Millionaire on the Prairie

Tag: Dreams

  • No One Said It Would Be Easy.

    No One Said It Would Be Easy.

    Getting what you really, really want is hardly every easy. It can be a grind. There are going to be days when you don’t want to work for it. Chances are you shed a tear or two along the way. It might take you much longer than you’d anticipated, and there are no guarantees the path will be a smooth one.

    So what!

    Accept the fact that the life you really want and that the dreams that you want to see come true are not going to fall into your hands like snow on a winter’s day. The reality is that you are going to have to put in some serious effort then reap the rewards later. If it’s worth having, then it’s worth fighting for. Never forget that!

    Since this is a personal finance blog, I can help you with the money part of building the life you honestly and truly desire. There are some very basic guidelines that will get you 97% of the way there. If you follow these, then you’re set. The other 3% won’t make or break you either way. The more of these rules you fail to follow, the harder you’ll make it on yourself.

    Choose wisely.

    First things first… commit to living below your means.

    There’s no way around this fact. If you spend every nickel you earn, then you will not have money leftover to put towards your dreams and the life you really want.

    You need to save some of the money you earn. I used to think that 10% was enough. Now, I’ve matured and I see that 20% should be the bare minimum.

    Maybe you can’t start at 20% right now. Fine – 20% is out of the question for right now. I refuse to be persuaded that you can’t work your way up to 20% over time. Start where you are right now, then increase your savings rate by 1% every single year. If you can increase your savings rate at a faster pace, then so much the better.

    People get raises, start side hustles, create content, teach skills, etc… There are many ways to earn additional money. Find one that works for your life and do it. Whatever money you earn can be applied to building the life you want and to turning your dreams into your reality.

    Next, work on getting out of debt.

    This might take a minute. Getting into debt is usually fun, but getting out is a tedious task. Unless you come into a windfall, it’s going to take you some time to pay off your creditors. If you can, make extra payments to pay off your debt faster.

    And for the love of all that you hold holy, stay out of debt. If you want something, set up a sinking fund then use cash to buy it. As a matter of fact, set up a sinking fund even if there’s nothing in particular that you want. Set up an automatic transfer in the amount all of your former debt payments and send that money to your sinking fund. You’re already accustomed to making those payments, but this time they’ll be going into your pocket instead of someone else’s.

    When you finally decide what you want, the money will be there waiting for you. No debt needed!

    Invest for your long-term future.

    While paying down your debt, cinch your belt a little tighter and set some money aside for Future You.

    Debt payments are about paying for past decisions. Investing for your future is about self-care. You’re going to need food, shelter, transportation, heat, and a few other basic necessities every single day until the day you die. This is why you absolutely must set aside some of today’s money for tomorrow’s expenses. You won’t always be physically and mentally capable of going to work. There’s also a decent chance that you simply won’t want to leave the comfort of your home to do tasks for someone else. Or maybe you’ll no longer love running your own business.

    Whatever the case, you don’t want to be forced to keep working when you’d rather stop.

    When that time comes, you’ll be very happy to have cashflow from investments to replace the cashflow from your salary. Start today. Invest for the long-term. Re-invest all your dividends and capital gains. Set up an automatic transfer to invest a portion of every dollar that crosses your palm. When you stop sending your body out to work, there will be a pot of gold waiting for you. Future You will be very glad that Today You made good choices.

    Build your emergency fund.

    Much like paying off debt, it’s going to take a minute or two to build up atleast six months’ worth of expenses. I’m not adverse to seeing people with one year’s worth of expenses set aside, but I appreciate that six months’ worth will do in a pinch. Emergencies always have a financial component, so kindly make hay while the sun shines. Believe me when I say that an emergency is never made better by the addition of debt.

    The last thing you want is the burden of paying for an emergency for months, if not years, after it’s happened. To avoid this depressing situation, make sure that you’re adding to your emergency fund on a regular basis. Every time you’re paid, send some money to your emergency fund and leave it alone.

    No one has ever complained about having too much money during an emergency.

