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Author Archives: Kristina Tahnyak

Avatar photo About Kristina Tahnyak

Tahnya is a Certified Financial Planner and former Investment Advisor turned marketing and communications professional She holds a degree from Concordia University, is debt free and currently works in the field of digital marketing.

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Financial Survival of the Fittest

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financial survival, financial tips, financial advice

The past few years have been very rough for the economy with the decrease in the value of the American dollar, the increase in unemployment, and the credit/debt crisis.  With the recent instability of foreign countries due to political uproar, we may once again, face an unstable American economy.

People have lost their jobs, their homes, in some cases their families, and all of their possessions due to an overwhelming amount of debt and lack of income to repay those debts.  It is said that our true colours shine brightest during a time of darkness; if we have financially survived the past few years I think we deserve a shiny gold metal.

We can look at the recent recession as a financial survival of the fittest where only the strongest have survived. We should learn from our past experiences; therefore next time the market and our economy crash, which may be sooner than later, we will know how to react. More importantly we will know how to be prepared.

If you have suffered a loss of income like I have over the past few years, you have made some adjustments to your living and spending habits.  I have learned to live on less; not only because my income has decreased, but because I realized that I took money for granted.  I thought my money, and more importantly my income, would always be steady and stable.  However, I have learned in the last two years that this is not true.  I now earn less than I did in 2007 and 2008, but I save more.  I don’t spend as much as I used to because I have learned that material goods don’t matter that much, and money really cannot buy happiness.

Have you changed your spending habits to survive?

If you lost your home, will you now be a lifetime renter? If you lost your savings, will you now invest in low risk investments? I used to think that money was the key to my personal and financial happiness; I have learned this is also not true.  Good budgeting and self worth are now my financial priorities. My disposable income is less than it was in 2008, but I am a lot happier.  I have realized that money is not guaranteed. Therefore, the next time the market crashes I will know what to expect, and how to react. Although we can never be fully prepared, we can take precautions to make the transition less of a shock.

Saving more in my non registered savings account is another adjustment that I have made since the recession.  I still invest for my retirement, but I am no longer obsessed with maxing out my retirement savings plans each and every year.

Will you be able to financially survive another recession?

DINKS Financial Survival Guide:

  1. Save Save Save. Whether you save for retirement or you save in a non registered investment account, it doesn’t matter…Just Save. Spend less and save more. It is important to create a nice financial cushion of money in case you find yourself without income or less income in the future.  If you don’t need it to keep warm or keep your belly full then don’t spend money on it.  Pay your bills and be happy that you have a mortgage payment to make and a grocery bill to charge…not everyone does.
  2. Be prepared with a backup income. In case you lose your job it is important to have a secondary source of income such as a side hustle.  It is always good to have options available instead of having all of your income eggs in one basket.
  3. Don’t Live Beyond Your Means. If a lot of your monthly income goes towards debt repayment I suggest that you start to live on a cash budget. Pay with cash first, and use your credit card as a secondary payment option.  This way we will not ruin our credit history if we can’t meet our debt repayment obligations.

Photo By BaronBrian

The Hottest Guest Posts on the Web

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Happy Friday DINKS! As bloggers, we all love finance. We all love writing about money and sharing our personal experiences with you, the readers.  But sometimes bloggers just need a day off…Enter the wonderful concept of Guest Posts.

Guest posts are a great way to drive new traffic to any blog.  Guest Posts are also a great way to test out a new writer who we may want to become a regular featured writer on an existing blog.

A guest post lets readers see the point of view of another blogger, as well as discuss other topics that may otherwise be untouched.

This is my favourite guest post on DINKS:

Laura Adams wrote this post in April called “Should you live on a cash budget?” I love Laura’s writing style because it is relatable and easy to read.  As you may remember I am not a huge fan of accumulating debt.  I think the world would be a much better place if we all lived on a cash budget, but I know it is probably only my opinion.

