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How to Prevent Food Waste in Your Home

Food waste is an invisible and expensive habit in our homes. No one wants to waste food, and no one walks into a grocery store and says, “Hey, I’m going to buy all this delicious food today and then throw it out next week.”

So if your fridge is filled with good intentions but you still manage to garbage your groceries, I’ve got the goods on how to prevent food waste and save up to $1,000 per year.

What is food waste?
Food waste is the forgotten food stuffed at the back of your fridge, the odds and ends that could’ve been a meal but you’re uncertain how to whip it into a recipe, lingering leftovers, and the packaged products a little past the so-called “Best Before” date. All these foodie situations could become food waste. Food waste is the food that’s ok to eat, but it’s being discarded, composted, or left to spoil without a plan to turn it into a snack or meal.

Food waste happens thanks to a chain of different (and expensive) behaviors starting with grocery planning, food shopping, meal preparation, leftovers, odd ingredients, and ending with everything in the trash or compost bin.

How much food do we waste?
I didn’t believe the number at first, so I asked a behavioral scientist who studies food waste to help out. Angela Cooper, PhD, an Associate at BEworks, says the problem is “pretty big”. Over $30-billion of food is wasted per year and about half of that is occurring in people’s homes. We might think it’s the restaurants or it’s the grocery stores, but we as consumers and as homeowners — we’re the culprits.

How much money is wasted?
Canadian households on average waste over $1,000 per year, says Cooper. That’s $92 a month, $21 a week, or $3 a day. The really tragic part is over 60% of that food is edible. This is what we call avoidable food waste — this is stuff that can be eaten — but maybe it just doesn’t look as nice, it’s a little bit shriveled or not the freshest looking, and this is what gets tossed. [This food] still has use, but a lot of people have an aversion to it.

How does food waste affect the environment?
Food waste has a massive environmental toll, says Cooper. In Canada, over two million tons of CO2 is produced from food waste which is about the equivalent of two million cars on the road. There’s been research that shows if food waste were a country, it would be the third largest CO2 emitting country in the world after China and the US.

How to prevent food waste?
BEworks, a behavioral economics firm, did a significant research study with Unilever Hellmann’s to help prevent food waste. After studying over 900 families, they found some very simple solutions that reduced food waste by 30% — saving families at least $300 per year.

Step 1: Place a Bowl in Your Fridge for “Food Recovery”
We all have ingredient odds and ends that get lost or buried in our fridge. Cooper says the simple act of using a bowl to collect a rogue celery stalk, half tomato, or apple slice “increases salience”, or in simple terms — hits you in the face when you open the fridge! The idea is if you see it, you’re more likely to use it.

Step 2: Pick a ‘Use-Up Day’
Pick one day per week to make a ‘Use-Up’ meal. Perhaps it’s the day before your next grocery haul, maybe it’s the beginning of the week or just a random day.

Step 3: The ‘3+1 Approach’ & a ‘Magic Touch’
So what to do with a bowl of odd ingredients? Here’s where the science of simplicity comes to play. BEworks and Hellmann’s found that giving families a simple formula for how to make a meal with food on hand made it easy to use it up.

They call it the ‘3+1 Approach’, where you bring together ingredients from three categories: a base (bread, rice, pasta), vegetable or fruit (pick one or a few), a protein of choice (chicken, eggs, tofu, beans), plus a ‘magic touch’ in the form of spices or sauce to bring the dish together and add flavour. This is designed to encourage people to substitute, swap out, and think a little bit more flexibly because recipes can be constricting. A wrap with chicken, lettuce, leftover bell pepper with tomato, and a dollop of hummus or mayo could be a 3+1 use-up recipe for lunch.

So grab a bowl, choose a ‘Use-Up Day’, and try the ‘3+1 Approach’ for a meal. Making these simple switches could reduce your food waste by 30% (or more) plus save you hundreds per year in trashed groceries.

December 15, 2021
How to Set Up Your Holiday Spending Budget
Did you know Canadians spent $25 billion last holiday season? And retailers expect shoppers to spend even more this year, despite the pandemic. That’s a lot of photo cards, candy canes, CD’s, and sparkly ornaments. But unless you plan on skipping Christmas this year, you’ll find yourself a part of that $25 billion machine. To enjoy the gift-giving season without any guilt-ridden overspending, set up your Christmas budget now—and then stick to it like sap on a fir tree.

