Category: Retirement (page 1 of 2)

FIRE.

Some thoughts today:

Very recently I was unexpectedly offered employment with the Government of Canada. I was in the boonies, middle of nowhere – Costa Rica at the time and had a rickety phone connection that got cut off by a power failure. It took about an hour of frantic waiting to accept the job, and here we are, 3 months into a full-time term job of 6 months.

I love/hate it. I hate being an employee but I love the department I am in and what they stand for. There are many coworkers that I love, and some that I don’t, training has been frustrating as I’m sure is the case in many places; there simply wasn’t enough or much of it.  Many things have been a struggle, and it has also been an amazing opportunity.  I had been looking for “real” work for a very long time, years! I’ve also been selfemployed for many years. Was I not just blogging about the perils of finding actual employment? Did that not last for years, and now I’m 3 months into this cool opportunity? Haha. The grass is always greener on the other side right? I thought that finding work would offer me stability and more income and it has. Having to report to someone else instead of making your own way and schedule… its been a big adjustment.

What this job has also given me is a very nice boost in income that has helped me speed up my savings big time. Where before I’ve only been able to eke out a few hundred here and there to set aside every month, I’m making big steps now. Once upon a time I said I wanted to be a millionaire. I don’t want that anymore, in fact, more and more my focus is drifting to lean FIRE. (linkitylink) I have no visions of sitting on a beach sipping beer, but I want to work on things I enjoy and take on projects because I can because worrying about paying this month bill is no longer a worry. Volunteering and helping out with other people and community projects because I have actual time to do so.

I’m focusing on building my investments, my RSP and TFSA and in the next two months I will restart my Questrade portfolio

I am likely a few years away of any time of “retirement” and that absolutely does not include any real property as I currently rent. Aside from just saving like a squirrel, I have no concrete plans, I also don’t think of it as retirement… more so as a very lean version of financial independence.

If I quit today… What would I do?

 

Networth October

 

Fall colours

Fall colours

Woah, there is so much to update on this month but I was travelling for three weeks so I didn’t get a good snapshot of my budget at the end of the month. Instead of the usual chart I will thus just do a general overview of how everything went.

My networth goals for October were: Don’t go broke. Very non-specific. How did I do? I survived! My networth at the end of October was $57,261.82. A very small $40 increase from Septembers networth of $57,219.61. 

While it wasn’t a huge increase I am pretty happy with this number though because I spent the last 10 days and the first 11 days of November travelling. I used a lot of points and credits for the trip. (Two nights at a Marriott with points, my airfare was paid for with AMEX rewards and my carrental fee was covered with Aeroplan points. In addition I used money collected from bottle deposits at work and one creditcard signup bonus to pay for other various expenses like two nights in Germany and multiple traintickets.) Despite all that I still spent $1,700 in cash on gas, food, getting around, some Christmas gifts for my family etc so I fully expected a nice dip in my networth. I’m sure November’s networth report will reflect that.

Goals for next month, and the future: I wrote about all this stuff when I revisited the 10% rule, for tracking purposes it’s easiest to log all my financial goals in my monthly net worth updates but here’s a summary of what I talked about: I’m thinking of traveling for a few months and I won’t be able to do that without careful financial planning.

After considering my retirement financials, and discovering I was doing pisspoor at planning for the future my first move was to set up a $20 auto-buy for my RSP with ING and I budgeted out in YNAB how much I need to save per month to achieve a $10,000 emergency fund before the end of August orso of 2014. I need to save $300 per month for October, November and December of 2013, and $400 per month for January – August 2014 in order to achieve a $10k emergency fund by September 2014. In addition to making small contributions to my RSP and getting my emergency fund up to $10k, I need to save for regular stuff like vacations and less-regular stuff, AND wherever I end up in life I WILL eventually need a new car. I have so much I need to save for!  I’ve set my contribution to this miscellaneous savings account at $200 for November and December. I’ll re-evaluate in January to see if I can add more to this account.