Here are some of my favourite guest posts from around the Web:

Molly wrote a post for The Side Hustle Series on Budgets Are Sexy.  This series features guest posts by actual readers who all have a side hustle job which is outside of their normal day job. In this guest post Molly discusses her side hustle of being a Chicken Farmer.  I have to be honest; the first thing I thought about after reading this post was Kevin Skinner from America’s Got Talent

Lisa Cintron wrote a guest post on Financial Samurai about Annuities. As a Personal Financial Planner I am not a big fan of annuities because they are inflexible and usually only a good investment option for a specific type of client.  However, if their personal financial situation is fitting, I guess Annuities could play a key role in retirement or estate planning.  Annuities are a great financial product for people who want to do nothing more than live off of their fixed (and inflexible) income. No budget required.

I wrote this guest post for Budgets Are Sexy called “If he can’t put a ring on it, then he can’t sign for it.”  This guest post discusses the debate of whether to make couples finances joint if they are not yet married.

Do I Have To Pay My Taxes?

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Every year around this time we start to gather our personal information and collect all of our tax slips, in preparation to file our annual income taxes.

It completely shocked me to learn that many people don’t file their annual personal income taxes.

I can’t imagine why anyone would not file their annual personal income taxes.  According to The Associated Press 1 in 6 Americans did not pay their personal income taxes in 2007.

Do I have to file my personal income taxes? Plain and simple the answer is totally YES! It may be a long process, dealing with the federal government may be frustrating, and waiting for the results may test our patience, but we absolutely have to file our annual income taxes every year.

The deadline to file personal income taxes in the United States of America is April 15.  Not filing our personal income taxes on an annual basis, and failure to repay any amounts owed to the Internal Revenue Service (IRS) could result in expensive fines and even jail time.  It is a federal offence to not file our annual income taxes.  Not only could we have to repay the money, but we could also go to jail…not one or the other, but both!

I would never risk going to jail over money…Never! As you may remember, I am deathly afraid of going to prison; therefore I try to keep my temper in check and file my taxes on time every year :)

In 2007 I owed money to the federal government after filing my personal income taxes, and I didn’t pay the money that was owed. I didn’t pay my tax bill because I thought that I would just make it up the next year when I had a refund.  I asked my accountant exactly what I needed to do the next year in order to have a refund.  I assumed that my refund the next year would offset the money that I owed in 2007, and everything would even out; but I was wrong.

After 6 months of “friendly reminder” notices from the federal government (which I ignored) they eventually garnished my wages.  Each pay check the federal government withheld 20% of my gross income until my entire tax bill of approximately $7300 was paid in full…and then some.

That’s right! The federal government continued to garnish 20% of my wages even after the $7300 was paid in full.  I inquired why they continued to take money from my pay check after my tax bill was paid; they told me that it was MY responsibility to contact them once the amount owed was paid in full.  It took the federal government 6 weeks to refund my money that was overpaid.  I know that my $7300 owing in federal taxes is small peanuts compared to some other citizens, but the situation was still very frustrating.

Joe Francis who is an entrepreneur in the entertainment field was sentenced to time in jail for not filing his annual income taxes as well as filing a false return. Some of you may know Joe Francis as the creator of the series Girls Gone Wild.  Joe Francis was also fined several thousands of dollars for not filing his annual income taxes; this includes the interest owed on the non payments.

It is reported that the IRS looses over $300 million in unpaid/unfiled taxes each year.   Click Here to learn more about other Celebrities who have had a run in with the IRS such as Nicholas Cage, Wesley Snipes, and Sinbad.

(Photo By Infrogmation)

Employee Savings Plans…Do you contribute?

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employee savings plans, employee contributions, programs offered by employers

Every January we (employees at my financial instituion) are encouraged to review the investment options in our Employee Savings Plans.  Employee Savings Plans are savings options that are sponsored by our employer; our  investments are made through payroll deductions.

