Saving Money Feels Good!

Our goals have changed so much (and so frequently) this year that I'm not going to do a 2010 goal recap post as so many people are right now.  Instead, we're just continuing to work towards our goals - and in January/February we should be able to really hash out exactly what we need for what goal - and make it happen in 2011!

I just deposited $500 into each of our top priority goals right now: Wedding Fund, House Fund and Emergency Fund! Our status bars while not at the 100% mark look pretty healthy - which is a pretty fabulous feeling!

Emergency Fund - Replenish Plan

The first step to replenishing our emergency fund went smoothly.  Jordan's two year secured credit card was released of it's 'security' at the end of November.  We transferred that $500 directly to ING and we're well on our way to having a stash of cash.

This need to rebuild our emergency fund quickly goes back to the peace of mind I wrote about in my doing it all post last week. 

I found out that I'll be getting a Profit Sharing/Christmas Bonus of $775 (less taxes).  That will be deposited on my December 10, 2010 pay - so we'll do a swift transfer of that money into the Efund as well.  That should bring us to about $1,000 by the end of the year.

In the new year, we'll add any tax refunds we get (which there will be some from RRSP contributions and Jordan's school expenses) as well as Jordan's beneficiary cheque (I'll explain more on that when it comes in).

I'm hoping that by...say April - we've got our $2,500.  It feels like a long time to wait for peace of mind - but it'll be worth it once we have it straightened out.

Changes to the Canada Pension Plan

I came accross an article in The Globe and Mail who published on October 28, 2010,  that discusses upcoming changes to the Canada Pension Plan (CPP). I hadn't heard of any changes, so I started digging.  Before I share what I've learned, for my non-Canadian readers, The Government of Canada established the CPP program in 1966.

It is an earnings related social insurance program that provides basic benefits when a contributor to the plan (someone who is employed in Canada) retires or becomes disabled. When contributors die, the Plan provides benefits to their survivors. A CPP retirement pension is a monthly benefit paid to people who have contributed to the Canada Pension Plan. The pension is designed to replace about 25% of a person's earnings from employment, up to a maximum amount.

Commencing in January 2011, Canadians are about to see some significant changes to the Canada Pension Plan (CPP).

CHANGES

The following changes to the CPP will be phased in gradually between 2011 and 2016, with the first major change occurring in January 2011 for people retiring after age 65:

• The monthly CPP retirement pension amount will increase by a higher percentage if taken after age 65
• The monthly CPP retirement pension amount will decrease by a larger percentage if taken before age 65
• A longer period of low earnings will be automatically dropped from the calculation of the CPP retirement pension
• Contributors will be able to receive their CPP retirement pension without any work interruption.
• If you are under 65 and you work while receiving your CPP retirement pension, you and your employer will have to continue making CPP contributions. (or if you work outside of Quebec while receiving a QPP retirement pension) These contributions will increase your CPP benefits.
• If you are between the ages of 65 and 70 and you work while receiving your CPP retirement pension, you can choose to continue making CPP contributions. (or if you work outside of Quebec while receiving a QPP retirement pension)These contributions will increase your CPP benefits.

The government website states that these changes will improve retirement flexibility for working individuals in Canada, enhance pension coverage, and improve equity in the CPP.

Have you heard of these changes?  What do you think of them?

I think it's fantastic that you can continue working past age 65 (up to age 70) and continue contributing to CPP (with your employer contributing at the same time). 

Monthly Spend Report

Here it is again, our monthly spend report.  I'm really enjoying the process of categorizing and tracking all of our spending via our master card.  It makes it easier then writing everything down every day (though we are trying that for any cash expenditures).

I am pretty pleased with the majority of these categories.  As you know, last month we recognized that we were spending a lot of money on Booze & Eating out - this last month we spent wayyyy less in these categories.  There's obviously still some work to do in the eating out category - but this is good work as far as I'm concerned.

The reimbursables this month include Christmas shopping for family and a $1,000 deposit to hold the new Escape.  This will be refunded in a couple of days when the Retire Your Ride approval comes through.

We're still low on grocery's, but as we eat out less this number will go up.

I bought a pile of new work clothes, but this was from birthday money and allowance money that I've been saving up - this was not against our joint expenses.

Education is high because I registered for my first CHRP exam!

Gifts is high (hello Christmas!) but we had savings for the majority of this spending and we're almost done our shopping.  Finally, you all know about our family emergency in November - we had some money stashed but not enough to pay for the whole trip up North.

