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Index
MONEY RULES
Rule Your Money or Your Money Will Rule You GAIL VAZ-OXLADE
Contents INTRODUCTION Figure Out How Money Works RULE #1: RENTING IS NOT A WASTE OF MONEY RULE #2: DON’T MARRY A MONEY MORON
DOES YOUR DARLING …?
RULE #3: YOU MUST HAVE A WILL RULE #4: YOU MUST HAVE POAS RULE #5: FIGURE OUT WHAT’S REALLY IMPORTANT TO YOU RULE #6: SET SOME GOALS RULE #7: YOUR BANKER IS NOT YOUR FRIEND RULE #8: EVERYONE NEEDS AN EMERGENCY FUND RULE #9: CALCULATE YOUR OWN DEBT REPAYMENT PLAN RULE #10: YOUR FINANCIAL EDUCATION IS YOUR RESPONSIBILITY RULE #11: HOME OWNERSHIP DOESN’T GUARANTEE AN EASY RETIREMENT RULE #12: COMPARE YOUR STUDENT LOAN INTEREST RATE WITH REGULAR LOAN RATES RULE #13: TERM INSURANCE IS NOT BETTER THAN PERMANENT RULE #14: DON’T LET YOUR LENDER DECIDE HOW MUCH HOME YOU SHOULD BUY RULE #15: DON’T WAIT TO INVEST RULE #16: DON’T PUT ONE GUY IN CHARGE OF THE MONEY RULE #17: NEEDS MUST COME BEFORE WANTS RULE #18: CREDIT IS GOOD—DEBT IS BAD RULE #19: WRITE DOWN WHAT YOU’RE SPENDING RULE #20: KEEP LEARNING—KEEP GROWING RULE #21: IT’S NOT HOW MUCH YOU MAKE—IT’S HOW MUCH YOU KEEP RULE #22: EVERYBODY NEEDS A BUDGET RULE #23: MAKE A BUDGET RULE #24: CALCULATE YOUR TAXES TO AVOID A TAX BILL RULE #25: NEVER IMPULSE-SHOP RULE #26: DON’T HAVE YOUR CREDIT WITH THE BANK THAT HAS YOUR DEPOSITS RULE #27: DON’T TITHE IF YOU OWE MONEY RULE #28: DON’T USE PREPAID CARDS RULE #29: YOU CAN HAVE IT ALL, JUST NOT ALL AT THE SAME TIME RULE #30: EVEN CHICKENS CAN INVEST SAFELY RULE #31: ENROL IN YOUR COMPANY PENSION PLAN RULE #32: ENJOY YOUR MONEY ONCE YOU’RE BACK IN THE BLACK RULE #33: SAVE WHILE YOU PAY OFF YOUR DEBT RULE #34: WATCHING YOUR PENNIES DOESN’T MAKE YOU “CHEAP”! RULE #35: DON’T OBSESS ABOUT YOUR CREDIT SCORE RULE #36: DANCE YOUR WAY TO WHAT YOU WANT RULE #37: KNOW YOUR TIME HORIZON RULE #38: MORE WON’T MAKE YOU HAPPIER RULE #39: YOU ARE IN CHARGE RULE #40: FIGURE OUT YOUR MONEY SET POINT RULE #41: DON’T PLAY THE KEEPING UP GAME RULE #42: TALK TO YOUR PARENTS ABOUT THEIR MONEY RULE #43: YOU CAN USE YOUR RRSP AS COLLATERAL RULE #44: PROTECT YOUR FINANCIAL IDENTITY RULE #45: MEASURE YOUR PROGRESS RULE #46: DON’T PUT YOURSELF AT RISK TO HELP OTHERS RULE #47: PAY ATTENTION TO YOUR CREDIT CARD COSTS RULE #48: IT’S NOT YOUR MONEY UNTIL IT’S IN THE BANK RULE #49: YOUR KIDS’ FINANCIAL EDUCATION IS YOUR RESPONSIBILITY RULE #50: