| Newsletter Issue #3 | October 2006 |
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Ontario Association of Credit Couselling Services Accredited Member |
Visit us at creditcanada.com
Hello Subscriber,
It’s finally here! The long-awaited third issue of our newsletter is finished and ready for your reading and money-saving enjoyment. We would like to thank you for registering to receive our newsletter. Credit Canada has undergone some significant changes over the last few months, and the newsletter is a great way for you to keep up-to-date with any changes we make to our services and organization. Furthermore, in every issue of our newsletter we strive to give you some quick and creative tips on how to trim your budget.
We have also added a new section to our newsletter called Ask Elena, Your Money Manager where one of our counsellors (Elena, hence the title of the column) will answer a money management/budget question sent in by one of our subscribers. If you happen to have a money management question you would like Elena to answer for you, please send it to newsletter@creditcanada.com, and she may answer it for you in our next issue.
Enjoy, and have a safe and happy Halloween!
Not to worry, this makeover didn’t involve any scalpels or anesthesia; just a bit of creativity and some sound advice courtesy of our Executive team. As you may already know, Credit Counselling Services of Toronto has been around for more than 40 years, and we thought that it was well overdue for a ‘new look’. Not that it hasn’t been revamped every so often, but we thought it was time for the Credit Counselling logo and brand to get a complete overhaul.
As for the logo, well it’s new, it’s fresh, it has that Canadian flare, and it looks at least ten years younger. But alas, no words could possibly do it justice. You’ll just have to take a peek yourself.
Before After
CREDIT CANADA Debt is Manageable
The leaves are at their brightest, the days are getting shorter, and soon the air will be overwhelmed by the smell of burning candles in pumpkins. Yes, it is almost Halloween and when you take into consideration costumes, decorations, and enough candy for all the neighbourhood children we can understand why some people don't anticipate the spooky festivities with too much enthusiasm. Getting prepared for Halloween can put quite the dent in your wallet if your not careful, but fear not! Here are some options you have that will keep your spending in line while not compromising the fun and fear that Halloween brings.
Make Your Own Costume
Most likely, everything you need for your own or your kids' costumes can be found in your very home. All you need is some time and creativity. The key is to think of costumes that don't require too many expensive props. For example, being a vampire isn't too expensive; just a pair of fangs for no more than $5, black clothing, and some purple eye make-up to give you that 'I've been dead for a couple of centuries' look. Ninjas are also a good idea because all you really need is a sword you can purchase for under $2, and the rest of the costume can be completed with clothing from your closet. And if you can't find anything in your house, the smart place to go costume hunting is at second-hand clothing stores. The point is to avoid costumes that commit you to purchasing them at the regular Halloween stores, which charge upwards of $25. Other great Halloween costume ideas are princesses (dress used for a wedding), beauty queens, scarecrows, mad doctors/scientists, zombies, someone from the 50's 60's 70's or the 80's, rock stars, devils (headband with devil horns), and your general ghost.
Buy Pumpkins Directly from Local Farmers
It just seems silly to spend approximately $5 on something that is just going to end up in the garbage within a couple of days. But it just wouldn't be Halloween without a pumpkin, so an option that you could take is to go to a local farmer and pick out your pumpkin yourself from a pumpkin patch. Luckily, Ontario has many farms that are no more than forty minutes away from major cities. Not only will this save you almost half the regular price, but this is a great Halloween outing for you and your kids. What better way for your kids to get in the Halloween spirit than for them to pick out their very pumpkins from a genuine pumpkin patch!
Create Your Own Decorations
Staying in the Halloween spirit also entails giving your home a spooky makeover. So instead of buying expensive decorations should you just not clean for a couple of weeks, that way soon enough your place will look like a legitimate abandoned home, complete with cobwebs and dust? Of course not! If you have children you could have them make Halloween crafts for you to display around your home. The falling leaves are also fantastic for making festive decorations. You could also find really great and inexpensive decorations at your local dollar store. In total, decorations shouldn't cost you more than $10.
Purchase Halloween Treats in Bulk
One way you can avoid spending anywhere from $20 - $40 on Halloween candy is by going to purchase them in bulk with a couple of other adults at a wholesaler. In doing so, you and the other adults can reap the rewards of buying in large quantities, which significantly cuts down the costs. You could also buy from the bulk store which could save you a couple of bucks rather than buying from a regular retail chain.
We hope these tips will help you make the most of your budget this Halloween!
