Life after debt definitely hasn’t been exactly what I thought it would be (well obviously, I didn’t see a global pandemic coming at me). After paying off $26,500 of debt about a year and half ago, I thought we’d be saving more money than ever before. In fact we made a goal to save $10,000 last year and we fell terribly short, even though our income is higher and we have no debt. So what gives? We’re less motivated to save.

It seems to be a pretty common problem, after hustling to pay off debt, we’re likely a bit burnt out, ready to spend some money on ourselves and with the goal finally achieved, a little lost.

I thought I should go over WHY we need to save, and little tricks I’m using to make sure we save money in 2021!

Why You Need To Save Money

There’s 3 basic reasons you need to save money; an emergency fund, for a purchase or for wealth building. Let’s chat about all 3

Emergency Fund

An emergency fund is usually the next step after you’ve paid off your debt. Many financial experts suggest having 3-6 months worth of expenses in your emergency fund just in case you lose your job, or are unable to work (hello, pandemic!). You should be keeping this money in an easy place to access, like a savings account so that you don’t have to jump through a bunch of hoops to get money when you need it.

I keep ½ of mine in my regular checking account, and ½ in a TFSA. I also keep $1000 in a savings account for small emergencies. 

To be honest though, we have about 2.5-3 months of expenses saved, so we should be saving more. Although we could pull from our vacation savings in the event of a true emergency. 

Purchases

This type of savings is for planned purchasing, like a house, wedding, car, vacation, Christmas, etc. We use sinking funds and save every month for these types of expenses by setting up an automatic transfer. 

We currently have sinking funds for: travel, Christmas, utilities, and a new car.

For Christmas and utilities I added up how much we normally spent in a year and divided by 26 (the number of paychecks we get a year). For travel we have a set amount that goes in every payday, and for the car we were trying to save whatever was leftover at the end of the month. This is not a good strategy and it very clearly has not been working.

Wealth Building

The last reason to save money is to build wealth, which is usually done through investments. Usually you are building wealth so that you can retire, and possibly pass some wealth down to the next generation.

Wealth building takes time, but it’s so important. Who wants to trade time for money for the rest of their lives? Not this girl!

I’m not a financial advisor, so I won’t recommend WHERE to invest, but I definitely recommend finding an advisor you trust, so that you are set up for the future.

How To Stay Motivated To Save Money

Make A Goal

Just like when you were paying off debt, making a savings goal will help you stay focused. I remember feeling so motivated by seeing our debt payoff tracker on the fridge, so perhaps I should be using a savings tracker now! Use whatever motivates you.

Give Yourself Grace

I feel like I’ve written this a hundred times but giving yourself grace to make mistakes, go over budgets, and miss goals is so important. If you go over budget one month, stop using it as an excuse to stop budgeting altogether. Accept that it happened and go the next right thing. 

How To Stay On Budget

Ultimately, we aren’t saving money because we’re too busy overspending. Trying to save what’s left over at the end of the month won’t work most of the time (trust me, I’ve tried). Here are some tips to stay on budget & save money:

List Your Irregular Expenses

Irregular expenses will sneak up on you if you don’t pay attention. I keep a running list of all my bills and when they are due, including ones that come up once a year, or every 2-3 months. Don’t forget things like annual dues, water bills, pet annual exams, sports fees, etc.

Automated Savings Are Your Friend

I will never be able to stress this point enough. Set up automatic transfers with your online banking on payday. Every payday money automatically goes into our RRSP (for retirement), our Christmas savings, and our travel savings. I don’t even miss that money because we never really see it. It’s the easiest way to save and once you set it up you don’t have to do anything ever again!

Mix Up Your Budgeting Style

When I first started budgeting, I made monthly budgets, because I didn’t really think there was another way. Then I discovered budgeting by paycheck and that made things SO much easier for me. I am self employed and my paychecks vary. My husband is on a salary, so his stays the same every time. Budgeting by paycheck allowed me to budget money that we already HAD instead of guessing what I would make. That way if I had a month without so many clients, I wasn’t over extending my budget. 

Don’t be afraid to mix up your budgeting style: monthly, bi-weekly and weekly are all perfectly acceptable, find what works for you!

Final Thoughts

I hope this has helped you come up with some ideas to start saving again! Obviously we won’t always be motivated, but if we make saving a habit, it will happen anyway. 

Thanks for reading. I’ll chat with you again soon,

As you know, a mattress is a really important purchase! You want something comfortable and well made, all at an affordable price.

I started researching mattresses a few months ago, as it was time to replace ours. I wanted something that was made in Canada, eco friendly and within our budget of about $800. I also didn’t want to drive around testing out mattresses with pressure to buy from a salesperson in a showroom. 

