Some of you may remember last year I did a case study on which was cheaper replacing the burner on my Bar B Q or buying a new one? This story is an Epilogue to that story. I originally posted this on my family private blog, but figured it was worth sharing for a Saturday Funny.

Is the Label Supposed to Be On Fire?

That was a good question asked by my daughter on Wednesday, looking at our Bar B Q.

My wife had started the Bar B Q (the really old Bar B Q), and was playing soccer with our son in the back yard (waiting for the Q, to warm up). Time passed and the game continued waiting for the impending cooking of raw meat on flame.

My oldest daughter came out of the house and saw that the label on the Bar B Q (the one at the bottom where the knobs to turn the gas feed up and down (you know where the propane and air mix)) was actually bubbling and burning.

She asked, “Should the label be on fire?”, and my wife turned to see flames engulfing the bottom of the Bar B Q, this being a very bad thing since the flame could ignite the propane tank, thus causing an explosion that might blow a lot of windows out of the back of my house (not to mention blowing up some of my children).

My spouse ran over quickly, shut off the gas, showing great calm under pressure (I wasn’t there, so for all I know she was yelling obscenities and pushing small children out of the way, but I’d like to think she showed grace under pressure (Rush 1982)).

Luckily nothing else exciting happened after that (except that we had a delicious Swiss Chalet dinner instead of burnt flesh).

This long weekend, we will be buying a brand new Bar B Q.

No worries about disposing of the old Bar B Q, as they disappear off the front curb in seconds on garbage day.

Almost reminiscent of a dear old friend and his Bar B Q, that caused a chain reaction that lives on in the history of Barrhaven, but that story is for another time.

Finally a long weekend, it has been months since Easter (ok it feels like that), and we finally get our long weekend in, whoo hoo! It has been an interesting week (read tomorrow’s humorous story about why I am buying a new Bar B Q for more fun).

Lots of great posts across the board from my regular readings and some of my postings, let us recap:

• I resurrected one of my favorite humorous posting about The High Price of Daycare and Alternatives, which makes me laugh every time I watch it (thanks the Onion).
• On Sunday we found out that if I had to pay my wife, I’d have to get a second job, because as a Mother I cannot Afford her.
• The Canadian Capitalist wrote about The High Price of Eating Out, but more importantly how more people are eating out. I remember when my parents took us out to dinner it was a special occasion, not to my kids.
• Should I join a Credit Union just to avoid service charges, read the comments, it’s pretty entertaining.
• Michael James wrote about MER the Gift that Keeps on Giving for your mutual funds. You must read this just to understand how much you are spending to “save”.
• What does a Shredder have to do with Personal Finance? Read the article and see.
• I added Gail Vaz Oxlade to my Financial Bloggers list, this is the lady from ’til Debt Do Us Part (with the mason jar budgeting system), very interesting reads.
• I started to get up on my soapbox espousing my views in Computers: Another Great Financial Tool , and then topped it off with Security the Most Important Financial Concept where I went off the deep end talking about computer security. Sorry folks, when I get on my home turf (i.e. High Tech) I get a little wacky.
• Ellen Roseman answered a lot of questions this week, well worth a read to see what folks are asking her.
• Larry MacDonald started the warning bells about Inflation and how it may have a global impact, especially in China. Given how supercharged their economy is right now, I am not really surprised to see that possibility on the horizon.
• Our Amigo Average Joe resurfaced over at Dividends Matter and did a post on Saputo the Cheese Maker (they also sponsor soccer stadiums in Montreal I hear).
• Loonies and Sense resurfaced as well with an Apologetic Post this week as well.

All in all a good week of reading and research. Enjoy your long weekend, buy a hammock and lie out in the sunshine (with SPF 50 on).

Security of your financial information is essential, for many reasons. Identity theft is the main issue, in that if someone can get enough information to re-create your identity in some fashion and get credit cards (or worse) in your name, it will create huge issues for you.

Fraud is rampant in our society, and you must be diligent to ensure you are not a victim of this crime.

Paper Security?

The Shredder , as we spoke about on Tuesday is your security weapon for your printed records. Any old financial records must be destroyed (after they are no longer needed, please don’t just destroy records without knowing whether you need them any more), or stored in a safe place until they are no longer needed. The safest place I can think of for saving important financial documents would be either a Safety Deposit Box or a home safe (or strong box). This will secure your printed information.

What kind of information?

