Creating Your Future Net Worth Statement

Having and updating your very own personal net worth statement is one of the most beneficial ways of viewing your current financial status and can be a deciding factor in decisions such as buying a house, car or taking time off work.

While I believe that it is crucial to create a monthly update of your personal net worth, I also think it is equally important  to make your future net worth statement as well.

Here is how it works. After you calculated your current net worth (hopefully it is positive!) Try to think out of the box and create a net worth statement sometime in the future. I usually create one a year from my current statement. Try to come up with realistic numbers of where you are expecting to be financially. The benefits of creating a future net worth statement are numerous and are as follows:

  1. A future net worth statement is highly motivational as it is almost in the same line as goal setting. The more realistic the goals are, the better the chance of you reaching them and accelerate your motivation!
  2. This statement can give you a much more clear picture of where you can expect to be down your road in life and can help you plan more precisely major buying decisions.
  3. Creating a future net worth statement is a great way to teach self control as you strive to achieve your own expectations. A future net worth statement set a year from now is a little easier to meet compared to budgets as you do not feel as “hand-cuffed” on a weekly basis. (Budgeting is still a great way to achieve your goals. Consider a future net worth statement a beginners tutorial in budgeting!)

There are many other advantages that can be branched off from the above mentioned 3 points but the main benefits are there. I am currently in the process of making my own future net worth statement and will be positing it by the end of the month.

Terrible Neglect on Dog in Ontario

As most in Canada already know, there has been a terrible case of neglect on a dog found in the backyard of a Durham, Ontario resident.

This link shows the state the dog is in. I must warn you that, the images are graphic and should not be viewed if you are sensitive to images of this nature.

According to reports from the OSPCA, the dog does not have any fleas which leads to the assumption that the dog was living in a home and was likely dumped off somewhere by vehicle.

Currently, there are no suspects in this case.

I am extremely against abuse on dogs or any other animal for that matter. It is a shame that animals do not have the same rights as humans do just for the fact they are deemed as inferior beings and have the disadvantage of not having a voice to speak up for themselves.

I am writing this blog post to create some more awareness on this case and many more similar ones on animals. I hope this person gets caught and gets convicted for such crimes. News such as this makes me feel a variety of emotions: sadness, anger, discouragement and despair. However, motivation to end crimes like these rises above all else and I feel that voicing my opinion is the right thing to do.

Thank you for listening to my rant.

Upgrade Skills?

During the last few weeks, I have been debating if I should upgrade my skills at my current position at work by taking some extra classes during the evenings with the possibility of gaining a certificate in my field. Currently, I am having a hard time figuring out  if the extra money invested in education will be worth it in the long run in terms of my overall financial health.

The position I am currently in doesn’t have the most room for growth available without furthering my eductation as the industry I work for is very specific. I currently enjoy the field I work in but it will not be something I would want to do until retiremement. This has nothing to do with the job I am currently working for as it is more myself and the need to be free from work eventually. Since I am expecting higher pay by upgrading my skills, I am hoping this will result in more money saved and a faster road to financial freedom.

After viewing all of my options, I have broken them down to the following:

Option 1: Upgrade my Skills by furthering my eductation

This requires the most money from the 3 choices but can prove to be the most beneficial in the long run. I can realistically expect at least a slight increase in pay and more opportunities of getting a better job in the future if all doesn’t go well at my current employer.

Option 2: Look for a higher paying job

I tend to find this a little risky since the job I am currently in has been tolerable for the most part compared to jobs I had in the past. However, there is always something better out there and I might find some luck if I look hard enough.

Option 3: Wait it out

I work for a pretty big company so there is bound to be some form of opportunity in the future. I just feel that I have more potential in terms of responsibilities and income and feel the need to act now in investing in my career by upgrading my skills.

With classes starting in September, I have some serious thinking to do in order to come to the conclusion that I feel comfortable with and feel that will truly help me financially. Here’s hoping that I make that right choice!

Life Expectancy and Our Retirement

A big issue that is gaining a great deal of attention is the life expectancy of an average human being and how it has been slowly increasing in today’s age. With modern health practices, medicine and the latest in technological developments, the average adult life leading towards the ripe old age of 100 is becoming quite possible.

