Why all the media coverage?  Everyone keeps hoping someone will cave in and they will get a new deal despite two years of negotiations between these governments.  If you can’t sort out the major points like targets and funding in two years what makes you think you can get it done in days?  The reality is everyone is ignoring the elephant in the room: Kyoto failed.  With out China, India or the US it never stood a chance of making real difference to world for CO2 levels.

Which leaves us to an interesting conclusion.  We can’t prevent climate change, that ship has sailed and we have missed the boat.   So if you accept for a moment that we can’t prevent some of the effects, you can get over this obsession from people on needing an international deal.  The reality is we can do this the old fashion way: via trade.  What we need is for the US, Canada, Europe to pass their own CO2 reduction regulation and jack up tariffs on any high CO2 imports.  Then if they also tie their technology and development adaptation aid to the country receiving the aid having a regulations in place you will seem most places fall into line.  A deal without all the current drama.

The draw back between this method instead of an international deal will be trying to link up any cap and trade systems.  Yet the reality is finance people will sort that out.  Perhaps each country will have it’s own CO2 currency complete with exchange rates to other systems.  If China has a poor verification system perhaps 1 tonne of CO2 reduction there is only worth 0.25 tonnes in a US system.  In the end things will work out, but just too late to do any real prevention.

So that’s my thoughts on this whole mess as it goes into its last day.  What did you think would happen at Copenhagen?  Were you hoping for a deal?

Or I would remember the papers when I couldn’t possibly get to them or when the dental office was closed and I still needed a signature on them.   This tends to happen to me once in a while.  I develop a block about dealing with something that will go on for months.

So where else can you forget about money? Well in my case here is some places I’ve done it:

• Not filing health or dental benefit forms.
• Not doing paperwork at the bank to reduce fees.
• Not investigate renewing my mortgage earlier (I could have done it three months earlier and saved some interest).
• Not contacting my bank to update my investor profile and have money sitting in cash for too long.
• Not contacting my service provider to reduce my service package when I no longer need something (last time it was removing something from my cable package).
• Not selling items in my house online that I no longer need.  I have a least $100 of stuff to sell right now.
• Forgetting to use a gift card or coupon.  I have a Home Depot one sitting on my night stand right now.
• Not moving money to my high interest saving account from chequing for months.

Each item is usually rather small but when you add it all up it can be a lot of money that is slipping through your hands every day.  So how do you deal with it?  To be honest I’m not sure.  It usually works out in the end for me, it just takes a while to get there.   How have you tried to remember forgotten money?

Just about anything little change at this point will comfortably shove me over that edge.  So if either my wife takes another kid in the daycare or we cut back a bit on the accelerated debt repayment and reduce my mortgage payment would do the trick.

I rather liked my wife’s reaction to this news, she said “No, you can’t quit your day job.”

To which I replied “No, I wasn’t even thinking about that.”  Actually I was more still in shock of the result than anything when I said that.   To suddenly realize  I’m right on the edge of not needing my day job is liberating in the extreme.  It’s not true financial independence where you don’t need any job at all, but it a huge step up from the typically wage slave existence that we typically spend most of your life in.

So this allows me a particularly useful gift.  I can view my day job very differently.  I’m no longer tied to my career.  I need a job, not this job anymore.  I’m no longer there to put food on the table and keep a roof over my head.  I’m there because I choose to.

I’m there because I want to fund my complete financial independence from any job.  Threats of a layoff or being fired are now not even threats but rather opportunities to do something new.  Semi-retired just went from a idea to a valid choice.  I’m not sure of the complete implications of this yet, but it does give me another avenue for thought.

My favourite memory from when I was young (probably 10 or 12 years old) was sitting around the kitchen table by the roaring fire-place playing a board game (The Farming Game) and listening to a play on the stereo (Letters From Wingfield Farm) with my family - eating snacks and just relaxing, having a quiet day at home with nothing to do.  I couldn’t tell you what I got for Christmas for presents that year, in fact I can’t remember what I got last year either, but I can remember that afternoon (and many like it) from almost 20 years ago.

I think about how easy that afternoon was to organize (no organization at all) those afternoons and contrast that to the people I see roaring around the mall with three to five page lists of presents to buy for friends and family and wonder how much enjoyment these people are going to get from spending all the money they are going to spend.  Everyone has seen the VISA television commercials where people’s credit card bills magically disappear - what the credit card companies won’t show are the people paying for Christmas until next spring because they decided someone needed a special “thing” that was not affordable to them at all.

It seems that the holidays have become much more commercialized in the past 10 or so years, with the introduction of such things as super-expensive video game systems and fancy electronic toys.  “When I was younger there was no such thing as fancy electronics” (In the words of an old curmudgeon) - I didn’t own a video game system until I was 13 or 14 (which I bought for myself) and at most got a few toys that probably cost around $10-$15 each.  Fast forward to today when even cheap toys cost around $30 and I can understand why people go broke over the holidays.