1. Old Tax Forms, with receipts and associated responses from the government
2. An inventory of your house with it’s estimated value (don’t store that in the house)
3. Wills
4. Birth certificates and such
5. Receipts from Credit Cards, Property Tax Payments, and such (I think the rule of thumb is at least 3 years of that data).

Computer Security

Damn right you need computer security .

Possible Computer Security Attacks

First whatever computer you are running your Financial Software tools on, must be secured with a password of some kind, that is common sense.

Next if the computer is connected to the Internet (which it most likely is), then it must also have Anti-Virus and Anti-Spy Software, or your data can be corrupted, or worse still your machine can be compromised by:

• Trojan Horse software that simply replaces parts of your system with it’s own versions which will look for information on your computer.
• Key Capture software that will simply steal your on line banking password, by logging all the keystrokes you type on your system and sending them to another computer

Yup, this can happen to you, and you need to protect your finances from this kind of attack. There are many others, I am just highlighting the major ones here (there are many, many more attacks out there).

Network Security

If someone can break into your home network, they can get onto your home computers and steal information directly from your system. There are some easy fixes to stop this (or at least slow it down).

If you have a home network and have a home router, please change the password on the router from the factory default and turn off remote administration! You may as well leave your front door open if you have this turned on, and I can’t tell you how many configurations I have run into that are set up this way.

Linksys, has changed their default configuration to FORCE people to change the default password, but on older routers, this is not the case. If you have a router and don’t know what I am talking about, you need to get someone in to set up your network security.

If you have a wireless home network, TURN ON WAP or some other wireless security, and turn off SSID broadcast. Look up War Driving and see what can happen to unsecured wireless home network configurations.

I had an old router who’s security was compromised, and I ended up selling Herbal Viagra for a while (I didn’t make any money on the deal, and I had my Internet access turned off for a week, and only got it back because I plead stupidity about how I had not configured security on my system).

Again, I am only highlighting a few areas, if you aren’t sure, consult the Internet or call someone who knows about this kind of stuff, don’t just hope it doesn’t happen to you.

Disposal

Inevitably you will want to dispose of either the backup media you have been using for your computer, or even the computer itself and this is where many people’s identities get stolen (if it can happen to F1 Driver Lewis Hamilton, it can happen to you too).

1. If you have old floppies around the house and you do not know what is on them, run a powerful magnet over them, or destroy them (with a hammer).
2. If you have been doing backups on to CD’s or DVD’s and you do not need these backups any more, destroy the media (my shredder actually chews up CD’s and DVD’s, so that is where they go).
3. If you have tape media, cut it up, burn it, whatever.

This media if just thrown out, is insecure and can easily be used to get information about you (especially if they have been used to back up your financial data).

The one computer point people don’t think of is disposal of your computer. Your computer has a hard drive in it, if you simply throw the computer out, the hard disk has all of that information on it about your finances, and whoever picks up the computer now has this information.

The best thing to do with an old computer is the following, remove the hard drive from the system, and physically destroy it. Either take it apart and smash the platters, go at it with a sledge hammer or something of the like.

If you want to give this computer to someone or donate it, you must find a shop that will WIPE the disk clean or buy software that will do that. This software will overwrite the data on the disks over and over with varying patterns until the only people who might be able to read it is the CIA or CSIS, you can then donate your computer (but I won’t, I will destroy the hard drive by hand, I don’t trust any of this stuff).

Never, ever give a computer away with the hard disk intact, if you have used it for any financial work at all. Even if all you did was order some stuff from E-bay on line, wipe it clean.

Am I Being Paranoid?

You are only paranoid if everyone is not out to get you (hey I am now the Big Paranoid Cajun Man), but seriously, securing your financial data both hard copy and soft copies and the associated software is the most important thing you can do for yourself, and your family.

My major tool in my Financial Planning activities is my computer. I use it to track my spending, I use it to make up financial plans for the coming time, and I use it to analyze my spending habits, all in all a very powerful tool for me.

My wife prefers to use pen and paper because she likes to see the spending and such, and if that is the way you work, I have no problem with that either. It takes a little longer, but maybe when it takes longer you might notice and absorb more information from the data entry side of things.

