The Finance Blogger

Wishful Thinking Will Not Make Bad Debt Go Away

November 22nd, 2018 ernie Posted in Debt Management | No Comments »

Bad debt will not just disappear. You have to take some specific action in your life to deal with it. Wishful thinking will not make bad debt go away. It will not disappear on its own and actually will just get worse if you do not do something. Interest continues to accumulate and debt collectors will hound you if you do not take action. In this post we will discuss some of the areas that people use to avoid dealing with debt situations. The bottom line is that consumers facing a debt situation must deal with their situation now to avoid foreclosure, bankruptcy and losing everything.

Wishful Thinking Will Not Make Bad Debt Go Away

Ignoring Your Debt

the worst thing is ignoring your debt situation. It is only going to get worse. Interest charges will add to the debt and your credit rating will get worse.  A bad credit rating will make it difficult to borrow money and sometimes even get a job.

Hanging up On Debt Collectors

Debt collectors are persistent and will just continue to follow you and call. They will take action and initiate asset recovery i.e. impound your car etc. unless you talk to them and work out a plan.

Not Talking to Your Lender

Sometimes a lender can offer solutions such as a lower interest rate or a longer term. But you will never know if you do not talk to them. Be prepared to work out a plan and focus on how you will repay the loan.

Betting on the Lottery

Buying lottery tickets or going to the casino does not work. Sure we hear about the odd person winning a large sum and repaying their debt. But this is less than 1%. Use your money to repay your debt instead of buying lottery tickets.

Inheriting Money

Often the timing does not work out and the amount of money you receive is less than expected due to taxes, expenses and sharing the estate with other heirs. If you do inherit money treat it as a bonus. Focus on repaying your debt independently from any inheritance.

Making More Money

Getting a extra job is a good thing to do to help repay the loan. Counting on a promotion at work or a raise to help with your debt situation does not always work. Again focus on repaying your debt. Any extra money you earn can be used to repay the debt as well.

It will Work Itself Out

Thinking that things will just work themselves out over time usually does not work either. You have to take some direct action to deal with a debt situation. Set up a budget and stick to it. Talk to your lender and make sure they know you will repay the loan so they do not initiate some kind of collection action. Communication is very important in these situations. So is commitment to repay your debt and not ignore or run away from the situation.

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A Financial Playbook for Couples in Retirement

October 7th, 2018 ernie Posted in Retirement | No Comments »

A Relationship Playbook for Couples in RetirementWhen couples retire together there are many issues they have to figure out how to deal with. From filling their time to spending time together to dealing with their finances. There are lots of issues and they can put a lot of pressure on couples as they adjust to this new life style. In this post we are going to try to help develop a financial playbook for couples in retirement. Believe it or not it is just not about spending money. Some items or issues concern the emotional relationship you have with your spouse. How well do you communicate? Do you have the same objectives? How much time do you spend with each other? Are their couples you spend time with? Allow time to adjust to each other and to your retirement. Lets discuss some of these issues in more detail and how they relate to your financial playbook.

A Financial Playbook for Couples in Retirement


One of the most significant issues is how well you communicate. If you cannot discuss your plans, your objectives etc., your marriage may be headed for trouble. When this occurs all kinds of things can happen. Including over spending, spending on items that are not supported by both spouses etc. Your financial affairs can quickly spiral out of control if one or both parties do not take control of the finances.

What Are Your Objectives

Do you have the same objectives for your retirement years. How do these objectives translate into your spending plan. Trips, house renovations and upgrades, car replacements etc. should be discussed and planned. Even day to day expenses can get in the way of an enjoyable retirement if your budget is under pressure.

Spending Time Together

Do you enjoy each others company? Retired couples see a lot more of each other and they may not be ready. There are extremes. Some love to spend time with each other and value the time they now get to spend together. Others want to mimic the nine to five schedule and really do not want to see each other during these time frames. Assess your needs to spend time together and discuss it with your partner.

Spending Time with Other Couples

Traveling with other couples, going for dinner etc. can also be beneficial. Spending time with couples with similar objectives, financial wealth etc. can be very enjoyable. If you are trying to constantly keep up financially this can place a lot of stress on the relationship and also on your financial budget.

Adjustment Time

We suggest that couples new to retirement allow for some time to adjust. Remember that you are figuring things out as a couple and also individually. It takes time to do this and meld the two with each other. Take it slow and do not spend money that may impact your long term financial health.

Budgeting and Planning

It all comes down to planning your budget for the life style you want to have and the money you have available. Spend the time developing a budget which includes your objectives and plans. Discuss these plans and the financial impact with your spouse. Be prepare to review your budget and make adjustments as needed.