While this is great news, it can be quite worrisome when you throw retirement into the mix. 65 is the age most people aim to retire and many more are planning to retire at 60 and earlier. I for one am aiming to retire somewhere in my early 50’s and hopefully even leave the workforce much sooner if I can get a viable business up and running whatever it may be. One thing I am cautious about is the possibility of living 40+ years without an income from a job. It seems that us future retirees will have to be more strategic in the coming years!

If you, like me, are interested in receiving a calculated estimate on how long you will be alive, I would suggest you visit the Living to 100 life expectancy calculator. The questionnaire takes roughly 10 minutes to complete and it is free.

As our life expectancy continues to increase, I do not want to spend more of my time in the workforce then I have to. I value my time and I am looking forward to becoming financially independent while still being relatively young. I believe that sound investing at an early age is a great way to be prepared for life after work as well as being content with what you already have. Also, take advantage of employee matching to your retirement fund while you are employed as this is free money. Free money is always a good thing! If you consider your self in being far from financially savvy, I would suggest an investment in index funds. Index funds are a low cost alternative in investing and almost always out preform mutual funds. A great article from Financial Self Starter on index funds and can be found here.

While it is a smart idea to prepare living for the long haul and have as much saved as possible to enjoy your life, try not to stress too much about it. Besides, stress decreases our lifespan!

Remaining Debt

After I paid off the remaining balance on my car loan a few weeks ago, I enjoyed the luxury of a greatly reduced debt load and am highly motivated and focused on paying the remaining balance on my line of credit from a major bank and my MasterCard.

I created a chart below detailing the remaining debt that I have to pay off. Luckily, I only have two forms of debt remaining with one of them being a really low balance. I am aiming to be completely debt free in the next 3 months if possible.

 

Debt

As you can see, I owe just a little over $2,000 and I will be using the following method in eliminating the remaining debt:

  • Entirely pay off the remaining balance on my MasterCard and put about $100 towards the balance on my line of credit.
  • Once the credit card debt is eliminated, I will put all free money used to pay off the MasterCard on a monthly basis onto my line of credit.
  • Stop adding money to my high interest savings account (usually around $150/monthy) and add this amount to repaying my line of credit
  • All money remaining from my bi-weekly budget will go to debt repayment. This varies all the time depending on what part of the month I am as I tend to  pay more in expenses early in the month and barely any during the second half.

Once I receive some extra money from my budget or by any other means, I usually transfer the funds from my chequing account to my line of credit on-line. This eliminates any hassle of travelling to pay off debt and tackles the problem as quickly as possible.

If all goes according to plan, I should be debt free by the end of November! Excited is something that barely describes what I am feeling.  It is extremely hard to mimic the feeling you receive of being debt free. I know it has been a long road for me and I must say I am enjoying the journey but am much looking forward to the benefits of reduced stress financially by seeing a big fat 0 on my debt column.

However, with my wedding less than 14 months away and the pursuit of home ownership hopefully not in the too distant future, staying out of debt will be tough. Having a mortgage is debt I am willing to take on but  my fiance and I are trying extremely hard to pay for the wedding in cash rather than credit. Getting into debt for one night (even though its a great one!) is not something we are willing to do.

For the time being, I am going to focus on what I can control, and that is eliminating the last remnants of my debt.

10 Ways to a Fulfilling Life

Life can take us in many directions and for the most part, we have the choice of where we want our lives to be headed. Some people take the right choice and some do not. Sometimes, life gives us choices which are not as black and white. These grey choices are more geared towards our personal preferences and are unique to each and every one of us.

Aside from my regular goals, I have composed a list for myself expressing my 10 ways to a more fulfilling life. I tried to make this list as generic as possible so it can be used by others but a few of the points are unique to me. Every one of us on Earth is unique in some way, shape or form and no 2 lists should look exactly the same. I decided to post my 10 points on my blog so others can view and hopefully, inspire people to make there own unique list.

10 Ways to a Fulfilling Life

1.       Think Positive: I try to think positive as much as I can. Whenever a problem comes up in my life, I feel that it is important to embrace the challenge and not say such things as: “Why did this happen to me?” Or “I can’t handle a problem like this in my life.” Being positive through your mind and words helps keep you at ease and deal with the situation head on.