First things first: It’s time to do some digging into your Christmas budget. That means you need to ask yourself the following questions to see where you stand now so you can know how much to spend on presents later.

How much do you have saved? Before you know what you can spend, see what you’ve got to work with. Hopefully, you started saving early. If not, we’ll talk about how to get extra money, so you don’t end up just doling out coal this year.

What budget lines can you tweak? Even if you started saving early, you might still need more cash to cover all the Christmas costs. Look through your normal budget and figure out what budget lines can get trimmed down to free up gift money for your Christmas budget.

Don’t know where to start? Here are a few nonessential budget lines you can probably cut back: restaurants, clothing, personal spending, entertainment, and gourmet coffee.

How can you boost your income? If you’re able, boost your income for a couple weeks as a way to up your spending power. You could sell some things, take on extra hours at work, or start a side hustle. Get creative: Babysit so parents can go Christmas shopping alone, shovel driveways and sidewalks, offer gift-wrapping services… you get the idea!

What Christmas traditions can you skip? You can save money this year by cutting some expenses—and that includes traditions that don’t really matter (like the annual office ornament swap). Be open and honest with your budget and your loved ones.

Do you have a shopping list? If not, make one! You need to list out every person you’ll need to buy for and start brainstorming present ideas.

How can you save on gifts? Shop sales. Use coupons. DIY and make homemade gifts. Skip random gift exchanges. These are just some of the ways you can save serious cash this Christmas on presents.

How to Set Up Your Christmas Spending Budget
1. Plan how much you’ll spend this year.
  Last year, the average Canadian was expected to spend $1,593 on holiday spending. And remember, retailers expect even more this year! First of all, you should never feel pressured to spend that much. You should spend what you’re comfortable with based on what you make, what you’ve saved, and what you can move around in your budget to get the job done. So, crunch some numbers and see how much you’ve got to play around with this year.
1. Add the names of everyone who need a present.
  Once you’ve set up your budget, make a list of each person you have to buy for. Now, go ahead and assign spending limits to each person.
1. Track your spending as you go.
  Want to know how you don’t overspend? You track. You track hard. You track often. Keep up with all that spending as you go.
1. Move amounts around when needed.
  Oh no. You overspent on Mom by $5. What will you do? It has to come from somewhere. You can lower Dad’s line (sorry, Dad!) by $5 and use it to up Mom’s line. Move that money around until your budget balances again.
1. Budget early for next Christmas.
  Here’s a quick shout-out to planning early—do it! Put a sinking fund in your budget as soon as January to start stashing away cash for next year’s Christmas. If you do it little by little, month by month, coming up with Christmas money won’t hit you like the reindeer that ran over grandma in that song that’s now stuck in your head!
November 1, 2020
Start an Emergency Fund

We never know what the future holds for us, so it’s always best to be prepared. Having an emergency fund is extremely important so you’re always prepared to deal with what life brings—good or bad. It’s a good idea to make an emergency fund one of your highest savings priorities. Put $20 a week in an emergency fund and your account will grow to over $1,000 in just one year. That’s often enough to cover a repair bill or emergency travel. An emergency fund can also shield you from the high cost of borrowing and keep you from sinking into debt. Follow these five tips to help you set goals and take steps toward starting an emergency fund:

Chart your monthly income & expenses. Grab a piece of paper and write down how much money your earn and how much you spend for each month. Be sure to include recurring expenses such as your rent or mortgage, utility bills, childcare, and estimates of other out-of-pocket expenses for things you might buy such as movie tickets, dinner out and clothing.

Set your emergency savings goal. An emergency fund should cover three to six months’ worth of realistic living expenses. If you feel your income is stable or have access to home equity or other forms of credit to use if needed, then you may be able to plan for the lower figure. If your credit is near its limit and your income outlook is less secure, you might want to save more.

Develop a plan to start saving. Setting a goal and developing a plan to achieve those goals go hand-in-hand. Part of your plan may include specific and measurable targets to work toward. For example, one specific goal may be to save an extra $300 over the next six months to put into an emergency fund.

Put your emergency fund in an accessible place. The best place for your emergency fund is in a liquid account (accounts where your cash is easily accessible). A liquid account might be a regular savings account at a bank or credit union that provides some return on your deposit and from which your funds can be withdrawn at any time without penalty. If you consider other options, like a certificate of deposit, money market fund or mutual fund, be sure to figure out how accessible your money will be in an emergency.