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Things To Do Before You Retire

September 20th, 2018 ernie Posted in Retirement | No Comments »

Things To Do Before You RetireMany retirees assume that life will be grand after they retire. They will have lots of time and money available in retirement to do the things they have always put off while working. This can be true for many but it does not automatically happen that way for many people. There are five factors that many people should consider before they retire. What are the five things to do before you retire? Our list was developed after reading many articles and doing a great deal of research as part of our own retirement planning.

Things To Do Before You Retire

Assess Your Savings

The first step is to assess your savings now and what it will be when you actually retire. If for example, you have $400,000 saved and feel that this is a huge nest egg, is it enough? Using the standard 4% rule, your income would only be $16,000 a year. Can you live on that? What other sources of income will you have? Add these up and assess whether it is enough to live the live you would like during retirement.

Develop a Retirement Budget

The next item on our list of things to do before you retire is to develop a budget. You have already determined what your income will be. Now how will your expenses change. If you have plans for your retirement, don’t forget to factor these in. Upgrades to the house, travel plans etc. should be considered in addition to all of the usual expenses. Don’t forget major maintenance projects for your home. Will you need a new roof in five years? How about the furnace or AC units? These major expenses along with any others should be factored in.

Understand Health Care Costs

As we age, health care and nursing home care can make a substantial impact on your budget. Do you have health care coverage? How will you pay for medications and other medical equipment you may need. Know and understand what the costs will be.

When Will You claim Social Security

The amount of social security you receive depends on two major factors. The first is how long you have worked before retiring and how much you made. The second factor is when you start collecting social security. The earlier you claim, the less you will receive. If you can wait longer to claim security, your income will be higher. Factor this plan into your budget plans.

What will You Do With Your Time

Many people mention they will have more time to golf, to pursue their favorite passions, travel and take on various maintenance projects. Will this be enough? Remember that your going to have between 8 to 10 more hours a day to fill taking into account commuting time. Take a moment to think about what you may do in retirement. It could even include going back to work, part time work, or even volunteering.

Good luck in your retirement and we hope these things to do before you retire will help you in your own retirement.

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Best short term investments for small amounts of money

April 21st, 2018 ernie Posted in Investments | No Comments »

Smart Financial Moves to Consider before Year EndConsumers love to talk about the stocks that have increased in value exponentially. Very few actually participate and make a lot of money in these situations. But most of us cannot time the market, maybe afraid to get involved in the market, or just do not have the time to monitor investments like these. So what are consumers going to do, in order to make the best short term investments for them? It is actually quite simple. If you look at the debt that you currently have and you focus on paying the highest interest debts first you will actually be making a very good investment.

Best short term investments

Let’s talk about credit card debt for a moment.  The interest rate on unpaid balances of credit card debt is typically 21% or even higher. Sure there are some credit cards that offer 7% or 10% for a short period of time. But if you carry the debt beyond that grace period, they quickly jump to 21% or higher. Now if you pay that debt off you are actually paying yourself a 21% interest rate. That is much better than anything you will get on average in the stock market.

Even if you have a car loan at 5%, or a personal loan at seven or 8%., You will save money. Most people will save themselves that interest by paying off the debt early. When the debt is repaid you have even more cash flow to utilize. Use this free cash to pay off either debt. Or to buy some of the things that you really would like to have. You can also set aside money for future expenses that will be of an emergency nature.

Once you have all of your debt repaid the next area of your focus is to save some money for emergencies that always show up at the worst times and to pay yourself long term for retirement. Invest your retirement savings well, diversified, and insecure investments to ensure that your savings will be there in the long term and generate the kind of income you need when you do finally retire.



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How do I Avoid Probate?

March 21st, 2018 ernie Posted in Wills | No Comments »

Before we answer the question, how do I avoid probate, we should really define what probate actually is. The actual process of going through probate will vary state by state and province by province. However, in general terms probate can be defined in the following way. It is a legal process that ensures that all of your debt is paid before distributing assets to your heirs. There is a probate fee associated with this process. It is based on the size of the estate. It can vary a great deal depending on the state that you live in.

Probate is all about winding up your financial affairs in a fair way. It is supposed to follow the instructions outlined in your will. If there is no will, the court will step in and distribute your assets. They pay debts first and distribute the remainder to your heirs based on local legal requirements.

If there are insufficient funds to cover your debts, the court will develop a formula again based on local laws that will see your assets distributed in a fair manner to pay all of your debts as much as possible. Some debtors will receive penny’s on the dollar.

How Do I Avoid Probate?

Most lawyers would tell you that you should not avoid probate. The probate process ensures that everything is completed in a legal manner and funds or assets are distributed according to the instructions outline in the deceased’s will.