Let me tell you why Douglas by GoodMorning.com checks all my boxes!

Eco-Friendly and Canadian Mattress

First of all Douglas is made in Canada, in fact they are made in Ontario and Quebec, usually within hours of your order!

It is made with 3 layers of foam; the top layer is a cooling gel foam, which keeps you from overheating at night. The middle layer is a supportive foam, and the bottom layer is 6 inches of motion isolation supportive foam, so you don’t have to worry about your partner (or dog) disturbing you throughout the night.

I also love GoodMorning.com‘s commitment to the environment. As you know I have been trying to lower my carbon footprint, and the Douglas is made from ecoLight®️ foam. The foam is less dense (meaning it’s lighter and easier to transport), and made with 40% less carbon input. The mattress cover is made with Tencel®️ fibre, made from renewable wood sources in a process that produces almost zero-waste. 

The company uses 90% renewable energy to manufacture their mattresses, limiting their carbon emissions!

Price, Sleep Trial and Customer Service

A mattress can be an expensive purchase, so you want to make sure it’s the right one for you, and that it will last.

First of all, a Queen size Douglas by GoodMorning.com comes in at $749 and the King Size is just $849! Almost every mattress made in Canada is going to be $1000+ so you are saving money right off the bat!

I know it seems scary to buy a mattress without ever testing it out! That’s why GoodMorning.com has a 120 night sleep trial. That’s practically 4 months to make sure that you’ve got the right mattress for you. They recommend giving your new mattress a try for at least 30 nights. Usually you have an adjustment period to a new mattress. 

So what if the mattress isn’t right for you? Contact the amazing team at Customer Service and they will help you out! Returns are completely free and the company will send someone out to pick up your mattress (no you don’t have to roll it back into that box!!). 

The best part? That mattress will go to someone in need. Returns are never restocked, they are donated to local charities and organizations so that someone can have a comfortable bed. 

My Honest Review

The first thing that impressed me is that delivery was super quick! It came within days of being ordered and shipping is free as well.

The box is large (but it definitely doesn’t look large enough to have a mattress in it). My brother managed to get it in the house by himself (I was traveling and wasn’t home, thanks bro!), but I would say it should be a two-person job to move it around.

The next day my husband and I arrived home to our new mattress, and unboxed it. Unboxing took about 6 minutes, and it was super easy! Just take off the plastic and watch the mattress inflate. Definitely unbox your mattress in the room where it’s going to go, you don’t want to have to move it too far after it’s inflated!

We put it on our custom made bed frame that my husband made last year. If you have a regular box-spring, you’ll need a piece of plywood to put between your boxspring and your mattress so you don’t void your warranty!

There was no odor or off-gassing that I noticed. 

As of today we’ve been sleeping on the Douglas for about a week now. I will say that the first few nights I wasn’t sure. The foam was so different from the traditional mattress that we had for the last 10 years! After the 3rd night I really started to enjoy it.

I’m normally a stomach sleeper, and the Douglas feels firm enough that my back doesn’t hurt when I lay on my stomach. I also feel comfortable on my side and on my back. The Douglas pillows are perfect for me, not too bulky, although to be honest my husband didn’t love his. 

Final Thoughts

I’m really happy with the Douglas and GoodMorning.com in general. I’m definitely looking forward to more cozy nights on my new mattress. 

The good news? If this mattress isn’t for you, GoodMorning.com has 6 others to choose from! Make sure to check them out.

Let me tell you, this was an eye opening exercise.

Method

I budget biweekly, and so I got out my budget binder, and first I added up 6 pay periods of  pre-pandemic totals for income, fixed expenses, and variable expenses. I also pulled out the info for groceries, eating out & gas just because I thought the comparison would be interesting.

Then I added up 5 pay periods of during pandemic totals for the same categories. I created an average for each one to compare. 

Income

Thanks to my husband getting a raise right at the beginning of the pandemic, and the CERB government program, our income is only down 4% from it’s usual. Without the CERB our income would be down 30%.

Thankfully because we live within our means, we have been able to deal with less income and we haven’t had to dip into our emergency fund at all. 

It was announced this week that massage therapists will be able to go back to work in June. It may be awhile before I’m back at 100% of my previous income, but I know we’ll be able to manage until then.

Fixed Expenses

Being that these are fixed expenses they haven’t changed a whole lot. In fact the only thing that has changed is that I have stopped our automatic savings that goes into our travel account. While that was sad for me to do, reality is that we probably won’t be traveling for a little while, and we needed that cash flow for other parts of our budget.

Our fixed expenses dropped by 16%.

