The financial pressure is mounting and without careful planning I can see the health of my bottom-line articulated with red ink.

As I mention last time around, I was brought up by fiscally-conservative parents. You know they type: don’t spend it if you don’t have it. Anyway, that attitude has rubbed off on me and for the most part has served me well.

This attitude is of issue because I forgot to plan for my son’s annual sports and summer camp fees. For whatever reason, next winter’s hockey fees are payable now, along with next season’s soccer fees, ski pass and so on.
I’m sure my portion of the bill, which I split with the lad’s mother, will cost about $600. And there is no excuse for my lack of planning, as I paid these same bills this time last year and the year before.

Because, I was brought up to spend only what I have (mortgages and car loans a different issue), I feel compelled to somehow make it work.

The easiest way for me to come up with the $600 in the next six weeks is to dine in and not out. One friend has kindly pointed out that I am not as much fun while I work through this ode to bad planning. But, I hold to the theory that the dinners are more fun when I’m looking forward to the future and not deciding how to pay for the past.

Kat’s got the most important concept of all: managing your money is all about you. No one else. There is No Big Money Judge in the sky (although some of our use of money may have decided implications for us). It’s entirely and only about empowering ourselves.

Hmmm. Resistance. To recording expenses again. Collecting the receipts seems to be no problem. But I haven’t been able to sit myself down in front of the spreadsheet and enter them all. What’s that about? Obviously it’s about the fear of seeing where my money is actually going. I remember where my money went the last time I tracked expenses. But I wonder how my habits have changed since the last time I did this? Where is my money actually going now? Last month I said I wasn’t afraid to know…but I’m realizing that’s not entirely true! Once I see where the money is actually going then I will feel pressure to make informed choices about spending, and how to adjust things so I achieve the financial goals I’m striving for. That means no more denial about my spending habits!! eeeeeeeek!

I remember feeling resistant to this exercise the first time around too. That was almost two years ago. In the end, recording expenses turned out to be so helpful that the fear and apprehension I experienced initially was outweighed by the benefits of what I learned about how I handle my money. It was a very empowering exercise. So even as I’m writing this I’m aware that recording the receipts in the spreadsheet won’t be as hard to do as I think it will. And I know I will learn a lot by doing it!

It’s hard to understand what makes us resist that which we know is good for us. So many things in life are like this - it seems to be human nature to resist choices that will improve our lives. Yet, I have committed myself to financial, physical, spiritual and emotional health. To be successful in each of these areas I believe it’s important to accept that progress of any kind is always subject to ebbs and flows. Currently I feel that I am experiencing flow in every area of my life, perhaps with the exception of finances. (Well, unless you count “cashflow” - as in “flow right out of my hands”!!) The last several months saw my financial flow recede to a financial ebb for a time. I can feel the return of flow as I re-develop the habit of expense recording and analyzing my spending patterns.

Nancy once explained it to me very succinctly: in our lives we are subject to seasons. Sometimes we are in the summer of our lives where everything is lush and full and vibrant. Other times we are experiencing winter. Things are dormant, energy is more subdued, life is spare rather than abundant. The same is true of finances (among many other things). What feels promising for me is that Spring is both literally and figuratively on the horizon!

So “carpe spreadsheetum”…Spring, here I come!

Arrrgggghhhhhhh! Fresh off Christmas and straight into RRSP season, which is much like the starting gun to an often taxing tax season.
And then there are the regular bills, dreams of cool toys to be had and the knowledge that everything is becoming more expensive. It is tough for a fiscal conservative to live large when times are tight.

By way on introduction, I am using the name Jack, which allows me to protect some anonymity and, hopefully, my dignity. Therefore, I can share financial blunders, successes and my fiscal worldview in a culture that does like to discuss how individuals use their money.

Ever notice the emphasis is on capitalistic trinkets we acquire like big homes in great ‘hoods, cars to lust after and the annual vacation of a lifetime? Never is the question asked: are you making the best use of the money available to you?

I am a single dad in his early-40s living in a spacious rented “garden suite.” I like to joke that I have the same assets now that I had when I graduated from high school: a Japanese car (now coveted) and a killer stereo. Actually, the picture is not that bleak. I am debt free, have some long term savings and wish to enjoy today while working for a better future. As long as Nancy allows, I will share my ongoing dealings with my money with the hope you find it interesting to know what a fellow financial sojourner is encountering.