You can minimize the probate tax which is really the objective of most people. Assets that are jointly owned usually pass automatically to the surviving partner and do not become part of the probate process unless their share is specifically mentioned in the will.

For example, a home owned by two people is jointly shared and would pass automatically to the surviving spouse. You may still need to register a change to the deed to reflect a change in the ownership from joint ownership to single ownership.

Probate laws vary across the country. Check with your lawyer to plan your probate tax strategy and always make sure that you have a will.

For more ideas about avoiding taxes and especially probate taxes, click here.

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What is Credit Utilization

February 21st, 2018 ernie Posted in Credit Repair | No Comments »

credit utilization Credit utilization is a relatively new term that was initiated because many consumers were being penalized for having many credit cards open. We have all found ourselves inundated with credit card applications, stores that offer significant discounts if you open an account with them. Then there are the special offers from the credit card companies themselves. Free debt transfers, low interest rates, travel points etc. The offers go on and on. We cannot help ourselves and end up with a significant number of credit cards. many cards have a $5000 credit limit or larger. Even if you just have 6 cards, that’s a potential $30,000 in debt that could be added to your debt load.

Many people were penalized for having so many credit cards and such large potential debt loads. Their credit scores were lowered due to the potential debt load even though they carried a nil balance and paid their balances in full each month. As a result credit utilization was added to our credit scores as another factor to determine the credit score.

Credit Utilization Defined

Let’s take our sic credit cards as defined early and assume that this person only carries an unpaid balance of $2000 on one of the cards. All of the others have a zero balance. He pays the minimum payment each month and has a good record of paying everything on time. His credit utilization  would be $2000 divided by $30,000 or 6.6% when expressed as a percentage.

Lenders look for a ratio under 30% which is amply met by this consumer. In previous days, most people would close credit card accounts to improve their credit score. Lets assume that this person closed five of his credit cards. Also that he used the one that he has a balance on. His credit utilization would go to 40% and would be well above the objective that many lenders look for.

This consumer would have been better off to keep his five credit card accounts open and just not use them. His credit utilization would still be low and contribute favorably to his total credit score.

There are many other factors that contribute to a credit score. An obvious one is paying all of your monthly bills on time every month. Never have a late payment and repay all debt as quickly as possible.

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Recurring Payments Improve Credit Scores

January 31st, 2018 ernie Posted in Cash Flow | No Comments »

Paying bills on time each month is important for consumers, business customers and merchants. Recurring payments improve credit scores and maintain good relations with merchants, landlords and all providers of services. Failure to make monthly payments on time can also cost money. Increased interest charges for overdue payments and possibly penalties for late payment.

Business customers who invoice customers on a regular basis also benefit by issuing recurring invoices automatically. Issue invoices on time. Debits are automatically made to a customer’s credit card or debited from checking accounts. Transfer funds immediately to your account. Manage cash flow. Minimize collection activities. These reduced activities improve profitability and lowering operating expenses.

Recurring Payments Improve Credit Scores

Once merchants implement recurring payments credit scores improve. Customers accept recurring payments. Both parties are happy with the arrangement. Businesses find that their cash flow is better managed. Their late accounts decline and they spend less time chasing after customers. In fact, customer satisfaction actually improves since there are fewer negative conversations about paying bills on time. Customers are confident that the same amount will be deducted from their accounts at the same time each month. There is no need to try to remember if they paid a bill. They will not incur late payment fees or interest charges. Their credit score can actually improve over time. It can save them money when it comes time to borrow money for loans and mortgages.

A merchant who wants to bill a customer on a regular basis must first arrange for consent with the customer. They must have consent for them to withdraw funds automatically from their bank account or credit card. This is a one-time consent provided by the customer to the merchant. Consumers can withdraw consent at any time. The amounts are fixed. However, consent can be provided for variable amounts based on a set of services that are provided each month. This process works well for both parties. The processes to manage the start and stop of recurring billing is extremely easy for both the consumer and the merchant.

Benefits for All

In conclusion, there are benefits for everyone when they implement and agree to recurring billing payment processes.

Merchants no longer have to chase customers for payment; Reduce collections are significant; cash flow improves; expenses decline and profits increase; Add pro-rata payments to help with clients who are already overdue; if an automated payment does fail the merchant is notified immediately; cash flow is much more predictable and manageable; and transfer funds directly to designated company accounts.

Customers also benefit from participating with merchants who employ recurring billing systems. No more worries about whether you paid that invoice or not; Predict payments and cash flow; Maintain credit scores. and sometimes improve credit scores; no more late fees or penalties for late payment; better credit scores mean lower interest loans and mortgages. The benefits of a properly implemented system can be enormous for both the merchant and the client.


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Do I need a lawyer for a will or can I do it myself with an online form?

