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.
Good morning Dinks and Happy Halloween. Are you giving out candy tonight? Nick and I live in an apartment building and I have yet to see a child in this neighborhood so we are going to stay in eat candy and watch scary movies. A few of our other childless friend couples are going to see The Rocky Horror Picture Show so they aren’t giving out candy either. I’m just wondering if you don’t have kids what’s the proper protocol on Halloween – do you still give out candy?
Have a fun Halloween enjoy these posts from our friends:
Money Talks News – Go Big or Go Home: The Million-Dollar Halloween Costume
Good morning Dinks. Do you have an online bank yet? I’m not asking if you log into your bank’s online portal to pay bills and transfer funds. I want to know if your primary bank is completely virtual.
When online banks were first introduced it was a nightmare for me as a financial planner, but as a client I was intrigued. Online banks were offering rates that traditional banks couldn’t compete with and therefore we were losing a major chunk of savings to our new online competitors. I knew I couldn’t compete with the low service fees and high interest rates that online banks were offing to my clients so I tried to sell something that online banks couldn’t offer – the personal one on one benefit of having a financial advisor. It worked on some clients, but to others all they cared about was the bottom line – WOW that hurt!
I knew I should avoid online banks as a client because they went against everything I stood for as a financial planner. However I was admittedly tempted by the allure of everything online banks had to offer and quickly jumped on the band wagon. I opened a savings account for the substantially superior interest rates. However the love affair didn’t last long. I found it incredibly inconvenient when linking my virtual account to my primary bank accounts and trying to transfer money between them. When it comes to dollars and cents I like everything to balance out on a daily basis and waiting 2-3 days for my money to transfer made me stir crazy.
Open an account with an online bank if…
Online banks are both a gift and a curse. They offer attractive interest rates but in most cases they’re not a full service bank. I don’t know many people who use an online bank as their one and only bank, but I do know a lot of people who use online banks to compliment their overall financial strategy. This is a great way to use an online bank.
If you don’t need to do foreign exchange transactions, purchase non-cash investments (i.e. mutual funds, stocks and ETFs) and enjoy the comfort of a dedicated financial advisor then online banks are for you. If you’re shopping around for attractive rates on your savings deposits, mortgages and Guaranteed Investment Certificates then online banks are also the way to go – as long as you’re internet savvy and can live without actual paper confirmations.
Skip the online bank if you want customer service
I know this is a major reason why my Dad isn’t a client of an online bank – because he can’t physically go to a bank branch and talk to a teller or financial advisor. Truth be told my Dad doesn’t even use online banking, he doesn’t even use telephone banking. My 61 year old father likes to go into the bank once a week to get cash and pay his bills. While waiting in line he munches on cookies and enjoys a hot cup of tea. That’s banking to my Dad.
The flip side of that scenario is that you never have to wait in line with an online bank and you never have awful customer service because with an online bank you’re the client, the teller, the financial advisor and the branch manager. I’m not sure if that’s better or worse, that’s just the way it is.
Good morning Dinks. Two months ago my company announced they are being sold to a competitor and although it’s supposed to be “business as usual” my current employer can’t help but talk about how beneficial it will be once the takeover begins. What is a flexible work schedule? Our new employer is offering a variety of flexible work arrangements including a 10/4 schedule where employees can do their 40 hours in 4 days with 10 hour work days. They are also allowing employees to work from home up to three days a week as well as offering a variety of 8 hour shifts with start times varying from 7 am to 12 pm; that’s a great option for people who prefer to work later than the normal 9 to 5. The stress free environment of working from home and working the hours you want to helps relieve the burden of your managers watchful eye always looking over your shoulder. It will make employees more productive because they will be more relaxed working on their own terms. Right? Do you have a flexible work schedule? Over 40% of the workforce at my new potential new employer (I say potential because our jobs aren’t guaranteed as of January) work unconventional hours outside of 9 to 5 or work from remote locations. This will be a fantastic perk. I work as a community manager and therefore I can work from absolutely anywhere; however my current employer prefers all employees to be in the office. My manager is very understanding about giving us time off for doctor’s appointments and family matters but it’s frowned upon to work from home without a valid reason. However come January this may change. A flexible work schedule will also require employees to use less vacation days which means in the long run we get more days off. We no longer need to take a day off every time we want to leave the office early on a Friday because when you can work remotely you can work from anywhere. How great is that?! Flexible work arrangements are a win-win for everyone If you’re an employer I think a flexible work schedule is a valuable way to attract and retain employees. As an employee a flexible work arrangement is the absolute best work life balance there could be. It saves employees time commuting and gives them more time to spend with their families. As an employer it makes employees happy and happy employees work harder. Sometimes travelling to and from the office during the day can be a colossal waste of time. If we work from home or have the option to work flexible hours it can definitely help balance personal appointments and family obligations. In some offices special arrangements are only permitted for matters related to children, but what if you don’t have kids? In my new job (if I have one) flexible hours will be the norm for everyone, not just for those families with children. Photo from Flickr
I’m not asking if you go to a casino and drop $500 down on the table for one hand of Black Jack or one roll of the dice. I mean do you like your income, expenses and debt to be consistent every month or are you OK if they fluctuate?
