Personal Finance

How am I doing and what can I improve

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Newbie
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Jun 18, 2013
28 posts
7 upvotes
Montréal

How am I doing and what can I improve

hello all,

I've recently (this month) decided to finally start keeping a personal budget and tracking all income and expenses on a excel sheet. I've been living 34 years with zero budget and no real plan so this is all new territory for me. one trend I've noticed after a few weeks of tracking and planning is net income is still equaling up to my expenses so little to no savings being made. I was hoping some input from the community on what I can change will shed some light on my spending habits.

my monthly plan (goal) looks like this:

MONTHLY INCOME (this is take home pay after taxes)
PAY 1 $1,154.54
PAY 2 $1,154.54
RENT PAY $250.00
Total net income $2,559.08

FIXED COSTS
RENT $825.00 firm
CELL $101.14 negotiable
CAR Ins. $47.34 negotiable
bank fee $10.95 firm
CREDITCANADA $200.00 minimum
TTL $1,173.48 45.86%

FINANCIAL GOALS
Emergency fund $400.00
new car/ $200.00
travel $75.00
TTL $475.00 18.56%

VARIABLE SPENDING
Gas $200.00
Car maintenance $100.00
groceries $300.00
eating out $100.00
haircut $20.00
TTL $720.00 28.14%

a few clarifications. I had a lot of credit card debt the last few years and it eventually became too much so I signed up with CreditCanada to consolidate all my debt into a monthly payment. the minimum is 200$/month and the total debt is 8k$ +. I'd like to pay this off in less than 2 years ( I have the exact details online for this).
I live in Quebec Canada so all monies are in CDN (if that makes any difference). I have a 9 year old car in good shape (Hyundai Accent, 2007 manual, 110000km) but it will need to be replaced in 2 years I estimate.

I am single and live in an apartment so I assume food costs are a little high even for me. I try to shop at walmart but not sure if that is as cheap as I can go. I would eventually like to get on a health plan (estimating 50-100.month... it's Quebec)

my big question is... are my priorities in order? (pay off debt, create emergency fund and savings for car) . I assume after all that I can dive into the world of investing. what say you?
Don't let the floor be your ceiling
28 replies
Sr. Member
Aug 20, 2015
517 posts
307 upvotes
Toronto
You should definitely look into reducing the cost of your cell phone plan. $100 a month is pretty crazy when you have to pay off debt.

Is your bank fee really firm? There are a lot of free banking options out there, tangerine, pcf etc.

How much is your interest on your debt?

This is really dependent on your peace of mind, but have you considered reducing the amount you put into your efund and put it into your debt instead? Could do it the other way around if you really feel the need to have a efund buffer, i.e. $400 into debt $200 into efund. This would probably pay off your debt in 2 years instead of 4+.

And yes your grocery bill is rather high for a single person. Try to start cutting things out a little at a time, you'll adjust faster than you think once you start making small adjustments over time.
Deal Guru
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Mar 23, 2008
13006 posts
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Edmonton
What about things like clothes, gifts for other people, toiletries, etc. What is your "Rent" income?

Where did you get your numbers from?

C
Sr. Member
Aug 20, 2015
517 posts
307 upvotes
Toronto
and yes as C pointed out you're likely missing some field in your expenses. Others that come to mind are parking, entertainment, hobbies.

Also just curious, do you get paid biweekly and you're budgeting based off these biweekly amounts?

If this is the case there will be 2 months in the year where you will get a 3rd paycheque (budgeting based off of 24 paycheques, but you get 26 per year). You should figure out which months this happens for you if this is the case and use that 3rd paycheque to solely throw into your debt. Mine occur June/Dec this year.
Sr. Member
Aug 17, 2008
513 posts
234 upvotes
Quebec
what is the interest rate on your debt? Id pay the debt first before building an emergency fund. $600/month * 12 =$7200
A little over 1 year and your debt is gone.

