In recent discussions with some folks and to play off Preet Banerjee’s blog name (where does all our money go) I was reflecting on some things I’ve discovered about spending and money – here they are.
- Owning a house is expensive
Heat, hydro, maintenance and property taxes are just a few housing costs. The bigger the house, the more money it costs to own it. Let’s not forget the mortgage either. I figure the sooner my wife and I are debt-free the better.
- Paying yourself first is crucial to retirement planning
Our retirement plan would be nothing without creating a habit of paying ourselves first. Setting up a pre-authorized monthly payment plan to fund our Registered Retirement Savings Plans (RRSPs) has been a crucial step for us. I only hope we can keep up this saving discipline for another 10-15 years as we work towards an early retirement.
- There’s nothing wrong with saying “I can’t afford it”
I’ve spoken these words a few times and I’m always interested in the reactions I get when I do. I think there’s nothing wrong with this statement yet for whatever reason I feel out of place when the words come out.
- Credit cards aren’t evil but they make spending money easier
We pay off our credit card bills every month but that doesn’t mean we’ve got 100% control on our spending. It’s just too easy to pay for things with plastic and worry about it later, which we sometimes do.
- Don’t be afraid to ask for a deal
I’m guessing the majority of people can’t read minds. So, if you want a deal on something, just ask, nicely. You might be surprised how often this works.
- Owning a car for many years makes sense
I’ve learned that buying a car, borrowing lots of money to pay for a depreciating asset is a bad idea. I think if you’re going to own a car, buy it/finance it ideally at 0% interest and then keep it for at least 10 years or longer if you can. Otherwise, buying or leasing new cars every few years will be a wealth destroyer. Buy a used car instead.
- Earning good money is hard work
I have nothing more to add. Nothing comes easy.
- Nobody wants you to save
That’s partially true because the banks want you to save, only so the banks can lend out your money to other people willing pay for it as part of a loan. The financial industry is largely rigged against you and I. The reality is few people want you to save your money. You’ll have to make that choice on your own.
I know there’s more to this list but those are starters.
What have you discovered about money?