Your Emotional Brain is in Control

Based on our not so scientific observations, we all have two brains — our logical brain, and our emotional brain.

Each and every day we have choices to make and decisions to take. On our best days, we’d like to believe that our logical brain is leading the charge, making the most rational decisions based on the facts we have. But guess what? Our emotional brain is always in the driver’s seat, guiding and driving our decision making process, with our logical brain buckled safely into the passenger’s seat, along for the metaphorical ride.

Simply put, our emotional brain is actually in charge while our logical brain provides support. With our emotional brain calling all the shots however, our logical brains therefore get saddled with the responsibility of justifying the emotionally-driven decisions we make… and let’s just say our logical brain has to get pretty creative with its rationale to support our, at times, brash emotional choices. Better yet though, our rational brain takes its support role very seriously, using justification to do an incredibly convincing job at making our emotional decisions make “sense”.

So, what are some tell-tale, warning signs to be aware of that would indicate that our rational brain is using bad logic or has scrambled into high-drive justification mode to what is naturally an emotionally-driven financial decision?

  1. We move into justification mode — you find yourself uttering the words “it’s an investment” when it comes to acquiring a depreciating asset — like a vehicle — or spending money on home “improvement” like a pricey kitchen renovation years before you’re ready to move.
  2. The primary feeling you’re experiencing is excitement — while excitement is a good thing and a healthy emotion, generally, when it comes to outfitting your home with a new roof or your car with new tires, the emotion you feel generally is not excitement but anxiety of not wanting to wait too long to replace either versus purchasing the latest iPhone because your battery health has decreased from 98% to 97% and has therefore become less reliable in your mind.
  3. You make no decision — whether you realize it or not, no decision is in fact a decision. By choosing to not make a decision you may think you are not letting your emotional brain drive the car, but in fact, you are, it’s just fear that you’re feeling this time.
  4. The sacrifice is not obvious — when we make a decision to take our young family on yearly international vacations rather then on local camping trips because we’re convinced that one experience is superior over the other and we’re doing it “for the kids”, our emotional brain might be focused on enriching the lives of our children but what about the potential opportunity cost of putting off financial independence in the process?
  5. Your decision reduces the control in your life — we decide that welcoming more debt into our life is justified if it means reliability in the form of a brand new, top end of the line vehicle — however with this decision comes expensive vehicle payments which potentially ties us to a particular salary figure and a particular job with little or no option to transition onto a lesser paying employment opportunity.

As humans, every decision will automatically be one made and led by emotions — it’s simply just a matter of understanding that this is in fact the case. Your rational brain will do all it can to defend and support your emotional brain’s decisions, so simply be vigilant, aware and prepared for an upcoming blog post on our five strategies for managing our emotional brain for personal finances.

Budgeting Made Simple

Honesty hour: it’s taken me a long time to admit this to myself (and you), but I don’t know how to budget. Or more accurately, I didn’t know how to make or use a budget before last monthNow before you say to yourself, “but Courtney, you have a personal finance podcast, how can you possibly not know how to budget????”

Now let me let you in on a little secret. I thought I knew how to budget. I honestly did. I was really good at saving my receipts, putting them into a box for a few weeks, pulling the pile out and then entering the information from the receipt into my Excel spreadsheet, and then filing the receipts away in 12-month receipt organiser. I was really proud of my spreadsheet – it seemed to do a lot. Keyword: seemed. The only problem with my spreadsheet was that it didn’t really tell me anything… that is anything personally meaningful that made sense to me. So essentially I was left with a really intense expense tracker, not a budget.

And I think that’s where the lines blur a lot of the time and where confusion occurs. There is a huge difference between an expense tracker and a budget – tracking your expenses looks backwards at what you’ve spent and budgeting looks forward to make predictions on what you will spend based on what you have spent.

I think, like everything else, there is an explanation to why we have trouble creating a budget and using it – because we don’t want it bad enough. And I know that was true for me. As a student, I worked strictly during the summer months and used my earned income throughout the school year – so essentially my budgeting strategy was to ‘make it last’. Now, as a full-time working post-grad, that strategy has obvious and apparent pitfalls.

I think there’s a lot of pressure built around how you’re supposed to budget. Thanks to the help of talented creators and masterminds behind budgeting apps and software these tools appear to take away the intimidating and overwhelming aspect budgeting brings.

However, for me, this is where it all fell apart. Because what is not blatantly apparent is that while these tools are amazing at actually helping you use your budget they don’t teach you how to budget.

For me, finally learning how to create a budget did not take place within any app or software program, but rather with pencil and paper. I came across a budgeting journal at Michael’s, the arts and crafts supplies store, and instantly knew that this was the solution I needed. I was able to have a high-level overview and more control.