YOU’RE ENTITLED! RULE #51: YOUR MONEY SAYS A LOT ABOUT YOU RULE #52: SET UP A CURVEBALL ACCOUNT RULE #53: DON’T BUY THE MINIMUM PAYMENTS BULLSH*T RULE #54: STAND ON YOUR OWN TWO FEET RULE #55: A MATE IS NOT A PREREQUISITE FOR HOME OWNERSHIP RULE #56: LEVERAGING ISN’T FOR EVERYBODY RULE #57: LEARN FROM YOUR MISTAKES RULE #58: DON’T LET EMOTIONS MAKE YOUR DECISIONS RULE #59: NEVER SIGN UP FOR IN-STORE CREDIT CARD OFFERS RULE #60: NEVER BUY MORTGAGE LIFE INSURANCE RULE #61: MAKE YOUR OWN OVERDRAFT PROTECTION RULE #62: UNDERSTAND OPPORTUNITY COST RULE #63: MAKE SPOUSAL RRSP CONTRIBUTIONS BY DECEMBER RULE #64: PLAN LIKE A PESSIMIST RULE #65: JUST BECAUSE YOU HAVE A VARIABLE INCOME DOESN’T MEAN YOU CAN’T BUDGET RULE #66: KNOW THE DIFFERENCE BETWEEN GOOD AND BAD DEBT RULE #67: TAKE CARE OF YOUR STUFF RULE #68: TIP MONEY IS REAL MONEY RULE #69: EI DOESN’T NEGATE THE NEED FOR AN EF RULE #70: STOP LETTING YOUR ADULT CHILDREN TAP YOUR WALLET RULE #71: BE CAREFUL WHEN GIVING OUT YOUR INFO RULE #72: DON’T AUTOMATICALLY RENEW YOUR MORTGAGE RULE #73: TRACK YOUR NET WORTH RULE #74: DON’T BUY WHAT YOU DON’T KNOW RULE #75: PAY OFF CALLABLE DEBT FIRST RULE #76: STOP RATIONALIZING RULE #77: BUILD A STRONG PERSONAL ECONOMY RULE #78: TOO GOOD TO BE TRUE USUALLY IS RULE #79: KEEP TAX-RELATED PAPERWORK FOR SEVEN YEARS RULE #80: KNOW YOUR RISK TOLERANCE RULE #81: AVOID EARLY RENEWAL PENALTIES RULE #82: STAY WITHIN CDIC LIMITS RULE #83: CALCULATE THE REAL PROFIT ON YOUR HOME RULE #84: KNOW HOW COMPOUNDING WORKS RULE #85: PATIENCE IS A VIRTUE RULE #86: THE KNOW YOUR CLIENT FORM DOES NOT GIVE YOU A GOOD RISK PROFILE RULE #87: CLEAN UP YOUR DEBT MESS RULE #88: CHARGE YOUR KIDS RENT RULE #89: PLAN TO GRADUATE WITH LOANS OF LESS THAN ONE YEAR’S NET INCOME RULE #90: QUITCHERBITCHIN’ AND FIRE YOUR BANK RULE #91: STAYING HOME WITH BABY IS A PRIVILEGE RULE #92: PAY YOUR MORTGAGE OFF BEFORE RETIREMENT RULE #93: DO NOT CASH IN REGISTERED SAVINGS TO PAY DOWN DEBT RULE #94: STOP PROCRASTINATING RULE #95: FOCUS ON BEING MARRIED, NOT JUST ON GETTING MARRIED RULE #96: SELL UNREGISTERED INVESTMENTS TO PAY DOWN DEBT RULE #97: BE HONEST ABOUT YOUR MONEY RULE #98: YOU CAN’T BEAT THE TAX MAN ON RRSP WITHDRAWALS RULE #99: A PREAPPROVED MORTGAGE DOES NOT MEND YOU’RE GUARANTEED FINANCING RULE #100: DON’T CLAIM YOUR RRSP DEDUCTION RIGHT AWAY RULE #101: DEFINE RELATIVE VALUE BY YOUR DISPOSABLE INCOME RULE #102: STOP