    And if you have to use your emergency fund at some point, make sure that you re-build it as fast as possible. There is no way of knowing when your next emergency is going to land so it’s best to be prepared as soon as possible.

    Finally, stop getting in your own way.

    By this, I mean do not take on financial burdens unless absolutely necessary. More monthly subscriptions won’t get your closer to your dream life unless you’re the one selling to subscribers. Any dollar that is spent on something other than what you want most is a dollar that is not bringing you closer to your dreams.

    Remember that there is always someone out there who is goading you to spend your money in ways that aren’t getting you closer to the life you want. You’re the best person to know what your heart really desires. And you need not sacrifice your priorities just because the AdMan and the Creditor request that of you. They’re your dreams so it’s your responsibility to protect them, to nurture them, and to pay for them.

    Again… No one said it would be easy. I’m here to tell you that it will be worth it.

  • Making the Best Moves to Get Your Dream Life

    Making the Best Moves to Get Your Dream Life

    Before you get too far into the craziness of the Spending Season, take a few minutes to reflect back on the past year.

    The next 6 weeks will be filled with the AdMan’s best efforts to get you to part with your hard-earned money. His one and only goal is to make you spend. Cash or credit – either one will do so long as you’re opening your wallet as often and as fast as you possibly can.

    Here’s a little tip from me to you. Don’t spend money on things that don’t matter to you. Seriously. It’s okay to say “No” and to keep your money in your wallet.

    And this is why now is such a good time to assess if you’re moving closer towards your dream life and your heart’s desires. Only you know what your dream life looks like. And your best shot of getting it is to be laser-focused on the choices you make with your time, energy, and money.

    My blog is about personal finance so I’ll focus on the money-stuff. There’s are a lot of other inputs and factors that go into our money choices. I realize this. The truth is that I can only speak about my personal experiences and my own observations of the world. I don’t claim to be an expert in psychology. What I do know is that the first step to getting what you want is knowing what it is that you really want. Without that information, you’re kind of flailing in the wind.

    If not now, when?

    This question should be the one you ask yourself every time you think about going after what you really want. Tomorrow is promised to no one. There are no guarantees about the future. An amazing opportunity might come around again…or it might not. You have to be prepared to pursue your dreams every single day. And that starts by knowing exactly what they are.

    The next step is to start saving & investing for your dream life. Maybe you want to run a cafe in Paris one day. If that’s what you want, then that’s what you’ll start working towards. First things first, you open a dedicated bank account for that dream. And you set up an automatic transfer to start filling that bank account. It might take you a few years to save up a sizeable sum, but so what?

    The time will pass anyway.

    Read that again. The time will pass anyway.

    So start your automatic transfer today, and stick with it. While you’re working and saving and investing, you’re also going to start researching the steps you’ll need to take to make your dream come true. You’ll go online and search “How to own a business in Paris”. Maybe you’ll plan a trip to Paris and see it with your own eyes for a week or two. You’ll take French lessons or figure out if there’s an ex-pat community where they speak your language already.

    And while you’re fleshing out your dreams, your money will quietly and consistently accumulating. It will be working for you 24/7. Keep adding to the pot. Don’t make withdrawals – just leave it alone. When the time comes for you to bring your dream to life, the money will be waiting for you.

    Make smart choices in the interim.

    I’m not telling you to save every nickel. What I am telling you is to stop spending money on things that don’t matter to you. Is eating out for lunch every day more important that your dreams? Would you rather buy your 27th sweater or take a course that gets you closer to the life you really want? Is it better to impress family, friends, and strangers today instead of being proud of and satisfied with the accomplishments of Future You?

    You’re the only one who can answer these questions for yourself. After all, you’re the one who is going to live with the consequences of your choices.