I am a huge fan of Employee Savings Plans because they are a form of forced savings. Forced savings means that the investment money is automatically deducted from our pay check before it is deposited into our bank account.

I also love Employee Savings Plans because we have a guaranteed return in the form of our employer contributions. Employee Savings Plans are sponsored by our employer, this means that for every dollar we contribute, our employer also contributes a percentage on our behalf.

I am going to share my Employee Savings Plan options with you, and I would like to know how it compares to other Employee Savings Plans out in the workforce.  If you are self employed, do you offer an Employee Savings Plan? If so, what are the contribution options?

Our first employee savings option is the Pension Plan.  We contribute a mandatory 2% of our annual salary and our employer contributes 6% on our behalf.  This is a new Pension Plan option for 2011; it used to be an equal 2% contribution by both the employee and employer.

There used to be a 2 year waiting period for employees to be eligible to contribute into our Pension Plan.  However, now after 3 months of service, any employee can start contributing into the Pension Plan as of the following January 1.  Our Pension Plan is a Defined Contribution Pension Plan, and contributions are mandatory by all employees.

We have 3 other Employee Savings Plan options available outside of the Pension Plan.  We can tribute up to 8% of our annual income into an optional Retirement Savings Plan, a Non Registered Investment Account, or a Tax Free Savings Account.  For every dollar we contribute into any one of these optional Employee Savings Plans our employer contributes 50%.  Therefore, if we contribute 8%, our employer will contribute 4% on our behalf.  This applies for each and every Employee Savings Plan option.

It is important to fully understand our Employee Savings Plan options as there is usually a vesting period. A vesting period is similar to a holding period before we (employees) are able to access our employer contributions; it can be any amount of time, usually between 6 months and 2 years.  Our employee contributions are always accessible.

The investment options in an Employee Savings Plan can range from individual Stocks to Mutual Funds.  The fees for investments in Employee Savings Plans are usually a lot lower than if we bought the investments as individual investors through a discount or full service broker. Many companies now use a service to handle their employee benefits, as this ensures that every worker gets the most out of these plans. All the company has to do is come up with a benefit package for its employees and the proper employee benefits services will be automatically applied. These benefits can be automatically renewed every year and can include optional benefits like medical, life insurance and dental, depending on what the organization wants for its employees. Overall, this is a great way to operate a business because it automates the entire process and provides support for employees along the way.

I see Employee Savings Plans as “free money”, otherwise known as a guaranteed return.  Even if the investments from our contributions lose value, we still have the contributions from our employer to invest.  Therefore, Employee Savings Plans are a great way to invest because we earn the guaranteed contributions from our employer, as well as any gains on our investments.

What options do you have for your Employee Savings Plan?

Can you afford NOT to be in a couple?

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divorce, not being in a couple, being separated

With the divorce rate growing, it is becoming more and more common for couples to spit up.  What happens when our DINKS income gets cut in half and our dual income becomes one?

I have a client who has made a great living and built an extravagant lifestyle by selling luxury condos.  She has been separated from her husband for five years. They live completely separately; she lives in a country house, and her husband lives in an apartment in the city.  They are friendly and often interact, but they do not live as a married couple.

My client refuses to divorce her husband because she doesn’t want to give him half of her wealth. Her riches include over one million dollars worth of real estate properties, loads of cash, as well as several investments. My client is the go to girl when developers are ready to sell their luxury properties.  She works freelance and travels the world in her spare time. She is self employed and works on 3-12 month contracts with developers to sell their condo units.

When clients come into the bank and ask me for a current account statement including their current balance, it is usually for one of two reasons…they are buying a house and need to show their mortgage broker proof of their assets for the down payment, or they are getting divorced.

More often these days the reason that clients come to the bank and request a copy of their account statement is because they are getting divorced.  In 2005 clients were asking for their account statements because my clients were buying a house, but now it’s because they are getting divorced.