Stick to your plan. Once you’ve created your plan, make sure you stick to it. This can sometimes be the hardest part of saving for an emergency fund or any financial goal in general. If your goals are realistic and attainable, sticking to the plan will be much easier. A good way to stay on track is to save automatically. Set up a systematic transfer from your regular checking or savings account at your bank. Be sure to keep your rainy-day funds separate from your other accounts, and label it “for emergency use only.” Just writing down an account’s purpose can keep you from spending the money for any other reason.

Starting an emergency fund is a necessary building block for long term financial stability. Anyone can do it; you just need the right plan.

June 1, 2020
Reduce Your Household Waste

Reducing household waste has been on the top of our agenda this year because we noticed that we have far too much garbage leaving our house each week. If you just stop for a moment and think about ALL of the containers in your kitchen that should make you want to consider reducing household waste. I know that’s sort of how it went down for us when we began cleaning out our kitchen using the Konmari method of organization last week.

Every cupboard we opened we found more and more plastics, containers, bottles, bags and general junk that couldn’t be recycled that we knew would end up in our landfill. It’s amazing what you learn about the way you live when you become mindful of what is happening around you. Too often we are so busy with work, parenting and life that we race through our day and forget about other things that matter such as our environment.

Reducing Household Waste is Next Level Generation

More than ever in Canada we need to consider reducing household waste which may seem a bit harsh on the budget at first, but you’ll find that over time it’s not as pricey as you may think. I’ve compiled a list of ways we plan to target reducing household waste in our home and we hope that you consider adopting some of the same practices. Keep in mind that reducing household waste is a process so you can’t expect it to happen over night nor are you expected to be perfect at it, nobody is. As much as someone wants to say they’ve bagged the environment thing from all aspects I’m doubting that is a reality. What is real is doing our part to reduce, reuse and recycle what we have as a community, country and world-wide. Let’s have a look at what we came up with. I’m excited and I hope you are to join us on this journey to reduce household waste.

Water Bottles: Another part of our plan for reducing household waste is to stop buying plastic water bottles and enjoy water that comes from our taps, which for most, is perfectly safe to drink. Just because companies like Nestle Waters Canada offers 100% recyclable water bottles that doesn’t mean the bottles end up being recycled. More and more bottles keep showing up in our waters and that should be a warning to consumers that we need to rethink our mindset about reducing household waste.

Straws: We don’t use many straws in our house, but when we do, up in our cupboard was a huge container of plastic straws. Not anymore! We are replacing them with stainless steel straws and biodegradable paper straws.

Reusable Containers: Using reusable food storage containers instead of plastic baggies is a big deal to us, especially now that our son goes to school. We purchased affordable bento-style lunch boxes from Amazon for our son that seem to be working well and they come in various colours. His school was asking parents to eliminate sending packages and plastic baggies to school and to opt for bento lunch boxes if possible. There are also reusable silicone baggies you can buy that are a reusable option as well just eliminating them. Another option is to buy glass or stainless bowls with silicone bowl covers to store leftover food or even to freeze foods for later use. Just remember you won’t be able to eliminate everything but sourcing the better options is better than doing nothing at all for our environment.

Reusable Shopping Bags: You can now buy reusable shopping bags and reusable produce bags that you can bring along on your grocery shopping trip. What I love about them is that you won’t have plastics to dispose of and they are cost-effective.

Beeswax Wrap: I found this brilliant product by Abeego wrap after one of the parents at my son’s school mentioned that she uses it at home in place of plastic wrap. The best part is that Abeego is self-adhesive so just you just use the pressure and warmth from your hands to shape and mold the product around whatever you are wrapping. It also comes in various sizes and although the price point may seem high at first you have to think long-term with products such as this as well what goals you plan to achieve from reducing household waste. When you are done with it you simply wash it in cold water along with biodegradable dish soap and hang it to dry.

Parchment Paper & Foil: Another great tip is to use silicon mats instead of parchment paper or foil when baking and I can attest to how well they work since we have about 4 of them.

Eco-Friendly Cloths: Using organic, bamboo reusable kitchen towels that are absorbent is a great option to eliminate paper towels if you prefer to go that route. You can also use old shirts to make cloths by cutting them up, which I’ve done many times. There is also a great company called Norwex, that sells fantastic reusable cloths that have silver woven in for superior cleaning capabilities. They can be pricy, but you’ll have them for years to come, so it may be worth the investment.

