saying “The government has tons of problems, but their solutions usually add to it.”

Glen Craig at Free From Broke presents Work from Home? Why You Should Consider Child Care , saying “Working from home sounds great, but with kids it can be difficult to get things done. Solution – Get child care. See why, if you work from home you should consider child care.”

Debt and Credit

Mike at Rewards Cards Canada presents Best Cash Back Credit Cards, saying “In the latest MoneySense Magazine they ranked the best cash back credit cards on the market. Here's a look at the overall top 10:”

Janet at Credit, Eh presents Capital One Low Rate Guaranteed Secured MasterCard, saying “If you have made mistakes in the past, or if you don’t have an established credit history, it can help to turn to a guaranteed card. A secured credit card can help you establish your credit, since you can easily get approved.”

Melissa at Mom’s Plans presents How We Plan to Tackle Our Debt, saying “We would like to have a significant chunk to put down on a house in a few years, and I don't want to purchase a house if we have other debt. Here is our plan for paying down our current debt quickly:”

Economy

Big Cajun Man at THE Canadian Personal Finance Site presents CPI on the Rebound for August 2011, saying “Here we go again folks, the Consumer Price Index as reported by Stats Canada for August 2011 shows that Inflation is bouncing back up and the CPI (year over year) is back above %3 with it sitting at 3.1% (for the past 12 months). Surprisingly the regular culprit was not the catalyst for this past month's 0.4% (month over month) jump (i.e. it wasn't Energy/Gas directly).”

Extra Income

Mike at The Financial Blogger presents Why We Talk So Much About Passive Income While You Still Have To Work Your Ass Off To Make it Happen, saying “Are you willing to put the work in?”

Frugality

Matt at Living in Financial Excellence presents Back to School Shopping. . .Saving Money after the Dust Has Settled, saying “To me – both as a parent,and as a thrifty adult – the best part of the back top school sales starts now… just in time for several upcoming occasions.”

Marie at Money Spending Mommy presents Compare DIY Material Costs and Save, saying “When you hire a contractor, you usually have little say in the materials used for your home improvement project. But when you're in charge, you can shop around for the best deals. Here are some tips that will help you save money on materials.”

Mike at Money Matters Guy presents Spend Less Than You Earn, saying “Most people spend their entire lives just scrapping by and living paycheck to paycheck. If you want to avoid their fate and start building wealth, the first step is to simply spend less than you earn.”

Kelsey at Money Mum presents Is Buying in Bulk for You?, saying “Buying products in bulk can be extremely beneficial for your wallet as you often get more for your money with bulk buys. It can also be a great time-saver as you won't be running to the store every day to pick up the ingredient or household product you forgot to buy during your last shopping trip. Before you start buying all of your products in bulk, however, there are a few important items to consider:”

Neal Frankle at Wealth Pilgirm presents How Much Should A Wedding Cost? Here's How To Lower It., saying “As the father of three daughters, when you ask, "how much should a wedding cost?" my answer is simple.”

Investing

Div Guy at The Dividend Guy Blog presents Dividend Dad How I Show The Importance of Money To My 6 Year Old Son, saying “If you can teach a kid about investing, would you? I show how I taught my son about money management.”

IS at Intelligent Speculator presents Would You Bet Your Money On Beating Roger Federer At Tennis Or Tiger Woods At Golf?, saying “Which would you take the shot at? Probably neither.”

Mike at Experiglot presents How to build your own mortgage payment calculator in excel, saying “You can finally build your own calculator.”

Ahmad Hassam at FX Forex Trade Blog presents Forex Profit Accelerator End Of Day Trading FREE Presentations By Bill Poulos!, saying “Trading forex at the end of the day can make additional income. In these Forex Profit Accelerator End of Day FREE Presentations, Bill Poulos shows how you need not more than 5 minutes every night to trade forex and make a few thousand dollars extra income every month.”

Mike Collins at Saving Money Today presents Investing in Gold, saying “With gold prices soaring and more investors looking to add some to their asset mix, it's important to learn the different ways to invest in gold.”

Money Cone at Money Cone presents Following Buffet Blindly Can Be Injurious to Your Wealth, saying “An individual investor is not in the same boat as Mr. Buffett. It is hard to predict in which direction BofA's stock price will swing, but either way, Buffett will make money, not so for the individual investor who follows Buffett blindly. “

Jim Yih at Retire Happy Blog presents Benefits of investing in low fee mutual funds, saying “I have been a long time advocate for low fee mutual funds and other investments. Paying less for anything, puts money back in your pocket.”