Even though I’m young and I work in personal finance I am what you call risk adverse – with both my money and my life. I don’t like change and the possibility of the unknown makes me uneasy. I like having a daily routine, I like knowing what I should expect throughout any given day and I don’t like to see major spikes or declines in the value of my investments.
Are you OK with changes when it comes to money?
Taking a balanced investment approach
I’m not a high risk investor, not by any means. I take a balanced approach to my long term retirement accounts which means I invest 60% in equity and 40% in fixed income. I have a good 30 years until I retire; I know I should be taking more risk because it can be very rewarding over the long term, however that’s just not my style.
I prefer to see my money grow a little bit each and every month. I know I could potentially be making more but that would require me to take more risk. I prefer to sustain small increases over time as oppose to big spikes and big drops in the value of my investments. The thought of losing a substantial percentage of my savings in one day or over a short period of time makes me feel sick. After all you know what they say, slow and steady wins the race.
Consistent expenses
If you have a fixed income you also need to have fixed expenses, that’s just the way it is. People who spend more than they make end up in debt and I don’t want to go there again.
In our new apartment Nick and I now have to pay a hydro bill every month and this makes me uneasy. I don’t like not knowing what’s to come, especially when it relates to money. This is partially due to the fact that I’ve overspent in the past and my bad habits landed me over $50k in debt. It’s also probably due to the fact that I’m a control freak and I always like to know what’s coming.
Variable mortgage rates
One of the biggest debts we will ever have in our lives is our mortgage. Even though our home is also a huge asset I can’t imagine taking a gamble with hundreds of thousands of dollars.
As a financial planner I have to always offer variable mortgage rates to clients but personally I think they’re a bad idea. I know the thought of low rates is appealing but the fact that payments can change at any time if interest rates change makes me nervous.
However recent data from Rate Supermarket confirms that variable rate mortgage holders have no reason to be nervous – at least not in the immediate future. “The U.S. Federal Reserve clearly expect that they will not be raising their administered rates anytime soon, which means that interest costs for variable rate mortgages rates should change very little during the coming year.”
How do you handle changes in your money? Do you freak out like me or do you take it with grace?
Happy Friday Dinks. How was your week? Mine was great. I’m feeling more and more at home in our new apartment and I joined a gym in my new neighborhood. Yep that’s right I, lover of the outdoors, joined a gym. For the next 12 months I will have $43 deducted from my bank account every month for my good health.
More about why I chose to spend over $500 a year on my appearance later next week.
If you want some good reads while you drink your morning coffee here are some great posts from our friends:
Boomer & Echo – What Are You Doing With This Stock Market Pullback?
Good morning Dinks. Nick and I have been in our new apartment for almost a month and although we still have some furniture to buy and some boxes to unpack we are slowly but surely getting settled into our new space.
I have advocated many times here on Dinks Finance that I am not a fan of debt because I will be forever scared by my past money troubles. Now at 34 years old I’m in $5000 of debt again but surprisingly I’m not freaking out. I did have a pain in my gut just before I signed for the financing but now I’m totally OK with it. Why? Because this time it’s different.
This time I have a plan
We decided to finance our new furniture with two different companies and pay for our other apartment must haves with the savings we’ve been accumulating since May. I’m not freaking out about my debt this time because there is a definitive start and stop date.
This debt is not going to be an ongoing thing. I set up payments on both furniture accounts to have the debt completely paid off by April 30, 2015. It could have been a lot faster but we have Nick’s birthday and Christmas during that time so we will need some extra cash to celebrate. I didn’t want to spend all my income paying off debt then using credit to live until my next paycheck – that’s a mistake you only make once.