    As I said earlier, we’re heading into the full court press of Spending Season. You will be subject to advertisements on every single platform and they will all be exhorting you to your spend money. The unspoken promise is that spending all of your money is the secret sauce to having a “perfect life”. Believe me when I tell you, there’s no such thing as a “perfect life”. And even if such a thing existed, I highly doubt that it could be purchased at the mall. Oodles of gifts ensconced in reams of wrapping paper beneath a beautifully-decorated tree make for a lovely advertisement. The harsh trust is that they don’t give you what you really want, which is more than likely connection and community with the people whom you love best. Strong relationships built on trust, love, respect, and admiration aren’t bought with cash or credit.

    Keep that in mind as the Spending Season moves into full swing. Don’t let the endless encouragement to spend detract from pursuing your dream life.

    Back to my original point… It’s time to figure out whether you’re any closer to the dream life that you really and truly want for yourself. If the answer is not to your liking, then figure out what you need to change to get what you really want. Then go make it happen.

  • Just Start Today

    Just Start Today

    This is going to be a short post. I want you to start funding your dreams today.

    Yes. Today. Start today. Don’t wait until tomorrow. If you’re reading this post on your computer or your phone or your tablet, then you’re capable of going to your bank and opening an account. Or you can go to a different bank and open an account. It truly doesn’t matter.

    Open the new account. Set up an automatic transfer to fund the new account. Start with a $1 per day. That’s a weekly transfer of $7, or a bi-weekly transfer of $14. If $1/day seems ridiculous, then start with $5/day. Again, that would be $35 per week or $70 every two weeks. Again, the choice of how much to transfer every day is yours but you have to start today.

    If you’ve been here for any length of time, you know that I like to preach that you should identify your priorities first. I’m starting to waver on that. Priorities are extremely important, but many people have a lot of trouble identifying what they hold most dear. If you’re a person who doesn’t know what they want, then you should still be saving and investing your money. It might take you 5 years to figure out what you really want, and that’s okay. Waiting 5 years to start saving and investing is not okay. That’s 5 years of time that you will never get back. It’s better that you’re saving and investing while also trying to figure out what you want.

    Start today… even if you don’t know everything. You’ll learn along the way. Personal finance isn’t too hard for to you learn. You can learn as much as you want and at your own pace. Once the automatic transfer is in place, you’ll be setting aside money on a regular basis. As you learn more, you’ll make more informed choices for your money. You’ll grow confident in your ability to make wise decisions with your cash. Don’t wait until you feel that you’ve “learned it all” before you start saving and investing. Speaking from personal experience, I can assure you that you will never feel that you’ve learned everything there is to know.

    The better route is to start today, never stop learning, and put what you learn into practice. As you know better, you’ll do better.

    No one has ever regretted having a little money set aside. Life will throw challenges your way. Having money in the bank means that you can deal with the financial side of those challenges with a certain amount of ease. The time to build the ark is before it starts to rain. So just start today. Open the account – set up the transfer – keep learning about yourself and what you want your money to do for you. That’s it. Everything else is details.

  • Rage Applying – New Name for an Old Idea

    Rage Applying – New Name for an Old Idea

    I just learned about “rage applying“. Apparently, it takes place under the following conditions. When you don’t like your current work environment, you apply for a new job.

    Trust me when I tell you that this is a new name for an old idea. No one has invented anything new by slapping a new moniker on this behaviour. (If anything, this new name is a fine example of re-branding at its finest!) Here’s the big, open secret just in case you haven’t learned this particular lesson yet. Most people look for new jobs when they no longer like their working conditions. This is a normal, rational response to a situation that has become unbearable and unpalatable. That this behaviour has earned itself a trendy hashtag says more about the merging of entertainment and news than it does about employee behaviour.

    Sometimes, people find themselves in situations that they want to leave. Maybe it’s work, or maybe it’s a relationship. Whatever it is, people want a way out. They will look for an escape. Should you happen to find yourself in this position, might I suggest that you have a little bit of a cash cushion to tide you over? There should always be a little bit of money in the kitty for endings, especially when you initiate them. Endings can be painful, disruptive, and disagreeable. People rarely speak about the fact that endings are rarely, if ever, free.