Financial Tools

My major tools that I use (I am not endorsing these computer tools, I am simply pointing this out to be complete) are:

1. Quicken, first and foremost this is the tool I use to keep track of spending and attempt to report trends and such. A very powerful tool, that I still don’t think I am using completely correctly.
2. Tax software, in this case Quicktax, but only because it is so simple when I do it this way and I can E-file my taxes which is quicker and easier for me. I also use that tool to infuriate myself figuring out what might happen if the Government supported Income Splitting.
3. Excel or whatever spreadsheet you like. I like to extract data from Quicken and then use it for some elementary calculations and forecasts in Excel. Excel has some very powerful financial functions, but make sure you are using the Canadian versions for Interest calculations and such.
4. Powerpoint, to present information easily to my wife or to my banker, if I am going in to try to get Free Banking
5. Internet Explorer or a browser for On line banking, and thanks to my PC I no longer walk into my local branch weekly to get my banking updates, I get them daily on line. This is an amazing capability that we take for granted that didn’t exist 20 years ago. I pay bills that I don’t have to mail in any more either.
6. Firefox or Internet explorer as a research tool, by looking up on Government sites I learn about Tax rules, by reading company’s web pages I learn about good investments and by reading some amazing Blogs, I learn about Finances in general (see my right bar for some excellent financial bloggers).

These tools make Personal Finance for me a little easier to deal with.

Take Care of your PC

As with all tools, you must maintain your PC. Yesterday my PC was taken away, because it was doing suspicious “Virusy” things at work and now I sit at my kids’ computer attempting to get anything done. I am lucky because I have an entire I.T. group to take care of my PC (for now), most folks do not, so here is my views on the minimal I.T. tasks you should be performing on your PC (this advice I do actually stand behind, because this is an area I think I have some expertise):

1. Backups, backups, backups! If there is any data on your computer that is important, you must make sure it is backed up in some fashion. There are many ways to do backups
   1. Back data up to CD’s or DVD’s if you have a CD writer. If you don’t have a CD or DVD burner, go get one NOW.
   2. Norton and other services are now offering network based back up services that you can subscribe to. I would read their agreement closely to see what re-courses you have if your secret data is compromised by their backup system, but this is still another way to go.
   3. If you have TWO computers at home, make a BACKUP directory on each, and back up important data on the other machine. At least if one fails you still have your data.
   4. Floppies? Well, if you think that is the way to go, knock your socks off, but I do not recommend it.
2. Restore! Yes this is just as important, you must test that you can restore data from your backup system! Backups are useless if you cannot retrieve your data. If you have important data already backed up on floppies, transfer it to DVDs or Cd’s or something. Also check the state of your old important backups, because the Media it is on, does degrade.
3. Anti-Virus software, get something, ANYTHING, but do not think that your Internet Access provider or your good ideas are going to stop viruses from getting on your computer. Use Norton, McAfee, NOD or others, but use something or your machine will become compromised.
4. Anti-Spyware software too, most anti-virus systems now come with Spyware checks as well, important to get this kind of software, or you are going to end up selling Herbal Viagra from your PC.
5. Clean your computer. Vacuum out the fans at least, or take it to a reputable local computer shop to have it cleaned (ask for references from the local shop, if you don’t know the owner). I had a fan break on my CPU, due to dust and my machine was gone for a few days.

There are many other tricks of the trade you should think about, but this is my minimum list. If anyone else cares to comment on other important tasks, please feel free, as I don’t think this list is exhaustive, just a good starting point.

Last year, we bought a shredder because I kept taking stuff to shred to work, and felt I had enough stuff that appears in my house that I do not want to leave my house in the garbage where anyone might look at it, and I also enjoying destroying things.

What kind of things do I enjoy running through my shredder?

• Most of the credit cards I have keep sending me “cheques” that I can use to make cash withdrawals and get charge 20% interest from the moment the cheque is cashed. These things have on them my credit card number on it, and thus if someone got a hold of it in tact, I would be in very deep trouble. They shred very nicely.
• Credit Cards that I do not use, I have a bunch of credit cards that I do not use, that I am going to cancel, but I have already shredded them. They shred very nicely indeed.
• I also shred many old financial documents that I don’t need to keep, don’t want to burn and don’t want to leave out in my garbage either.
• Canceled cheques and the like as well.
• Old pay stubs.

I put my shredder in the same class as my safety deposit box as being something important in my Financial Planning, an important aspect of safety and security in finances.

New Housing Prices Still Rising

Just not as fast, and it’s acceleration is dropping. This means if you are buying a new house and you waited from last year it is going to cost more, it’s just not getting as expensive, as quickly.

Year-over-year growth in new housing prices slowed for a second consecutive month in March. This deceleration continues a downward trend that started in September 2006, due mainly to the softening market in Alberta.