For a bit more perspective on our spending, I wanted to show you this month to month image.  In 16 categories of spending, we spent less in 11 of them from October to November!

Since we had money saved up for Emergencies, gifts, education and clothes - this is fantastic! The banking was for when we ordered our credit reports online - wasn't sure what category to put that under.

Our Learnings:

• Need a larger emergency fund, STAT - at least $2,500 i think
• Need a bigger Christmas fund for next year
• Need to save for education expenses (I'll have a few more big ones for my CHRP) and Jordan will have textbook expenses next year
• EAT OUT LESS

Choosing Your Winter Tires

I don't know that I've ever written a post on choosing winter tires, but folks who live where the winters look like this...

...you need to make a good choice.

Now, I've always had winters and I rotate every change of season (winter-summer), it's also a good time to get your oil change and any other basic maintenance done.  In the long run this type of maintenance can save you big bucks.  We'll be losing the car for the Escape on Saturday, and so we need to address the tires right away.

Here are Jordan and my top considerations when choosing a good winter tire:

• Weather Appropriateness.
• When searching online or in a store you need to take care to LOOK at the tire - not just listen to the salesman trying to tell you what's best.  Look for The Snowflake (point one below is the snowflake).  This tells you that the tire has been rated for cold/snow/ice.
• Size of Tire 
• you can find the size requirements in your owners manual or the internet
• 195 is the width of the tire in millimeters. 
• 60 is the “aspect ratio.” It’s the percentage ratio of the height of the sidewall to the width.
• R means the tire has radial construction. 
• 15 represents the wheel diameter in inches. 

x

• Moisture Separation (directionality of wicking)
• This speaks to how efficiently moisture is wicked away from the tire allowing posting contact with rubber to road.  The better the tire is at wicking the moisture, the more tracking you will maintain.
• Siping is a process of cutting thin slits across a rubber surface to improve traction in wet or icy conditions. On roads covered with snow, ice, mud, and water, sipes usually increase traction.  The rubber tire has greater flexibility because of the slits.

This is how Jordan explained it to me.

Pick something up....go ahead....I'll wait.

Okay, So lets say you picked up a can - when your fingers compressed around the object the grooves/wrinkles that make up your finger print compressed/flexed around the object making it easier to grip.  Make Sense? Here's a fancy diagram to help:

• Texture of Rubber
• Softer rubber is better in the winter because it molds itself to the ice and snow, thus providing better traction (this also helps the Sipes mentioned above).
• Winter rated tires have a more flexible compound (are softer) which hander the lower tempatures better than an all season or summer tire does.  

So there you have it - they key elements (as Jordan and I see it) to selecting your tires.  

So, what tires are Jordan and I going to buy for the new 2011 Ford Escape?  We chose the Michelin-Latitude® X-Ice® Xi2. The base price of these at Costco is $200 installed.  What are we going to pay...$177 - installed.

Please know that you can negotiate tires like you negotiate for a new vehicle.  You don't have to pay the MSRP...we sure won't.

Negotiation Update

So the 2011 Ford Escape that we were meant to buy - was sold!  How frustrating!

Luckily, the found a very similar model that had all the same features we wanted plus a remote starter (which we wanted but had cut previously when looking at numbers).  Further to that, now that it's December instead of November there are different promotions going on.

We still have Jordan's Xplan pricing, but the extended term financing is $4,000 instead of $3,500 (which pays for the remote start).  We can also now get another $1,000 off for having a Costco membership.  All of that, combined with 1000 bonus Air Miles - makes me a happy camper.  We are losing out on the Winter Tire package - but Jordan can find those for a better deal anyway (and we won't have to finance them).

Networth Update

My detailed networth update can be found here, or you can follow the link from the badge below.



If you click on the link to check out my NetworthIQ profile, you'll see that this is the first time I've combined Jordan and my networth 100%. As we took the vehicle debt on jointly it only makes sense to add in our joint cash flow as well as joint retirement savings.  Some other details on how the networth is pictured include:

• I addded Jordan's retirement savings to my own - as the vehicle debt is ours jointly. The vehicle is also listed as an asset, it will depreciate as time goes on (and the loan is paid off). 
• Cash includes all planned spending savings accounts as well as emergency fund and wedding fund. 
• Our cash for a down payment on a house in the 'house' section of assets. 
• Actual value of my company shares is in 'shares' 
• Cash set aside to purchase shares is in 'other assets'