Sunday, April 20, 2008
Friday, April 18, 2008
I'm finally going back to work on Monday....at least temporarily. I have been laid off work since Mar.5 and other than 3 days where I was called in, I have been off the whole time. Another company that is on strike has disrupted business where i work, hence the layoff. The strike is not over but i will be going back to work for the next 3 weeks (supposed to be). Hopefully the strike will be over by then and things can get back to normal for me. I want to get back to trying to reach my financial goals and it is hard to do when there isn't a regular income coming in!
Thursday, April 17, 2008
Wednesday, April 16, 2008
I am very happy with myself. I received $1700 back from my income tax return this year. I have actually saved the whole $1700 plus an extra $300. I previously could not decide what i was going to do with the refund. What am I saving this for? My home down payment fund. As you can see my home down payment goal is now almost reached at 95%. Did i want to spend this on a new high def tv or a new computer. Yes, and the refund would have put a nice dent into the cost of the tv and paid for the computer completely. I resisted the temptation and instead am securing my financial future.
I am a huge hockey fan and i love this time of year. I know that this has nothing to do with financial matters, but thought it would be fun to make some NHL playoff predictions. Obviously these series are in full swing, so it won't be quite the same as making predictions before the series started. Here we go:
San Jose vs Calgary -Calgary in 7
Detroit vs Nashville -Detroit in 6
Colorado vs Minnesota -Colorado in 7
Dallas vs Anahiem -Anahiem in 7
Ottawa vs Pittsburgh -Pittsburgh in 4
Montreal vs Boston -Montreal in 5
Philadelphia vs Washington -Philadelphia in 6
New Jersey vs NY -NY in 7
What are your predictions?
Tuesday, April 15, 2008
The Dividend Guy started the whole top 3 investing mistakes thing. I am finally getting around to throwing my 3 mistakes into the mix. Luckily I haven't made too many mistakes as i was lucky to read about some of the common mistakes others have made and learn from them. So without further ado, here they are:
1. Investing in my RRSP - You're probably thinking what the?? I'm sure there will be some people that totally disagree with me here. Let me explain. My strategy is to invest in dividend paying companies and then live off those dividends. If I am investing in an RRSP, it has to be converted by the age of 71. If I convert it to an RRIF then I have to draw down on my capital every year. I forget the formula and percentages, but it is significant. I want to have control in how my money is spent and managed, and investing outside of an RRSP provides that best. Like I said, i just want to live off the dividends, not draw down on my capital.
2. Not Starting Sooner - If only I had started sooner! If i had started investing at the age of 20 instead of almost age 30 i would be in much better shape. Granted, I didn't have much money to invest at age 20. If only i had understood the powerful concept of compounding over time. It is a crime that this stuff is not taught in schools!
3. Investing in Bonds - Bonds barely stay ahead of inflation. If you want to hamper your wealth creation, then buy bonds. Now, when I am close to retirement i might shift some of my portfolio into bonds (within my RRSP at least). I am young and my risk tolerance is such that i have no business owning bonds. I own a bond ETF and i will be selling out of it soon. See this article as to why bonds are a bad deal.
What are your top 3 investing mistakes?
The Round Up
Give Me Back My Five Bucks asks how much do you save for retirement?
The Simple Dollar gives you an idea of what to do with all those old baseball cards. In my case it is hockey cards.
Get Rich Slowly has a couple of posts on emergency funds. This is something I have been thinking about a lot lately. Check out his posts here and here.
Monday, April 14, 2008
As you have probably noticed I have some financial goals listed to the right in bar graph form. I thought i should explain what these goals are and why i have chosen these.
The first goal is an emergency fund. Due to a recent layoff (temporary) I have come to realize the importance of having an emergency fund. I have set a goal of $5,000, as this should provide for about 3 months of expenses should i ever lose my job. I hope to achieve this goal over the next 2-3 yrs. You can check out an earlier post about why you should set up and emergency fund.
I have set a goal of $40,000 of dividend income. This is the amount of income i would like to be collecting from dividends when i retire. As you can see it is currently at $0, as i have been investing inside of an RRSP until just recently. I am changing my strategy to invest outside of an RRSP in companies that grow their dividend year after year. I hope to retire in about 20-25 yrs if all goes well.
The third goal is to have $10,000 for a down payment on a home. I am currently renting and want to get out of that rut so i am building my own net worth and not someone else's. I am well on my way to this goal and have about 75% saved thus far. I am trying to decide what to do with my tax refund and I may put it toward my down payment. We will see. I hope to achieve this goal in the next 6 months.
I have a bike loan for a motorcycle I bought a couple of years ago. At this time i have no plans to pay off the loan early, as i want to concentrate on some of the other goals. For now i will be paying the monthly amount until the loan expires. As you can see i have about $8,000 left in the loan and it will be paid off in May 2011.
The final goal is a net worth of $1,000,000. I pretty much just pulled this number out of the sky. It is not nearly important to me as the dividend income of $40,000/yr. However, I would still like to achieve this goal even though it will take quite a long time. I obviously have a long way to go on this one but hope to achieve it by the time i retire. You can learn how to calculate your net worth here.
These are my current financial goals. Hopefully they will inspire you to set your own!
What are your finacial goals?
The Round Up
Dividends4Life has listed his favorite 5 stocks.
The Simple Dollar has a visual guide for making your own laundry detergent. I think I might give this a try.
The Money Gardener shows his growing dividend income. A great looking chart.
Former Fed Chair vs Current Fed Chair. I'm siding with the former fed chairman.
This couple is in serious financial trouble unless they change their ways.
Sunday, April 13, 2008
I posted earlier about the Forbes 2008 billionaires list. Today we are going to look at the most expensive homes in the world. Why? Because everyone loves lists. Especially when it involves lots of money!
Can you imagine paying well over a $100 million for a home? I know I can't. The most expensive property? How about $165 million for a 75,000 sq/ft home in Beverly Hills. The US may be in a housing crisis, but there seems to be no such thing in the ultra high end of the market!
Be sure to check out the video tour of the worlds most expensive home, it is impressive. You can read all about your dream home at the Forbes website. There is a great picture gallery too.
*photo credit Forbes.com