Contractors’ selling prices rose 6.1% between March 2007 and March 2008, a slightly slower pace than the 6.2% year-over-year increase posted in February 2008.
(…)
Elsewhere in Ontario, contractors’ selling prices were 4.5% higher in Toronto and 3.1% higher in Ottawa–Gatineau compared with March 2007.

Personal Finance Update

So my attempts at stopping my spending at work begins anew. No spending over the last few days and that is a good beginning. De-Crapification continues as well, with more crap to go very soon.

Given that for now I am still a telecommunications employee I can join the Telecommunication Technologies Credit Union (this is not a promotion for them, nor am I being paid to mention them, this is me querying my readership). This Credit Union has ATMs on campus where I work, and thus if I need money I must use their machines (or drive to find a TD Canada trust machine).

As a bit of history about 10 years ago, CIBC was on campus and their ATMs were on site. They had a no charge banking deal back then, so I opened a bank account with them, where I put some “mad money” (usually no more than $50.00) where if I needed money and I was at work, I could withdraw it without incurring any extra service fees. This worked quite well, and then when CIBC played the dirtier trick of “out sourcing” their ATM machines, it was even better, because then I paid no service charges, but if I tried to take money out of my TD account, I got nailed with a $1.50 charge from TD, and CIBC nailed me with a $2.00 fee for it being a “White” ATM machine (and not a CIBC machine). You wonder why I invest in banks, they are just so darn EVIL!

Now I have the option to open an account with the Credit Union, which I almost did last week, since they seem to offer “no fee” banking so I was going to go back to my old “Work” account concept, except, the Credit Union has an interesting twist for new customers. I must be a “member” of the Credit Union, thus I must buy a share in the Credit Union (I think this is standard practice with Credit Unions), and this share costs $220. If I ever leave the Credit Union, this money is refunded to me, and it evidently earns a dividend of some sort every year as well.

This leaves me in a quandary, do I pay the $220 set up fee to have a convenience account for me to save $3.00 a month or so in service fees, or do I just get some “intestinal fortitude” and simply not take money out of my bank accounts willy nilly (and instead take out the money I need for two weeks in 1 block, and when it is gone, it is gone)? The Credit Union does not have a lot of ATMs around Ottawa, so thinking of them as an option to move ALL my banking to is not really “on” either, although they do seem to have some good services as well.

I can guess a few of my friends answers, but I am curious to hear what my readers think would be the better thing to do in this situation.

Lottery Tickets, another reason to Loath Them

The CBC is reporting yet another internal investigation at the Ontario Lottery Corp about their approval of a $21.5 Million “Insider Win” in the 6/49.  Given this is the 6/49 so the ability to tamper with this lottery is less likely (unless the person figured out how to “past post” the winners (see the Sting to understand that)), it still has the appearance of something smelly in the Lottery business (which already has had fun and excitement with Fraud allegations in the past year). Given the Lottery Commission has investigated, I guess they are satisfied their was no Fraud involved. Either way, I read this story, and I thank my lucky stars I don’t buy Lottery Tickets.

Yes, it is Mother’s Day, a day to celebrate our Mother’s and the good works of all Mother’s that we know. My mom’s works always amazed me growing up, and now my wife’s tireless works amaze me even more (and make me appreciate the hard work all Mothers do day in and day out).

Every year usually there is a survey that says, if Mothers were actually paid for their duties they would earn $X, and this year is no exception. This year’s value says mothers should be paid $126,593.00 according to Salary.com . Given the hours Mothers work that isn’t as big a salary as you might get (working 12-14 hours a day 7 days a week), and my bigger concern is who pays that? I can’t afford to have a Mother on my payroll if I had to pay that much! Guess, I’d have to get a second job, to pay.

“But they should try cleaning their house with little kids running around and messing it up right after them.”

The salary calculation for mothers also took into account the roles they fulfill as laundry machine operators, computer operators, facilities managers, van drivers and janitors. With overtime work averaging about 54.4 hours a week, stay-at-home mothers worked a hefty 94.4 hour work week.

Points well taken and well understood by most Fathers as well.

If a Mother works in the home her entire life, she gets CPP at the end of it, but not much else either, so the job has lousy benefits too.

Another interesting point about Mother’s Day is it used to be the day when the most long distance phone calls were made (according to AT&T in the U.S.), however Father’s Day was the day the most COLLECT phone calls were made, which sums it all up nicely.

This post was originally posted as Cheaper Day Alternatives last year, but I found it doing some clean up on my site and it still made me laugh, so here it is again for a Saturday Smile. This whole out-sourcing thing is getting a little out of control, and I am not too sure whether I could sedate my son enough to get him into a box or not.

