A Money Coach in Canada

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65221081_4212cf145d.jpgDavid Drucker, fellow vancouver blogger, had quite a startle the other week: his jeweller of many years is on the lam! Here’s his story:

When I proposed to Pam, I had already gotten a ring at Alpha Omega Jewelers in Cambridge. It was a small shop in Harvard Square, family run, with not spectacularly high or low prices. In the years since then, we used them for not only our wedding rings, but other bits of jewelry.

So, I was not without a fair amount of shock when I read this headline on the web site boston.com:
Alpha Omega liquidation sale set to start tomorrow

What was even more shocking was why they were liquidating our old family jeweler:

The investment consortium that bought the assets of Alpha Omega Jewelers in a bankruptcy court-approved sale said that the liquidation sale of the chain’s inventory will begin at its four stores tomorrow.

Everything must be sold before Ross-Simons, a Rhode Island-based chain, assumes the leases of Alpha Omega stores at Natick Collection and the Prudential Center in Boston, and items will be discounted to ensure fast sales, the consortium said.

The chain’s other two stores are located in Harvard Square and at the Burlington Mall.

According to stories in the Globe data base, Alpha Omega Jewelers filed for protection under Chapter 11 of the US Bankruptcy Code last month. The filing came after owner Raman Handa unexpectedly left the country with his wife, son, and daughter, prompting the company’s bank to seize Alpha Omega assets and temporarily close its stores just before Christmas.

That’s right, they were going bankrupt because the owner fled the country with his family. Suddenly my mind filled with all the plots of Jewel heists, with the thieves heading for Mexico, having deposited some of their misbegotten wealth in a Swiss Bank Account…

And to think I was served by Mr. or Mrs. Handa (I never learned their names, nor do I remember them particularly well), who might have been planning their disappearances for years!

Or perhaps it was something less glamorous and far more depressing, like mounting debts and “a threat to himself or a member of his family”.

Readers:  do you have any Theft stories?  I caught a thief once, in gastown (not an addict).  Called the police who caught him in the alley.   And of course there’s the legendary story of the guy who stole the computer from Workspace (where I rent office space) and uploaded a photo of himself onto flickr.

2287182588_cef8bd1ba6_m.jpgSweet. This is something that could really work for a whole lot of us. And it came from the Harper Gov’t (*shakes head*).

Here’s the deal (and why I’m posting it as blowing all other Freebies out of the water today):

Each of us (of legal age) can save up to $5000 per year, and whatever money we make on it is tax free. You could put it in a savings account (yawn, but if you must, at least choose Citizens’ Bank’s Ultimate Savings account) but you could also buy stocks or mutual funds. (and I’ve doubled my money plenty of times within a couple years. If I did it, so can your average bear).

But the beauty is this. If you need it – say for an emergency, or traveling, or renovating the house – you can take it out hassle free, you don’t get dinged with tax, and then the room from the money you took out is freed up to replenish when you can.

So for the 40% of Canadians who have withdrawn from their RRSPs (on average, 3 times) this could be a great alternative. Save your RRSPs for Retirement. Use this TFSA as a place to save up, and use as needed.

Personally, I’m over the moon on this one. Begrudging respect to the conservatives on this one.

Shoot straight with me:  think this incentive will encourage you to save more aggressively? Why/why not?

(ps: this all assumes the house doesn’t fall on March 5th.

pps: merci a jean-pierre pour le photo. et pardon ma francaise.)

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Don’t all lunge at me at once. I’m not about to bend over for CRA or anything – I’m as aggressive as your next ave. joe canadian on my tax returns – but I gotta ask: when did we get such a hate-on for paying taxes?

Be honest: the #1 thing we all wanna know about The Budget is, “how much of a tax break are They giving, and who gets it, and am I on the losing end?”

But a bit of devil’s advocate here.

1. Isn’t the They actually Us? I mean we’re not conquered peoples (pardon –most of us aren’t) giving our money to Nero here. We’re a civilized country that’s collectively opted to build a society together, and pool our money to do so.

2. Specifically:

  • while Michael Moore was a bit optimistic about us, the fact remains most of us have confidence that if we need emergency care, we’ll get it (and for every horror story, I’ve heard stories of remarkable care provided by our health system, haven’t you?)
  • I got an amazing education for about $50K all told. I’m still annoyed that I had a $30K student debt but I also know that I cost the taxpayer about $350k – and so did you, if you got 4 years of education after high school.
  • Oh, and my grades 1-12 were paid by taxes.
  • And I don’t know where you walk, but I walk on reasonably kept sidewalks, and most cars stop for me by these efficient little red circles of light – sometimes I even get to push a button to make the cars stop!
  • And when something a little freaky happens in my neighbourhood I just push 3 buttons on my phone: 911 and help is on its way.
  • And I don’t personally want to help unemployed get employed, or personally provide refuge to kids whose parents have abandoned them, or the stray cats for that matter, but I’m sure glad they’re getting at least a baseline of help.

So I guess I wonder if we’re being a bit facile when we moan about our taxes. Wouldn’t our time be better spent asking questions like, “what kind of society do I want to live in?” and “how do I want my elected officials to allocate our pool of money?” and “how does Canada compare to other countries who handle taxes differently, and what do I make of those differences?”

