CBC Radio Series - Financial basics - 20 something's

If you missed our 20-something segment with CBC Radio's Peter Brown (first in a series), catch it here http://bit.ly/faqna2

RRSP, Pay Down the Mortgage, or Both? AOL's WalletPop Canada

Well, it's that time of year. RRSP season is upon us with the deadline for your contribution fast approaching - March 1st. The classic question I get from many is, should I invest in an RRSP, pay down on my mortgage principal or both?

I must preface that if you have any high interest credit card debt, that should be the first focus. With those rates hovering around 11-29% interest, it always makes more sense to get rid of that debt first.

Let's assume that you doesn't have any other debt and are simply wondering if the RRSP is the better way to go or, should you fast track paying down your mortgage?

Read on to find out which is the better option, or, if you should opt for a blend of both
http://www.walletpop.ca/2011/02/23/rrsp-pay-down-the-mortgage-or-both/

Should couple move to trim housing costs? Globe & Mail's Cash Clash

Madelaine, 42, and Ben, 48, Victoria

Should this couple downsize their debt by moving to a smaller home? The family of five live in a dream house in a beautiful ocean-side neighbourhood, but the costs are high. She wants to move to smaller digs in suburbia. He doesn’t think it’s worth the hassle. Should they stay or should they go?

Read the full article and my advice here:
http://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/should-couple-move-to-trim-housing-costs/article1915584/

Innumeracy; Not Knowing this Simple Calculation Could Cost You Thousands of Dollars in Your Lifetime - AOL's WalletPop Canada

To paraphrase the allegory at the start of the book, Why Smart People Make Big Money Mistakes and How to Correct Them, the scenario goes like this. You're shopping for lamp and spot one you like for $50. Just as you're about to make the purchase, a friend bumps into you at the cashier and tells you that identical lamp is available just a few blocks away for $25. You do a quick calculation in your head realizing that's a 50% savings for a little inconvenience and decide to go a few blocks for a big savings.

Here's the next scenario. You're shopping for a big screen TV. You're at the electronics store, you've narrowed down your choice, spent a considerable amount of time negotiating with the sales person and feel good about the $1,250 price tag. Again, just as you're ready to make the purchase, you bump into your friend that tells you the exact TV can be had a couple of blocks away for $1,225. You do a quick calculation in your head and realize that's only a savings of less than 3%. Do you put the TV down and make the extra effort? If you're like most, you decide it's simply not worth your time for such an insignificant savings. But that's a big mistake.

What happened in both scenarios? Read on to find out:
http://www.walletpop.ca/blog/2011/02/18/innumeracy-not-knowing-this-simple-calculation-could-cost-you-t/#comments

Should a couple share financial decisions? Globe & Mail's Cash Clash

Jen, 29, and Dave, 32, Kelowna, B.C.

Should one spouse make all the major financial decisions in a marriage? That’s the pickle this couple are in. With both a baby and an inheritance on the way, she’s trying to figure out the best plan of action. He argues it’s not his money to manage. Can they agree on a strategy before their family and their problems multiply?

Read the full article and my advice here:
http://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/should-a-couple-share-financial-decisions/article1907462/page1/

Be a Valentine's Day Hero - Low Cost Ideas for Love - AOL's WalletPop Canada

I know; we just got over Christmas (and some of us are still paying for it) and retailers are already pushing yet another holiday - Valentine's Day. And if you have someone special in your life, you can't miss this one! I've collected a plethora of gift ideas and ways to show your care without breaking the bank.


Buy flowers early and from a grocery store as opposed to a flower shop; the latter tends to be much more expensive especially in the days leading up to the 14th.
Make your own fortune cookies with love notes inside and hide them around the house. Here's a recipe for them - http://chinesefood.about.com/od/diningout/r/fortunecookie.htm

Click here to read the full article:
http://www.walletpop.ca/blog/2011/02/11/be-a-valentines-day-hero-low-cost-ideas-for-love/

Should frugal savers enjoy their money while they can? Globe & Mail's Cash Clash

Mike, 48, and Jill, 40, Edmonton

How much do you really need to save for retirement? This couple have built a nice nest egg, living below their means and diligently saving. She says it’s time to start enjoying the fruits while they’re still young, but he thinks they should keep socking money away for their old age. Is it too soon to raid the piggy bank?

Click this link to read the full article and my advice:
http://www.theglobeandmail.com/globe-investor/personal-finance/rrsp/should-frugal-savers-enjoy-their-money-while-they-can/article1898322/

Is an RRSP an Investment? If You Answered Yes, You're Wrong! AOL's WalletPop Canada

If you think an RRSP is an investment, don't worry; many Canadians think the same. However, an RRSP - Registered Retirement Savings Plan, is simply a shelter, not an investment.

I like to explain it this way: think of your RRSP as a garage. It's essentially an empty structure. You still need to put cars into your garage. These cars could be GIC's at your bank, stocks, bonds, mutual funds or just about any combination and more. But without carefully choosing which cars go into your RRSP and periodically changing those cars up, many Canadians aren't optimizing their RRSPs.Thinking that the shelter is the investment is the number one error I see individuals making when it comes to RRSPs. They rush into their banker or financial advisor's office moments before the deadline and take a sigh of relief that their investment made it in time for a juicy tax refund to come. The professionals in the financial industry are swamped at RRSP time and may simply plunk your investment in a cash account within the RRSP (that's a car too) so that you can make the deadline and ask you to remember to come back at a less busy time of the year to property allocate (diversify) your contribution. You forget to do so, or at least, many do, and therefore your RRSP doesn't work as hard as it could to grow your retirement savings.

Read my full article here:
http://www.walletpop.ca/blog/2011/02/07/is-an-rrsp-an-investment-if-you-answered-yes-youre-wrong/

Should near-retirees re-mortgage their home to play the stock market? Globe and Mail's Cash Clash

Bernie and Linda, 53, Calgary

Wanting to retire in a couple of years, these empty nesters have had a long-time goal: to ride off into the sunset with $1-million saved. They’re not quite there yet, and he’d like to top up their funds by re-mortgaging their house and investing the money in stocks. She thinks going back into debt is just plain loco. Who’s got the most horse sense?

Read the full article and my advice here:
http://www.theglobeandmail.com/globe-investor/personal-finance/household-finances/should-near-retirees-re-mortgage-their-home-to-play-the-stock-market/article1889939/