January 21st, 2018 ernie Posted in Wills | No Comments »

do I need a lawyerThe quick answer to do I need a lawyer for a will is no you do not always need a lawyer to prepare a will, however there are reasons why you might consider having a lawyer prepare your will for you. If your assets are complicated or you have multiple beneficiaries, then using a lawyer might make their lives and yours easier.

Even if your worried about the expense of preparing a will using a lawyer, always make sure you have one. Having a simple will is better than no will at all. At the very least your intentions are made known. Your heirs will have to sort things out based on your directions. A simple will basically says everything goes to your spouse unless they die at the same time, or predecease you. In that case everything goes to your heirs as per your specific instructions which could simply be split evenly between them.

Do I Need a Lawyer for a Will?

Over 50% of consumers do not have a will. They delay and procrastinate and do not really understand what happens if you die without a will.

For a straight forward will, a lawyer will charge something in the order of $500 to $1000 and can complete it within an hour or two. You review it, sign it and they witness it. It is pretty easy.

You can also use one of the online will websites for around $100. They are also pretty straight forward. Just make sure that you use the forms that are legal for the state you live in.

More complicated wills should really have a lawyer prepare and review them. Your instructions will be clear and you will be following all tax laws etc. Homes, cars, stocks, heirlooms etc. can all be specified in the will to be dealt with as per your instructions.  With no will the courts will step in and divide the assets according to their formula which may not be what you had planned.

Finally, make sure you keep your will up to date as life changes take place. Getting married, having kids, divorce, moving, deaths in the family can all be reasons you may want to review and possibly update your will. Tell your heirs where the will is and how to find it. If you use a lawyer, they will also keep a copy. Your heirs should also be aware of the lawyer that you used.

For more information on wills, click here.

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Financial Lessons For My Kids

December 21st, 2017 ernie Posted in Adult Children | No Comments »

What are the most important lessons you can tech your kids? There are lots of things, however this site is focused on financing and saving money. We put together 4 or 5 financial lessons that we think are the most important. It is never too early to begin start educating your kids about money. It will serve them well during their lives and hopefully make their quality of life easier.

Financial Lessons To Improve Your Life Style

Save 10% of Your Income

Regardless of how much you make always set aside 10% of your income for a rainy day. Or for retirement or for emergencies. Invest the funds in a diversified account. Never touch them until you have a real emergency or it is time to retire. Manage the funds, make sure they are invested in blue chip stocks that pay regular annual dividends. You will be amazed at how much you can accumulate over 30 years allowing you to retire early if needed.

Separate Wants and Needs

Whether you are 10 years old or 65 years old, knowing the difference between things you would like to have and those that you need can go along ways to saving a lot of money. Saving money by not purchasing those things you want to have can mean a huge improvement in your lifestyle over the long term.

Financial lessons Material Possessions vs. Wealth

Anything you purchase is worth less as soon as you walk out the door of the store. That expensive car you just purchased may look great, but you lost 20% of its value the moment you drove off the car lot. It is now a used car. On top of this loss consumers forego saving money and earning interest off of it.

Material items may impress for awhile, then you have to buy another to maintain your image. Next thing you know you are spending all of your money on depreciating goods and not saving anything for a rainy day or retirement.

Compound Interest Earnings

Earning interest on top of interest is one of the fastest ways to build savings for retirement or vacation or emergency funds. The rule of 72 is appropriate to discuss. Divide 72 by the investments rate f return to find out how long it will take for the investment to double.

If It Sounds Too Good to Be True, Then it Probably Is

Always be careful of promises tat sound better than they really should be. If you are doubtful, check the promise out in detail and run if you suspect any kind of a scam. This is one of the most important financial lessons.

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35% of Consumers Make this Money Mistake

November 21st, 2017 ernie Posted in Financial mistakes | No Comments »

money mistakeHow many automatic payments are you making every month? If you don’t know you’re not the only one. Over 35% of consumers do not know how many automatic monthly payments they make each month. This is a common money mistake.

These automatic payments are for subscriptions to magazines, membership services to gyms, automatic renewals for coffee shop memberships and more.

They often start associated with the service as a free trial. Many consumers forget to cancel it at the end of the free trial and they receive unexpected charges as a result. This is a pretty standard approach for many company’s who are trying to grow their business.

It turns out that generation X members are the most likely to have signed up for auto pay programs. Parents are more likely than none parents to be enrolled in such programs. Even people with higher education and income levels are more likely to be enrolled then those with lower incomes or education.

Why are people making this money mistake?

We are all inundated with offers of two months or three months free on some service. All we have to do is sign up and provide a credit card. The company that we’re dealing with is hoping that we will forget that we signed up for in the first place.