Goals for November:

1. $300 to Emergency Fund, minimum balance of Emergency fund $6,500 at end of November.
2. Ensure RSP contributions continue, $20 this month.
3. $200 to MISC savings, minimum balance of MISC savings $400 at end of November.
4. Organize my financial mess. Because my company is now smaller I only use one credit-card for all personal and business expenses, receipts are sorted out and a log is kept of what belongs where. I need to sort this out because it feels very messy for my budget purposes. I also need to get back to having more buffer in my chequing account so I’m not waiting for money to trickle in to pay bills on time.

Year-end Goals:
1. $6,800 Emergency fund minimum balance 2. $2,200 RSP balance 3. $600 misc savings. ($190 spring getaway/$410 Project Move)

I’m also going to have work done on the plumbing and electrical in my house so this winter will be tight. I hope to get back to blogging a little more to help me stay motivated. 🙂

Saving for retirement and other things – the 10% rule revisited, and a plan for the rest of 2013

Moneys

Moneys

Back in June of 2012 I wrote a blogpost on how I was intending to begin saving 10% of my gross income towards retirement. Here’s what I wrote:

I’ve done ZERO retirement planning in my life so far. Sure, I’ve thought about it and what I want from life but I’ve taken very little action to plan towards it.

I currently have a $6,000 emergency fund, $2,000 in an RSP, $1,000 in a brokerage account, a few thousand in a rather volatile investment, and of course my largest asset, my house (mortgage and all, darn it) Obviously none of these will feed me much more than a few months (unless I want to eat my house?) so, starting with yesterday’s paycheque I implemented the 10% rule.”

I am sad to admit that after I updated the blogpost two weeks later, I didn’t follow through with this plan. After I began my bathroom renovation and went on a trip globetrotting, then there was school in the fall and a big reduction in income from Christmas until early summer this year. All in all, I didn’t save a dime towards retirement. From my monthly networth updates you might know that while I do still have a $6,000 emergency fund and while I have been investing in my house my renovating it, and while I have made progress networth-wise primarily due to my house value increasing and the very slow downward slope of my mortgage… I haven’t made any real, any dollar value of progress to my savings. Actually, since selling off my stocks I’ve decreased my liquid assets by $1,000.

This isn’t good. I also need to make a lot of sacrifices and aggressively save for the next year if I want to follow through on my plan to leave Canada for 3-4 months to figure out where I want to be.

I need to drastically improve my savings rate, restart contributing towards an account for retirement and cut all unnecessary spending. I feel a bit overwhelmed financially but I know I need to make a move, because not doing anything doesn’t get me any further. So, this is the plan for the rest of 2013:

1. I’ve set up an auto-purchase of my ING RSP of $20 every month going forward. It comes out on the 14th of every month, a random date I chose for no particular reason. This should be doable no matter what my budget looks like. It’s $20, it’s an auto transfer and I tend to do well with auto-transfers because it just becomes a regular bill once it’s been going for a while. $20 is a far cry from 10% of my gross income, but my primary goal here is to start with small contributions, get my other savings going and slowly ramp up the percentage of money being contributed to my retirement. I can only do this by carefully planning out my other expenses and plans, plus my immediate goal is not to put large sums of money to retirement. It’s more-so getting used to actually saving for something that’s still very far away instead of all the short-term stuff. Speaking of short-term stuff:

2. In addition to that $20 RSP contribution I’ve budgeted out that in order for me to have a $10,000 emergency fund by September 2014. (after which I am thinking of globetrotting for a bit) I need to save $300 per month for October, November and December of this year. And $400 per month from January – August 2014. I’ve planned this out in my budget and I should be able to swing it as long as no big projects or bills come up.

3. I of course need way more cash than just an emergency fund so I also need to start saving more in my misc savings, I’m currently contributing $50 a month towards a spring vacation to this account, I’ve budgeted an additional $150 to be saved in this account toward my living expenses, airfare etc. for this possible adventure. So, between now and the spring my miscellaneous savings account will hold money for two purposes; a spring vacation and my possible move.  I also eventually will need a means of transportation wherever I live, other trips etc. Building up a nice buffer in miscellaneous savings is important. This is a start. Once the emergency fund is full my focus will shift to this account and various other things to save for and increasing funding to my RSP.

I’ll keep tabs on these goals in future networth updates, I think it’s easiest to keep everything together in one monthly post, it will also be easier to see how much progress I’m actually making.

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