After my recent family fall out I asked My Dad why he is staying with his current girlfriend.  He confirmed that he knows she isn’t the best match for him and she isn’t a good fit for our family, but he continues to stay with her.  When I asked him why he chose to stay he told me it is because he can’t afford to live on his own. I am not one hundred percent convinced that this is true because my father chooses to live on a fixed retirement income, he doesn’t have to.

When we are in a couple we become accustom to a particular lifestyle. When we leave that couple are expenses maybe less, but so is our disposable monthly income.  Could you survive if your dual income became one?

(Photo By Cliff1066)

Working Out on a Budget

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budgeting, budgeting goals, budgeting tips

We are now at the end of January.  It’s time to check in on our New Year’s Resolutions.  Was your New Year’s Resolution to work out, to lose weight, or to live a healthier life? If so, how is that going? Are you working out for 30 minutes 4 times a week? Are you watching what you eat? Don’t worry, if you haven’t yet fully embraced your New Year’s Resolution of working out DINKS Finance is here to help.

I enjoy swimming and doing Yoga, so I know how expensive working out can be.  Between the latest equipment, workout clothes, the perfect pair of shoes, and a gym membership working out can become a very expensive hobby. Our hobby can become very expensive if we take our hobby to the extreme.  Some Yoga students plan a trip to India to practice Yoga with its founders. Some cyclists may travel to South America to cycle through the Andes.

As young professionals, we are expected to look, to act, and to be a certain way.  If we don’t fit into the perfect corporate mould we may be booted out the door.  Sometimes it’s not about our work ethic as much as it is about our appearance and overall professionalism. Unfortunately, we live in a materialistic world; in general gorgeous people are used to getting what they want.

If your New Year’s Resolution to work out is currently on hold due to your lack of disposable monthly income, we understand. Budgets are always tight after the holidays; we focus on paying off debt and saving a little more to make up for the spending that we did during the holidays. Weekly sessions with my personal trainer was one of the first things that I had to cut out of my DINK budget when the financial crisis hit and my income dropped. However, I have learned to Work Out on a Budget.

Here are some great tips to Working Out on a Budget:

You don’t have to work out at a gym. We can burn just as many calories working out at home as we can burn in the gym.  I enjoy working out at home because I am very lazy, and I will find any excuse not to make the commute to my neighbourhood gym.

Work Out Outside. Since some of us live in the cold North East we don’t always have the opportunity to get outside during the winter.  I (despite being Ukrainian Canadian) hate the cold, so there is no way I am going outside to run in the winter.  However from March to November I enjoy walking or running around my neighbourhood. I get to go to places that I normally wouldn’t visit, and I have discovered some great restaurants and shops during my outdoor adventures. I enjoy the fresh air opposed to the sweaty smell of a gym.

Buy a Video. We can find some great workout DVDs on EBay.  The cost of a workout DVD is between $7 and $10.  We can buy 4 videos a month for less than a monthly gym membership.

Friday Roundup: Blogging, Questions, and Answers

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Happy Friday DINKS. Today we are discussing our online business and the lives that we lead online as anonymous bloggers.  For some of us our online personalities reflect our real life personalities.  But for some others being anonymous online allows us to be free and more open with our opinions, views and questions.  Being an anonymous blogger online allows us to break free from our (maybe) moulded life.

The exact same is true for those of us who choose to conduct our personal financial business online.  I am the first to admit that online banking is extremely convenient, but I also love it because it is anonymous.  To ING Bank I am client 55899821.  I don’t have to meet a financial advisor, I didn’t have to agree to a credit background check, and I never have to visit an ING bank branch.  I like the fact that my business relationship with ING is based online, and not based on my personal relationship with a financial advisor or branch manager.

In our real lives we can’t always express our feelings and be honest due to our fear of rejection or non acceptance.  Sometimes we just don’t ask questions because we think our question may be stupid.  However, online we can ask our questions anonymously. We can get honest answers from personal financial professionals and other personal finance bloggers who may be experiencing the same situations.