The debt is for a good reason
Our old apartment was less than shall we say perfect. We moved there in 2008 after the market crash and we didn’t buy any new furniture at the time due to our limited budget. So this time when we moved we wanted to do it right with a bigger apartment in a better location and with all new furniture.
With our recent move our lifestyle got a whole lot better. Our living space more than doubled; we knew we would have to buy new furniture as well as functional items for our new apartment such as lamps and desks etc. We also have new appliances in our new apartment so we had to buy supplies for the washer and dryer as well as the dishwasher. It doesn’t make sense to use the good stuff when you share laundry with 21 other floors of tenants, but now that we have our own laundry in our new apartment we can splurge a bit for laundry supplies.
This time I have something to show for my debt
This time our debt is actually for something – new furniture. This time I have something to show for my debt – a gorgeous new apartment. My biggest debt mistake in the past was living off credit to finance my lifestyle. It was continuous spending on clothes and vacations as well as at restaurants and concerts. If I wanted something I would whip out my credit card and pay for it. Not this time. This time I have fixed financing through a store, no credit cards and no revolving credit – unless I want to buy something else at that same store. This time my debt is controlled and that’s why I feel good about it.
Good morning Dinks. As you know buying a car was my biggest financial mistake and although some days I do really miss the convenience of hopping in my ride I will probably never buy a car again. Actually that’s not necessarily true I will never buy a new car again unless I really need it. As my current living situation is Nick and I don’t need a car. However if some day we buy a house and move to the suburbs we may need a car. I’m not saying never, I’m just saying not now. But what can we do if we need a car and don’t want the monthly payments? Rent a car temporarily. So that’s exactly what we did.
Buying a car is expensive
With our move on October 1st Nick and I needed a car to run errands and set up our new apartment. It was convenient having the car to help buy things for our new apartment. However having a car for the last two weeks also brought back all the things I hated about owning a car over.
Saturday night as we were driving home from our last day of shopping (after seeing the new Dracula movie) Nick said something to me that made me realize we made the right decision when we sold the car. He said that owning a car comes with so much more expenses than just the car payment. When you have a car you can drive to big box stores such as Wal-Mart, Target and Home Depot – I went to Home Depot for the first time in my life last weekend and all I can say is WOW.
When you have to carry your groceries and shopping bags you can only spend as much as you can carry. However when you have a ton of space to load bags into the back of your SUV you can end up spending hundreds of dollars in just one shopping trip.
Buying a car is convenient
I’m not going to lie, there are days that I do miss having a car. However the majority of the time I’m just glad to be saving the monthly payment. That Honda Civic was the first thing I ever truly bought and selling it was a personal defeat, but at the end of the day I just couldn’t justify the monthly expense.
If you are thinking of buying a car – don’t do it. If you’re thinking about selling your car – do it. You’ll miss it at the beginning but you’ll get along just fine without it. You’ll walk more which is good for your health and you’ll spend less which is good for your wallet.
4 reasons I won’t buy another car:
The expensive payments. Oh I don’t miss the payments. I think we can all agree that $800 a month could be better spent.
Looking for parking. There is nothing more that I hate than driving around in circles looking for parking. It’s a waste of time, gas and it runs my patience very thin.
It’s killing the environment. Gas consumption and car exhaust pollution are extremely bad for the environment. I for one can live with walking.
The gas game. I hated paying for gas and watching the prices drop the next day. Is there really a right time to gas up?
Good morning Dinks. Let me ask you a question, are you overpaying for your lifestyle? I don’t mean if you’re living beyond your means or if you are racking up thousands of dollars in debt. I’m asking if your currently living situation could be done on less.
What does someone with money look like?
Why am I bringing this up? Because sometimes I feel I have to justify my success (and my bank account) because I don’t look like the typical financial planner. I don’t wear Jimmy Choo shoes and I don’t dress up in jeans and a blazer to go to the grocery store on the weekends. I like being comfortable in flip flops and hoodies from American Eagle. Yes I’m 34 years old (as of last week) and I dress like I’m 19 – so what? Can you tell this is bugging me?!