    Leaving your job for another one might entail a delay in receiving your first paycheque from your new employer. Take that into account before you leave your current position. Ask yourself if you have enough money set aside to continue paying your bills until you get that first paycheque? If you need to move cities for your new job, do you have enough to cover all the associated bills? Have you considered keeping a little cushion of cash set aside just in case the new job doesn’t live up to your expectations and you need to find another one?

    Rage applying might assist you to get away from an intolerable situation, yet you should always be working towards making your dreams come true. If you’re going to look for a new job, ask yourself if it gets you closer to the life you really want to build for yourself. Is it a strategic move? Does the new job challenge and intrigue you? Will you be able to shed those tasks and responsibilities that you hate at your current job? Is there going to be a pay increase such that you can direct more of your hard-earned money towards the elements of your life that make you happiest?

    Think about what you want to accomplish in 2023. Will rage applying help you attain your goals?

    For the record, I’m not suggesting that you stay in unhappy situations. That’s not in your best interests, it’s detrimental to your mental health, and it won’t maximize your joy. I want to see that you’re moving towards the dreams that you have for your life. If you truly believe that applying for a new job will bring you joy, then start sending out those applications. Just make make sure that you’re smart about it. Establish what you’re looking for in your next position. Better promotional opportunities? A chance to work with someone you admire? Experience that will develop & strengthen areas where your skills are weak?

    Take some time to determine what it is that you want. Don’t forget to consider the financial impacts too. It’s a no-brainer to leave for more money. A better work environment and a boatload more cash is what everyone wants. The challenge lies in figuring out what you’ll do if the next position pays you less than what you’re making right now, but will get you closer to your heart’s desire. Is a potential paycut justified if you truly believe that you’ll be happier? Can you take a pay decrease and still meet your financial goals?

    Rage applying is a new name for an old trick. Life is too short to be utterly unhappy at work. Change your job, if you must. Moving to a situation that brings more joy into your life, or atleast eliminates a significant chunk of unhappiness from your life, is a good thing. Just do it in a smart way. Spend some time on the front-end to determine what you want, what you don’t want, and apply for positions accordingly.

    Good luck!

  • One Week Closer to Your Dreams

    One Week Closer to Your Dreams

    Well, the first week of 2023 is in the bag. Either you’re one week closer to your dreams or you’re not. No need to share your response with the class, but which one is it?

    Personally, I don’t do New Year’s resolutions. Any day of the year is a great time to make beneficial changes to one’s life. January 1 doesn’t hold any special power when it comes to setting priorities for how you want to live the rest of your life. That said, I do use the sentiment of season as incentive set and re-assess the goals for my life. (Since this is a personal finance blog, I’ll only discuss my personal finance goals.)

    Some of my financial goals are long-term, i.e. retiring ASAP, while others are in my near future, i.e. maximizing my RRSP contribution in May or June. I find that January of each year is a good time to figure out what goals are most important to me. This way, I can focus my spending in ways that get me closer to the life I want to live.

    So far, and in no particular order, my goals for 2023 include:

    • paying cash for Christmas 2023 (no credit card hangover in January for me!)
    • contributing to my TFSA and RRSP
    • taking myself to the spa for my birthday in August
    • upgrading my iPhone
    • increasing my dividend cashflow by 10%
    • using my newly-creating slush fund (shout out to Bridget Casey of Money After Grad)
    • taking lunch to work more often than not
    • doing more meal prep so there’s less motivation to choose for fast food
    • maintaining my contributions to my non-registered account
    • beef up my emergency fund to account for inflation

    These are the financial concerns that are currently most important to me. And since it’s my list, I’m the only one who gets to add, amend, or remove items. By the same token, I’m the person who has to fund them too.

    How I Meet My Goals

    Unsurprisingly, I’ll be using sinking funds for many of my goals. As I get paid, various chunks of money will be saved in various sinking funds until it’s time to spend the money. Most banks allow you to create nicknames for your various accounts. I love this feature! Nicknames are the perfect reminder of which priorities are being funded with my money. Should I ever need to withdraw money, then I know exactly which priority is being sacrificed for some other purpose.