By the time we notice this recurring monthly payment, at the very least one or two months have gone by. If we don’t check our accounts on a regular basis it could be six months or year before we notice. At 10 or $20 a month this can add up to two or $300 a year. That’s a lot of money in my book.

If we have several of these it would not be long before we’re spending $1000 a year and not even realizing that we’re getting these recurring services. In fact we may have forgotten all about them. With so many people falling into this trap it is no wonder that companies take this approach.

Take a few minutes right now and examine all of the transactions that have taken place in all of your accounts over the past three months. Follow up on any that you don’t recognize. If there are recurring charges being deducted from your account, check to make sure that this is something that you really want.

You could save yourself $1000 a year without any problem. You could have enough money to go on a three or four day trip!

For more financial money mistakes to avoid, click here.

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Buying Common stocks advantages and disadvantages

October 21st, 2017 ernie Posted in Stock Dividends | No Comments »

Biggest Financial MistakesCommon stocks advantages and disadvantages are frequent. In the past 8 years almost anyone who bought equities on the stock market when it hit bottom in 2008 has more than doubled their investment. Gains in the value of the equities as well as income from dividends has outperformed almost any other investment.

Some of the advantages and risks associated with stocks include income from dividends, growth opportunities, diversity of investments and being able to sell your investment quickly. Before you invest in the stock market, many investors believe that buyers should develop a strategy that matches their objectives and their tolerance for risk. If an investor cannot stomach the volatility of the stock market, equities or stock might not be the right investment vehicle for you.

Strategy for Common stocks advantages and disadvantages

A typical investment strategy which considers common stocks advantages and disadvantages could be as follows:

Blue chip – invest in high quality companies that have been around for many years, pay  dividends on a regular basis and have a strong future in the industry they are in.

Income – If you need income, dividend paying stocks have advantages. Some companies have a history of increasing dividends every year. They perform much better than GIC’s and other fixed investment income vehicles.

Dividends – Companies pay a dividend every 3 months to the stock holder. Many pay cash direct to the investors account. Many companies also allow re-investment of the dividend into the same stock. This is an excellent way of avoiding any broker charges and growing your investment at the same time.

MER – is the fee charged by mutual fund companies for managing the fund. You pay this fee regardless of whether the mutual fund performs well or not. Investors should decide if they want someone managing the investment for them and what they are willing to pay for the service.

Diversity – Never place all of your money into one investment – stock, mutual fund or GIC. Diversify your investments across several stocks in various industry segments.

Risk – the market is considered high risk. There have been significant upticks and down ticks in the market over the years. This is both an advantage and a disadvantage of common stock investing.

For more information about stock dividends, click here.



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How do I keep my heirs from Probating my Will?

September 21st, 2017 ernie Posted in Wills | 1 Comment »

probating my willMany consumers want to avoid an estate having to go through probate. Probating my will is something that most people try to avoid by doing appropriate planning prior to their passage. They are trying to reduce the probate charges that the government will charge for the probate process. Let’s start by saying that you should make a will through probate. At the same time taking steps to minimize the cost of probate.

Why would you want to probate a will? First, it is the legal process that declares to the public that someone has died. Their estate is about to be closed. If there are claimants, this is the legal notice that gives them a chance to make a claim for money owed or to contest the will. While no one wants to deal with this situation, it is better to deal with it legally than face claims later on. Don’t avoid probating my will but do take steps to minimize the charges.

Probating my Will – Minimize Probate Charges

Probate charges vary depending on the location you live in. IN some locations, everything is included when calculating the probate cost. While in many locations there is a deductible with probate calculated on the remaining balance after the deductible has been included. Your challenge prior to your death is to minimize the number of your assets that will be included in the probate calculation.

For example if you own a home it will be included in probate calculations if your spouse has passed away prior to your death. One method many people use to avoid this is to make their home jointly owned with their kids. Joint ownership items pass automatically to the remaining owner and avoid being included in probate. You can apply this approach to many assets. However there are many issues to consider.

One area of concern is with joint ownership with someone, you need to make sure it is someone that you can trust. Not everyone can be trusted in situations like this. Money is very attractive to many people.

We strongly suggest that you discuss your options with a lawyer and your financial accountant prior to taking these steps. The first bit of data you need is to find out is the probate deductible. Perhaps you will not need to worry about probate costs at all.


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Happy Thoughts on Retirement From an Actual Retiree

September 7th, 2017 ernie Posted in Retirement | No Comments »

An acquaintance sent me this note which first appeared on Carrick and Money in the Globe and Mail. As a retired person trying to figure out what my own retirement is going to look like, I found this quite an interesting read about happy thoughts on retirement from an actual retiree! Here is what this retired consumer had to say.