As you know last month I went to New Orleans for FinCon. My flight left at 9 am so I had to call a cab at 7 am. I’m not sure who looks their best at 7 am, but it’s not me. I got into the cab and the driver said “To the bus station?” Now before we go on I have to tell you that I was so offended (and exhausted) that I snapped. I know it wasn’t the right thing to do and if I ever see that taxi driver again I will definitely apologize. I hastily responded “I’m not sure what it is about me that makes you think I don’t have money but I’m going to the airport. Thank you.”
Living on less without changing your lifestyle
Ok so back to my question. Could you live your life on less? Think about it for a minute. Could you live exactly how you are but for less money? I’m sure the answer for most of us is YES. Sometimes we become accustom to living for convenience that we forget about what really matters. The basics.
Location. Nick and I just moved into our new apartment and it’s $400 a month more than we were paying. Of course we could have shopped around a little more, moved outside of downtown and found an apartment within our price range. But we didn’t. We lived in an awful apartment for six years so we decided that paying a bit more for more than double the space was worth it. We did have to make cuts in our other monthly expenses such as our cable bill to accommodate our new rent payment – but for us it’s worth it.
Home esthetics. Yes of course it’s convenient to have a gorgeous home that is well decorated but you know what? Decorating is expensive!
Be conscience of your consumption. As of October 1st Nick and I now pay electric every month. This is new for us and we don’t really know what to expect. Of course I would love to have all the lights on in our apartment at the same time for security and convenience, but that’s just not financially smart. We really don’t know what to expect so we invested in bedside lamps for the bedroom and table lamps for the living room with energy efficient light bulbs to help save on our hydro bill.
Good morning Dinks and Happy Friday. It’s been 17 days since we moved into our new apartment and although there are still some boxes we need to unpack we are definitely getting settled in. This weekend we are going to walk around and get to know our new neighborhood. For the first time in three weeks we are actually going to get outside and enjoy our new apartment. Our sofa and bed were delivered this week so this weekend we are going to do nothing but enjoy our new space.
Whatever you’re up to this weekend, I hope you enjoy it. Have a great one Dinks!
Good morning Dinks. This past week one of my colleagues offered to buy me coffee during our break. Normally I enjoy accepting free Starbucks but there was something about the way he offered that really offended me. I asked him why he always has the need to pay for things when he’s around me, even if I offer to pay. I guessed it was one of three things, one: we haven’t known each other long enough for him to be comfortable accepting coffee from me, two: he doesn’t accept gifts from women or three: he feels I can’t afford to buy us both Starbucks.
Have a good time without spending a fortune
He told me that it’s two of the three: he always feels the need to pay because he earns more money and he always pays for women. I continued to tell him not to judge a book by its cover. Just because I don’t spend money on $2000 suits and talk about spending $1000 in a night at the 40 Club in New York City both of which he does doesn’t mean I don’t have money.
4 ways I save money on everyday awesome things:
Hotel deals. I think it’s absolutely crazy to overpay for a hotel room. If you spend some time searching online you can find four or five star hotel rooms for less than half the original cost on discount websites such as Priceline. As you know I’m a huge fan of booking hotels and flights via Priceline – not because they pay me to, but because I’ve been obsessed ever since I discovered it back in 2011. In March I’m looking to take a long weekend trip to Las Vegas and I found a five star hotel on the strip for only $109 a night.
Cheap transportation. I am all about being comfortable but sometimes I’m willing to give up my convenience if the discount is worth it. I can fly to NYC for $320 or I can take the bus for $140 roundtrip. Will I take an overnight bus to save $200 – you’re damn right I will. I mean who cares because I’m asleep anyways. Once you add up the cost to get to and from the airport as well as baggage fees flying can be expensive so I only do it where there is no other method of transportation available.
Entertainment. I would never spend $1000 drinking at a VIP nightclub. If you’re not famous and aren’t going to be hounded by fans why do you need the VIP experience. If you want to drink in a private room just buy a bottle of Vodka at the liquor store and stay in the comfort of your own home. I really don’t understand people who go clubbing and spend a fortune to be alone.
Your home. Back in the day I would buy a ton of furniture and decor for my home just so it would be full. Now that I’m older, wiser and appreciate money I spend on a few select quality items. I’ve learned there’s no need to fill your home with cheap stuff that will break in a year. If you have to rebuy your furniture it will probably end up costing more to replace the items than if you had just paid more money for a long lasting quality item the first time. You may not have a ton of furniture but at least you’ll have good quality home furnishings – and that’s more important.
About Kristina Tahnyak
