Wednesday, November 08, 2006

Living within our means...

I am not sure if I posted yesterday about having a financial needs assesment last night. We have a friend who is getting into this business and wondered if we were interested in a meeting to see where we could save money and invest for the future...

I thought it would be interesting to see if we were blowing lots of money unnecessarily and where we could change things to save us money. My hubby worked at a job from 1998-2005, we were feeling "stable", you know, nothing is going to hurt us, cause he's got a good job...then the layoff happened...for reasons that are very fishy surrounding them...(read nepitism). Then we went into this downward spiral of job after job after job.

It was really stressing to me, since we have chosen that I stay home with the kids and homeschool. We had also decided that regular daycare was not something I wanted to do again, though I would have if it came down to it, but my kids needed to be priority for a while. We lost the sense of stability that we had once had, but had also refused to live in debt because of it (1 credit card, balancing 2800, right now...that is it).

So, we bought groceries when the money was there, and we went to the food bank occasionally, when we were desperate. My parents helped us out a great deal, and we would have debt if it weren't for them. I learned to cook meals out of nothing and I learned that soup can be filling;)
I learned that talking to the people that we had to pay our regular bills to is a good thing, they really are nice and just do their job, but are very understanding when you call them and explain a tough situation.

Now my hubby has a very well paying job. He is enjoying it and has been there almost 3 months. We don't have any concern that he is going to lose this job. Ahh, the feeling of stability again. So we had some choices with this new found we continue living at the level that we had learned to live at before or do we celebrate and "overspend"? Not a hard decision, we decided that we wanted to have that credit card paid by Christmas, that would be the best gift in the world for me to have!! We do have overdraft and are working on getting out of that (I forgot to mention that last night, but it is not a big number and we should be out of it by the first week of December.)

Anyhow, these guys came over last night and talked with us, and looked over our papers, and basically said that we are not the "norm". Is the norm good or bad? Well, the trainer bascially said that we seemed to have made the best choices in how to spend our money and we are in the group of the few people who choose to live within or below their means...

Wow, that made me feel good!! They said there is nothing they would change about our insurance, and told us to get the card paid down quickly to pay the least interest. But we don't have any emergency fund (that is not my parents) or retirement plans going on, and they are going to see what we can afford to do now to plan for the future. I think after all this, we are going to seriously consider what they are offering...also we are thinking of finally setting up a family RESP, that any of the kids can use.

Anyhow, we will see when we have our next meeting and after I fax in the budget worksheet, where we get to see where our money is really going!! If you know anything about Primerica taht would be helpful to me, I would love to hear about it...(Shash is asking the same thing on her site!!)


  1. Being in the financial business for as long as I have I know that they do have a good reputation for term insurance, this extra stuff they've started doing is new but sounds honest and pro-customer - which is something most banks are not.

    A savings plan and a plan for the kids is a GREAT thing. The Bible is chalk FULL of examples of needing a "storehouse". Think of the 7 years of famine, where would they be if it wasn't for the 7 years of plenty and storing it away?

    I have RESP's for 2 of the kids which are transferable to any of the kids, it's a small amount I do each month ($55) which I use my government child tax money for. I did double that but I couldn't keep up and always thought of taking the money out, which is bad and a sign it was not manageable. This amount I don't even think about, it just debts itself and goes into their plan. I also continue to collect money through Kidsfutures that will go towards a new RESP plan for the other two. It's not much but at least it's something.

    We definitly need to plan for the future, we don't want to work forever. It's so true - don't work harder ~ work smarter. My parents found they weren't making enough RRSP's money for their retirement, cashed them all in and bought up commercial property. They have a steady stream of monthly income, more than their RRIF's would have paid and it will only increase. Getting into that market is easier than it sounds, it's one step at a time. Making wise small purchases now, starting with what kind of place you buy next.

    Oh boy, this was a long comment... maybe I'll do a financial post later in the week while it's still on my mind...

  2. WOW! This is really great news! YOU should think about teaching others what you've already learned. ;)

  3. that is great that you are so smart! I wish we were smarter!!

    I would definitely really LOOK into RESP's, I am very sceptical of anything government sponsered cuz they look out for #1 first and you know that is not you or your family! if you decide to cancel or stop the RESP's you may find out that you will get a huge penalty/fine and heavily taxed!!
    anyways I don't know much about primerica but they have been around for a long time.....they are also commissioned salesmen...something else I take with caution!!

  4. It does sound like you are ahead of the game, but use caution before jumping in. Continue to reference people who have been where you want to get to and have the Biblical aspect in ALL advice you consider. Also, shop around for other companies that offer similar investments ( ethical funds ). Look into Faith Life Financial as another source of info.

  5. Good for you! Dave and I spent the last year paying off all our debt, which enabled us to buy our new house. It is so easy to slip into debt when you live paycheck to paycheck (which was our situation when I decided to stay home with Julia). We had to make some big adjustments to our lifestyle to stay afloat. Now, things are much better, but it was a challenge to gain our financial stability back. Sounds like you're doing great! You have a lot to be proud of!

  6. The majority of RESP's are safe but some company's do charge heavy fees and fines for withdrawing early, this has nothing to do with the government and everything to do with the company. I was sucked in by CST (Canadian Scholarship Trust) you see them in the malls all the time, with the Owl symbol... they have HUGE HUGE HUGE paperwork fees - you can't transfer out of them without loosing everythng you put into them. The next RESP I do for the younger 2 with be with my credit union. An ordinary guaranteed investment certificate with no strings attached.

  7. p.s. RESP's are not government sponsored, the new CESG (Canadian Education Savings Grant) is "currently" added to your portfolio, a certain percentage of what you deposit on a yearly basis. You do not receive a tax credit but the interest earned is sheltered until the withdrawal, that is when --- if you've earned enough interest --- it is added to the child's income statement and taxed at their income level, which for most 17-20 year olds is very minimal. You cannot loose your money if you keep it in a regular GIC, however, it will only earn a minimal amount of interest as a 1 year certificate runs anywhere from 1-3%. It's when you invest in higher risk investments that it could have the possibility of earning high interest or loosing everything, these are usually not guaranteed funds and unprotected plans.

    This was my field for many years... can you tell?

  8. On another note.... I do not do RRSP's and wouldn't. Most people do them for a tax credit - I do donations and get the same savings - they have to pay huge taxes when withdrawing the funds and some never see the annual amount when they HAVE to convert it to an income fund because it goes directly to pay the tax for it. These are run and regulated much differently than RESP's.

  9. Primamerica, I've heard bad things about them out here.

    Sounds like you are doing the right things by yourselves.

    I was always living paycheck to paycheck when I was married. Once me chidren got older it was much easier to have a savings account.