Bulk Grocery Shopping: You may not agree with prices when it comes to bulk grocery shopping at places like Costco, but there are lots of deals to be had. As a grocery expert we shop started shopping at Costco a couple of years back and do not regret the decision. Buying products in bulk from Costco reduces the amount of packaging that you bring into your home plus you can still use coupon apps and credit card rewards for added savings to your grocery budget.

Shopping at places like Bulk Barn is another great option because they allow you to bring in your own reusable containers instead of having to take more from the shop. They often have specials and coupons that will help to reduce your budget costs even further. Buying your spices in bulk is far better because you have the option to buy as much or little as you want, thus wasting less.

The Bottom Line

This is where I say ‘do what works for your family and lifestyle’ but you should also consider the impact to our environment now and for the future of our children. Every little bit of reducing household waste is a part each of us owes to the world we live in. It’s a beautiful place so let’s keep it that way!

~ Adapted from Canadian Budget Binder

May 1, 2020
Before Spending Your Emergency Fund, Ask Yourself These Questions

We get so used to thinking of our emergency fund as cash we shouldn’t touch. It can feel wrong to actually spend that money. But the financial situation that’s cropped up as a result of the COVID-19 pandemic makes now a perfectly legit time to tap into your reserves. Honestly.

Your individual circumstance, however, may leave you questioning whether it’s really okay to be spending your emergency fund. Maybe you have a spouse who is still working or enough money in the bank to stretch a few weeks longer.

Here are four questions to ask before spending your emergency cash:

Is this expense a need?
This is a pretty obvious question but one that’s vital to consider. When you use your emergency fund to replace lost income, you can’t spend like you used to. Ask yourself: Is this expense necessary for my survival? If not, it’s not worth draining your rainy-day fund for. That may mean pausing your cable service or taking a break from tithing so you can eat, stay healthy and keep a roof over your head.

Are there resources to help with this expense?
In response to this financial crisis, various organizations and companies are providing assistance to those in need. Banks are waiving overdraft fees and adjusting payment plans on loans. Many credit card and mortgage companies are letting customers defer payments. Food banks are trying to distribute more food. Utility companies are vowing not to shut off service for those who can’t pay. Any assistance you’re able to get will help stretch the money in your emergency fund.

Do I have cash outside of my emergency fund?
Before you start spending your emergency fund, look at other money you can use first. If you have money saved up for a summer vacation or holiday gifts, use that cash. If you have more money than usual left in your checking account because social distancing eliminated your entertainment spending, spend that. Hold off on using your emergency fund until you’ve exhausted other viable options. Avoid pulling money from your retirement accounts.

Can I get what I need for less money?
Your emergency fund will only stretch so far. Be smart about what you spend by looking for cheaper alternatives. Buy store-brand products instead of name-brand to save money on groceries or shop at a store that offers lower prices. Even if those aren’t your normal habits, think of them as a temporary belt-tightening. Reduce your utility usage to help lower your bills.

April 1, 2020
New Year, New Financial Goals

[vc_row type=”in_container” full_screen_row_position=”middle” scene_position=”center” text_color=”dark” text_align=”left” overlay_strength=”0.3″ shape_divider_position=”bottom” bg_image_animation=”none”][vc_column column_padding=”no-extra-padding” column_padding_position=”all” background_color_opacity=”1″ background_hover_color_opacity=”1″ column_link_target=”_self” column_shadow=”none” column_border_radius=”none” width=”1/1″ tablet_width_inherit=”default” tablet_text_alignment=”default” phone_text_alignment=”default” column_border_width=”none” column_border_style=”solid” bg_image_animation=”none”][vc_column_text]The start of a new year is the perfect time to reflect on what you want to improve in your life and to create plans to make it happen. There is a good chance that you’re already thinking about resolutions like going to the gym more, eating healthier and volunteering with local organizations.