High Cost of Day Care and Alternative Methods

So after my posting about the cost of raising kids a while back a lot of folks pointed out the costs of daycare and how this is prohibitive for dual income families. To those who were so vociferous in your commentary about how I had missed the point, please watch the following video which I think puts forth a viable alternative to the high costs of daycare.

Mobilize This!

Report: Many U.S. Parents Outsourcing Child Care Overseas
Many thanks to John Chow for pointing this one out.

Related Links:

• My Spouse is Worth How Much: Scenario
• The Disappearing Middle Class in Canada
• Spousal RRSP: Income Splitting
• My Spouse is Worth How Much?
• High Price of Parenting
• My Wife is Worth How Much 2007

Random Thoughts

It is Friday again, and it has been yet another interesting week financially in this world.

• There is now serious talk of Gasoline going for $200 a barrel, which would mean it’s price in Ottawa would be around $2.20 a liter, which may well cause folks to seriously look at alternate transportation methods.
• I reviewed my Family’s Personal Spending for April and found some interesting spending oddities of my own.
• Ellen Roseman asked a good question about Who Speaks for Investors, and she was part of a group who tried to, and was even asked to, however, not much seems to have come out of her work.
• Stats Canada talked about how Family Incomes haven’t really changed too much in the past few years, certainly doesn’t look like it keeps up with inflation.
• The Canadian Capitalist asked us if We are Comfortable With our Portfolio, I think my answer is, it’s doing ok, but it would be nice if it doubled tomorrow.
• The Government has an Auditor General to make sure spending doesn’t get out of control, shouldn’t we all have our own Personal Auditor General?
• Any way to control your spending is by creating Artificial Scarcity in your own money supply according to Michael James.
• My mail bag does have some very interesting things in it, as well.
• The Quest for Four Pillars states boldly Zero Down Payment On a House is Just Fine, which on the surface sounds wacky to me, but the article isn’t espousing buying houses you can’t afford, simply not waiting until you have some magic number for a down payment. Interesting concept, not sure I completely buy it, but interesting.
• Finally the Globe and Mail is having a poll about picking the Top 5 Financial Bloggers in Canada , I note I am conspicuous by my absence, but I am not bitter, where did I leave my copy of the Ottawa Sun? I’d vote for the Canadian Capitalist myself (but I would have also included Michael James on Money on that list as well).

Flash: De-Crapification Set Back

Never go to a Gar(b)age sale if you are trying to get rid of your crap. Our Church is running one, and I came home with something, I have however removed something from my bedroom (which is where the new item will go), however, I am ashamed of myself. I did get a trouser press for $10 however, which I think is still kind of cool, and I could bring a lot of crap back to my Church’s gar(b)age sale tomorrow, so maybe this will work out.

No that is not my pet name for the guy who stuffs my super mailbox, however, I do get some very interesting e-mails and 1 yesterday I felt I had to make a comment on.

Art for Financial Gain

This e-mail almost had me passing my liver I was laughing so hard. It started off with:

If you’re looking for an alternative to investing in stocks or real estate, art might be the way to go – whether you have $1,000 or $10,000 to spend.

You are not serious or as my daughters might say WTF? For my regular readers you know I have very little skill when it comes to investing in stocks (I have had many more flops than wins), I think I know as little about Real Estate, but then again, I have a nice house (which is not an investment in my mind) and I know I never want to be a landlord, so that covers most of the investing areas I know of, but this e-mail suggests Art?

Don’t get me wrong, I like art and I own art, but it is Art for Art’s Sake. I am an amateur ornithologist, especially liking pictures of birds of prey, so I own a couple of Robert Bateman prints which are worth something, I think. This e-mail is saying that I should work with this web site to make money using a methodology outlined by an entrepreneur.

Pardon? So as with most get rich schemes, I give someone I don’t know money to invest and hope they don’t simply squander it, in an area where I have no expertise other than, “That looks nice to me”? I think I’ll be passing on that “investing idea”.

Other Interesting Mail

I also get lots of other interesting e-mails, which fall into a few categories:

1. How my girlfriend is unsatisfied with me, and I need herbal Viagra of some kind. Why is it my girlfriend is unhappy but my wife isn’t? Curious why those ads always talk about my girlfriend.
2. Get rich schemes for this blog and how if I use the right keywords like: Royal Bank of Canada, Scotiabank or PC Financial, I will make a fortune. No Canadian Capitalist is the only successful financial blogger I know of right now.
3. Phishing e-mail from people in the former Soviet Union or Nigeria who want to send me $1,000,000.00 because I am a good person.  I think I deserve that money, but no, I don’t answer those either.
4. Occasional inquiries from readers about specific things and even some who ask for investing advice. Here is my investment advice: Pay off your debt and never ask me about investing advice, I will steer you wrong.