Laurie Campbell, Credit Canada’s Program Manager and spokesperson for the last fifteen years, was appointed as the new Executive Director for Credit Canada on July 1st, 2006. Throughout her first fifteen years with the agency she developed a well-earned reputation as a strong advocate for people facing credit problems. Campbell was the President of the Credit Association of Greater Toronto and is recognized as an expert in her field. She has been interviewed for several prominent books on finance and has reviewed financial literature for organizations such as MasterCard Canada, Visa Canada, the Investment Funds Institute and the Investor Education Fund. Campbell serves on the Board of the Ontario Association of Credit Counselling Services and is a committee member of the Credit Counselling Canada Public Awareness Committee.
Today Credit Canada faces new challenges, along with a new competitive market and diverse clients. “Our agency will continue its leadership role in Toronto and build on our emerging national focus under our Credit Canada brand,” says Campbell. “The industry is facing competition from large American companies that I don’t believe have the interests of consumers and lenders at heart. Recent investigations into the not-for-profit status of many of these operators in the United States simply underscore the need for concern.” Regardless of these obstacles we are also in a time of excitement and change. Armed with a new brand and logo, and an innovative Executive Director that refuses to back down, Credit Canada is up for the challenge.
Account Representatives Sacrifice their Weekends…for You!
You don’t come across too many organizations where employees are willing to work over the weekend just to better serve their clients. But here at Credit Canada, our account representatives have done just that. Credit Canada has extended its hours in order to better accommodate the hectic schedules of our clients. Currently, our account representatives are now available from 8:00am – 8:00pm Mondays to Fridays, and 8:30am – 4:30 pm on Saturdays. What this means is that credit counsellors are now available to clients an extra 28 hours per week; that’s a total of approximately 1,456 extra hours a year!
Credit Canada has been dedicated to serving the community for over 40 years, and as such, it has developed a sincere concern for the financial stability of its clients. It helps its clients by providing credit education, counselling on budgeting and wise use of credit, and planned debt liquidation programs. Our service reach extends across Canada, and involves the operation of 12 branch offices in the Greater Toronto Area, a new network-enabled administration, and a new in-house Call Centre. Because we understand the importance of the services we provide our clients, top management felt that it was necessary to make the agency more accessible to the community. So, it was decided that our availability was going to be extended to include weekday evenings and Saturdays.
It’s important to us that our clients are able to reach their counsellors whenever they need to. It is also crucial that clients foster a relationship with their counsellors where honesty and communication is constantly reinforced. We know how difficult it is for some clients to get in touch with counsellors due to their time-crunched schedules; paying back loans is especially tough while juggling a job, a family, and the cost of living. Therefore, we know that our clients may not always be able to reach us during our regular hours throughout the work week. Our ability to sufficiently serve our clients is the backbone of Credit Canada, and this can never be over stated or said too often.
Dear Elena,
I have a daughter who is in her mid teens and has a part-time job. She is earning enough to pay for her own expenditures, but I’m worried that her spending habits are a bit out of control. How do I get my daughter to understand the value of money?
Sincerely,
Concerned Mother
This is a problem many parents face when their kids grow up and become independent consumers. You should try showing her with some real life examples the consequences her spending has on her future spending, which is the main reason why she should start saving. For example, you may want to make her aware that the $3 smoothie or café late she is buying everyday is costing her approximately $150 year. It’s also important that you provide your daughter with some tips on how she can stretch out her dollar for maximum value:
1. She can consider trading in her old video games and buy used video games, CDs, or DVDs.
2. If she is thinking of getting the latest techno toy, she can buy last year’s model which most likely will have the same features but will cost less.
3. You can suggest that she consider comparison shopping at shopping sites such as froogle.com, shopping.com and become.com.
4. If she is into magazines she can read the latest issue at your local library. She can also borrow CDs, DVD and books too.
If she changes some of her daily expenditures she will be likely to save for bigger ticket items that she is always saying she is never going to be able to get. That’s what saving is all about – future spending!
The word itself may make you cringe, want to run to the hills, or stop reading this article, but don’t! Why? Because budgeting has gotten a bad rap over the years, which is really undeserved. It’s not as bad as you may think it is, and the great thing about it is that once you’ve got the hang of it, peace of mind is sure to follow, possibly a vacation, and if you get really good at it you can end up having lavish retirement. Sounds good, right? But you are probably wondering what it’s going to cost you. Well, that all depends on what your goals are. But for those of you who are still not convinced that budgeting is something you should be considering, the following is a checklist. If you can honestly answer yes to any if the following, guess what? You should be budgeting!