Variable Expenses

Wow, variable expenses have been a struggle! At first I thought we would be spending way less, because we wouldn’t be driving far, and we couldn’t go out shopping. 

I was wrong.

Our variable expenses have increased by 9%. I’m not surprised about this (just wait until you read about our groceries!). I have definitely been ordering online more than usual, and we’ve splurged on a few things to make our time at home more fun.

Here are a few things we’ve bought that we probably wouldn’t have normally:

• Deck chair
• Paint for downstairs bathroom
• Organization bins
• Alcohol
• Art on Etsy
• Ticket To Ride board game + expansion pack

As you can see, we’ve been playing a lot of games, and doing some organizing and redecorating! I actually don’t regret any of these purchases at all. 

Groceries

Within variable expenses, I picked out a few categories that I thought changed the most. Groceries have been a huge struggle for us since starting physical distancing. We are home all the time, and eating more. Plus I have been doing some baking that I normally wouldn’t have time to do. 

I’ll be completely honest that I have been struggling to get our grocery spending under control and we’ve ended increasing our grocery spending by 38%.

It’s not the end of the world, but it’s something I want to get a handle on going forward. 

Read More: Budget Recipes!

Gas

Of course, now that I am off work and that my husband is working from home, I thought it would be funny to see how much our gas consumption has changed! We decreased our gas spending by 91%! I guess that’s what happens when you hardly leave your house ;).

Eating Out

We actually don’t eat out very often. We only eat out probably once every 6 weeks or so. I miss restaurant food so much right now though! We’ve only gotten takeout once since the pandemic started. It was delicious but I definitely missed the magic of sitting in a restaurant, since we almost always eat out with friends. 

Our restaurant budget has decreased by 67%.

Budget Percentages

I also decided to take a look at our general budget percentages. Lots of interesting info here: 

Housing = mortgage, property tax and home insurance
Transportation = gas, bus tickets, parking and car insurance
Utilities = water, power, phone, internet, and Netflix
Food = groceries and eating out
Savings = retirement savings, car savings and emergency fund
All Else = clothing, gifts, pets, personal care, entertainment, travel & Christmas sinking funds, life insurance, charity, misc spending

Overall I’m pretty happy with how our percentages fall. 

I included the recommended percentages, but of course that is just a guideline! If you have debt you’d have to work that in by decreasing spending in other areas. As long as it adds up to 100% you’re golden!

Final Thoughts

This was definitely an eye opening exercise, and interesting to see how our budget has changed over the last almost 3 months while we’ve been home more (and working less in my case!).

You can’t make changes without data! We are committing to decreasing that grocery budget, I’ll give you an update on that soon! 

Has your budget changed over the past few months? Let me know!

Spring has sprung, and that always has me thinking about spring cleaning! Have you ever considered organizing your financial life part of spring cleaning? Finances can be overwhelming to most of us, papers can take over, and it makes us feel stressed and disorganized. I’m going to show you had to literally organize the mess, and how to set yourself up for future success! 

Clean Out The Papers

This step may be challenging, especially if you don’t have a filing system in place already! It is worth it to take a day and get your papers organized into a system that works for you. Once you do this, every other year’s Spring cleaning (and tax time) will be so much easier.

Shred Old Documents

Anything you don’t need, including tax returns over 8 years old, make sure you shred them! A lot of financial documents have personal information on them, and you don’t want that to fall into the wrong hands! Recycle the shreddings

Make A Filing System

We have a filing cabinet that I store all our old tax returns in, receipts for major purchases like appliances, debt repayment documents, and mortgage documents. They are all labeled in folders.

I also have a smaller file folder where I keep receipts for everything we purchase all year. At the end of the year I get rid of everything we don’t need for tax purposes etc. I keep all our receipts just in case we need to return something, or I want to cross reference with my online banking. 

You don’t have to use the same system I do, make one that makes sense for you!

Check On Retirement Contributions

Another part of your yearly spring cleaning should be going over your retirement contributions. Are you saving enough? Should you be saving more? And has your risk tolerance changed due to your circumstances? 

These are questions you should go over with your spouse and your financial professional to make sure you are on track to retire when you want to.

Update Your Budget

Or make one if you haven’t already. Budgets should be living documents, growing and changing to meet your needs. 

We have been budgeting biweekly for almost a year now, and we budgeted monthly for about 2 years before that. 

Read more about starting a budget.

If you’re looking for a personal finance organizer, check out The Budget Binder! It will help you make a budget, track your net worth, save money and be more organized. 

Get the budget binder!

Update Sinking Funds

When updating your budget, go over your sinking funds and set some up if necessary. We have sinking funds for our power bill, travel, Christmas and a new car.