I enjoy reading mail and e-mail, and I like reading comments too (especially the nice one who said the Globe and Mail got it wrong and that I was one of the top 5 Canadian Financial Bloggers).

Be Cautious

The CBC asks the question are Canadian Investors being too cautious?

Canadians are sitting on a record $45 billion in excess safe, liquid assets that would normally be invested in the market, according to a report Wednesday by CIBC World Markets economist Benjamin Tal.

So people who want you to invest so they can make money on the transactions think we aren’t investing enough? I am pretty sure that Laura Secord thinks I am not eating enough chocolate too, but I don’t listen to her either.

We in Canada have seen some SPECTACULAR investment busts in Bre-X, Nortel and the high tech bubble, and others, be skeptical and be cautious. Invest in what you understand and know (to paraphrase Warren Buffet), unless you are able to deal with losing the money you invest!

The Canadian Government is a mega-business in terms of size and jurisdiction, and to keep this monster organization in line there is the Office of the Auditor General. Yesterday the Office of the Auditor General put out it’s 2008 Annual Report, and as usual it is full of many interesting issues with the Government specifically in the area of spending. There are some very interesting comments on User Fees in general and how they have been arbitrarily added by many government agencies without a specific accounting of what the “fee” is for. Interesting reading.

The concept of the Auditor General got me thinking about whether I could stand an audit of kind by a 3rd party of my finances. My answer is I don’t really think so, however it might actually be a great idea to force me and my family to explain some of the purchases and financial decisions that have been made over the past little while. Think of having to explain to someone why I held on to my High Tech stocks for so long? Makes me cringe just thinking about this whole idea, but to me it sounds like a good idea.

I have previously written about the Quarterly Financial Review (which we are almost half way through the second financial quarter) and also about your Financial Resume, and these ideas are great concepts to help families communicate with each other about their current financial status (especially once you have a few reviews under your belt so you can actually compare and contrast quarter to quarter), but I am thinking that maybe these ideas aren’t quite enough. If you add more accountability (pardon the pun) to your Personal Financial Life you may be forced to make more informed decisions (i.e. you are less likely to rely on your “gut” or impulses, if you know you have to explain later to someone why you did what you did).

Any ideas where this kind of “Personal Audit” could be implemented are welcome.

Decrapification Update

My continuing attempts to declutter is still on track. I have taken more “crap” to work to offer to other geeks for them to take home, however, none of them took my pile, so I ended up throwing it out. Yesterday, I hauled up a bag of Pink Fiber Glass insulation from the basement (it had been sitting there from when we finished our basement three years ago), and I put it out for the garbage. I was pretty sure the garbage man wasn’t going to take it, however, within 20 minutes it disappeared. My guess is a neighbour took it for later use, which is fine by me.

It continues to amaze me how much one man’s crap is another person’s treasure in these instances.

More decrapification to come (I hope).

Our friends in Stats Canada put out yet another interesting article yesterday comparing the income of Canadians and specifically Canadian families. Being a member of a Canadian family as usual I find the numbers fascinating (but I do have a Math degree as well, so I will try to temper my enthusiasm).

The Data in this survey seems to center around the Median Income numbers for the groups in question. If we ask our friends at Wikipedia they remind us:

The median of a finite list of numbers can be found by arranging all the observations from lowest value to highest value and picking the middle one.

Keeping that in mind (this is not the AVERAGE income but the value in the middle of the entire sample), there are some interesting facts to be seen.

Our friends at Stats Canada Point out:

Families had an estimated median income after taxes of $58,300 in 2006, up 2.1% from 2005 in real terms. It was the third consecutive annual increase. In 2006, the increase was mainly the result of gains in both market income and government transfers.

Now that is ALL families (a very large sample given it includes groups of two people or more), in the Two parents with Children category (where I live) income was up from $74,200 to $74,900 which isn’t bad (ok it’s better than it going down), which is a 0.93% increase. Inflation at that time was somewhere around 2.0% (I am guessing don’t have the exact numbers) so that means the Median families were losing ground.

Interesting statistics to look over and decypher.

Any other comments?