1. You think your checkbook register is a good place to play checkers.
2. You don’t know what a checkbook register is.
3. The clutter of bills on your desktop requires an archaeological expedition.
4. The salespeople at your favorite shoe store know you by your first name, your shoe size, your work schedule, and have you on speed dial.
5. Thinking about how you are going to achieve your dreams makes you want to take a nap.
6. The sound of a cash register opening makes you smile.
7. You say a little prayer every time a sales clerk swipes your credit cards.
8. You can make a cocktail dress out of the credit cards you have; but sadly, you can’t actually buy a cocktail dress.
9. You have convinced yourself that having your car repossessed was actually a good thing – riding your bike to work will help you stay fit.
10. Every time you go grocery shopping you come back home with new clothes, electronics, and/or make-up, but mysteriously, no groceries.
The main reason why most people would prefer not to even consider being on a budget is that they automatically assume that their quality of life will significantly decrease. Okay, let’s be honest here. Yes, you are definitely going to have to cut down on expenses, but it really is all about perspective. Would you rather have that five dollar coffee everyday and a closet full of clothes that you probably won’t be wearing within a few months, or have that vacation within a year? Dream wedding that has an expiration date of about eight hours, or a down payment for a house that will become a home to you and your future family? Or an even more realistic example would be dining out or putting that money towards paying your phone bill. You have to remember that every dollar that you spend has direct consequences in other areas of your life. And in this North American culture that we live in, where self-fulfillment equals consumption and instant gratification is becoming the social mantra, well it’s just getting more and more difficult to understand the consequences to your spending habits.
So, let’s talk about some positive action you can take right now.
1. Track what you are spending your money on
Keep your receipts for the last three to six months and review them, including even the small purchases you make on a regular basis, such as a cup of coffee and any withdrawals that you made at your bank before going out on the weekend. Once you’ve gone through them you should ask yourself what dollars actually went towards satisfying a need, and what dollars satisfied a want. You may discover that some dollars didn’t satisfy either! This will help you identify any unnecessary spending that you can avoid, as well as the stores and locations where you can’t resist but spending your hard-earned cash. These are your weakness stores, and so you must avoid them! And don’t fool yourself; you can’t go in there “just to take a look”. Save yourself the trouble and the cash.
2. Create a budget
A budget is a plan on how exactly you are going to be spending every dollar that you earn. And yes, you must do one, there’s no way around it. Why is this so important? Because as Dave Ramsey said, author of “The Total Money Makeover”, managed money works harder. But remember that budgets are plans, and plans change quite frequently. So right before every month begins, plan out on paper exactly how every dollar is going to work for you.
3. Everything’s negotiable
One rule of thumb is to never pay retail because more than likely you can usually talk the price down. This also means that you should shop around for better auto insurance rates, mortgage plans, credit-card interest rates, and phone companies. You can do this by calling your credit-card companies and/or your phone company and tell them that you are thinking about moving your money to another company that offers lower rates, better packages, more benefits, etc. The secret is that most customer representatives have the authority to significantly lower your interest rate or offer you better deals. This is because your business is literally worth thousands to them. Remember the first rule about negotiation: never accept the first offer.
4. Purchase store brands
Clark Howard, co-author of “Clark’s Big Book of Bargains” has stated that store brands usually cost about 40% less. This is because there is no middle-merchant who the store must purchase the products from, so quality isn’t compromised. Every time you go to the grocery store, you should try purchasing one more store brand product.
5. Used over new
This little tip comes especially in handy when you are purchasing a car. You will be able to buy a good, high-quality car for practically half its original price after two years of depreciation. The trick to buying used is to focus on high-quality merchandise. You should also think about buying used when it comes to books, furniture, music, and anything else where the hygienic risk you take isn’t too high. The flipside to this rule is to sell everything! Garage sales are a surprisingly lucrative venture, especially when you are getting money for something that was going to end up in the trash or goodwill anyway. And do not fret. No garage, no problem. If you live in an apartment complex you can organize a community yard sale, that way your neighbors could earn some extra pocket change as well.
6. Use cash over plastic
Simply because it hurts more when you pay in cash, so you avoid spending it as much as possible. Recent studies have revealed that people usually spend about 20% more when they use plastic to purchase merchandise because there is less emotional pain. A new phenomenon that is emerging is that young adults who have grown up in this plastic economy do not even really consider the amount that they spend using bank cards and credit cards as real money. So try not to use plastic as much as possible, and you may even see a 20% increase in income.