For me, budgeting finally took a turn for the better when I understood what I needed to do to succeed, had the motivation and drive to succeed, and lastly, embraced simplicity.

Are You a Mindful Spender?

Mindful spending = making conscious financial decisions.

Do you spend every dollar with intention? Do you thoughtfully consider each purchase before making it?

To determine whether or not you are a mindful spender there are two key red flags to be aware of: a) you spend money spontaneously and b) you spend money while under the influence of others.

The simplest way to become a more mindful spender is to ensure that every purchase made is one that you feel is adding value to your life and one that comes from intrinsic desire. Making a purchase (whether it be an object or experience) to please or impress others isn’t benefiting you and your hard earned dollar.

Next time you go to make a purchase, stop and ask yourself, “who am I trying to please?

– Courtney

Can Our Relationship Work?

How important is money in a romantic relationship?
VERY is my simple and straightforward answer. Often in new relationships, money is viewed synonymously with discussing how many children you both want – it’s something that’s too serious to consider until it gets serious. However, while talking about money can potentially be a heavy subject, it doesn’t have to be. By infusing money talk into more conversations, it will soon become a topic that gets easier to discuss. Money is so important because financial incompatibility can be a deal breaker if not addressed properly.

How do I know if my significant other and I are financially compatible?
Before you can even begin to answer this question, you must first look inward. What are your own personal values, beliefs, and attitudes when it comes to money? Next, ask these same questions to your partner so you are aware of his or her views and then compare his or her views to own and reflect on the similarities and differences in outlook.

I’m in a relationship with someone whose money values are a LOT different than mine, can we make it work?
As like with anything else, patience, respect, and a deep level of understanding are the key ingredients that will allow your relationship with your partner to flourish. If you and your partner are willing to listen to one another and be understanding of one another’s values when it comes to finances and money then the relationship can succeed.

For more on this topic, check out episode 26 on financial compatibility.

– Courtney

Coffee Making Essentials

If you claim to be a non-functional human being in the morning until you’ve had your first cup of coffee, you’re not alone. How I’ve become such a caffeine-dependent life form is beyond me. But that issue aside, like you, I appreciate a well made, great tasting cup of joe. I appreciate the aromatic taste and its invigorating smell.

But the actual physical drink aside, there is a magical aspect to the coffee experience. For some of us, we feel that when we walk into a coffee shop and hear the whirling of machines, the quiet constant chatter, the soft overhead music, and the smell of coffee brewing.

As much as that atmosphere isn’t quite the same when you’re making coffee in your kitchen, it has the potential to turn into a morning ritual that you can look forward to. For me, the way I make my coffee makes me look forward to that first sip.

While you and I both know that making coffee isn’t rocket science, we can still agree that there is a clear distinction between good and bad coffee. I’m sure you’ve had a cup of coffee in your hands, and anticipated that first sip, only to be brutally let down. We’ve all been there.

I used to have this coffee making method that produced ill-tasting coffee. I then moved on to drinking instant coffee. Both left me feeling so coffee deprived. Obviously, each individual has their own personal preferences and if you thoroughly enjoy drinking instant coffee I’m glad (but please share with me how you do it). Drinking coffee that wasn’t my definition of delicious only made me resent drinking my morning coffee at home and made me long for a store-bought one instead.

However, the day I changed my coffee making method was the day that making coffee at home became exciting and invigorating and something to look forward to in the mornings. (For any non-coffee drinker reading this right now, I swear I’m not exaggerating).

Here are four essentials to help you power through the Frugality February challenge:

1. The coffee making system counts

If you listened to episode 23 on minimalism, you’ll know that Trevor and I embrace the minimalist mindset. And this philosophy extends to coffee making. Trevor and I both live in households where we are the solo coffee drinkers of the house and only drink one to two cups each in the morning. So this renders a standard six to eight-cup coffee maker a little excessive. So to compensate we use individual cup coffee brewers.

I use a Bodum french press and Trevor uses a coffee infuser. We’ve of course tried so many different coffee making systems but have really settled on these two methods for the absolute best tasting coffee. And of course, in the minimalist frame of mind, both these kitchen gadgets don’t take up much space, are easy to clean and don’t waste coffee. Just remember that whatever your go-to coffee making method is just make sure it produces coffee that doesn’t make you wish you were drinking coffee made by a barista somewhere else instead.