The topic of what my household spends money on has been discussed before, but here is as a percentage of my entire expenditures, what my family spent it’s money on last month (April 2008)

• Tax 25.24%
• Recreation 19.68%
• Groceries 13.11%
• Insurance 8.88%
• Mortgage Int 5.55%
• Utilities 3.94%
• Auto 3.54%
• RRSP 3.04%
• Commuting 2.70%
• Savings (non RRSP) 2.28%
• Other 12.04%

These numbers are relatively trustworthy since I use Quicken fairly religiously, and my expenses are mostly tracked there (and we don’t really use a lot of cash in our household).

Financial Scary Things

Recreation being 20% of the money I spent things on last month. That is down to my kids recreational activities (basketball). That is one hell of a lot of money, and that is not registration fees or anything like that, that is money spent on going to and coming from and being at tournaments. That one scared the nickels out of my piggy bank.

Why was Insurance there? I pay for my house insurance in one payment every year, and I had to pay it last month. This month it will be big again, because I have to pay my car insurance as well. I also have on going Life Insurance costs that come up for my wife and myself (that was 9% of my spending).

Commuting, is actually the cost of bus passes for my daughters to be able to go to school, so that is not an insignificant amount of capital spent either.

Financial Oddities

The money I am paying in mortgage interest costs is only 6% of my expenditures in a month? Wow, that is really not a whole heck of a lot in comparison to say the amount I spend on Groceries (13%). I honestly don’t know if that is good or bad, it’s mostly confusing, I guess. Anyone care to hazard a guess, I am open to interpretations.

I am also putting 5% away in savings of sorts, in comparison to my total expenditures for the month. Since you don’t know how much I spent last month (no I am not saying what that number is), it’s kind of hard to figure out if this is a good or bad amount (it actually isn’t too bad, and I have to keep remembering that one).

Financial Insights

There are areas where spending can be curtailed, and there will be areas where spending will stop for a while too (specifically recreation), so that is a good thing. My guess is the Auto side of things is going to go up with the cost of gas continuing to go up as well.  I think also this is not reflecting debt repayments either (as this is not a category in Quicken) except for specific mortgage interest as a cost basis point. I’ll need to look at that more as well.

Any comments or insights from my readership appreciated.

Don’t remember this in the bible, but it is a very good thought. Our society seems bent on quick gain tactics to wealth and assuming that it is the only tactic, to gain wealth. The people I know who are wealthy (I think rich has negative connotations) in the monetary sense all worked hard to get this money and it did not happen over night (although some larger gains for them may well have).

I get “Get Rich on the Internet” schemes in my inboxes every single day, and I have read most of them (without paying for them, I don’t pay for this stuff) and it all entails either “trickery” or methodologies that make little or no sense. People get rich on the Internet by working hard and doing something FIRST or BEST, not by doing “me too” stuff.

If I am to ever “Get Wealthy” I know that there are a few simple rules to follow:

1. Spend less than I make
2. Pay off all my debts
3. Invest carefully
4. See rule #1

Simple, and the bible tells us to also be patient, it will take time, keep that in mind.

This week I had some very good feedback and discourse with my readers about the high price of post secondary education and how it pertains to Family Finances and Personal Finance. This topic was suggested by my wife and I didn’t think it would amount to much, but to me, I think it really opened my eyes to the fact that most parents want the best for their kids, and most parents want to help their kids get a post secondary education of some kind. The limiting factors in their ability or inclination to help are varied, but I did not hear from a single person who said they would not help their kids, even though they had the financial means to do so, and I think I was glad to see that.

• Student Debt starts with an introduction of the problem or the discussion point as I saw it.
• Student Debt Part 2 went further into the Pros and Cons of the parent fully paying their child’s way in a post secondary education.
• Student Debt Epilogue is the entry I like the most out of this essay, because it reflects some thought provoking and interesting comments from my readers, and for that I thank you.
• Surprisingly our friend over at Canadian Capitalist did a piece on Still Sour on Group RESPs where he continues his discussion on the topic of Group RESPs. I added my own comment to this topic, so go over and see my comments on this important area of Post Secondary Education Financing.
• Michael James did an unscientific, but effective study of the Interest Rates you can get for your Unsecured Line of Credit. Surprisingly, you are on your own on what kind of deal you can get!
• Ellen Roseman wrote about the Direct Energy home furnace “warranty” program and other horror stories from the world of energy and heating. Spine chilling stuff there.
• Larry MacDonald wrote about a Job surge in the U.S. last month, which is never a bad thing to read about.
• Free Money Finance had a great article on how much you can save throwing stuff out instead of storing it (something I am going to try to live to this year).
• My article on Found Money The Prisoner’s Dilemma was showcased in the Carnival of Financial Planning.