But what about financial resolutions? The beginning of the year offers the opportunity to focus on what’s going on with your money. With the right plan in place, you can stick to your financial resolutions and end the coming year in a better place than you started it.[/vc_column_text][/vc_column][/vc_row][vc_row type=”in_container” full_screen_row_position=”middle” scene_position=”center” text_color=”dark” text_align=”left” overlay_strength=”0.3″ shape_divider_position=”bottom” bg_image_animation=”none” shape_type=””][vc_column column_padding=”no-extra-padding” column_padding_position=”all” background_color_opacity=”1″ background_hover_color_opacity=”1″ column_link_target=”_self” column_shadow=”none” column_border_radius=”none” width=”1/1″ tablet_width_inherit=”default” tablet_text_alignment=”default” phone_text_alignment=”default” column_border_width=”none” column_border_style=”solid” bg_image_animation=”none”][nectar_icon_list animate=”true” color=”default” direction=”vertical” icon_size=”small” icon_style=”border”][nectar_icon_list_item icon_type=”numerical” title=”List Item” id=”1579034774653-5″ tab_id=”1579034774654-4″ header=”Save More Money” text=”Not surprisingly, the top financial resolution is to save more money. There are nearly countless ways to go about this — you can increase your RRSP contributions, set up automatic transfers to a high-yield savings account and cut back on unnecessary spending. You can also use a credit card to your advantage. Many of the best credit cards offer competitive rewards and statement credits that can earn you cash back, points or miles that can be used to offset purchases.”] [/nectar_icon_list_item][nectar_icon_list_item icon_type=”numerical” title=”List Item” id=”1579034774701-7″ tab_id=”1579034774702-2″ header=”Improve Your Credit Score” text=”If you have a less than stellar credit (scores below 650), make it a priority to raise this year. You can improve your credit score in several ways, including paying your bills on time and in full (which may include setting up autopay), paying off debt, limiting how many new accounts you open and cutting back on spending. It’s important to regularly check your credit report so you can spot fraud early and ensure the correct information is reported to the credit bureaus (Experian, Equifax and TransUnion).”] [/nectar_icon_list_item][nectar_icon_list_item icon_type=”numerical” title=”List Item” id=”1579034774729-8″ tab_id=”1579034774730-5″ header=”Create a Personal Budget” text=”For some, a budget can feel constricting, but tracking your spending can be a useful tool to help you understand where your money goes each month. A clear budget can help you set guidelines for what you can afford to spend and help you identify areas where you could cut back. Start by writing down all your fixed expenses, such as rent/mortgage, cell phone, groceries and savings. Then you can see how much money you have leftover for flexible expenses, such as restaurants, clothing and entertainment costs. Looking at your credit card statement can be an easy way to see all your purchases in one place.”][/nectar_icon_list_item][nectar_icon_list_item icon_type=”numerical” title=”List Item” id=”1579034774759-5″ tab_id=”1579034774760-9″ header=”Pay Off Credit Card Debt” text=”If you’re struggling with credit card debt, you’re not alone. In fact, about 61% of Canadians have a credit card and cardholders carry an average balance of $6,194, according to Experian. So, it’s not surprising that so many people are looking to pay off credit card debt in the new year. If you have credit card debt, consider consolidating it on a balance transfer credit card, which offer no interest for up to 21 months. Consumers who can pay down debt on their own ought to consider payoff methods like paying off your highest debt first (called the debt avalanche method) or paying off your smallest amount of debt first (debt snowball method).”][/nectar_icon_list_item][nectar_icon_list_item icon_type=”numerical” title=”List Item” id=”1579034774781-9″ tab_id=”1579034774781-5″ header=”Start an Emergency Savings Fund” text=”Nearly four in ten Canadian adults have no emergency savings. If you’re one of those people, now is a good time to set a goal to build your emergency fund. With an emergency fund available, you will reduce the risk of going into debt trying to cover unforeseen expenses, like a flat tire or medical bill. Consider setting up automatic transfers to a savings account. With this strategy, the money is ‘out of sight, out of mind’, reducing the chance that you will be tempted to spend it. Even having as little as $500 to $1,000 saved can keep a family from falling on hard times, according to an Urban Institute study. So, don’t feel like you need to have three-to-six months’ worth of expenses saved immediately. Start small and keep adding to your emergency fund throughout the year.”][/nectar_icon_list_item][nectar_icon_list_item icon_type=”numerical” title=”List Item” id=”1579034774811-8″ tab_id=”1579034774812-4″ header=”Boost Your Retirement Savings” text=”Saving for retirement is one of the most important aspects of preparing for a sound future. Many Canadians worry that they may never retire, so it makes sense to consider your own retirement prospects in the coming year. Consider opening an RRSP account and make automatic weekly or monthly contributions. Much like starting an emergency savings fund, you may not notice a small amount missing from your weekly pay cheque, but it will add up over time and provide you with some peace of mind in the future.”][/nectar_icon_list_item][nectar_icon_list_item icon_type=”numerical” title=”List Item” id=”1579034774842-9″ tab_id=”1579034774842-6″ header=”Cook More at Home” text=”You might be surprised at how much you spend on eating out each week. Once you add that expense up, you might decide that it makes more sense to cook at home. Cooking at home is cheaper, healthier and it builds a useful skill that everyone should have. Consider putting those savings toward paying down debt or building up your emergency savings fund.”][/nectar_icon_list_item][nectar_icon_list_item icon_type=”numerical” title=”List Item” id=”1579034774862-10″ tab_id=”1579034774863-5″ header=”Boost Your Income” text=”Sometimes, it’s less about savings and cutting back and more about increasing your income. There’s no substitute for making more money. Consider looking for ways to start a side hustle, get a promotion, or even look for a better job. You might need to update a certification to qualify for a higher pay or advancement, but that could be worth the cost if it comes with a pay hike. Find different ways to increase your revenue streams so you aren’t entirely dependent on one income source. Not only can that strategy help you make more money, increase your savings and reach your goals, it can also provide some protection if you lose your primary job.”][/nectar_icon_list_item][/nectar_icon_list][/vc_column][/vc_row][vc_row type=”in_container” full_screen_row_position=”middle” scene_position=”center” text_color=”dark” text_align=”left” overlay_strength=”0.3″ shape_divider_position=”bottom” bg_image_animation=”none”][vc_column column_padding=”no-extra-padding” column_padding_position=”all” background_color_opacity=”1″ background_hover_color_opacity=”1″ column_link_target=”_self” column_shadow=”none” column_border_radius=”none” width=”1/1″ tablet_width_inherit=”default” tablet_text_alignment=”default” phone_text_alignment=”default” column_border_width=”none” column_border_style=”solid” bg_image_animation=”none”][vc_column_text]Bottom line: think about what you want from life in the coming year (and in the future) and set resolutions that can help you make the most of your financial resources. Remember that these goals are designed to help you live your life better, however, don’t forget to spend some time enjoying the here and now as well.[/vc_column_text][/vc_column][/vc_row]

