by Mary Ann Marriott, CIRP, LIT
November 2, 2018
November is Financial Literacy month, and I couldn’t think of a better focus for a month. Of course I am biased as I am a Licensed Insolvency Trustee and it is my job to help people sort out their financial woes. And we Canadians (really, all of us around the globe) have lots of financial woes.
Personally I do have a pet peeve with the education system omitting basic financial education in the school system. I mean, I get it, we have limited resources, but personal finances are, without a doubt, one of the major pillars of life. Your finances support every aspect of your life from your emotional to physical well-being.
So where does one start if they have not had the benefit of receiving sound financial education in their lifetime?
The following are three things that you can do today to invest in your financial wellness on the most basic level:
- Connect with resources available to you to provide the information and education you need at each stage of your life. Follow blogs, get books from the library or listen to podcasts, whatever works best for your lifestyle. Be informed! Get advice on any area of your life, including but not limited to:
- Planning for your first home
- Setting up a home / paying bills
- Raising kids
- Retirement planning
- Be open to new ways of doing things. Try new things. What’s that you say Dr. Phil? “How’s that working for you?” J …. If you keep doing what you are doing you will keep getting what you are getting. Do one small thing at a time and evaluate its effectiveness. If it works, keep doing it. If it doesn’t, try something new. Would you like some examples?
- You usually pay your bills when they come due….try paying them a week or two in advance. The first month or two will take some planning, but once you are in the grove, the financial output will be the same.
- You pick up groceries every day on the way home….try making a list and buying groceries once a week or every couple of weeks, stopping less often.
- You use your credit cards as an emergency fund….try saving for the so-called ‘emergencies’ such as car maintenance, gifts, etc.
- Track your spending. Information, as they say, is power! The most powerful thing you can do to invest in your financial future is figure out where every cent you earn is going and evaluate whether the expense is worth it or not. It is amazing to me, when I do this exercise with people, how many hundreds of dollars are being spent mindlessly without any concern for what else they could be buying for you. The biggest culprits:
- Food & beverages outside of the house – dining out, fast food, coffees, etc. I have seen clients spending hundreds every month. That’s ok, if these things are THAT important to you, but what else could you do with that $100, $200, $300 per month?! Maybe take that trip you want, or pay off debt, or work towards some other goal.
- Groceries – does anyone NOT think they spend too much on groceries and household items? Start tracking and start saving. Changing small habits can have big impacts.
- Kids – instead of giving your kids money every time they want something, put them on an allowance (their own personal budget) and let them learn the value of money. Figure out what you are spending on them now, discuss a suitable allowance amount and voilà! Instant savings!