Sometimes we can’t always figure out our own problems. Sometimes we have questions that are too personal to ask our friends and family. Blogging online and asking questions anonymously are great ways to get advice from personal financial professionals as well as interact with other people who have the same questions that we want to ask.

Do you have a personal finance question? Ask us and we will be happy to answer!  We can respond to you individually, or we can post your question along with our answers and advice on the blog to help other readers.

Here are some other readers who got answers to their personal finance questions online:

  • Clever Dude gives advice to a reader about paying down debt in his post $18,000 in Credit Card Debt.
  • Blonde and Balanced answers two reader questions about combining finances.
  • Free Money Finance has a link on his blog where readers can ask questions and get answers.  He posts the answers and questions online so that other readers can get advice.

DINKS Reality: Would you Smuggle Goods for Money?

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smuggle goods for money, locked up abroad, smuggling

It’s time once again for another edition of our latest financial series…DINKS Reality.  We discuss the money lessons, and sometimes the life lessons, learned from our favourite reality television shows.  With a new television channel package that my boyfriend Nick has added onto our ever growing cable bill, we now get the National Geographic Channel.

The National Geographic Channel has a show called Locked Up Abroad. It is a series about Real People who live to tell their Real Stories about being locked up abroad because of their greed and their love of money.  They are far from home, and far from help.

I have seen several episodes of this show and each time a person is approached by a “business man” to “transport” goods (usually drugs) across foreign boarders.  The “business man” has a “fool proof” business plan that can’t fail.  However, each and every time the greedy transporter is caught by foreign authorities and sentenced to several years in a foreign prison.

The one thing that astonishes me about this show is in each and every episode I have seen, the transporter says that they needed the money and it was “easy money” to make.  I am sure we can all testify to the fact that there is no such thing as easy money.  If it was easy we would all be doing it.  We all work for our money.

A recent episode of Locked Up Abroad told the story of an American girl who was offered to smuggle drugs from Japan.  It was 2 days of work, all expenses paid, and she would make $35,000…in 48 hours.  Although the offer to make $35,000 in 2 days may sound tempting, it is definitely too good to be true.  Nobody makes $35,000 in one day without taking some risk.  The reward may be great, but the risk may be greater.  This is the exact moment when temptation has to be overcome by some financial sense. Common sense has to get off the sidelines and come into play.

Would you be tempted by $35,000?

I am the first to admit that I could use $35,000, and the offer to make it with only 24 hours work is tempting.  My fear of going to prison, and especially a foreign prison, is far greater than my love of money.  However, we can’t say the same for everyone; otherwise Locked Up Abroad wouldn’t exist.  One thing on my list to never do before I die is go to prison; the thought scares the hell out of me.  Also on my list of things never to do before I die is get eaten by a shark!

The other reality check about Locked Up Abroad is that Americans are locked in foreign prisons.  The judicial system in some foreign countries is not as liberal as in the United States of America.  The woman who was caught with drugs in Japan was immediately taken to prison. She later received a letter stating that she had been sentenced to 9 years in a Japanese prison.  No court date, no trial by jury, and no philosophy of being innocent until proven guilty.

Would you smuggle something across the border if the price was right?

MSN recently published an article titled “The craziest things people have tried to sneak on planes”.  You would not believe what some people try to smuggle. According to MSN people have tried to sneak everything on planes from Baby Tigers to Dead Bodies…that’s right, dead bodies.

(Photo by Malias)

Financial Personalities: The Unhappy Money Lover

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money choices, financial personalities, family and money, relatives and money

Today we are going to discuss more financial personalities in my family. The more I thought about it, the more I realized that my individual family members all have very different financial personalities.

My Uncle Daniel is a middle child on my mother’s side of the family.  My Uncle Daniel is extremely successful in the car industry.  He manages a Honda dealership, and he also sells cars to his long time loyal customers.  You could say that selling cars is the family business; my Grandfather also worked in car sales. As the dealership manager my Uncle makes a great annual base salary; he also makes a bonus based on the sales of the dealership as a whole, and a commission every time he sells a car.