7. Before paying anyone else, pay yourself
With every paycheck you earn, automatically transfer part of it to a retirement account and another part to a short-term emergencies fund. David Bach, author of “The Automatic Millionaire” suggests saving one hour a day of your income each week for the retirement account, and a salary contribution equal to thirty minutes a day is a good amount to put towards a short-term emergencies fund. By the end of a year, you will be quite surprised what this can amount to.
8. Save on phone expenses
Having a cell phone is convenient, but do you really need it? Avoid having one for as long as you possibly can. But if you must have one then the most economic choice is a prepaid plan, and try not to agree to contracts that lock you and your wallet in for years.
9. If you must have a credit card, choose wisely
Make sure that your credit card gives you something in return. Try and find a no-fee card with a rewards program, such as 5% rebates on all gas purchases. This helps you save without necessarily changing your buying behaviour. But beware: do not be a slave to the rewards program because it could get you into some serious financial trouble. Furthermore, the downside to these kinds of credit cards is that the chances of you negotiating a lower interest rate are slim to none. But hey, it doesn’t hurt to try.
10. Willpower
This is probably the most harsh yet most rewarding tip of all. You must exercise restraint when it comes to spending. What this means is that instead of buying fast food, eat at home. Bring your morning coffee and lunch to work. Want to spend less money on gas? Stay home or carpool. You must try to spend less than what you earn, but that doesn’t mean that your quality of life has to decrease as well. One suggestion is that while your in you money-saving mode (and hopefully you will be for a while), try to avoid television, magazines and major media sources because they have the tendency to fool you into thinking that you need to make unnecessary purchases to be a fulfilled human being. If you are really serious about saving, you should even consider cutting out the cable completely. Not only does this equal more money but also more time. Once you start avoiding those things you will have more time to spend with your family, friends, going outside, exercising, and doing things that really make you happy…just not shopping!
Most importantly, remember that Credit Canada is always here to help turn your financial woes into financial ways. Credit counsellors want to help you start living again, without that debt weighing on your mind. It’s not healthy!
They say the best things in life are free…well, they might just be right. Credit Canada isn’t promising anything, but the following websites below are some sources for getting freebies; and who doesn’t like a freebie? So take a gander, because you never know!
www.favorville.com – This website is a community of people, segmented into different areas, who offer and request different services and goods. When you join this site, you can specify the area where you live so that you are dealing with local people only. Merchandise and/or services are free or are offered at a very minimal cost.
http://www.redflagdeals.com/ – RedFlagDeals.com is Canada's largest bargain shopping community. This site searches online stores and store flyers for the best prices, free stuff, and Canadian coupons. It doesn’t matter where you are shopping in Canada, you will find the best prices and coupons when shopping for everything from laptop deals and cell phone deals to apparel deals and restaurant coupons.
**Currently, if you are one of the first 500 people to visit a participating Home Depot, Home Hardware, Wal-Mart, or Costco on their scheduled date you will receive a
http://www.freecycle.org/ – The Freecycle Network™ is made up of many individual groups across the globe. It's a nonprofit movement of people who are giving (& getting) stuff for free in their own towns. Membership is free. To sign up, find your community by clicking on your respective region, then go directly to your local group by clicking on "Go To" or you may immediately joining by clicking on "Join." It will generate an automatic e-mail which, when sent, will sign you up for the local group and send you a response with instructions on how it works.
http://www.save.ca/ – This is a sight that offers Canadians many different coupons for consumer packaged goods, depending on the province you live in.
http://www.canadafreebies.ca/ – By visiting this website you will be given a list of numerous other sites that are offering freebies, holding contests, or giving away merchandise in exchange for your information. Merchandise you could receive varies from books, to jewelry, to flowers, toys, baby products, and much more.
http://www.greatcanadianrebates.ca/ – This website allows you to earn significant rebates if you shop online as a registered member of this organization. Registering is free, quick, and easy and all you need is an email address. This organization earns commission for every purchase made via Great Canadian Rebates, which allows it to pass the savings back to you in the form of a Cash Back Rebate. The rebates are paid every two months by cheque or can be directly deposited into a PayPal account.
Thinking about starting your Christmas shopping? Well, if children’s toys are on Santa’s list this year a great place to do some shopping is at Samko and Miko toy stores. Credit Canada is planning a fundraiser from December 6th – December 17th 2006 in association with this retailer. If you would like to participate, all you have to do is go shopping at any Samko and/or Miko toy store location between December 6th and December 17th 2006, and when you go to pay for your merchandise tell the cashier that you are taking part in the Credit Canada fundraiser, and she/he will stamp your receipt(s). Then just mail your receipts to:
Attention: Elena Jara
M2N 5W9