Next week I am thinking of looking closer at my family’s finances and maybe wondering out loud why we are spending money on some of the things we do. We’ll see.

Have a great weekend.

Netfile Tax Reprieve

Freedom from having to pay taxes, for 5 more days, if you Netfile. This extension only applies if you are going to use Netfile to submit your return, and it only applies if you owe money. As was pointed out by someone, if the government owes you money, they don’t really care WHEN you submit your taxes (but you better be sure you are getting a refund before you procrastinate like that).

Shrinking Economy

Stats Canada reported that economic activity shrunk by 0.2% in February, and this was caused by shrinking manufacturing and wholesale trade, what caused this? Don’t know but it’s not a good indicator that the Canadian economy is going to “weather the U.S. downturn well” as has been said by a few economists.  One month does not a downturn make, but it’s something to remember.

Interest Drops

This month is a new month, and for me, it means a complete month with lower interest rates on my Mortgage and my line of credit.  TD’s prime lending rate is 4.75% right now and if you are curious what rates you can get on a Line of Credit, read Michael James’ essay on that topic, especially the comments, which are very telling as well.  I will be taking this opportunity to make the same payments I always make and thus taking more principal off these debt devices.

Gas Prices at $1.20 per Liter

That is where they have been in the Ottawa area, and driving has been much more expensive. I am paying about $10 more a week for my car to drive (which is a 50% gain in what I was spending), just in gas costs also (not including car wear and tear and insurance). I am attempting to offset that by NOT buying coffee at work (yes I am attempting that again). So far this week, I have only bought 1 coffee, which means I have not bought about 8, so that is quite good (and it does add up to my goal of $10.00 or so). I will keep my readers informed of my progress.

Ottawa High Tech

Alcatel (ALA) announced some hefty bad numbers yesterday, with a 5th consecutive losing quarter.  This combined with a warning on sales figures and fresh lay off talk, makes the Ottawa Tech sector a little more jittery this month. Nortel (NT) announces Friday morning, and there are concerns of similar statements from the former High Tech juggernaut.

What does this have to do with me? I live in this world, and a jittery world it is right now.

Is there a right way to deal with the question of whether a parent should pay for a child’s post secondary education or whether the child should be left to pay for a University Education (and left with a large debt load in student loans)?

I think that is a pedagogical question since most of the times the parents financial situation is what dictates how much parents can help their children who want to get a post secondary education. I find it rare that parents who can help their children with their post secondary education, don’t help out in some fashion or another. I do know of some children who have refused help from their parents, out of pride or other reasons, but that is a rarity as well.

Some of the comments I have received have been very interesting, and I want to thank all of my reader’s who contributed (and those who de-lurked for me as well).

• A large number of comments agreed with my opening statement that it is very rare that parents who can help, choose not to help out their children who choose to try to get a University Education, it usually comes down to whether the parent is in a position to help or not.
• Michael James commented:
  

  I plan to pay for the basic necessities for my kids initially, and am hoping that they earn enough to take over by the end. I’m not paying for any extras, though. Meal plan, residence, books, and tuition are necessities.

  I think that point of view is a healthy view point, and fair. The extras he comments on, I think are part of the “College Lifestyle”, but then again, should a parent be expected to pay for them?

• Trent commented:
  

  And I would say emphatically, if the student in question never had a job during high school, then I think you would be doing a great disservice to them by allowing them to wait until they graduate college before punching their first clock.

  Which is very much the “Christian Work Ethic” espoused by many parents and grandparents. I think I agree with that comment as well.

  As a personal aside, I worked delivering Telephone Books one summer, loading trucks another summer and had a paper route from age 13, so on those days at University when I thought, I am going to chuck this whole thing and get a “real” job, I just remembered heaving bundles of Penthouse into the back of Grumman delivery trucks in 30 Celsius heat, and it was amazing how well it motivated me.

• Nerd Money Commented:
  

  I think one possible solution in terms of funding is that you loan out any funds you’ve set aside for their education. Set it up like a government funded loan where there’s no interest while they’re in school and then a modest interest rate payable to “The Bank of Mom and Dad” six months after graduation.

  Interesting concept, that I don’t know if I agree, but it is another way to teach the value of the money spent on the education (remember the infamous