I would say that my uncle is very successful, but I would say that he is not very happy. My Uncle Daniel is very good at his job, but I am not sure that he enjoys it. The money is good and he has an obligation to provide for his family which includes my Aunt and my 18 year old cousin.

The reason why I think that my Uncle may not be happy is because selling cars was not his first career choice.  He started selling cars with my Grandfather when he was in his early 20’s. Now, 25 years later I think that my Uncle is comfortable with his job, as opposed to being passionate for his job. In the early 2000’s after my Grandfather passed away, my Uncle Daniel left his life of car sales to explore new opportunities.  With my Grandfather gone, my Uncle felt that he could finally make his own career decisions. My Uncle Daniel enrolled in culinary school.

For as long as I can remember my Uncle has loved to cook; and he has always wanted to open his own catering business.  However, by 2005 my Uncle Daniel was back at the Honda dealership selling cars.  There is not a lot of money in catering, and the cost of culinary school was very expensive.  Sometimes we become so addicted to money that our personal happiness takes a back seat to our financial (and family) obligations.

My Uncle’s strong work ethic has crossed over to his daughter.  My cousin who is in her last year of high school currently works two jobs.  At the end of the school year she plans to buy a car (from my uncle of course) and move out on her own at 18 years old.  She plans to attend a private culinary college.  My cousin does not want any help from my Uncle, even though he can afford to pay for her college degree and for her car several times over.  My Uncle is a prime example that Money Can’t Buy Us Happiness.

Who is the unhappy money lover in your family?

My New Year’s Resolution is to Want Less.

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resolution, New Year's resolution, New Year's goals

watch landA few months ago I met Regan in my neighbourhood Starbucks.  Regan lives a very simple life that is not focused around, or ruled by money.  His extreme minimalist lifestyle has made me re-evaluate everything in my materialistic lifestyle.

I live in a world that is completely ruled by money. This is mostly because I work in finance.  The majority of my friends also work in finance; actually, almost all of my friends work in finance.  We are surrounded by money all day.  My friends and I are all very open when we talk about our own personal finances, as well as when we discuss the money of others.

In 2011 my New Year’s Resolution is to want less.  I am going to try not to focus so much on my love of money and my personal finances.  Every day I look at my daily spending, my budget, and my savings. It is pretty safe to say that I definitely live in a world that is ruled by money.  It will not be an easy resolution to try and focus my life less around money, because my love of everything related to money has been fifteen years in the making.

I am the first to admit that I live in a world ruled by money.  I wouldn’t say that I am obsessed with money, but you know what they say…Cash Rules Everything Around Me.  There is always another restaurant where I want to eat, there is always something else that I want to buy, and there is always another place that I want to travel.  I strive to be the best at my job because my job controls my money.  I used to believe that a person (or a couple) can never have enough money. Although after meeting Regan I may reconsider my beliefs.

Regan has made me think about my financial life and consider if I am really happy.  I wake up every morning and check my bank accounts along with my investment accounts.  I go to work and I am always working towards the next big deal.  After work I go out and spend my hard earned money.  What if I didn’t strive to always want more? Would I be happier?

Regan lives in a world that doesn’t revolve, and sometimes even involve, money.  I am not 100% positive why I live in a materialistic world.  I am not sure why I feel the need to purchase unnecessary items such as expensive spa treatments and handbags in mass quantities.  I guess it is because I have always worked, and therefore I have always had money.  My only expenses are my rent, groceries, and utilities.  Therefore, I feel that I have the freedom to spend my extra money as I please.

Do you live in a world that is ruled by money?

My priority in life is ______________

My New Year’s Resolution is _______________

My 5 year goal is ______________

Did your answers all involve money?

If so, then maybe you also live in a world that is ruled by money.

Photo By JohnSeb

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