Happy Thoughts on Retirement From an Actual Retiree

My retirement was well planned but here’s what I’ve learned since my wife and I retired a little over two years ago:

1. You don’t need as much money as the financial industry says you do. Sure, more money is better than less, but we sacrificed a lot to max out our RRSPs every year and then also max out TFSAs when they came along. I see now that we needn’t have sacrificed so much while working. In fact, I find we have more money to spend in retirement than we had when we were working. Not having to furiously save for retirement frees up a lot of cash.

2. We are BUSY in retirement. Pre-retirement, I did worry about not having enough to fill the days, but there is so much to do it’s hard to fit it all in. Of course, unlike work, no one is going to bring you something to do every day. You have to go out and find it yourself. The upside is you get to choose what brings you the most joy. Hiking, volunteering, gardening, traveling, twice a week at the gym, and joyous times spent with our grandchildren. As I often say: “If you are bored in retirement you aren’t really trying.”

3. The stress reduction for me was huge.

Years of working to meet ever higher demands with continually reduced resources and budgets was leading to more stress than I realized. Now, I call the shots and if I don’t want to do something, then I don’t do it.

4. It is psychologically hard to spend down what you’ve spent decades saving. When the time comes to retire, it is remarkably hard to change your mindset from saving for the future to spending for now. The reality is that we only have so many healthy, disability-free years left. If you didn’t save all that money so you could spend it [when healthy], why did you save it? Remember: “When you are retired, the future is now.

5. Understand that you’ll need some time to figure out what to do with the rest of your life. I read a tonne of retirement books on the financial side (overall they seem to say “never spend anything ever” though Fred Vettese’s The Essential Retirement Guide is a notable and recommended exception).

6. I was nervous before making the jump to retirement, but now that I’ve done it I wonder what I was worried about. My retired friends say the same thing.

For more ideas about retirement and happy thoughts on retirement from an actual retiree, click here.

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How do you pick an executor?

August 21st, 2017 ernie Posted in Wills | 1 Comment »

pick an executor Last Will and TestamentOne of the main reasons many people put off making a will is that they have to choose an executor. Sure lots just do not want to think about wills and what this means. Some just do not even care, they are going to be gone anyway. Consumers who care about their families and want to make sure that everything is looked after will have a will. They will carefully pick an executor as well. For some picking, an executor may be difficult. Although the majority of people will select a younger family member who will meet whatever criteria they may have. The most important thing is to have a will and select an executor. Otherwise, the government will step in and do it for you.

Criteria to Pick an Executor

Everyone’s situation is different and therefore not all of the criteria will apply to everyone. We have listed several criteria with a few descriptive words to clarify. It is up to the consumer to decide which is more important for them in their situation. This will guide them in making the right decision regarding picking an executor for their will. Here we go:

Someone You Can Trust – above all do you trust the person to do the right thing and carry out your wishes as indicated in the will. Will they be honest with your heirs?

Close Family Member (s) – this is the most common choice for the executor and often will be shared between several. Will they work well together and will they treat other members of the family in a fair manner.

Recipient of your estate – if there is only one recipient of the estate, you may as well make that person the executor of the will. As long as they are adults then there should be no problem if they carry out their duties properly.

Proximity to your Home – an executor who does not live close to your home may have to incur some costs traveling back and forth to your home to make arrangements. These costs and possibly their time as well would be charged to the estate prior to distributing the estate.

The complexity of the Estate

Complex estates with property, investments etc may require specific expertise to manage and distribute. This expertise can be hired by the executor, however they should have some idea of what to do and what makes sense.

Value of the Estate – probate may be required and a lawyer will need to file probate with the courts in any case for large estates. Large estates with a lot of investments may require someone who has the time to manage them until dissolution.

Legal issues of your Estate – if the will is contested, if there are lawsuits against the estate of the deceased etc, then someone who is familiar with these issues should be considered.

Probate requirements – small estates typically do not require probate although it does depend on where you live and the local laws governing probate. Can your executor deal with probate with the help of a lawyer?

Other – There may be other concerns that are personal in nature. Often relationships affect decisions about who will be executor as well.

Make the best decision for your situation and family. Discuss your request with the person or person you chose to ensure that they are comfortable with being an executor and know in general terms where to find everything they will need.



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Habits to become Financially Stable and Successful

August 7th, 2017 ernie Posted in Financial Advice | No Comments »

habits to become financially stable and successfulIt takes effort and discipline to become financially stable and to stay that way. Even a temporary relaxation of your financial judgement can jeopardize your stability. Spending too much on a credit card, going on a trip you cannot afford, taking on more debt than you should are examples of what not to do. Becoming financially stable and successful also has benefits as well. For example your stress level will be much less. You can relax more when you are not worried about money. Take the time to review where you are when it comes to the following suggestions to become financially stable and successful. What changes do you need to make in your life?