2.       Live a Healthy/ Active Lifestyle: Being active not only keeps you looking and feeling great. It also helps you stay young and is linked to happiness. Enjoy playing your favourite sports; be active with your friends, kids and loved ones. If others are not willing to join you, why not join a recreational sports league or go it alone with a nice run!

3.       Keep Your Free Time Free: Free time should be for things that you enjoy. Personally, I love reading a good book or playing a video game as it helps me escape the daily stress of life. I like the feeling of getting into a story and feel like I am in a different world altogether. The important thing to remember is that free time should never involve work.

4.       Appreciate What You Have:  Having the most expensive clothes or car is not really important in the long run. If these things really are important to you, make sure you save for them and pay in cash. The amount of time needed to save will eliminate impulse buying and who knows; maybe once you have enough to purchase one of these items you may realise you would rather do something else with the money. I try to appreciate what I already have while planning for future purchases. When I have the itch to purchase a new car for example, the first thing I do is take my car to a car wash and clean it inside and out. This decreases the itch and makes me feel proud of the car I already have.

5.       Have Goals: Goals are really important and I extremely recommend that everyone have a list of there own to follow and aim to achieve. Achieving your goals is one of the most fulfilling things imaginable. Make sure you take your time and really pick goals that are meaningful to you.

6.       Always Learn Something New: I find this to be somewhat fun as it helps me grow as an individual and it keeps my mind active and alert which is known to fight off mental illnesses. Pick a topic that interests you and try to learn something about it everyday if possible. Another popular method is trying to learn a new word in the dictionary everyday.

7.       Follow Your Strengths: The hard part is to discover what your strength is in life. Most people give up at this stage but I try everyday to bring out the strengths in myself. Once discovered, try your best to embrace it and use it to your advantage. You could even use your personal gifts to make a business somehow and that is something extremely fulfilling!

8.       Give to Others in Need:  Nothing feels as good as helping others who really need it. This can be done by donating to various charities or helping out a close friend or family member. Sure, personal gain is important but helping others along the way gives you a feeling that is hard to duplicate in any other way. I would suggest trying this out even if the gift or donation is small.

9.       Live less like an adult: Being an adult sure has its advantages, such as being able to drive, making your own decisions, and being fully independent. Adults also tend to live rather unhappy and unfulfilling lifestyles. Sometimes, I try to live less like an adult and still like to dream as if I was a kid. Children see the world as something beautiful and worthy of exploring while adults see the world as a cruel, harsh place. The child has the better view of Earth in my opinion.

10.   Enjoy Your Life:  The ability to enjoy our life seems difficult with so many obstacles. Things in our lives such as work, bills and the cost of living tend to eat up all of our thoughts and free time. This should never be the case. Life goes by really fast and we must make the most of it. Many years from now, I want to personally look back at my life with happiness and with minimal regrets. I plan to do as much enjoyable activities while I can and for as long as I can!

I hope you enjoyed this list and were somewhat inspired to make one of your own. If that is the case, please share with me!

Saving for a House

Ever since the beginning of 2009, My fiance and I have been aggressively saving money in a joint savings account in hopes of having enough for a down payment for spring/summer 2010.

Initially, we started with a small amount of $240 each bi-weekly on the Friday we got paid. After a few deposits with this amount, we realized that we needed to pick it up if we were ever going to reach our goal of $40,000 in such a short amount of time. Slowly we increased our  amounts as we started to deposit $260 bi-weekly and then $300.

Fast forward all the way to the present and we decided to start depositing $400 each bi-weekly! On an average month, we are saving a combined total of $1,600 which we are extremely proud about.

We do not have automatic withdrawals from our chequing accounts into our savings account. We really enjoy the whole process of depositing the money ourselves either by direct transfers or through an ATM machine as it motivates and encourages us to save even more. Motivation is key as it is easy to get discouraged from saving since a down payment for a house is usually one of the largest sums of money you will have to come up with in your lifetime.

Currently, we have a combined total of just over $8,000 in our joint savings account but believe that this will increase more rapidly due to our larger deposit amounts. However, we do not know how much more we can increase our payments since we are reaching our limit of disposable income. To reach our goal, we will be required to save an additional $900 a month!!  This will not be, in any way, an easy task but hopefully my fiance and I can come through and figure out a way.

What are some of the ways you save money to reach a financial goal?

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