Banks

Enjoying the High Numbers

For the last two weeks I’ve  been enjoying checking out my bank balance and seeing all sorts of money in there. That’s because I haven’t yet divvied up my income tax refund. It’s been a busy few weeks at work and I haven’t had a chance to do anything with it. Half of it is going towards my loan, and the other half to my savings account for the car payoff next year. And this past Friday was pay day, so the number’s even higher than before! Yowza. It’s always fun to see the numbers go up into 4 digits, especially when it used to be only in the 2-digits.

Sadly this week I fear it’s time to start dividing up the money, so I’ll be a little sad to see the amount decrease, but it’s gotta be done.

Making it All Automatic

One of the things my FA (financial advisor) wants to do for me is to set up my finances so that I’m able to spend whatever money’s left in my chequing account guilt-free. He’s already set up quite a bit for me so far, so that with each paycheque:

• my loan payment is withdrawn automatically
• my savings amount is withdrawn automatically

He would love to set up my rent and other bills to come out automatically, however because it’s not a mortgage but a rent payment, he can’t quite do that. (much to his chagrin–it’s kind of funny to see how frustrated he gets at this.) To assuage this need of his I’m thinking of setting up a separate account for my rent and bills, so that I can shuttle money over to it, and then have the payments come out automatically. That way I can still spend whatever’s left in my chequing account guilt-free.

Slowly but surely my finances are coming together. I know it’s only been 6 weeks since I met with the FA and set all of this up, but it’s quite exciting to see everything come together, you know?

The Numbers Have Been Updated

There you have it folks, over there on the right sidebar you’ll see my new Current Debt ticker. It now shows the one-and-only debt that I currently have, my consolidation loan. Yippee! You might also notice that the number is almost $9,000 more than my previous current debt, and that’s because we paid out my car lease at the same time. In order to get the consolidation loan the bank said I had to get rid of absolutely every credit vehicle I had, which included the car lease, so we paid that off and rolled it into the consolidation loan. Not bad as that essentially reduces the number of bills I pay to one, my combo cable/internet/cell phone. Isn’t that crazy? Oh, and rent too, but that’s not really a bill now, is it?

I am so excited that:

• I am only paying one creditor right now.
• My loan payment is manageable enough that I’ll be able to save for both my retirement and regular savings.
• I’ll be saving for my retirement
• I’ll be saving for both an emergency and to pay off the car when the lease is up next year.

Gotta love it when things come together and life gets a bit easier. Me and my FA are going to meet again in 3 months to see how things are going, and to tweak any of the numbers. If my life isn’t impacted too much by the current RRSP and savings withdrawals, we might increase those to maximize things. By increasing the savings, I’d be able to pay off the car next year in cash. I could actually do that by dumping all of my current extra money into the savings account, but then I wouldn’t have anything left over for RRSP contributions, so by splitting it I’ll have both. And the RRSP contribution also gets me a refund from the government on this year’s income when I file next year, which I could then use for the car as well. It won’t make up the difference by any stretch of the imagination, but it’ll bring me a little closer, that’s for sure.

Success, huzzah!

The Pros Know

They really do! Remember how a few weeks ago I mentioned I was going to go see a financial professional to see if he could help me out? Well, he helped, he really did! I am now the proud owner of a 5-year open loan at prime + 1% (this is where working for a bank is paying off). Originally the bank would only give me the loan if I closed all of my credit cards and lines of credit, which I was intending to do, although I did want to keep one card for those situations where you do need one (like getting a Blockbuster membership). And that’s what my FA (financial adviser) thought of too, so he was able to do that for me. I get to keep my one credit card with a $1,000 limit, which is fine by me. In fact, this was a variation on the plan I was trying to work on! All in all it worked out nicely for me, if I do say so myself.

Now I’ve got a $340 bi-weekly loan payment ($680 total) for the next 5 years that comes out of my bank account on payday. It’s an open loan, which means I can make extra payments whenever I want. My FA also got me enough money to cover the rest of my car lease, which gives me enough time to save up money to buy out the car next year when the lease is due. I’m so excited about this, it’s not even funny! Instead of having to pay 5 different things, I only pay one. As my FA kept saying “your credit score will go up because we’ve moved all your debt to one bank, which looks better.”

Yee haw!