And back to the RRSP question. I was fortunate enough to earn some extra money last year doing some freelance work above and beyond the day job. I have yet to pay tax on it, a fact that will not go un-noticed by Revenue Canada. As I am still sitting on the entire pot of money, I plan to slide all of it into my RRSP, which means I don’t have to pay tax on it until it comes time to withdrawal those funds.

I resolve not to make a panic decision in terms of what to do with the RRSP. I’ll just make the deposit, claim the tax credit and then, over time, decide how best to invest the funds sitting in the RRSP.

Cheers. And panic not, for you are in control of your money.

Jack

I’d hoped to have 2 or 3 years of Jeffrey Journals (he does them so well) but like many of us, Jeffrey has a bit more on the go than he wanted to continue with. So with thanks to Jeffrey for getting the blog off the ground, we say an affectionate farewell.
The good news is we have a wonderful replacement… named.. you got it: Jack. I’ll let him introduce himself, and we very much look forward to hearing his tales about money!

Last week while conducting my financial review, I did the math to calculate exactly how much debt I had incurred since the end of my relationship at the beginning of June/05. I wanted to get a handle on how that experience impacted my finances so I could examine my behaviour for patterns that need attention and correction.

I noticed what types of things I was inclined to spend money on to “help myself feel better” following the end of my relationship, and recognized that even in choosing to incur some debt, I subconsciously set limits for myself in terms of how much debt I would be willing to incur and what types of things I would be willing to incur debt for.

The debt mounted primarily because I wanted to be able to enjoy being single again. To be able to go out with friends to social events, pubs, dancing, enjoy weekends away and not have to sit down and think out every expense before I spent money.

Even though my debt reduction plan was created BY me FOR me, I was feeling resentful of my money management plan….I wondered if perhaps my diligence with paying off debt and adhering to my debt reduction plan created frustration for my former partner due to my lack of financial flexibility for unexpected or spontaneous expenditures. So after our relationship ended, I was “feeling boxed in” by my money and spent freely on my Visa. Prior to the break-up, I knew how much money I could afford to pay on my Visa in any particular month and would only spend up to that amount so I could pay the bill in full when it came in. Post-break-up I racked up debt by spending sporadically over the last few months, paying what I could from my paycheque and any remainder I flipped over to my lower interest Line of Credit.

Wow, did I get a reality check when I sat down last week to total exactly what I had added to Line of Credit in the past six months by way of paying off my Visa! The individual increments themselves weren’t too daunting on their own, but it made me feel woozy when I looked at the total.

That being said, I also remember thinking as I was doing the transfers onto the Line of Credit, “Ohhh, I don’t like that balance…it’s approaching X dollars and I’m feeling uncomfortable”. I subconsciously thought I cannot allow my Line of Credit to reach that limit or it won’t be long before I’m back where I started and will have undone months of hard work. While it was hard to accept responsibility for having allowed myself to incur more debt, I also am very aware of my growth: by not allowing my Credit Line to exceed a self-determined limit (nowhere near the actual credit limit), by not running up my Visa to its limit, and by continuing to paying it off in full every month - even if that meant paying it with my Credit Line.

I have returned to my debt reduction plan, financial monitoring and being very careful with my expenditures. It means I have to be more mindful of what I’m spending and when. I’m creating a support system for myself by hanging out with other people who are in similar position to me financially so we can agree on economical entertainment choices and encourage and support each other’s financial health. I eat at home before going out to the bar, I can walk to my local pub which allows me to have a beer or two at home before going out if I choose - little things which save significant money. That pub meal, a taxi and two extra beer almost double the cost of the evening out! Do that 2 or 3 times in a month and before I know it, all my money is gone. I know where debt reduction is concerned, it’s “short term pain for long term gain” and the discipline of the habit will pay back tenfold. Because when the debt is gone and I have all those hundreds of dollars back in my pocket every month, I can use that money to do those things unavailable to me with debt: buy RRSPs, and put away savings for vacations and “spontaneous purchases”. Then I will have the lifestyle I desire, with no nasty bills to have to pay at the end of the month!