    Let’s use Christmas 2023 as an example. I get paid bi-weekly so I have 26 paycheques coming to me this year. My sinking fund will see contributions of $50 bi-weekly, which will give me $1300 to spend on Christmas in 12-months time. Now, if I think Christmas is going to cost more than that, then I can bump the amount up to $75 ($1950) or $100 ($2600) to cover my anticipated expenses. Thankfully, my family is nearby so I don’t have to cover huge transportation costs. We’re also not too big on gifts and prefer to focus on the food, playing with the kids, and playing board games. The lower amount of $1300 should be more than sufficient to cover the anticipated costs.

    By starting to save for Christmas 2023 now, I won’t be scrambling for $1300 in 11 months time. I’ll have been saving throughout the year in small chunks. When the time comes, I can spend on gifts, food, and decorations without wondering where the money will come from to pay for everything. The money will have been tucked away just for this purpose. Easy-peasy-lemon-squeasy!

    Automatic transfers take a good many money-decisions off my plate every year. They allow me to fund my priorities with the least amount of stress. I achieve my goals and get what I want by following this simple 3-step formula:

    1. My employer deposits money into my account on payday.
    2. Automatic transfers whisk a good chunk of it away to fund the things that are most important to me.
    3. Whatever’s leftover is spent on the day-to-day expenses of living: shelter, groceries, utility bills, entertainment, and other little nice-to-haves.

    I never have to ask myself if I’m going to transfer money from my chequing account to my various savings and investment accounts. Thanks to the power of automation, the money is siphoned away before I have a chance to spend it.

    51 Weeks Left

    The first week of 2023 is in the history books. Hope it was a good one for you and that you’re one step closer to living your dreams. And if you didn’t get any closer to your dreams, then take a few minutes to figure out why. Ask yourself the following questions:

    • How are you going to spend your money over the 51 weeks left in 2023?
    • Are there any financial obstacles that are preventing you from getting what you want?
    • If yes, what would it take to remove them?
    • Are you willing to bear the consequences of removing money impediments from your life?

    I get it. Change is hard, and I’m not terribly fond of it either. Still, life has taught me that sometimes changes have to be made in order to get what I want. Other people will always have opinions about how I’ve chosen, or not chosen, to spend my money. Guess what? They’ll sleep just fine with their opinions, but I’m the one who has to live with my choices. I’ll consider their opinions, before I do what I think is best for me.

    You’re in the same boat. My opinions on this blog are mine. You know your financial situation way better than I do so you have to make choices based on the facts of your life. After all, you’re the one who is going to be saddled with the consequences of every choice you make. Life is a series of choices, after all.

    When it comes to your money, I’m suggesting that you be the one to choose what happens with it. Don’t let anyone else spend it for you. Never let anyone else put you into debt! No one else knows what is most important to you. At the end of the day, your choices with money will affect every aspect of your life. This is why you should put in the effort to articulate what you want most then craft a spending plan to achieve it.

    This is the very best way for you to move closer to your dreams, and to seeing them come true.

  • The Boring Middle

    The Boring Middle

    The boring middle… I’ve come across this phrase several times in the past two years while perusing various personal finance sites. It refers to the period of time between setting a long-term goal, such as financial independence or retirement, and achieving that goal. From my own experience, it’s an apt term to describe the slog.

    Ideally, I would’ve decided to retire early and then won a lottery jackpot a few weeks later. Goal set – goal met! Easy-peasy-lemon-squeezy!

    That has not been my reality. It’s been 15 or so years since I set the goal of early retirement… and I’m still working towards it. I’m still in the boring middle! That lottery win hasn’t happened yet, despite my best efforts, so I’m stuck with relying on my paycheques and investment income to build my portfolio. Even after a decade and a half, I still don’t have enough of a cash cushion to amicably part ways with my employer.

    Now, that’s not to say that your experience is going to mirror mine. Some people are able to start a successful business and get there much faster. Check out Yo QuieroDinero‘s story of a lady who was able to quit her corporate job in under 10 years and is now living my dream life of travel funded by passive income. She also owns the food blog, Delish D’lites. Here’s the story of a man who was able to get it done in 5 years. The internet offers many, many, many such stories.

