By 2 Cents on January 10th, 2011 | Category: Saving |  Money often costs too much.
~Ralph Waldo Emerson
Update: This article was included in the 13th Canadian Personal Finance and Investing Carnvial posted at Investing Thesis. Thanks!
As if earning enough money to live wasn’t hard enough, we have to figure out a way to put enough aside for the days when we are no longer earning income. Even more arduous is the task of finding the best vehicle for growing that money. And then there are the taxes . . .
In Canada, we have a new product that is supposed to help defray some of our tax burden. The Tax Free Savings Account became available in 2009 and was considered to be a simple, efficient way for Canadians to save money and avoid paying taxes on the growth of that money. I love TFSAs and I think they’re a great product [...]
Read on and enjoy … TFSA: Investment Gains, Withdrawals and Contribution Room
By 2 Cents on October 13th, 2010 | Category: Saving |  To decide is to walk facing forward with nary a crick in your neck from looking back at the crossroads.
~ Betsy Cañas Garmon
Update: This article was included in the 279th Carnival of Personal Finance – 80s Music Edition posted at Dough Roller. Thanks!
I’ve received a couple of questions from readers on how exactly I have allocated our GIC portfolio. Previously, I’ve written about how set up a GIC ladder, but in reality the numbers don’t always work out as neatly as they do in the examples. The idea behind a GIC ladder is to diversify your interest rate exposure. You can do this by owning GICs with durations of 1-5 years or simply buying a new 5-year GIC each year and rolling money back into 5-year GICs as they mature.
The hope is that you can take the confusion [...]
Read on and enjoy … GIC Strategy: Two Important Questions
By 2 Cents on September 27th, 2010 | Category: Spending | Nothing diminishes anxiety faster than action.
~Walter Anderson, The Confidence Course, 1997
Update: This story was included in the Carnival of Money Stories #74 posted at Sustainable Life Blog. Thanks!
When we had our home built 7 years ago, we went with a rental for our hot water heater. I realize now that this is not the norm everywhere, although it seems to be the route most people here in Ontario choose. It seemed, at the time, like a good call.
Renting a hot water tank means that your up-front costs are zero, and you just pay a monthly rental fee of $15 – $30. Service is covered for as long as you rent the tank, so you don’t have to worry about unexpected expenses. A couple of years ago, a sensor went on our hot water heater. A technician showed up the [...]
Read on and enjoy … Hot Water Heater: Rent or Own?
By 2 Cents on September 6th, 2010 | Category: Spending |  You can never get enough of what you don’t need to make you happy.
~ Eric Hoffer
Remember when you were a kid and you begged, pleaded with, and nagged your parents to buy you something for months on end? You wanted it so badly. It would solve all of your problems and provide you with endless happiness.
When your birthday came along and you finally received the desired treasure, it probably did give you the boost you predicted. But how long was it before that treasure ended up collecting dust somewhere and you moved on to the next desperately needed gadget, trinket, or toy?
For many of us, this cycle repeated over the course of our youth. For some of us, it continued well into our adult years. Indeed, the decades following World War II saw society as a whole adopt much the same pattern. Our homes gradually [...]
Read on and enjoy … The Law of Diminishing Returns
By 2 Cents on July 16th, 2010 | Category: Spending | Failure is only the opportunity to begin again more intelligently.
~ Henry Ford
Update: This article was featured in the Carnival of Money Stories – Starting a Sideline Edition posted at The Financial Blogger. Thanks!
If only the government had followed the advice of Henry Ford when it came time to decide whether or not to let GM and Chrysler fail. I recently made the case that a failure to fail has made a pretty big contribution to our current financial problems and I pointed to the auto bailouts as an example of this unhealthy trend. I live in Windsor, Ontario, traditionally a huge employment centre for the big 3 automakers. Mr. Cents and I both grew up here. We lived in various parts of the GTA (Greater Toronto Area) for about 5 years, but returned home 12 years ago. (Has it [...]
Read on and enjoy … Buying a Car: Is It Wrong to Buy Foreign?
By 2 Cents on June 18th, 2010 | Category: Financial Literacy | When I was a boy of fourteen, my father was so ignorant I could hardly stand to have the old man around. But when I got to be twenty-one, I was astonished at how much he had learned in seven years.
~ Mark Twain
Update: This article was included in the Carnival of Personal Finance #262 posted at Personal Finance Journey. Thanks!
The financial habits of society at large over the past few decades have been, in some ways, reflective of the attitude of the 14-year-old in the opening quote. In an article entitled How Did We Get Here? I pondered the progression of social and financial values from the 1950s to the present era. I speculated that the Baby Boomers’ rejection of their parents’ social mores gave birth to some great new ideas, but that we may have allowed the pendulum [...]
Read on and enjoy … Financial Wisdom for Father’s Day
By 2 Cents on June 16th, 2010 | Category: Saving | My problem lies in reconciling my gross habits with my net income.
~ Errol Flynn
Update: This article was included in the Festival of Frugality: Summer Edition posted at Where’s My Rolling Pin? Thanks!
I recently received a request from a doctoral student to fill out a short questionnaire on savings methods. The survey was directed at personal finance bloggers. Two different savings approaches were explained, and then respondents were asked which they would prefer, and to what degree. I wasn’t quite sure if I completely grasped the spirit of each approach, but I answered the questions to the best of my ability.
The two approaches proposed by the doctoral student are the circular savings method and the linear savings method. I’m going to outline both of them as explained by the author here, and I’d be
interested in your thoughts on [...]
Read on and enjoy … Which Is the Best Way to Save Money?
By 2 Cents on May 25th, 2010 | Category: Saving | The best things in life are nearest: Breath in your nostrils, light in your eyes, flowers at your feet, duties at your hand, the path of right just before you. Then do not grasp at the stars, but do life’s plain, common work as it comes, certain that daily duties and daily bread are the sweetest things in life.
~ Robert Louis Stevenson
Update: This article is included in the Carnival of Personal Finance #259 at A Gai Shan Life.
I love TFSAs. I think they’re the best financial “innovation” to hit the market in a long time. Last week, I wrote a lot about the complexities that have built up, wreaked havoc on, and continue to threaten our financial system.
The beauty of Tax Free Savings Accounts (TFSAs) lies not only in their tax sheltering function, but in their simplicity. The [...]
Read on and enjoy … TFSA Withdrawal Rules
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