A new year means new goals and for many people, getting their finances in order is at the top of that list. Personal finance expert Lesley-Anne Scorgie shares her tips and tricks for improving your finances.
If you can make one simple financial improvement this year…
Raise your RRSP contributions by $20 per paycheque. This is a week’s worth of coffees or two purchased lunches. This extra money matters because it adds up to just over $500 per year.
If you are struggling to manage your money…
Cut up all but one credit card, have only one chequing account and one savings account. The theme of this tip is simplification; fewer accounts means easy monitoring and less service fees. If you’re saving for multiple big-ticket items like an emergency fund, a wedding or car repair, use the Mint.com app to flag each of those goals, but using that one savings account.
If you want to pay off your mortgage more quickly…
Pay $40 extra from each paycheque and put it towards your mortgage . You can shave years off your amortization and thousands of dollars in interest charges. Let’s say your mortgage was $500,000 over a 25-year amortization. Given today’s rates, an extra $40 per paycheque could shave a year and a half off the mortgage and save $14,000 in interest.
Make sure to reward yourself for being financially diligent
Set small rewards that can be dished out to yourself on a monthly basis – like getting your nails done or going out for lunch once a week. Set large rewards that can be dished out on an annual basis like taking a trip or buying a big-ticket item like a bike. The key with rewards is to incorporate them into your budget so that you don’t get overspending guilt.
Get yourself a credit card that earns you rewards
RateHub.ca is a great site to compare cards. Switch to a credit card that provides rewards that matter to you – groceries, trips, blenders, cash back, or contributions to your RRSP. This is entirely personal preference. The key with rewards is to use them or you might lose them. Reward providers have the right to do whatever they want to the program.
As seen on CTV’s The Social January 16, 2017.