$75/week for grocery seems reasonable. Car insurance is high for a 2007 Accent. Cellphone seems high too
Deal Guru
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Mar 23, 2008
13006 posts
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Edmonton
Some other budget categories...

Home/renter's insurance
Utilities (cable/internet/power/gas)
Car registration
Public transportation
Parking
Clothes
House cleaning/maintenance
Entertainment (movies/Netflix/concerts/going out)
Gifts
Personal insurance (life/disability)
Medical expenses (co-pay if you have medical at work)
OTC drugs/vitamins/supplements
Hobbies/sports (including video games or whatever you do in your spare time)

C
Deal Addict
Nov 25, 2014
1739 posts
960 upvotes
Newton Brook, ON
I'm guessing PAY 1 and PAY 2 are biweekly paychecks, in which case that total is less than your actual income. 26 paychecks = $30,018.04/year, or $2501.50 average per month. Plus rent = $2751.50.

With that debt, I wouldn't set aside any money for the car at all. Assuming it's high interest, you will be better off owing a bigger car loan in 2 years than carrying the CreditCanada debt longer than necessary. And like the others said, you could probably put some of the $400 toward this too.
You need someone with an umbrella not a fork
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Dec 12, 2006
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Messed Up Area
Missing alot: personal hygene supplies, cleaning supplies, utilities, renters insurance, clothing, gifts, toys, etc.


But you have rent pay as $250 income and as expense 825, are you sharing apartment? Maybe that rent income is too low and should be increased to 1/2 apartments rent. And technically it would not be considered income as it shared rent and you are just collecting and passing amount rent to real landlord.

As well monthly budgets are not based on 4 weeks ( 2 pays ) your budget should use calculaltions of 4.3 weeks per month ( 52weeks/12months ) As you do realize in some months you get 3 pays.


Bank ditch and get tangerine or PC ( saves you $100+ year )
cellphone....you can get cheap plans in QC so you can reduce that by 40$ ( saving you $480 per year )
car insurance maybe not negotiable, as depends your location and situation as how rates are calculated.

Consider moving to lower cost rental, you should not spend more than 30% income on housing. and your above that now.

You never included utilities - electricity, internet, gas, water, etc...

Since your spending 200 month gas, maybe move to save money closer to your travelled places, could save you 50%

No parking expenses?

Cut eating out, as can save you $100...saves you $1200 year
haircut do you actually need one once a month, skip 1-2 months....saves your $20-40 .

Maintenance on car... still spending 1.2k a year... seems high maybe look at different new vehicle now, you will have added expense but will use up maintenance budget and maybe save on gas reducing overall costs
Newbie
User avatar
Jun 18, 2013
28 posts
7 upvotes
Montréal
tsingoo wrote: You should definitely look into reducing the cost of your cell phone plan. $100 a month is pretty crazy when you have to pay off debt.

Is your bank fee really firm? There are a lot of free banking options out there, tangerine, pcf etc.

How much is your interest on your debt?

This is really dependent on your peace of mind, but have you considered reducing the amount you put into your efund and put it into your debt instead? Could do it the other way around if you really feel the need to have a efund buffer, i.e. $400 into debt $200 into efund. This would probably pay off your debt in 2 years instead of 4+.

And yes your grocery bill is rather high for a single person. Try to start cutting things out a little at a time, you'll adjust faster than you think once you start making small adjustments over time.
thanks for the reply, to reply to your questions.

the cell phone I should be able to renegotiate. the cost of the phone is included in the plan and because I didnt buy the phone outright I'm limited to the 60% + plans but I will look into it this week.

My bank is not firm... I never considerd that so I will look into changing to a free bank. I dont do anything crazy in terms of banking so I will see about those suggestions.

I am with a debt consolidation service (creditcanada.com) and I believe there is zero or minimal (<4%) interest while I pay the prinicipal down but I will check into that.

The emergency fund is touchy... I feel like the debt is stable with the debt consolidation service and I need to build a little efund in case my car breaks down or emergencies (I know its general) for example I had an unexpected funeral 2 weeks ago and I was out about 300$ in clothes, gas, etc. I will reevaluate wether the stress of the debt lends to me focusing more on it.