    I’m not an entrepreneur nor have I had any wildly successful business ideas. I’ve dabbled in rental properties, but my real love is dividend income & capital gains. They’re truly the most passive income out there. In my humble opinion, the only drawback is the amount of time that it’s taken me to build a decent 5-figure income stream from these sources. For me, the boring middle is going to be around for a very long time.

    Staying Motivated

    Truth be told, I’ve never wavered in my desire for early retirement. Staying motivated hasn’t been a problem. My career has been very rewarding in some aspects, but I don’t love it enough to extend it further than absolutely necessary. It’s not my passion. Unlike Garden Answer, I’m not making a decent living doing what I love. By the way, if you’re an amateur gardener, I’d suggest watching her videos. The flower pictures on this blog are from my yard & others I’ve worked in. I used to be scared to try new things. Now, I’ve got the confidence to tackle larger projects!

    So how have I stayed focused during the boring middle?

    Firstly, I have many interim goals. Pre-pandemic, most of those revolved around travel. I managed to visit Europe three times in 5 years. For a person whose family did mostly road trips when I was growing up, it’s almost embarrassing to admit that I have no idea how many times I’ve been on a plane. I’ve managed to visit 6 different countries so far. Once the airlines are fully staffed and running with their pre-pandemic efficiency, I’ll be back in the air and visiting more new places. Until then, I’ll be doing roadtrips in my own country and seeing all those homegrown places that are still on my want-to-visit list.

    Secondly, automation does a lot of the work for me. I have automatic transfers in place to move my money around each time I get paid. It’s not up to me to remember to send money to my investment portfolio. There’s never any temptation to spend that money on something else, just this once. The result is that I can go about my day-to-day life without having to worry about whether I’m moving closer to or further from my goal of early retirement. I don’t have to focus on the boring middle because automation is doing 97% of the money-moving work for me. Once a month, I buy more units in my chosen ETFs and then I’m done.

    Thirdly, I enjoy the present. It’s summertime! And that means I get to indulge in my amateur gardening skills. Yay! I spend late winter and early spring planning out what I want to buy and where I want to plant things. After the long weekend in May, I get shovels & trowels into the dirt. I’ve decided that I’m only going to put perennials in the ground. All of my annuals will go into containers. This choice makes things way easier on my lower back and knees, neither of which are getting any younger.

    Time with family and friends helps me in the boring middle. I realize that focusing solely on money and retirement isn’t healthy. I need to have good, solid relationships with others too. Spending time with my family friends creates and nourishes the truly important bonds in one’s life. As I’ve said before, you cannot have a relationship with money. So while I’m in the boring middle, I don’t have to have a life that’s boring. I’m building relationships. I’m reading, cooking, baking, traveling, gardening, etc… There’s a lot of life to be lived outside of financial goals. I don’t want to miss any of it.

    Day By Day

    Set your goals and make a plan. The boring middle lasts as long as it lasts. Maybe you’ll figure out a way to shorten it. If so, good for you! If not, that’s okay too. Don’t spend your life wishing it away. Focus on your priorities. Live below your means. Drink enough water. Be present when you’re with family and friends. Build strong relationships with people who are worthy of your time and energy. Invest your money consistently. Time will do the rest.

  • Tough Choices

    Tough Choices

    Try as I might, I still haven’t figured out a way to get everything that I want. There are always tough choices to be made about money. I honestly believe that tough choices are the foundation of the non-financial side of personal finance.

    While the Single Ones among us do not have to fight with anyone about money, it’s still incredibly important for us to identify our spending priorities. Being single does not eliminate the requirement to take responsibility for our money. Setting priorities helps us figure out what to do when tough choices have to be made about how to spend our dollars, and which goals to pursue.

