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How to get your Finances in Order (Part I)

11/01/2018
So you wanna be rich? Ok maybe not rich, but you want to have an good life? Own your own home, send your kids to a good school, go on vacation, retire well? But also you want to go out with your friends, go to concerts, buy those new shoes and eat avocado toast? (lol jokes you won't ever be able to afford a house in this city). *eye roll*

This will be a two part blog post because I feel that although financial posts are great, they always miss out on investing. YES you heard it right. Investing. *crickets* I know... what blogger talks about investing? No one. So that's what I'm gonna be writing about. But you need to walk before you can run, right? So to start off with part one, I'll be giving you some tips about how to save money and pay down debt.

If you want to read part II of my finance post, click here

Photo courtesy of *bloggers of Canada* 


As an FYI I work in banking and thus have aquired a fair bit of knowledge about finances, I also had to complete financial exams including my CSC, CPH and DFOL which helps with when I’m explaining investing :)

SO, where to begin? First you need to know how much are you bringing in and how much you're spending. If I asked you how much you make, would you be able to tell me off the top of your head? How about your rent, phone bill, hydro, and savings accounts? This is step number one, you need to know about your finances before you can figure out debt and savings.

Next, look at how much you're spending. Don't just guess it, take out your credit card statements and bank account statements and see how much you're spending on. Don’t just look at  one month, but a few months so you can see how much you spend on average, taking into consideration things like birthdays, weddings, car maintenance, vacations, concerts etc... fhese are things that don’t happen on the usual and as such you don’t tend to add them into your budgeting and expenses.

And then, you crunch the numbers. How much do you spend on dinner and drinks? Coffees? Clothes? Interiors? Did you really need to spend all of that money? Actually though?

This is an important lesson, just because you have the money doesn't mean that you should spend it. Repeat it again. Just because you have money doesn't mean that you should spend it.  Learn to enjoy seeing your bank account grow on a regular basis. It's a wonderful feeling. 

Whenever I read blog posts about finances, the first thing I see is to quit buying a daily coffees and lunches at work if you want to save money. That's correct, I'm sure we can all agree on that. But also let's do some math... $5 a day for coffee and a snack is $25 a week. Great, $25 is a good chunk of change. But then your dinner with some drinks on Friday costs you $50, $60, $70, $80?? Add in an uber or public transportation. That one night has now cost you 2-4 weeks of daily coffees. So yes, you can cut out your coffee.... or you can cut out the big expenses... The $50 shirts, the $200 front row concert tickets, the additional makeup that you don't actually need... See what big purchases can be cut out because that will make a bigger dent than a $5 daily coffee. If you can also cut out the coffee then that’s a bonus, if you can only cut out the coffee, then it’s a step in the right direction.

Another great tip is to call all of your companies... credit cards, phone, internet, insurance etc... and see if they can cut your price or offer you more. Don't be afraid to call back and don't be afraid to call again a few months later to negotiate another deal. It's annoying, you hate it but honestly..... do it, you'll be able to cut your expenses by a big chunk!

So, now you know how much you make, how much you spend and ways that you can cut back. Next is to tackle debt. If you only have one credit file/one loan then this is easy, pay it off as fast as you can, make more than the minimum payment and don't use it. You can always call your credit card company/bank and ask for them to decrease the amount of available credit... that way as you pay it down you'll have less credit available to use. 

If you have multiple credit cards/loans, you can look to see to consolidate them together which might make your payments easier because it's just one that you have to pay for. If you have multiple credits, you can either tackle off paying the one with the highest interest first, or the one with the lowest balance. Personally? I would recommend paying off the smallest debt first because that way you can use that payment towards another debt until it keeps snowballing. You can even look into transferring your credits into one, a lot of times they'll give you a benefit if you consolidate everything together.

And there we have it, the first part of my two part finance post. Next up? I'll be discussing different types of accounts and INVESTING. Oh yes oh yes, I'm going there, investing. All of the basics that you need so stay tuned for that!

Let me know in the comments below what the easiest way is for you to save money.

See you later :)
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