I recently had a discussion with my wife and was talking to her about the cost of toys and how many toys we were giving to kids and how they wouldn’t even realize that we bought them this awesome “thing” because they are getting 20 awesome “things” to go along with it.  Remembering my favourite Christmases, it definitely wasn’t the forgotten toys that made it special - it was family, food, and laughter.  If more time was spent thinking about that then running around to malls, maybe people would be a little less stressed (and broke) at the end of the season - putting a little less emphasis on presents and a little more on visiting and fun.

Do you have any special memories/ideas for Christmas fun?  Can you remember any awesome toys you got when you were younger(maybe jog my memory)?

I don’t actually regret much related to money but there are a few items that come to mind.  So here is my list of money related regrets that crossed my mind last night:

• I wish I would taken on a job not for the pay years ago.  I’m so enjoying my second job as a Trustee that I wish I would had the idea earlier.  I’ve taken jobs where money wasn’t that important, for example, I took a $20,000/year pay cut to move back to Regina.  Yet in all those jobs the money was still partly a factor.  The Trustee job was the first one where money didn’t matter at all.
• I wish I would have been braver to start my own business.  I had ideas over the years but generally fear kept those ideas in check.  I think it was lack of any supports to travel down that path earlier in life that kept me back (beyond the fear).  I really only learned about a small business once my wife went to open a daycare and now realize it isn’t that hard (not to say it is easy, but it is not impossible either).
• I wish I would have realized earlier that happiness is just as important as money.  I think perhaps I wasted a lot of time doing many ‘what if’ analysis on too many things before I realized that in the end the numbers are only part of the answer.  It’s ok to do something that isn’t the most logical as long as you know that.  Being happy is important even if you have to work a couple of years longer.

So what have you regretted related to your money?  If you feel like sharing leave a comment.

I just assumed for a while that most people didn’t argue about money, that is until I started discussing the issue with others.  I’ve been surprised by how most people I’ve talked to about this recall having some arguments over money.  Then I did some searches on Google and realized that arguing over money seems to show up on a lot of top five and top ten argument lists.

So what the hell makes a marriage functional about money?  Well here’s what I’ve noticed seems to work in my marriage.

1. Address Imbalances.  The reality is your income situation will likely be off balance.  One of you will make more than the other.  In my case I take home now about ten time more than my wife.  Yet I don’t believe for a second that entitles me to anything other than half of the decision making power.  Just because I make more doesn’t entitle me to more of a say since money is only one input into a relationship.
2. Play to Your Strengths.  I’m a long term thinker, so planning for an early retirement comes natural to me.  My wife on the other hand does not do long term well, but she is the short term expert.  She has all the birthdays on the calender and makes sure we start talking about next years vacation in order to book things.  She reminders me about swimming lessons for the boys and a visit with friends.  So I don’t try to do what she does well and she inputs ideas on early retirement but let’s me do all the math.  We respect what the other one is good at and let them take the lead on some things.
3. Address Emotional Issues.  Money isn’t just money.  It’s also got memories, hopes and fears attached to it.  You have to recognize that fact with your spouse and deal with these irrational moments that come up.  Also you need to address both of your dreams with money over the long term.  You might want a new car and your spouse may want a new trip, but you need to plan for both.
4. Set Common Priorities.  You have to have a common set of priorities to really excel together.  I know, for example, we both value our kids more than my account balances.  Should an emergency come up I won’t even pause to drain every savings account and max out my line of credit.  I’ve already did it once when our first was born ten weeks premature.  So we don’t ever argue about the big items in life.  We know what the answer will be.

Well that is what seems to work for my marriage, what works in your relationship?

It’s like putting the money in little jars and being scared to borrow from another jar when we are short in another.  The reality is there is no difference about a $1 in a chequing account and a $1 in a savings account.  We assign that difference as to our intention on what we are going to do with that money.  So for me chequing is the holding account for our usual spending money while savings are for longer term items.  The money is the same, but the intent is different.

This particular effect even extents beyond our different accounts types.  This is the reason why when you win some money or get find a $20 on the street it’s hard to put it in savings.  We tend to think of it as ‘found money’ that we were not expecting anyways and therefore give ourselves permission to spend it.

Yet when you start to  remove labels money something interesting happens.  Your money management get a bit simpler since you don’t have these emotional attachments to where the money came from or where it is going to.  It also means you can cross borrow money from different sources without feeling so guilty about spending your money.  So for example, then if you know you are getting a bonus once you get back from a trip does it matter if you borrow the money from your emergency savings for a week? When you remove the label from your money the answer becomes obviously: no.