    Last weekend, I found a wonderful house. It’s a 1500sqft bungalow with main floor laundry, a double-car garage, and – wonder of wonders! – a large foyer that opens into a beautiful, bright living-space. Did I mention the large composite deck, the spacious & fully-furnished basement, and the fabulous ensuite off the master bedroom? It’s even in the neighbourhood that I’ve been watching for the past ten years!

    So why didn’t I jump on the change to buy it?

    Here’s why… Doing so jeopardizes my retirement plans.

    The house is almost perfect for me. It’s main drawback is that it would require me to commit to working for at least another 5 years. Time is precious. I’m not one of the Very, Very Fortunate who loves their job and would do it for free. While my job has a great many benefits, I’ve long dreamed of the days when I can spend my time doing what I want and not what my employer pays me to do. I don’t want to sacrifice 5 years of my retirement for a house.

    And it wouldn’t just be losing 5 years of retirement. Having a mortgage again would mean that I would lose the financial flexibility that I have right now. In pre-COVID times, it was so nice to be able to say yes to spontaneous invitations without worrying if my budget could handle the expense:

    • Dinner with friends to celebrate the warmer weather? Sure.
    • Can I afford the Rimrock to attend a good friend’s wedding? I’ll be there with bells on!
    • How about a last-minute theatre performance? Not a problem!
    • Why not pop over to the Emerald Isle in six weeks? I’m on my way!

    Taking on a six-figure mortgage at this stage of my life would mean giving up the little extras that bring me joy. Those little extras are my reward for having been diligent and focused in my younger years, when I was paying off student loans, car loans, and the mortgage on my current house. Back then, I said “No” a lot more than I do today. Friends and family often chided me for the financial choices that I made, but I don’t regret following my plan. After all, I was the one who had to live with the consequences of my spending choices.

    So as much as I wanted to buy the very awesome new house, I had to make a tough choice between two competing priorities. I could stay on track to retire, and continue to live in my current home which is perfectly suitable for me. Staying in place means that I don’t have to forego time in retirement. Alternatively, I could go back to having a mortgage and living on a tighter budget. In addition to all its lovely features, this new house’s property taxes are twice what I pay now. I’d have a higher heating bill each month, and I expect that the other costs of running a house would be higher too. Also, little renovations that I would want – a railing for the deck, new paint in the dining-room – would have to be put off. My budget wouldn’t handle renovations and mortgage payments at the same time.

    At the end of the day, I chose to say “No” to the new house. The truth is that I’m not prepared to give up my goal of retiring when I want. I don’t hate my current house but I’m also not enamoured of the idea of never living anywhere else before my long dirt nap starts. Part of me is craving to be the Joneses, to buy another house, to set up a new little spot to call my own. It seems that everyone I know has bought a new house in the past 5 years – family, friends, colleagues, acquaintances. Why should I be the only one who doesn’t get to buy a new house?

    The last question is a stupid one. I am not being deprived of a new house! I’m simply making a different choice. Those who have bought won’t have the option of retiring a wee bit sooner. They’re committed to repaying the bank or losing their home to foreclosure. The choice for them was to buy the house and to work longer than I’ll have to.

    When it comes to money, tough choices have to be made sometimes. I’d already defined my priorities so it wasn’t too, too hard to walk away from the new house. I know what’s most important to me.

    Ideally, you’ve also defined your priorities and you’ve figured out how to spend your money so that you can meet them. You’re the one who works hard for your money so make sure that you’re pursuing your priorities whenever you spend it. Whether you want a new vehicle, a new home, a new book, or new clothes, just make sure that your money is going towards the priorities you’ve set for your life.

    The tough choices won’t go away completely. Knowing your priorities will better equip you to choose the alternative that gets you closer to the life you want to live.

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    Weekly Tip: Update your net worth every month, or on a regular schedule that best suits you. Net worth is determined by adding up your assets and subtracting your debts. If you have a negative net worth, that means you’re in debt. If you have a positive net worth, then your assets exceed your debts. Your net worth is a snapshot of your finances at a given point in time. Knowing this number will help you to determine what your next steps need to be on your financial journey.

  • Decide – Execute – Enjoy!

