Time for a financial wellness checkup?

Four trouble areas, and how a planner can help

The Covid-19 pandemic and lockdowns have created plenty of financial stress for individuals and families. Temporary or even permanent income loss has been only partially mitigated by relief programs, such as the Canada Emergency Relief Benefit (CERB) and the Canada Emergency Wage Subsidy (CEWS). In any case, these programs are not permanent and will be wound down eventually. Feeling stressed? This is a good time to take stock of your situation with a financial wellness check in four key areas.


You can’t ‘save’ a million – but you can retire rich

Escape the shackles of the savings account trap

You may as well face facts: You can’t “save” a million dollars. A recent survey of the market showed that the highest rate paid in a standard, plain-vanilla deposit savings account (the kind that most banks and large financial institutions offer as a place to put your cash) was around 2.8%, while the lowest was, believe it or not, one tenth of 1%. Believe me, with this kind of return, you will not be able to “save” a million dollars. But another fact is that you can still retire rich, possibly with much more than a million dollars in your nest egg, once you unshackle yourself from the savings account trap. Here’s how.


The seven sins of financial planning

How to stay on the virtuous path

At this time of the year, when Black Friday madness looms, and financial responsibility seems to evaporate for many people, it’s helpful to revisit what I consider to be the most common financial and planning errors most people make. Over the years, I’ve boiled it down to the seven deadly sins of financial planning. I first produced this list in my blog a few years ago. But it continues to be a popular item, so I thought I’d run it again as a refresher on how to stay financial virtuous and scale back the many temptations and excesses of the holiday shopping whirlwind. Here’s my list, then, and some suggestions for how to avoid those deadly financial sins. READ MORE

Budgeting for wealth

Little changes can make a big difference

As this is Financial Literacy month, and the theme is “Take Charge of Your Finances!”, I want to talk about the very foundation of financial literacy, the building block of successful financial management: the budget. I can sense eyes glazing over right now, but before you click away to another more interesting page or a funny cat video, let me talk about lattés instead. READ MORE

How to bring order to your personal financial chaos

Decide what you really, really want

Around this time of year, many people are beset by doubts and anxieties about their financial situation – especially after the no-holds-barred holiday spending season. But don’t despair – there’s a way to bring order to your personal financial chaos that doesn’t involve tedious budget lists and penny-pinching. It starts with a look at your financial picture from the top down. READ MORE

How a savings account eats up your money

Low, low rates mean you automatically lose

Are you sitting on a large chunk of cash in a high-interest bank account? Maybe you thought it would be “safe” because you’re nervous about stocks and bonds. Plus, there’s deposit insurance, and it’s liquid. Well, you’re right on two counts – it’s liquid, and the deposit is insured to a certain extent. But the bank’s definition of “high interest” and yours probably differ by several percentage points. And as for “safe,” that could be a matter of definition, too. So here’s a look at how savings accounts erode wealth, and some other options you might have. READ MORE

A quick course on RESP payments

How to withdraw funds for post-secondary expenses

If you have kids going off to college or university this fall, and you’ve accumulated substantial savings in a Registered Education Savings Plan, now’s the time to tap into those funds. But you won’t be able to use the RESP like a bank account. Your college-bound kid will be getting something called “Educational Assistance Payments,” and they come with a thick handbook of rules and stipulations. Here’s how it works. READ MORE

Do you have seasonal spending disorder?

The remedy for financial overindulgence

Every year around this time, I’m asked how to overcome the seasonal spending disorder that grips a large part of the population. But there is a remedy, and it doesn’t involve laborious budgets and daily penny-counting. Instead, step back and look at the bigger picture from the top down. READ MORE

Take your money and run!

How bank deposits are costing you and what to do about it

Thinking of saving a few bucks with your local bank? Forget it! The days of putting a little something aside in your “savings” account are long gone. That’s because these days, you’re earning just about nothing on savings account deposits. In some cases, you are actually earning nothing – often less than nothing – as the recent listed rate on deposit accounts at four reasonably large financial institutions was, yes, zero! Here’s what this means for you, and where you can put your money to actually save something. READ MORE