2. The coffee 

Trevor and I will disagree on this one, but I don’t think the coffee matters. I purchase a 2lb canister of Folgers Regular Classic Roast which lasts me a really long time. However, Trevor insists on bags of McDonald’s or Tim Hortons dark roast. If you’re more like me where “coffee is coffee” opt for the more economical canister option. But saying this, if buying a specialty brand coffee is what is going to keep you from running out to buy a cup of coffee, then spending a little extra on your coffee for home while grocrey shopping is a worthwhile purchase.

3. The travel container

My go to coffee travel container is my Starbucks traveler. It keeps my coffee and tea hot for a long time but doesn’t get hot to carry in my hand. It has a secure seal so I know it won’t leak. But there is no shortage of other options when it comes to travel containers, and the design and technology of hot beverage travel containers just keep getting better and better, so if you’ve ever experienced a not so pleasant coffee or tea spillage moment with your travel mug, don’t give up.

4. Don’t go overboard

Suggesting that you should make coffee at home is not an invitation to go out and buy the most expensive Keurig or Tassimo you can get your hands on and enough K-Cups or T-Discs to last you for the next twenty years. While the coffee from these systems may taste good, it’s not necessarily the most inexpensive way to make coffee at home. While I’m in no way condoning the use of either coffee maker, I’m just assuring you that making coffee at home can be as simple as you want it to be.

If you have any other coffee making inspiration that I didn’t mention please share it with us as we’re always looking for ways to make even better at home coffee.

– Courtney

What They Don’t Teach You in Post-Secondary

stack-of-books-images-book-stack-1We walk through life with all these expectations placed on our shoulders. At times, we may feel that these expectations are more than we can realistically handle or have the knowledge to deal with. As a student in post-secondary I can attest to this. Every post-secondary student has to face adversity and challenges bigger and tougher than they could ever imagine facing.

But I guess that’s part of post-secondary. Yes, you’re getting an education in a field of interest that will prepare you for your career, but you’re also facing hurdles that look too high to jump over until you’ve actually jumped over them and landed on the other side.

So while post-secondary makes you tough, teaches you how to maximize your caffeine intake for optimal lucidness while studying for midterms, it fails to prepare financially.

The concept of whose responsibility is it to teach youth about personal finance is a concept in which you can listen to in Episode 11. Because the elementary and high school curriculum barely cover the basics, the last glimpse of hope at a formal education in personal finance is post-secondary intuitions.

Now don’t go telling me that all the commerce students have a leg up on the general post-secondary population, because I can confirm for you first hand, with my minor in business, and the slew of accounting and finance classes that I’ve taken, this faculty doesn’t in any way direct you in how to handle your personal finances from saving to spending, when and how you should start saving for retirement, what your risk tolerance is, or how you should invest your money. TFSA, RESP, segregated fund, non-registered, registered, disability insurance, life insurance… seriously, how is the average student is supposed to know the difference?

Yet society acts so surprised when twenty, thirty and forty year olds make poor financial decisions such as buying a house with a mortgage that the individual will never be able to pay off. The unfortunate reality is, a majority of youth today may in fact never have the opportunity to gain a full spectrum of financial tools for their personal finance toolbox, and, as life throws them scenarios that require financial action, they will have to rely on trial and error, failure and success as a guiding compass.

Through my summer spent at a financial advisory firm I learned early on that what the personal finance knowledge I was learning wasn’t something being taught elsewhere.  I have learned an immense amount about investments, saving, spending and insurance, yet have barely brushed on the all the confusion that makes up the personal finance world. And all this made me realize one thing: why isn’t personal finance, something that can significantly shape your future and determine how well you succeed financially, more of a priority within post-secondary institutions?

Until the post-secondary world wakes up and realizes that they are inadequately supporting and teaching their students personal finance, it’s so critical to take the initiative yourself to become financially educated. I think it’s so important to understand what your financial goals are and why. It’s crucial to do your research and understand personal finance in a way that resonates with you. Trevor and I hope that, through this podcast, we can provide you valuable resources and strategies.

It’s so important to reach out to a professional or a financially savvy individual to better understand the impact your financial decisions have on your life. Because whether we like it or not, being financially responsible is something that we might not feel ready for, but need to be. Making irresponsible financial decisions can make or break us and really shape our future, making it so critical to be aware and alert of the consequences of your financial actions. So dig out your flashlight and shine some light on the world of personal finances, and you’ll soon realize that it’s not as terrifying or mystifying as you thought it out to be.