Become Financially stable and Successful

The following are ways that will gradually take you in the direction you need to be financially stable and successful. There will be setbacks from time to time. Emergency payments will be needed which will deplete your savings. This unfortunately is part of life. But if you stick to your plan, you can quickly recapture your savings and reach stability again.

  • Make savings automatic and save all raises or overtime payments you receive
  • Control your impulse spending. Avoid expensive lunches and dinners, clothes etc
  • Evaluate your expenses, and live frugally.  In fact live well below your income.
  • Invest in your future. Save for emergencies and for retirement.
  • Keep your family secure. Save for emergencies so that you can deal with them when they occur.
  • Eliminate and avoid debt. Debt costs money, credit cards have high interest rates. Avoid them like the plague
  • Use the envelope system or the account system. One for savings, one for emergencies and one for every day bills and expenses
  • Pay bills immediately. Set up an automatic payment so that you never miss any payments and negatively impact your credit rating. Late payments also incur penalties and extra fees.


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Credit Score – What can impact it

July 21st, 2017 ernie Posted in Credit Repair | No Comments »

If like many consumers, you are wondering what things can impact your credit score. This list will help you understand what you need to do to improve it. There is the obvious item – Payment History. If you are not good at paying your bills on time e.g. loans and credit cards, your credit score is going to suffer. This also includes utility bills as well as rent payments and tax bills. Pay them all on time and in full or negotiate ahead of time to make arrangements. Even if you speak to them ahead of time, there is no guarantee that your credit score will not suffer. But there are items that will affect your credit score in addition to payment history.

What Impacts Your Credit Score

Credit Utilization – Let’s say you have three credit cards each with a $5000 limit. If they have a zero balance or less than 30%, then your credit score will not usually be impacted unless your late with payments.

Length of Credit History – New credit and younger people do not have much history that shows how well they manage credit. The longer you can demonstrate that you can manage debt, the better your score is going to be. fifteen years is much better than two years for example.

New Credit History – Open new accounts slowly. Someone who opens many accounts especially credit accounts over a short time period shows that they are highly reliant on credit and maybe a higher risk. If you need new credit accounts do so over a period of time over several months.

Credit Mix – credit cards are considered higher risk than student loans, car loans that are secured, and mortgages on your home. Lots of credit card debt or potential debt can lower your credit score.

If you want to improve your score and are not dealing with these issues properly, it is time to look at each area and make adjustments in your life. Fixing one or all of these can improve your rating.

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Financial Checklist When a Spouse Dies

June 21st, 2017 ernie Posted in Estates | No Comments »

financial checklist when a spouse diesWhen your spouse passes away it can be emotionally overwhelming. Your best friend in many cases, has just left you and your wondering what you will do for the rest of your life. There are so many things to do and it just seems that you cannot focus on anything at all. How will you get through the next day let alone the next week and months? There are some things to focus on initially and as the days go on. It will get easier as time goes on. What you need is a financial checklist when a spouse dies to assist you in those first few months.

Financial Checklist When a Spouse Dies

  • Make funeral arrangements
  • Assemble your team
  • Apply for government programs
  • Contact employers
  • Call life insurance companies
  • Contact banks and investment advisors
  • Update wills and power of attorney
  • Review real estate position
  • Preserve your assets

Make funeral arrangements – this will take most of your time the first few days so focus on this with the help of your family. You should review the will so that you follow any special instructions

Assemble your team – meet your financial advisor, your lawyer, and bank manager. Involve your kids or a good friend you can trust to help you with all of the decisions and information that will need to be addressed

Apply for government programs – depending on age, there may be government programs available that will improve your financial situation. Apply for these now.

Contact employers – if your spouse was still working, you will need to let your employer know. There may be additional benefits that are available from your spouse’s employer.

Call life insurance companies – to find out what information they need for you to cash in any life insurance

Contact banks and investment advisors –  let them know what has happened and provide the necessary documentation to transfer all assets to you.

Update wills and power of attorney – now that your spouse is gone it is time to update your will and powers of attorney

Review real estate position – discuss your real estate situation with your lawyer and make any transfers that are needed. You may be thinking of downsizing, don’t rush, take your time to make your decisions.

Preserve your assets – you may need all of your savings for the future to pay your own bills etc. Avoid spending your assets until you have a good appreciation of your situation.