Like all good things, removing labels on money does cut both ways.  By removing your intention from some of your money you might lose focus on your long term goals.  After all you need to still keep track of your money to know if you meet a goal or not.  Also you can risk starting to overspend your savings by too much cross borrowing of money if you don’t keep track of it well.

So far my experiment with removing labels from my money has gone well.  By creating my Super Fund I have removed many different saving labels that I used to worry about.  So far I’ve noticed that I do like things being much easier overall, but I do occasionally miss knowing the sub-amounts that I use to track.  Yet at the same time I still use some labels.  For example, anything I deem for retirement is strictly off limits for any other use.

So how do you use labels for your money?  Does it help you or perhaps is it holding you back or making things more complex than they need to be?

Yet in the end I did the math and came out with a few things.  First off I expect the mortgage to finish the year at about $121,600, which would mean I’ve paid off about $15,000 this year on principle.  That’s fairly good given I haven’t focused too much on it.  So in 2010 I’m really going after it I’m heading for a goal to have my mortgage at $78,000 or less by Dec 31, 2010.  So for those of you with sharp math skills I’m planning on paying off over $43,000 in principle next year.

So obviously that is a huge number, so how the hell can I get there?  Well that’s got a few factors to it:

1. I’m reducing my investment activity down to just my pension, regular RRSP contributions and regular RESP contributions which should free up some cash.
2. I’m putting all my after tax income from my second job towards the mortgage.
3. I’ve increased my regular payments by 15% and the balance has dropped so each regular payment I’m now paying off a fair bit of principle.

The longer term result of all  of this should be paying off the final mortgage balance sometime in 2012.

So do you have any goals for 2010?  If so, what are you focusing on?

I am not a regular giver to charity.  In the past, I have given money to several, including the Shriners, Canadian Cancer Society, Heart and Stroke Foundation and other minor organizations.  I understand the concept of giving to charities - helping people and organizations achieve goals that they would not be able to attain without money provided by donors, but on the other hand when looking at an early retirement financial plan it doesn’t entirely make sense.  On a daily basis, I think about each and every purchase that I make, whether I should be wasting $1.26 on a muffin when I could have baked a batch of them for $3, to the best way to save on heating and cooling in the house.  The thought of just giving away money is essentially alien to the budget and goals that I have set up for my financial future, but in the past I have continued to give.

I understand that giving to charity is a good thing - providing for others that are unable to provide for themselves.  I just don’t feel attached to any cause.  I have never used a charity, nor have any of my friends or acquaintances and I just don’t know when I would, but generally I think that’s how everyone feels until the day comes when they need to approach a charity for assistance - I just can’t imagine the circumstance.

So, in the next year, I’ve decided that rather then give money to charity I’ll give time (call it a New Year’s Resolution).  Time is something that I have enough of to give and donating it to a charitable organization would have a two-fold impact:

Allow me to better understand a specific organization:  This understanding would perhaps allow me to understand the importance of the charity, as I am basically a newbie in what they do and how they do it.

Allow me to donate without impacting my budget: I have time, I waste a lot of it doing things that are not productive to myself or others.  What I don’t have is excess money kicking around, and as you may surmise from my muffin decision, I would fret a lot less about giving up a couple hours here and there then just giving away money that I so carefully oversee for the most part of my life.

Does anyone else have plans to donate time or money to charity?  Are donations a regular part of  your budget?

The holiday, money and stress are a similar issue.  Together than can be toxic brew that will leave some people utter stressed out, broke and unhappy.  Which is completely against the point of a holiday in my mind, so how do you change your approach?

Well this is what worked for me this weekend to change my approach:

1. Take longer to do it.  Even if you can complete something in a day doesn’t mean you have to do it that way.  Taking your time often means you are not in a rush and less likely to make mistakes.  Also you can often plan better and spend less.
2. Ignore convention.  The instructions said to put together the shelves standing up.  I ignored that and did them on their back which made things much easier.  The same goes with presents you don’t have to buy for everyone you know.  Also consider using gift exchanges,  making a gift (perhaps baking or a craft) or even buying nothing.
3. Get help.  It’s completely ok to realize when you just can’t do something by yourself.  So ask for help and save yourself the stress of trying to do the impossible.  Get ideas from others, do a baking exchange,  or go potluck for your Christmas party.
4. Do the project in many short periods.  Just about anything gets much easier if you do it in smaller parts.  I put together the shelves  in three sessions.  We also do our Christmas baking, shopping, decorating and present wrapping in many short sessions to avoid getting too stressed over things.
5. Lower your standard from perfection.  I mess up something on the shelves on the very back.  I could have fixed it given another hour.  I said “screw it” and left the flaw which no one will ever see.  Not everything has to be perfect.  Actually lowering your standard slightly can greatly reduce your stress associated with many different things in life.

So have you ever changed your approach to a problem?  If so, what worked for you?