– Courtney

7 Student Tips for Saving Money Day-to-Day During the School Year

With a limited student income being stretched to last eight months (September to April), saving becomes essential, so below are my seven tried and tested (and maybe even obvious) tips on saving money during the school year on a day-to-day basis:

1. Pack a lunch. – Not only do you save money but it also (hopefully) guarantees that you’ll be eating clean. If you’re currently a post secondary student you can attest with me when I say that the freshman 15 is not a myth made up to scare us, but the cold, hard reality if you’re living away from your parents while attending post-secondary. Eating out, whether for convenience or social purposes, drains your bank account. Avoid convenience eating by taking the time to meal prep at your house before heading to campus. Yes it takes more effort, planning and time but in the long run it’s worth it, and if you’re not one who habitually packs lunches or dinners, what better time then to start.

2. Skip Starbucks. – And I mean it. I want to inform you that your favourite grande, sugar free, non-fat, no foam, extra caramel, with whip, caramel macchiato is in fact sucking money out of your bank account faster than you can drink your beverage. The average price of a latte is just below $5.00. Your student budget can’t actually (or maybe shouldn’t be able to) handle your tri-weekly, every week Starbucks consumption patterns, regardless of how good it tastes. Even if you make the room in your budget for your Starbucks order, your limited spending money could be allocated to a lower-calorie, lower-price tag commodity. Ideally, making a tea or coffee in a to-go travel mug before leaving your house is the most economically friendly option. However, sometimes this isn’t always realistic, so if you insist on grabbing coffee while on campus, make it a tea or a plain, straight up coffee, to avoid the temptation of drinking away your day’s spending cash before lunchtime even rolls around. And just think, not only will your wallet be thanking you, but your waistline as well; it’s a win-win all around.

3. Learn how to have a financially responsible good time. – I live with six other students while I’m away at school which means that there is a lot going on, a lot of the time. Most of the time (because we’re not that exciting) it means binge watching whatever Netflix series we have on the go at that moment, but other times it means going out; whether to the movies, a bar, or a restaurant. As much as you want to be included in the fun, sometimes your budget just can’t handle it. Know and be aware of when you can and cannot say yes to going out. Also, don’t be afraid to be the one to suggest a different type of going out and a group activity that doesn’t involve spending. Have you ever heard of playing at the park? Seriously, try it. Dust off your ten-year-old self, and trek off to the park with a football, a few baseball gloves or a frisbee – we do it all the time at my house, and it’s great.

4. Pre-drink or skip the drinks altogether. – Your wallet, your liver, and your head will be thanking you when you wake up the next morning sans-hangover with zero regrets, an intact memory and a wallet full of cash. Learn how to have a good time sober – it’s not as hard as it sounds, I promise. I’m not saying throw in the towel altogether on drinking, but limit when and how much you consume, and when you do drink, pre-drink before going out and avoid buying drinks at the bar or club whenever possible.

5. Take public transit. – Depending on where you live and the how great the public transit system is, take advantage of it while it’s at your disposal. After post-secondary, you might have to have a car for your job and public transit just won’t be an option. But in the meantime, it eliminates paying for crazy expensive parking on campus. Plus as a student, with all the other expenses you’re paying for, insurance, gas and parking should not be one of them when there are other, cheaper alternatives.

6. Grocery shop with a purpose. – Going into a grocery store without a list screams overspending; it’s always good to know what you plan on buying before you leave the house. While you may enter the grocery store with good intentions, more likely than not, you’ll pay for your groceries with a heap of regrets as the grand total far exceeds your allotted grocery budget for the week.

7. Utilize point cards. – Unleash your inner savvy saver and sign up for point cards. It’s usually free, easy and they’ll be mailed straight to your house. Now with mobile smart phone apps such as Stocard you don’t even have to carry all your point cards with you, which lightens up your wallet and keeps them organized in one place. Some cards collect points, some save you money, and some provide special access to deals. Whatever the perks, saving money feels great. I’m a huge fan of PC Plus which earns points when you shop at Loblaws or any affiliated grocery store and SCENE  which earns you points that are redeemable at Cineplex.

The moral of the story is that in order to be smart with your money you have to know what’s smart for you. Don’t jump on board the money spending train unless it’s something you truly want to do, something that is truly justified or something that your budget will allow for. The money you choose to spend each and every day are small decisions, which may seem insignificant in the moment, but are the ones that lay down your habitual spending patterns and, in it’s totality, combine together to result in significant savings or lack there of.

– Courtney

Save money on home repair

house-with-moneySave money on home repair

In one of my earlier post I mentioned one of the things that helped me begin a life where I could live within my means (spending less money than I earn) was to focus on home repair rather than home improvements. I’m not saying you should never improve your home, but when you do make sure you’re not going into debt to accomplish the home improvement.

What drive the cost of home improvements is that it usually involves either the addition of something you currently don’t have such as finishing your basement into quality living space, or the demolition of your current state and a brand new re-build, such as a new kitchen or bathroom. Most home improvements people are motivated by wants as opposed to needs and my golden rule is to never go into debt to satisfy a want.