Mike at Stupid Cents presents Saving and Investing Are Not the Same Thing, saying “You need to understand the difference between saving and investing if you have any hope of building significant wealth.”

Lifestyle

Jason at Live Real, Now presents Time vs. Money, saying “My time is valuable. No matter what I do, or how hard I work, I can never get more than my allotment. Why would I waste it to save a fraction of what I can earn by using it in other ways?”

Carrie at Heartland Living on a Budget presents The Frugal, Simple Journey: Staying Motivated , saying “Learning to live a simple, frugal lifestyle can be compared to practicing a sport, such as running. It is certainly fun in the beginning, but it take continual effort and one has to avoid burnout.”

Briana at Personal Dividends presents Save the Environment and Your Money, saying “These are easy to implement changes to your lifestyle that helps the environment and saves you money at the same time.”

Real Estate

Mike Holman at Money Smarts Blog presents Can Home Owners Benefit From Falling Real Estate Prices?, saying “If you are upgrading from a starter home to something more expensive, you might be better off if real estate prices drop.”

Barbara Friedberg at 5 Lessons Learned from Moving presents 5 Lessons Learned from Moving, saying “This guest post by Kim at Balance Junkie outlines 5 of her insights from a recent move. The bottom line; you can’t plan for everything, no matter how hard you try.”

Taxes

Investor Junkie at Investor Junkie presents What Do Netflix and Taxes Have in Common?, saying “Now you might be wondering what does taxes have to do with Netflix? Everything! This is a classic example of elastic demand”

Other

Echo at Boomer & Echo presents The Wealthy Barber Returns: Book Review and Giveaway, saying “Now, more than two decades later, Chilton is back with The Wealthy Barber Returns.”

Canadian Finance Carnival #55 originally appeared on Canadian Finance Blog on September 25, 2011.

Allocating Funds to Fight Credit Card Debt

Posted: 24 Sep 2011 01:00 PM PDT

When individuals are faced with credit card debt, they sometimes get a little creative in coming up with ways to swiftly eliminate this problem. And we always find it a bit ridiculous when people look for various other ways to pay it off rather than using funds from a savings account. While we fully understand the reluctance people have over accessing this money – especially if it’s designated for a specific or important purchase – most of the time it’s arithmetically boneheaded not to use it. The negative stigma of dipping into savings, however, prevents many people from making logical financial decisions when dealing with substantial credit card debt.

Before we take a closer look as to why you should pay off your credit cards with the funds from a savings account, let’s first look at the few places in which you shouldn’t extract money.

First, never pay off your credit card debt with a retirement account such as an RRSP (or Roth IRA in the United States). These funds typically impose penalties for earlier withdrawals, plus withdrawals before maturity can drastically gouge the value of the account in the long term.

Second, while some financial experts say this is a strategy worth considering, we wouldn’t necessarily recommend using a home equity loan to pay off credit cards. By some calculations you could theoretically use the loan proceeds to pay down your debt by trading something like a 20% interest on your credit card(s) for a 6%-7% loan on your home. However, refinancing unsecured debt with secured debt isn’t really a fantastic plan. The overall goal of a personal debt reduction should be to minimize risk and offering your house as collateral against unsecured debt just to save a few points of interest increases the downside risk immensely. To better illustrate this risk, let’s look at worst case scenarios: The worst case scenario in failing to pay off your credit cards is an unfavorable credit rating (and of course the financial consequences of having this negative rating), however, the worst case scenario in defaulting on a home equity loan is losing the home itself. Plus, to a greater degree than defaulting on credit cards, you’re credit score also crumbles as a result. Therefor, we’d always risk defaulting on plastic before defaulting on your home – even if interest rate exchange is tempting.

Paying off Credit Cards with Savings:

This should be your go-to move in today’s economic climate. The annual percentage yield provided on a savings account NEVER warrants a decision to keep it locked in rather than using it to eliminate debt. Especially today when typical money market accounts aren’t even able to churn out a 1.0% return, keeping money stashed in these financial vehicles isn’t practical when your credit card debt is accumulating at a rate of 18% annually.

Allocating Funds to Fight Credit Card Debt originally appeared on Canadian Finance Blog on September 24, 2011.