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Rent Your Home to Retire Early

May 21st, 2017 ernie Posted in Debt Freedom | No Comments »

Rent your home to retire earlyShould you rent your home to retire early? This is the question many people ask themselves at various stages in life. Retired baby boomers traditionally have a home they have owned for many years. It is paid off and worth a small fortune. Should they unlock this value by remortgaging, selling and renting or take a reverse mortgage? What about millennials just starting out. Should they buy a home now and incur all of the maintenance expenses, taxes etc along with interest payments on the mortgage? Or should they rent an apartment and set aside the savings for investment?

These are hard questions and many do not have easy answers. There are some fundamental truths that everyone should consider before making a decision. Every person will answer them differently. It is very important that you assess these questions from a personal perspective before making a decision.

Rent your home to retire Early – Fundamentals

  • Will you save and invest your savings from renting
  • Can you deal with the risk associated with your investments
  • Income from work only will not allow you to retire early
  • Must have investments that grow on their own – real estate, stocks, equities
  • Can you live in a frugal manner
  • Do you have the discipline to save for retirement
  • Do you have the discipline to not touch your savings

These and a few other questions basically describe someone who is a risk taker, focused on saving, understands that they need to invest in something that will grow over time in addition to the money he or she puts in.




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Advice from Warren Buffett

April 21st, 2017 ernie Posted in Financial Advice | No Comments »

Advice from Warren BuffettAdvice from Warren Buffett comes in various forms. Some are made up while others are direct quotes. This particular piece of advice comes from a TV commentator who interviewed Warren Buffett and summarized his comments. It sounded really good to us so we decided to include it in this post for our readers to review.  There are other posts that you might want to review as well which cover his advice over the years. Feel free to check them out. As always if you have comments, please leave them. Our readers will appreciate different points of view.

Advice from Warren Buffett

“The trick in investing is to watch ball after ball go by and wait for the one right in your sweet spot. If people are yelling, ‘Swing, you bum,’ ignore them. There’s a temptation for people to act far too frequently in stocks simply because they’re so liquid.” Later in the film, he observes that “the biggest thing in making money is time. You don’t need to be smart, just patient.”

That is the trouble with most people today. They are too impatient and not willing to wait. Many investments, blue chips that pay good dividends are not going to provide the get rich quick schemes that consumers look for. However over 10 years, these stocks usually grow and they pay dividends all of the time. Reinvest those dividends and combined with growth you will usually do very well if not better than many indexes.

There will also be upticks and down ticks in the stock market. Being patient with good quality low risk blue chip stocks usually pays well. They always seem to return to their previous highs and even higher.

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Be Smarter about Your Money

March 21st, 2017 ernie Posted in Financial Advice | No Comments »

Be Smarter about Your MoneyDo you often wonder why some people seem to have more money to spend than you do? They might even make less than you do, yet can go on trips and have a nicer home. How do they accomplish this feat. The answer is actually quite simple, Be Smarter about Your Money and how you manage it. We have compiled a list that consumers should consider. Applying these ideas will help almost everyone Be Smarter about Your Money and make it last much longer.

Be Smarter About Your Money

Salary – review deductions, eliminate unneeded deductions as appropriate, take advantage of share plans, contribution plans offered by the company, use direct deposit
Saving – designate 10% for future needs, never to be touched unless there is an extreme emergency. This is in addition to retirement savings.
Avoid credit card debt – pay off all credit card debt and avoid the high 19% + interest charges
Live below your means – and you will always have money to save and provide independence during retirement years
But credit itself is important – you need to have a good credit rating. Borrow some money and pay it back on time and never miss a payment
Understand your spending habits – keep a budget and track expenses. Make decisions about miscellaneous expenses that cause you to fritter away your money
Automate everything – utility payments, taxes, mortgage payments, loan payments etc to avoid ever missing a payment. Missed payments are expensive in terms of fees and credit card ratings.

Get the big purchases right

Save big dollars by negotiating, comparison shopping and only making the purchase once you have worked out your budget and payment
Build up that savings account – for emergencies that will always come up. This is in addition to the 10% we mentioned earlier
Cover your insurable needs – including mortgage, loans, education for the kids, etc
Always get the match. To 401(k) plan to get the employer match – this is like a bonus and can add thousands of dollars to your retirement savings plans
Save a little more each year – when you get a raise, your savings amount should go up accordingly
Choose your friends and neighborhood wisely – it is tough competing with wealthier friends or big spenders. Don’t! You will not be tempted.
Talk about money – with the family so that they understand your goals and how they can contribute.

Material purchases won’t make you happier in the long run

Focus on friends and family

Read a book, or 10 – There are countless personal finance books out there.
Know where you stand – prepare a financial plan every year and assess your progress towards your goals
Taxes matter – minimize taxes owed every year as much as possible
Make more money – get another job to help meet your goals
Don’t think about retirement, but financial independence – meaning when you have enough to retire, you are now independent and can pursue other dreams or continue working

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