Over to you:

are you bitter about the taxes you pay?

are we truly overtaxed here?

what would you give up by way of services in exchange for fewer taxes? Why?

 

(no! not the balance sheet!)

bc-business-mag-photo.jpgThink a money coach is obnoxious, boring and sits around counting her pennies all day? Find out for yourself:

I got tagged in a meme by Moritherapy. The deal is, you get the traits of your birth month and bare your soul comment on their accuracy.

MAY:
Stubborn and hard-hearted. Sheesh! Not! Helping people with an area as sensitive with money just wouldn’t go with being hard-hearted. Not to mention I give a damn about the people in my neighbourhood.

Strong-willed and highly motivated: I’m an entrepreneur. Enuf said.

Easily angered. Yes when I see the underdog getting attacked. I lose all common sense and jump in – except in my ‘hood since it’s pretty tough. (I did catch a thief once, though!) No about most other stuff – although I typically pick fight over flight if it comes down to it.

Attracts others and loves attention. Not so much. But I want my ideas to get attention.

Deep feelings. I prefer the word passion, but yes. (or is ‘passion’ a cliche yet?)

Beautiful physically and mentally. In my pre-politicized days I ran for Miss Canada (yes, really) and did a bit of modeling. What’s that worth to me or anyone? Not much that I can think of. But I had great clothes for a while. And years and years of free hair products.

Firm Standpoint. Yes. Most of my opinions are rooted in a reasonably thoughtful philosophical/worldview/theological (eg. God really did create all people equally: who are we to create inequitable structures?) stance.

Easily consoled. Nope, when I grieve it goes deep.
Systematic (left brain). Love logic. Wish I’d majored in math or physics. (not really; I love being a liberal arts major)

Loves to dream. Who has time? Sigh.

Loves literature and the arts.
Yes, and yes. cbc radio 2 junkie. Got to grade 9 in piano. Love classical music and classic rock. Developing taste for jazz. Read most of the classics (and Dean Koontz for trash). Even took 3 yrs of Latin, so read a little Cicero. And Charlotte’s Web in latin (Tela Charlottae). Beat THAT for nerdy. And enough french to manage Le Petit Prince.

Dislike being at home. Restless. The opposite. My little loft is my fave place on earth.

Not having many children. Try: none. Doesn’t particularly bother me, but occasionally I worry about being old without kids. Meantime, my daschunds keep my home alive. And I have great relationships with a couple of my close friends’ kids.

Hardworking. Too much so.

High spirited. Especially when discussing big, good ideas like on ted.com and bigthink.com

Spendthrift. what the?? I’m a money coach. What to you think?

ps: if anyone is wondering, this is not a dating profile in disguise.

pps: others I’m tagging:  Mr. Cheap(how could I not, with a name like that?) – sorry if this is too touchy-feely for you, dude – Mike (who hung out with a guy trying to crack NASA’s website),  MoneyRelations (since she’s getting all personal on her blog today anyway, lol), Wooly girl  Woman(!), Netchick,  Gail Vaz-Oxlade the doyenne in the personal finance world, Saving4Later who I swear I’m going to hire, Bargainista queen of the deals, and BadHuman.

(I know this is a kinda long meme, but it’s a fun change – no pun intended – from our usual content, yeah?)

The problem with being a money coach is like anyone claiming a measure of expertise, you feel like a total idiot if you ever mess up yourself. But like everyone, life happens and I missed something for the first time in years – it’s RRSP season so I’m going full-tilt with clients and the bank; my dog is mysteriously scratching himself constantly and I’m totally worried (not fleas. allergies?); I came down with a brutal cold, and my cash-flow system, which usually runs like clockwork, derailed a tiny bit, with ugly results.

My clients all know I use, and recommend, a simple banking structure to keep things running smoothly.

  1. One main account into which all income goes, and from which all regular payments (mtg, insurance, internet, phone, hydro, car etc) get debited.
  2. A second spending account for discretionary items like groceries, entertainment, clothing. This gets regularly funded a set amount from account #1.
  3. A third high interest savings account for those ‘extras’ throughout the year – vacations, christmas, emergencies, vet bills (one sub account per item), also funded regularly from account #1.

The beauty of this system is you don’t have to think too much.

#1 means your bills are always paid on time.

#2 means you don’t overspend (since there’s a set amount available, and no more)

#3 means the tough spots are accounted for, and funds ready when you need them.

Trouble is, if #1 derails for any reason (and it’s an easy one to ignore since it’s all automated) you can, well… bounce a cheque! And in my case, since I work for the bank part-time, I don’t pay fees, so don’t keep $1000 cushion. I had spare funds in there, but this was a large pre-authorized payment.

Why did it derail? Simple. I forgot to deposit a couple cheques from clients. Just forgot in the craziness that is my life these days.

It’s embarrassing and frustrating — but keeps me humble. And I never claim to be perfect, just someone who’s (generally!) learned a number of tips and tricks to manage my money effectively and thoughtfully.

Hopefully this won’t happen to me:

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