Grocery bill I will analyze my week to week better. I do lump apartment supplies and toiletries in there as I shop at walmart and grocery stores interchangeably for groceries.
Don't let the floor be your ceiling
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Jun 18, 2013
28 posts
7 upvotes
Montréal
CNeufeld wrote: What about things like clothes, gifts for other people, toiletries, etc. What is your "Rent" income?

Where did you get your numbers from?

C
clothes is a good point... I dont really pay attention to that and I have amassed a big collection of clothes. the only items I buy annualy these days are socks/under wear and a few shoes or shorts / year but you are right... it is not factored into my monthly. I will allocate 30-40$/month for that

gifts I did not factor in as my family and friends arent really the gift giving but I should consider that (weddings, house warmings etc.)

toiletries are lumped in with groceries (maybe not a good idea) as I buy it at walmart where I grocery shop as well or the grocery store

my "RENT PAY" is poorly explained in my first post.
my job gives me a 250$ housing allowance as I had to relocate suddenly during the year. this 250$/month (10 months total) is too offset travel costs and moving etc.

I should of called it "WORK HOUSING ALLOWANCE" maybe
Don't let the floor be your ceiling
Newbie
User avatar
Jun 18, 2013
28 posts
7 upvotes
Montréal
tsingoo wrote: and yes as C pointed out you're likely missing some field in your expenses. Others that come to mind are parking, entertainment, hobbies.

Also just curious, do you get paid biweekly and you're budgeting based off these biweekly amounts?

If this is the case there will be 2 months in the year where you will get a 3rd paycheque (budgeting based off of 24 paycheques, but you get 26 per year). You should figure out which months this happens for you if this is the case and use that 3rd paycheque to solely throw into your debt. Mine occur June/Dec this year.
Parking is a non issue as I do street parking in Montreal and work reimburses me 100% for work parking costs. day-today I never really do pay parking in MTL as street parking is extremely accesible. although I have had 3 parking tickets in the last 5 months (about 200$ total) so something I need to be more careful about.

I cut out entertainment/hobbies as the residual 150$+ that is not accounted in my income-expenses sort of goes into that fluidly.

I am paid biweekly. and did not factor the 2 extra pays per 12 months (interestingly enough I calculated this the other day and I will have 4 extra payments between jan2017-dec2017 (march/june/august/nov) and am considering that as income that will be put towards either Financial security (emergency fund or small investing) or debt repayment. this amounts to 4500$ extra for this year.
Don't let the floor be your ceiling
Newbie
User avatar
Jun 18, 2013
28 posts
7 upvotes
Montréal
sr79 wrote: what is the interest rate on your debt? Id pay the debt first before building an emergency fund. $600/month * 12 =$7200
A little over 1 year and your debt is gone.

$75/week for grocery seems reasonable. Car insurance is high for a 2007 Accent. Cellphone seems high too
it is very low (I need to check but I believe between 0-4%) as I am with a debt consolidation service. my minimum is 200$/month (will be paid off in 38 months at that rate)

since the interest is low and stable I feel the need to build an emergency fund quickly as lately I have needed one (funerals, car repairs, considering career change)

groceries I know I can reduce that.... I'm big on meal prep and make all my meals 5-7 days at a time and think I can bring it down to 60ish. insurance is high (for quebec) as I had an at fault claim in the past and decided to stop driving for a year. in two years it will be lower (14 more months) . phone I need to get my butt in gear and figure that out.
Don't let the floor be your ceiling
Newbie
User avatar
Jun 18, 2013
28 posts
7 upvotes
Montréal
nmclean wrote: I'm guessing PAY 1 and PAY 2 are biweekly paychecks, in which case that total is less than your actual income. 26 paychecks = $30,018.04/year, or $2501.50 average per month. Plus rent = $2751.50.