    Decide – Execute – Enjoy!

    The first step to getting what you want is to prioritize your goals. You’re the only one who can decide what you need in order to live the life that you really want. The next step is to create and execute the plan to turn your dreams into your reality. The final step is to enjoy the reward of your efforts. Decide – execute – enjoy!

    I’ve followed this three-step plan to achieve many goals in my life, both large and small, long-term and short-term. When I got tired of saying that I’d never been to Europe, I decided to go overseas. Between 2016 and 2019, I travelled to Europe three times. For each trip, I found a way to set aside the money from my paycheque so that I could visit Italy, Spain and Ireland. Getting to Europe was important to me so I found a way to make it happen.

    The Claddagh Ring – Dublin, Ireland
    The Sargrada Familia – Barcelona, Spain
    Trevi Fountain – Rome, Italy

    One of the keys to my success was using technology to remove the temptation to spend money on things that didn’t get me closer to this particular goal.

    Automatic Transfers are Your Friends

    I absolutely and completely love automatic transfers. They are reliable – they’re effective – they’re simple to understand. All a body has to do is decide how much money to put toward a particular goal, and then put an automatic transfer in place. For example, if you wanted to create an emergency fund of $3500, then you could automatically transfer a fixed amount from each paycheque into a separate emergency fund account until you’d saved $3500. Easy-peasy lemon-squeezy!

    Once one goal is reached, you simply keep the transfer in place and use the money to go towards the next most important goal.

    And you needn’t limit yourself to having one transfer. For my part, I have 4 automatic transfers in place. One is for my long-term goal of early retirement. Another is for short-term goals like travel, house repairs, birthday & holiday presents, theatre tickets, vehicle replacement, and the like. The third transfer is in place for my charitable donations. And finally, the last transfer is in place to cover the costs associated with being a home-owning adult who has bills to pay.

    Once my automatic transfers go through, I can spend the rest of my paycheque however I want! My long-term goals are being funded. My short-terms goals are also getting a little love. The costs of running my house and various other bills all get paid on time. And I have money set aside for charity. The rest of the money can be squandered and I can still create the life I want for myself.

    I enjoy the theatre and I go several times each year. When it’s time for me to renew my subscription to Broadway Across Canada, the money’s there. Holiday traditions are important to me since they mean time with my family and friends. Is it time to buy some Christmas presents? The money is already there. And let’s not forget those special occasions that aren’t always so predictable. Invitation to a wedding or a spa weekend with friends? The money’s waiting for me.

    Sinking Funds are Key to Paying for It All

    Automatic transfers are a magnificent way to build sinking funds for all of your anticipated expenses.

    While we live in an instant gratification society, one of the realities of good financial stewardship is that we can’t always get what we want when we want it. Credit cards create the illusion that you’re living your best life. They allow users to buy whatever they want the very second that they want something. However, unless that person has the money sitting aside to pay the bill, credit cards burden people with exorbitant interest payments.

    Credit cards don’t teach people about patience. Let’t be honest. Most credit card purchases aren’t for emergencies. For a great many people, credit is used because someone doesn’t want to wait a little bit long to buy!

    If you’re serious about spending your money on the things that matter most, then take my advice. Siphon a portion of your income every time you’re paid into an account dedicated to your most important goals. Use automatic transfers and sinking funds to acquire the things that you really and truly want.

    You work too hard for your money to waste it on purchases that you won’t remember 48 hours after you’ve made them. Create a financial plan for your money by telling it where to go instead of wondering where it went. Automatic transfers and sinking funds are financial tools that will help you to build the life you really and truly want for yourself. Start using them today and move that must closer to achieving your dreams.

    Decide – execute – enjoy!

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    Weekly Tip: Don’t let websites store your credit card information. Firstly, doing so makes it that much easier for you to indulge in instant gratification purchases. The few extra seconds of typing in your information might be all you need to make you reconsider whether the purchase is moving you closer to or further from your goals. Secondly, if the retailer’s website is hacked, then your information is at risk and your odds of being the victim of identity theft go up.