January 13, 2020
The TFSA Limit is Being Raised

It’s official, the TFSA dollar limit will be increasing to $6,000 in 2019. TFSA’s have been extremely popular among millions of Canadians, many of whom will welcome the upcoming ability to sock away extra funds in their TFSA’s come 2019.

The TFSA was first introduced in the 2008 federal budget and became available to Canadians for the 2009 calendar year. The initial TFSA dollar limit of $5,000 had risen to $5,500 for the past few years. Under the tax rules, starting in 2016 and for each subsequent year, the annual TFSA dollar limit was fixed at $5,000, indexed to inflation for each year after 2009, and rounded to the nearest $500 to make the annual limits easy to remember.

Each fall, the Canada Revenue Agency announces the indexation increase for the following calendar year. The “indexation factor” for 2019 was calculated by taking the percentage change in the average monthly Consumer Price Index (CPI) data as reported by Statistics Canada for the 12-month period ended September 30, 2018 relative to the average CPI for the 12-month period ended on September 30, 2017.

This week, the CRA announced the 2019 inflation factor to be 2.2%, which is the rate used to increase the federal tax brackets from 2018 to 2019 and most federal credits. Combined with prior years’ inflation, it was enough to push the TFSA dollar limit for 2019 to the next $500 which is why it will hit $6,000 for 2019.

Unused contribution room can be carried forward to future years such that the cumulative limit for someone who has never contributed can be as high as $57,500 today. In other words, if you were at least 18 years of age in 2009 and resident of Canada throughout that period and have never opened a TFSA before, you could contribute the entire $57,500 to your TFSA today. In honour of the TFSA’s upcoming tenth year anniversary, let me share with you three reasons why Canadians have embraced their TFSA’s.

It’s really, truly tax-free.

While you contribute to a TFSA with after-tax dollars, once the funds have been contributed, they grow tax-free, for life. In other words, all income and gains, whether realized or unrealized, will never be taxed while in the plan and the TFSA funds may be withdrawn tax-free, at any time, for any reason.

And because TFSA withdrawals aren’t considered to be income, they don’t negatively impact income-tested benefits and credits, like the Guaranteed Income Supplement, Old Age Security payments or the age credit. Even upon death, the entire fair market value of your TFSA can be received by your estate tax-free. And if you name a successor holder or beneficiary on your TFSA, the assets can flow directly to the named successor holder or beneficiary without going through the estate, which could mean potential savings on provincial probate fees or estate administration taxes.