USING PLASTIC RULE #103: WORK IS WORK IS WORK RULE #104: A CONSOLIDATION LOAN DOES NOT PAY OFF DEBT RULE #105: DON’T FALL PREY TO THE SUNK COST FALLACY RULE #106: DON’T SHOP ON YOUR BALANCE TRANSFER CREDIT CARD RULE #107: SAVING IS EASY-INVESTING IS COMPLICATED RULE #108: NEVER TRAVEL WITHOUT PRIVATE MEDICAL INSURANCE RULE #109: PAY YOUR BILLS EARLY RULE #110: ASK THESE QUESTIONS BEFORE YOU BORROW RULE #111: IF YOU HAVE TO LIE, DON’T BUY RULE #112: YOUR SITUATION IS UNIQUE RULE #113: YOU’RE NOT RESPONSIBLE FOR OTHER PEOPLE’S DEBT RULE #114: COUNT YOUR SAVINGS IN $, NOT % RULE #115: MONEY LENT IS A GIFT RULE #116: PAY YOUR CREDIT CARD BALANCE IN FULL RULE #117: NEGOTIATE—DON’T COMPROMISE RULE #118: OPEN A LINE OF CREDIT BEFORE YOU RETIRE RULE #119: DON’T ACCELERATE YOUR HOME BUYERS’ PLAN REPAYMENT RULE #120: DON’T BE A SUCKER RULE #121: DON’T SKIP PAYMENTS RULE #122: ASK FOR A CASH DISCOUNT RULE #123: A SUPPLEMENTAL CREDIT CARD DOESN’T BUILD A CREDIT HISTORY RULE #124: DON’T GAMBLE RULE #125: BUSY PEOPLE SPEND LESS MONEY RULE #126: LAZY PEOPLE SPEND MORE MONEY RULE #127: DO NOT HAVE JOINT CONSUMER CREDIT RULE #128: PLAN YOUR FUNERAL RULE #129: DON’T PASS UP FREE MONEY RULE #130: NEVER BUY WHAT YOU CAN BORROW RULE #131: CREDIT IS SMART-DEBT IS STUPID RULE #132: CRAP HAPPENS RULE #133: DON’T OVERPAY YOUR WITHHOLDING TAX RULE #134: REVIEW YOUR CREDIT CARD STATEMENT EVERY MONTH RULE #135: ASK YOUR INSURANCE BROKER TO PROVE HIS INDEPENDENCE RULE #136: THINK ABOUT THE FUTURE RULE #137: GET OFF THE HEDONIC TREADMILL RULE #138: PROTECT YOURSELF FROM A MONEY MORON RULE #139: DON’T SEEK HELP FROM CREDIT COUNSELLING RULE #140: CHANGE YOUR BILLING DATES RULE #141: FIGURE OUT YOUR MOTIVATION RULE #142: KNOW THE RULES FOR WRITING OFF A HOME OFFICE RULE #143: DESIGNATE BENEFICIARIES ON EVERYTHING RULE #144: STOP DOING MENTAL MATH RULE #145: CHOOSE YOUR WORDS CAREFULLY TO GET ON THE SAME PAGE FINANCIALLY RULE #146: CASH FLOW IS KING RULE #147: LIVING TOGETHER IS NOT THE SAME AS MARRIED RULE #148: INCREASE YOUR INSURANCE DEDUCTIBLES RULE #149: DON’T WASTE MONEY ON YOUR CAR RULE #150: LOSE YOUR BAD HABITS RULE #151: MONEY ISN’T YOURS UNTIL IT’S IN THE BANK REDUX RULE #152: HIDE MONEY FROM SPENDTHRIFTS RULE #153: MAKE CHOICES, NOT DEBT RULE #154: EMBRACE ANTICIPATION RULE #155: IF YOU SPLIT UP, TAKE YOUR NAME OFF THE CREDIT RULE #156: MONEY BEGETS MONEY RULE #157: FIGURE OUT WHAT YOU WANT