With that debt, I wouldn't set aside any money for the car at all. Assuming it's high interest, you will be better off owing a bigger car loan in 2 years than carrying the CreditCanada debt longer than necessary. And like the others said, you could probably put some of the $400 toward this too.
car I own is owned outright (hyundai accent 2007) but it has started to need major repairs (since owning in august I have put 700$ into it (not including winter tires and general fluid uptake) and will likely need some more major soon. I want to buy another newer used car in a year (or less hopefully) . I do not have a car loan or finance and do not plan to in the near future.

you are correct about my bi monthly payments.... I will be paid 26 times in 12 months. I did not calculate that into my average monthly, thought I could use it as extra and divide it into my debt payment and efund
Don't let the floor be your ceiling
Newbie
User avatar
Jun 18, 2013
28 posts
7 upvotes
Montréal
theguyz wrote: Missing alot: personal hygene supplies, cleaning supplies, utilities, renters insurance, clothing, gifts, toys, etc.


But you have rent pay as $250 income and as expense 825, are you sharing apartment? Maybe that rent income is too low and should be increased to 1/2 apartments rent. And technically it would not be considered income as it shared rent and you are just collecting and passing amount rent to real landlord.

As well monthly budgets are not based on 4 weeks ( 2 pays ) your budget should use calculaltions of 4.3 weeks per month ( 52weeks/12months ) As you do realize in some months you get 3 pays.


Bank ditch and get tangerine or PC ( saves you $100+ year )
cellphone....you can get cheap plans in QC so you can reduce that by 40$ ( saving you $480 per year )
car insurance maybe not negotiable, as depends your location and situation as how rates are calculated.

Consider moving to lower cost rental, you should not spend more than 30% income on housing. and your above that now.

You never included utilities - electricity, internet, gas, water, etc...

Since your spending 200 month gas, maybe move to save money closer to your travelled places, could save you 50%

No parking expenses?

Cut eating out, as can save you $100...saves you $1200 year
haircut do you actually need one once a month, skip 1-2 months....saves your $20-40 .

Maintenance on car... still spending 1.2k a year... seems high maybe look at different new vehicle now, you will have added expense but will use up maintenance budget and maybe save on gas reducing overall costs
to clarify... personal supplies and home supplies are lumped into groceries in my eyes as they are all purchased at same store on same bill (walmart)

my rent includes heating, electricity, tv and internet so they are lumped into my rent payment. I do not have renters insurance and have never honestly had it. not quite sure I understand why I would need it.

the rent pay is a housing allowance from my job.

I understand the concept of 26 pays/12 months and I will do a second budget with youre 4.333 suggestion but honestly I saw as 2 exptra pays that when recieved can be put directly to debt repayment. cell phone I agree with you... will call this week. car insurance I explained in another reply but It may be slightly negotiable.

I completely agree with your housing assesment... this year I was between two cities (not sure which would be my permenent home) and because of that not sure what my options are.... my lease expires in July 1 so I will start looking for a more economical housing situation in the spring.

all those utilities are included in my rent cheque... I have a roommate with his name on the lease that pays all that.

the problem with the gas is it is extremely fluid.... some months I only spend 100$ other months 300$.... I've done about 15000km of driving the last 7-8 months (70% work and 30% personal) . it has now been less driving thankfully and I hope to see that stabilize around 100$/month but that is mostly due to my work situation (I am a swim coach and drive to diferent cities and if the city is farther than 100km my gas is paid... under it isnt)

no parking expenses... free street parking and work pays my parking there

I agree with eating out.... I need to cut it out 100% health wise and budget wise. haircut... no... I have since cut it out...

my car is a big sticking point... it is a great car, low mileage (2007 hyundai accent 110000km) but lately the major repairs have crept up (so far a wheel bearing and cv joint 250$, new starter and winter tires (550$) and now the shocks are going (no estimate yet but I'm guessing 500$)

considering saving right now for a newer used cars. these montreal winter roads do not help with my maintenance costs at all
Don't let the floor be your ceiling
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Dec 12, 2006
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Messed Up Area
JohnnyMac1 wrote:
my "RENT PAY" is poorly explained in my first post.
my job gives me a 250$ housing allowance as I had to relocate suddenly during the year. this 250$/month (10 months total) is too offset travel costs and moving etc.