If you name a successor holder, who can only be your spouse or partner, the TFSA will continue to grow tax-free and your surviving spouse or partner steps into your shoes and becomes the new TFSA holder. Alternatively, if your spouse is the beneficiary of your TFSA, she can transfer the entire FMV of the TFSA upon your death to their own TFSA without using any of their own TFSA contribution room, thus prolonging the tax-free income and growth in the plan.

You can contribute at any age.

To contribute to an RRSP, you must be 71 years of age or younger and you must have ‘earned income’. Contrast that with the TFSA in which there is no age limit and no earned income requirement. One popular strategy that has emerged is for seniors, who are required to withdraw a prescribed minimum amount annually from their RRIF at age 72, to re-contribute any after-tax withdrawals not needed to fund living expenses back into a TFSA for tax-free retirement accumulation.

You can re-contribute your withdrawals.

Finally, keep in mind that any amounts withdrawn from your TFSA can be re-contributed, beginning the following calendar year, without using up TFSA room. This is something you can’t generally do with an RRSP as you must have available contribution room, based on earned income, to re-contribute amounts withdrawn.

October 1, 2019
Before You Make a Budget
You’re ready to start a budget — awesome! You’re probably feeling excited and ready to get your money in order. But here’s the thing: It’s super easy to give up on budgets. They can get complicated and require some maintenance. So before creating your budget, take these simple steps to set yourself up for success:

1. Track Your Spending

Sometimes it feels like each paycheck disappears into thin air. The money lands in your account, you revel in your balance for one day, then you pay your monthly bills and it’s gone!

That’s why it’s so important to track your spending. Before you even start a budget, you’ll want to get a clear idea of where all your money is going each month. There are plenty of ways to do this: good old-fashioned check book balancing, pen and paper or checking your accounts each day. Get yourself used to keeping tabs on your spending by using an app like Mint.com. This will help you better understand what your fixed expenses are each month and where you might be overspending.

2. Set Yourself a Few Fun Goals

Because budgeting can quickly become a dreaded chore, you’ll want to set yourself a few goals to keep you encouraged. No, these don’t all have to be boring financial goals, like paying off student loans or starting an emergency savings. Although those are great, work at a fun goal, like a road trip or cruise. Then, hold yourself accountable by setting up a separate savings accounts and have money automatically come out of your chequing account. You probably won’t even miss that small amount each week, but over time, it will contribute to your goal.

3. Bundle Your Debt Into One Bill

One of the trickiest parts about budgeting is keeping tabs on all your monthly payments, especially if you have debt. Rather than making four different credit card payments each month and logging them in your budget, make life easier for yourself by combining them under one umbrella. It will be much easier to budget with one, easy-to-manage monthly payment.

4. Find Easy Ways to Cut Back Big Bills

Building a budget will force you to take a good hard look at your monthly expenses. Ask yourself: Am I paying too much for any of these non-negotiables? The answer: Probably. Start with a bill that’s super easy to cut — car insurance. Yeah, there’s no getting around it, unfortunately. But to get the best deal, you’ll want to compare rates twice a year. Sometimes you get complacent paying your bills, but there’s usually ways to save or haggle for a lower price. Cable/internet is another good example, if you call, chances are there’s some kind of promo they can offer.

5. Pick Your Go-To Budgeting Method

Yes, there are budgeting methods — plural — but before you panic, we recommend using the 50/20/30 budgeting method for its simplicity.

Here’s how it works:
- 50% of your income goes toward essentials
- 20% goes toward financial goals
- 30% goes toward personal spending
Of course, you’ll want to play around with this, but keeping these base-line percentages in mind will help you figure out how to allot your money for the month.
September 3, 2019
Thinking of Buying Your First Home?

Contribute to your RRSP so you can borrow tax-free!

If you’re planning to buy your first home anytime soon, you may be able to take advantage of a helpful federal government program. This enables you to withdraw money you’ve already contributed to your registered retirement savings plan (RRSP) and use it towards anything related to your home purchase, including your down payment, closing costs or real estate fees. The key is that the funds must be in your account at least 90 days before you can withdraw them under the Home Buyers’ Plan (HBP). You can withdraw up to $25,000 ($50,000 per couple) from your RRSPs tax- and interest-free to buy or build a qualifying home for yourself or a related person with a disability.