MONEY FOR RULE #158: ESCHEW ENVY RULE #159: NEGATIVE EQUITY IS AN OXYMORON RULE #160: REALLOCATE DEBT REPAYMENT SMARTLY RULE #161: WEIGH MERS AGAINST RETURNS RULE #162: YOUR FINANCIAL NEEDS WILL CHANGE RULE #163: DON’T TREAT YOUR HOME EQUITY LIKE A PIGGY BANK RULE #164: KNOW WHAT YOU’RE SPENDING ON YOUR KIDS RULE #165: DON’T SKIP FILING A TAX RETURN RULE #166: PAY YOUR TAXES RULE #167: DON’T RETIRE TOO EARLY RULE #168: PLAN BEFORE GIVING RULE #169: MAINTAIN YOUR HOME RULE #170: DON’T MIX BUSINESS INCOME AND PERSONAL INCOME RULE #171: WORK HARDER TO PAY MORE TAXES RULE #172: IT’S NEVER TOO LATE RULE #173: YOUR BANK WILL GIVE YOU ALL THE ROPE YOU NEED TO HANG YOURSELF RULE #174: LIFE ISN’T FAIR RULE #175: TELEVISION IS NOT REAL LIFE RULE #176: IF YOU’RE CARRYING A BALANCE ON YOUR CREDIT CARD, CUT UP THE CARD RULE #177: CONSUMABLES ARE NOT INVESTMENTS RULE #178: EXPERTS DIFFER RULE #179: ATMS ARE NOT WALLETS RULE #180: PRACTISE, PRACTISE, PRACTISE RULE #181: NEVER BUY CREDITOR INSURANCE RULE #182: EXAMINE YOUR LIFE RULE #183: FIND SOME BALANCE RULE #184: KNOW HOW CREDIT CARDS CALCULATE INTEREST RULE #185: SET CONCRETE GOALS RULE #186: NEVER TAKE A PAYMENT HOLIDAY RULE #187: HIRE GOOD HELP RULE #188: KEEP A SEPARATE CREDIT CARD FOR ONLINE SHOPPING RULE #189: STUFF ACCUMULATES. USE IT UP. RULE #190: PRACTISE NOT BUYING RULE #191: CHOOSE YOUR EVIL RULE #192: DON’T BE TOO SMART FOR YOUR OWN GOOD RULE #193: BUY AND STAY PUT RULE #194: IF YOU FREEZE, REBOOT RULE #195: BORROW CONSCIOUSLY RULE #196: YOU CAN BUY LIFE INSURANCE ON YOUR PARTNER RULE #197: USE AN RDSP TO PROTECT YOUR DISABLED CHILD RULE #198: PRACTISE FINANCIAL CONSERVATION RULE #199: DON’T TAKE THE TAX MAN’S ADVICE AS GOSPEL RULE #200: MUTUAL FUND AVERAGES DON’T MEAN DIDDLY RULE #201: KNOW THE BEST TIME TO USE A VARIABLE MORTGAGE RULE #202: NOT EVERYONE SHOULD HAVE AN RRSP RULE #203: ACCELERATE YOUR MORTGAGE REPAYMENT RULE #204: HELP CHILDREN WITH EARNED INCOME MAKE RRSP CONTRIBUTIONS RULE #205: YOU DON’T OWN YOUR COMPANY INSURANCE RULE #206: DIVERSIFY YOUR PORTFOLIO RULE #207: WRITE YOUR OWN MORTGAGE RULE #208: ALWAYS REVIEW YOUR NOTICE OF ASSESSMENT RULE #209: WATCH OUT FOR LIFESTYLE INFLATION RULE #210: ALWAYS SHOP WITH A LIST RULE #211: SELF-EMPLOYMENT IS TAX-SMART RULE #212: IT’S NOT WHAT YOU SAVED—IT’S WHAT YOU SPENT! RULE #213: CLOSE CREDIT ACCOUNTS YOU’RE NOT USING RULE #214: TAKE A SPENDING HOLIDAY RULE #215: IF YOU GET BAD ADVICE, COMPLAIN! RULE #216: STUDENT LOANS CAN BE DISCHARGED AFTER SEVEN YEARS RULE #217: REPLACE IMPULSIVE ACTION WITH CONSCIOUS CHOICE RULE #218: COLLATERAL MORTGAGES ARE A TRAP RULE #219: BUY INSURANCE WHEN YOU DON’T NEED IT RULE #220: ADD UP WHAT YOU OWE RULE #221: DON’T BUY AND CHECK OUT RULE #222: DON’T BORROW TO CONTRIBUTE TO AN RRSP RULE #223: OPEN AN RESP FOR YOUR KIDS RULE #224: NEVER BUY A GROUP (OR SCHOLARSHIP TRUST) RESP RULE #225: CONSIDER A MARRIAGE CONTRACT RULE #226: YOU WON’T GET RICH ON MATERNITY LEAVE RULE #227: SET A PET MEDICAL SPENDING LIMIT RULE #228: KNOW WHAT BEING AN EXECUTOR ENTAILS RULE #229: ASK YOURSELF, WOULD YOU PICK IT UP? RULE #230: KNOW THE LIMITATIONS ON RESP WITHDRAWALS RULE #231: UNDERSTAND HOW YOUR PENSION PLAN WORKS RULE #232: DON’T BUY NOW AND PAY LATER RULE #233: NAME A GUARDIAN FOR YOUR CHILDREN RULE #234: FIND THE BUDGET SYSTEM THAT WORKS FOR YOU! RULE #235: CALCULATE THE PER USE COST TO DETERMINE VALUE RULE #236: WATCH YOUR VARIABLE MORTGAGE LIKE A HAWK RULE #237: DON’T CONSOLIDATE TO YOUR MORTGAGE UNLESS YOU’RE SERIOUSLY SERIOUS ABOUT GETTING YOUR DEBT PAID OFF RULE #238: STOP THINKING OF AN RRSP AS AN INVESTMENT RULE #239: WATCH YOUR FOOD COSTS RULE #240: EMBRACE SIMPLE PLEASURES RULE #241: EVEN COMPANY PENSION PLANS HAVE RISKS RULE #242: IF CRAP HAPPENS, RENEGOTIATE YOUR STUDENT LOAN TERMS RULE #243: CO-SIGNED DEBT IS 100% YOUR DEBT RULE #244: KNOW IF YOU CAN “THOIL” IT RULE #245: DON’T MAKE YOURSELF HOUSE-POOR RULE #246: FEND OFF RETAILER INFLUENCES RULE #247: NAME A “CONTINGENT SUBSCRIBER” ON YOUR RESPS RULE #248: CROSS CHEQUES TO PROTECT YOURSELF RULE #249: BUY THE INDEX RULE #250: TAX-PLAN IN JAN RULE #251: DON’T GET SUCKED IN BY “FREE” RULE #252: YOU’RE ALLOWED TO SAY NO RULE #253: GET OUT OF OVERDRAFT RULE #254: MAKE MORE MONEY RULE #255: A LINE OF CREDIT IS NOT AN EMERGENCY FUND RULE #256: CALCULATE YOUR REAL MORTGAGE LOAN INSURANCE COSTS RULE #257: STOP LOOKING FOR THE EASY WAY RULE #258: LEAVE $1,000 OF YOUR EMERGENCY FUND IN YOUR CHEQUING ACCOUNT RULE #259: YOU DON’T NEED A TON OF CASH TO MAKE A PRINCIPAL PREPAYMENT AGAINST YOUR MORTGAGE RULE #260: TAKE PLEASURE FROM YOUR MONEY RULE #261: DON’T TURN GUIDELINES INTO RULES CONCLUSION Money Is Just a Tool LIST OF RULES ACKNOWLEDGEMENTS About the Author Credits Copyright About the Publisher
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