I should of called it "WORK HOUSING ALLOWANCE" maybe
This must be accounted for in budget as it will expire and your other costs will still exist, making $ more tighter in area's of budget. So at month 10 your numbers will be shortfalled by $250 right away. Approximatly a 10% hit from your monthly income.
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Dec 27, 2009
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Victoria, BC
JohnnyMac1 wrote: I have a 9 year old car in good shape (Hyundai Accent, 2007 manual, 110000km) but it will need to be replaced in 2 years I estimate.
I think you can get a lot longer than two more years out of your car (only 110,000KM currently). One of our cars is a 2010 Pontiac Vibe (manual transmission) with over 200,000KM and expect to get at least another 100K out of it. Stick some money aside every month for car maintenance/repairs. Guaranteed with your low budget any other used car you will be able to buy will also have issues (and they could be a lot worse than your current car's issues). You don't know how someone else has treated their car/driven it. Sometimes better the devil you know.
Deal Addict
Nov 25, 2014
1739 posts
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Newton Brook, ON
JohnnyMac1 wrote: car I own is owned outright (hyundai accent 2007) but it has started to need major repairs (since owning in august I have put 700$ into it (not including winter tires and general fluid uptake) and will likely need some more major soon. I want to buy another newer used car in a year (or less hopefully) . I do not have a car loan or finance and do not plan to in the near future.
Not financing is ideal, but the fact is you are already financing. In most cases a car loan is lower interest than unsecured consumer debt and that makes it the lesser evil. You need to find out for sure how much that consolidation loan is costing you and decide from there.

JohnnyMac1 wrote: I am paid biweekly. and did not factor the 2 extra pays per 12 months (interestingly enough I calculated this the other day and I will have 4 extra payments between jan2017-dec2017 (march/june/august/nov) and am considering that as income that will be put towards either Financial security (emergency fund or small investing) or debt repayment. this amounts to 4500$ extra for this year.
I don't see how this is possible. If you receive 3 paychecks in March, you will receive 3 again in August, but not June or November.
You need someone with an umbrella not a fork
Sr. Member
Aug 20, 2015
517 posts
307 upvotes
Toronto
Yeah I would try to separate your groceries and toiletries apart as best you can while doing your budgeting. It becomes easier to identify what you're able to cut down on. Also you'll avoid posters mentioning that $300 for groceries is quite high.

At this point when you consider your extra 2 missing paycheques, your debt should be clear in about 2 years with no changes to your current expenses. Keep in mind you will need to factor in the housing allowance after 10 months that another poster mentioned as well.

However, with this in mind you should still look at minimizing your expenses to avoid getting into a similar situation in the future. Hopefully in 2 years you'll be thinking about how to invest your savings as opposed to reducing debts (I would avoid trying to invest right now until your debts are clear). Also, possibly being more aggressive on the job market and look for a higher paying job as well will really help you out.
Sr. Member
Aug 20, 2015
517 posts
307 upvotes
Toronto
Also, note that tangerine (and others) usually has a sign up bonus. Currently with tangerine you could get $50 with referral and $75 with direct deposit switch.
That's about a $250 swing this year if you cancel your current bank now. Make sure that the abm's are convenient for you and see if any of your friends bank with tangerine to get a referral code from them.
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Jun 18, 2013
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Montréal
theguyz wrote: This must be accounted for in budget as it will expire and your other costs will still exist, making $ more tighter in area's of budget. So at month 10 your numbers will be shortfalled by $250 right away. Approximatly a 10% hit from your monthly income.
I have two residences currently and the 250$ pays for the second residence (200$/month) until I stop needing the residence (in 5 more months). its a complicated situation but it will not effect the budget after 10 months I will not need the second residence. there is a slight net profit from it
Don't let the floor be your ceiling

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