Home repair requires a completely different mindset, this is where you work with what you have to fix something

I had a situation with my home where I had a fence that was falling over because the fence posts were not cemented in when the fence was originally installed. Honest it wasn’t me, the fence was there when I bought the house. At the time the cost of replacing the fence was far too much for my budget as I had two kids (twines) in university, but something had to be done as the fence was going to fall down. What I ended up doing was digging around each of the fence posts, with the fence fully intact, align the posts then using quick set cement ($6.71/bag) I was able to stabilize each post. I was amazed with how well this processed worked and how inexpensive the whole project was. But what I didn’t expect was the feeling of satisfaction I got from making something out of nothing.

It would have be easy to spend money I didn’t have for a brand new fence, but to take a broken down beat up fence and bring it back to life takes creativity and determination. Home repair cannot only save you money it can also be a source of personal satisfaction.

5 easy ways to save money everyday





5 easy ways to save money everyday:

These five money saving tips are among my favorites because they offer the biggest impact on reducing expenses with the least amount of disruption to everyday life.

  1. Never grocery shop without a list – There is nothing worse than unpacking groceries only to find you forgot something and need to make yet another trip to the grocery store or worse you’ve bought something perishable (milk, bread) that you don’t need.
  2. Don’t drive aggressively  – Aggressive driving can cost you money in many ways. You will definitely use more gas with aggressive acceleration, your car will require bake service more often, and you will experience increased tire ware as a result of aggressive driving habits. Without question you will enviably incur traffic violations (speeding fines).
  3. Pack a lunch – The biggest opportunity for savings money on eating out is to pack a lunch for each day of your work week. For me to buy a lunch where I work, depending on where I go, would cost between $5 to $8 dollars each day. If I were to buy a lunch every day it would cost in excess of $2,000 a year ($8 x 5 days x 50 weeks).
  4. Air dry your clothes – I’ve installed a clothes hanging bar in my laundry room where I can take my clothes out of the washer and hang them to dry overnight. Using an electric or gas cloth dryer can cost you money is two ways. The first is obviously through the energy cost, either electricity or gas consumption. Another way you save money by not using a dryer is that your clothes will last longer. The heat of the dryer of very hard on the fibers of your clothes and will cause premature aging (fade and ware).
  5. Visit your public library – For many people this is an untapped resource. My local library branch loans books, as you would expect, but they also loan movie DVDs, music CDs, magazines as well as digital content such as ebooks and audiobooks. Don’t forget it is your tax dollars that funds your local library so you might as well reap the benefits.

To be effective these everyday money saving tips need to be integrated into your daily life as a habit. It takes about thirty days to form a habit so you may want to consider integrating these ideas one at a time to make the transition easier. On a daily basis each of these money saving tips may seem insignificant but their true power needs to be measured over time.

My Adventures in Cord Cutting

MCordCuttingy Adventure in Cord Cutting
Cord cutting is a term used to by people who have discontinued their traditional broadcast cable TV or satellite TV service, usually switching to an on-demand internet based stream service such as Netflix. On the surface most people are motivated primarily by money. The savings can be substantial with most people paying something north of $100 per month by the time you add in specialty channels, set-top boxes and PVR’s, compared to under $10 per month for a streaming service like Netflix. But there are other hidden benefits that only became obvious to me after I had cut the cord.

It wasn’t easy, first I had to convince myself it was a good idea and worth doing, then I had to convince my wife, three kids, and a dog it was a good idea. The dog bought in right away, my wife bought in based on the cost savings, the three kids threaten to call 911 claiming their father had gone delusional. I was able to convince them to try it for three months with the understanding that we would just unplug the cable not cancel the service. We held weekly meetings to see how everybody was coping and by the end of the second month everybody, even the dog, had been successfully weaned off of cable TV.

Traditional TV provided by cable or satellite is based on a broadcast model. This is where your favorite show is usually broadcast once a week on a pre-determined channel, at a pre-determined time. If the pre-determined time doesn’t fit your schedule, no problem you can “PVR it”. Over time your PVR begins to build-up a small library of shows you can watch whenever you want. In contrast an internet streaming service is based on an on-demand model. This is where you have access to a library of full seasons of shows which are available for you to watch as much as you want whenever you want.

The reason I describe these two vastly different formats is to illustrate the above mentioned hidden benefit is that I now consume my content with intention. Rather than watching whatever is being broadcast at me I now intentionally consume shows and movies at my convenience. As a result I actually consume more entertainment content but in a far more efficient manner.

Simple money solution – I saved time and money by cutting the cord.