If you don’t have money set aside for your RRSP, don’t worry, because you can get a loan from your bank in order to make your contributions. You can contribute up to $26,930 or 18% of your annual salary… and, you can also top up going back to the first year of your working career. You may have noticed these details on the bottom of your notice of assessment (NOA) each year.

The only exception to the first-time buyer requirement where you can take advantage of the HBP is if you have a disability or you’re helping a related person with a disability buy or build a home. You must be able to prove that the new home is a better fit for the needs of the disabled person than his/her current home. You’re considered a first-time homebuyer if you didn’t occupy a home that you or your current spouse or common-law partner owned in the past four years.

The HBP requires you to repay all withdrawals to your RRSP within 15 years. You’ll have to repay 1/15^th to your RRSP each year until your HBP balance is zero. If you don’t repay the amount due for a year, it must then be included in your income for that year. Repayments don’t affect your RRSP deduction limit. You can still contribute to your RRSP and designate that amount as a repayment under the HBP, even if your RRSP deduction limit is zero.

February 1, 2019
How to Create a Budget
A budget is a plan, an outline of your future income and expenses that you can use as a guideline for spending and saving. Only 47% of Canadians use a budget to plan their spending. But Canadians are feeling more in debt than ever with 90% saying they have more debt today than five years ago. A budget can help you pay your bills on time, cover unexpected emergencies, and reach your financial goals — now and in the future. Most of the information you need is already at your fingertips and the guidelines below will show you how to create a budget.

Setting Up a Monthly Budget

It’s a good exercise to document your own actual spending habits for a month or two, and then compare them to this model. This can be a quick way to find out if you are overspending in certain areas.

STEP 1: Calculate Your Income
To set a monthly budget, you need to determine how much income you have. Make sure you include all sources of income such as salaries, interest, pension, and any other income sources, including a spouse’s income if you’re married. Determine your pay after deductions, and then use the following chart to help figure out what your monthly take-home pay is:
- Weekly cheques, multiply by 4.333
- Every-two-week cheques, multiply by 2.167
- Twice-a-month cheques, multiply by 2
- Irregular annual income, divide the net total by 12
You also want to make sure you add in other sources of income, such as interest income, spousal support, child support, tenant rent, and other payments. As with your pay cheques, determine a monthly average for these streams. Using the downloadable Budget Worksheet, write a dollar figure next to each relevant income source. Make sure that the figure you write down is the amount you receive from each income source on a monthly basis.

STEP 2: Estimate Your Expenses
The best way to do this is to keep track of how much you spend each month. The first step is to sum up just where (and how much) you think you are spending. The Expense Worksheet divides spending into fixed and flexible expenses. If some of your expenses for one or more category change significantly each month, take a three-month average for your total. As for the other categories, you might prefer to split them into more narrow subgroups separating food, clothing, and entertainment, for example.

STEP 3: Figure Out the Difference
Once you’ve totalled up your monthly income and your monthly expenses, subtract the expense total from the income total to get the difference. A positive number indicates that you’re spending less than you earn – congratulations! A negative number indicates that your expenses are greater than your income and gives you an idea of where you need to trim expenses and by how much.

Well done! You’ve created a budget. The next step is to make adjustments to this outline in order to achieve your financial goals. Track your budget over time to make sure you’re on track. You need to start making records of your actual income and expenses. This information will help you to understand any “budget variances” – the difference between the amount you planned to spend in a certain category, and the amount you actually spent. Prepare to be surprised for the first couple of months. You may not need to track your spending indefinitely. Usually, a couple of months are all you need to get an idea of where your money is going.

Helpful Tip

The 50/20/30 Rule
When creating a budget, you can list each and every monthly expense you incur as its own line item, or you can combine some of your expenses and follow what’s known as the 50/20/30 rule. The benefit of the 50/20/30 rule is that it groups certain expenses together to make your budget easier to track. The 50/20/30 rule splits your living expenses into three main categories:
1. Fixed costs that stay the same month after month, such as your mortgage, car payment, and cable bill, should take up 50% of your income.
2. Variable costs that can change from month to month, such as entertainment, groceries, and clothing, should take up 30% of your income.
3. Savings, which should take up 20% of your income.
The 50/20/30 rule allows you to retain some flexibility in your budget while saving a nice percentage of your income. While you can always adjust these percentages to accommodate your circumstances, limiting your fixed costs to 50% of your income should leave you with enough money left over to save and cover your variable expenses. Along these lines, allocating 30% of your income to variable costs means you’ll have a decent amount of wiggle room within that category alone.
May 1, 2017