Some other sinking fund ideas are: 

• Kids sports fees
• House maintenance
• Back to school shopping
• Wedding

Basically anything that will be a large cost in your budget!

Read more about sinking funds!

How To Organize Your Bills

Spending a little time organizing your bills will help budgeting go much smoother. 

1. Write Them Down

As part of your budgeting, you should have all your bills written down and their due dates. This will make budgeting so much easier, because you won’t forget them! Don’t forget irregular bills like annual dues.

2. Change Due Dates If Necessary

I have a lot of my bills come out of my bank account every 2 weeks on payday. By having them come out on my payday, I can’t accidentally spend the money on something else and then not have enough to pay my bills.

3. Automate Savings & Bills

We also have our retirement savings, and sinking funds automated to move into different accounts on payday. It is easy to set up in online-banking. By automating our bills and savings we pay ourselves first, to make sure we don’t incur interest on our bills (and/or debt) and we are saving for the future.

Make Financial Goals

I have been making financial goals either monthly or quarterly for the past 3 years. Making goals helps you stay focused, and helps by giving you a sense of accomplishment when you finally achieve your goal.

Here are some ideas for financial goals

• Pay off debt
• Make / stick to a budget
• Save for a large expense like a house downpayment or a new (to you) car
• Sell items you don’t use
• Build your emergency fund
• Have a no spend week/month

Make A Debt Repayment Plan

One of your financial goals might be to make a debt repayment plan. We paid off $26,500 in 21 months by doing the debt avalanche method. Meaning we paid off the highest balance with the highest interest rate first. 

Some people prefer the debt snowball (the lowest balance) method. Either way, make a plan that includes paying the minimum balance on each debt, and then paying extra on one debt until it is gone.

Read more about debt avalanche vs debt snowball methods.

Get the debt repayment tracker emailed to you for free!

Final Thoughts

I know this seems like a lot of work, but it doesn’t have to be done all in one day! Spread out the tasks, and you’ll be much better off in the long run! This system will help you organize and save money. Happy Spring cleaning!

Groceries, and food in general, are no doubt one of the largest parts of our variable budgets. Everyone has to eat! 

Right now our grocery budget is $150 every 2 weeks, for 2 adults. That includes household items like cleaners and toilet paper. We often come in under budget, but sometimes we go over too! 

I want to show you how we save money on groceries and eat healthy, and we do it without coupons!

How To Save Money On Healthy Food

Meal Plan

Meal planning is a great way to save money and avoid the “what’s for dinner” conversation. When I make a meal plan I first look at what I have left in the fridge to use up before it goes bad, and make a plan to use that soon. Then I plan other meals after looking at the sales flyer. Don’t forget about breakfast, lunches and snacks. Plan to make extras at dinner so you have leftovers for lunch!

Meals With Fewer Ingredients

The fewer the ingredients in a meal, usually the less it will cost to make. Look at simple recipes without a long list of ingredients. Also meal plan around meals that will use many of the same ingredients. You can use that baby spinach in a salad, then a pasta recipe, and in wraps. That way you are buying one vegetable and using it all up!

Buy Whole Fruits and Vegetables

Precut vegetables and fruits, and premade salads are definitely convenient but they always cost a bit more. Buying whole produce will help you save money (plus then you won’t be buying it in plastic packaging!)

Buy In Season

Buying produce in season always helps you save money because it is not shipped from far away, therefore costing the supermarkets less to stock that item. “In season” will depend on where you live!

Check Out Farmer’s Markets

To buy what is in season, check out your local farmer’s markets! Usually you can get a cheaper price buying directly from a farmer. 

Reduce Food Waste

Reducing food waste saves you money because when you throw any food away, you’re also throwing away the money you spent on it! Try to use all parts vegetables, save peeling to make broth, you can even use broccoli stems in salad! My friend over at Stop Trashing It made pesto with her carrot greens, there’s lots of ways to use food.

Eat less Meat

I’ll be honest, we don’t eat a lot of meat at our house, and I think that’s one reason our grocery bill is lower. If you’re a big meat lover try adopting meatless Mondays to slowly reduce the amount of meat that you buy. 

Drink Only Water

Drinking water is not only better for you, it’s way healthier! Don’t buy bottled water either unless you live somewhere where the drinking water is unsafe. We have a Brita filter, but you could drink straight from our tap as well! Pop and sugary drinks are way more expensive, but if you miss the bubbles consider a SodaStream. We’ve had one for over a year and one Co2 canister lasts us 2-3 months. 

Cook And Bake From Scratch

When you cook and bake from scratch you control what ingredients go in, and it will be so much cheaper than buying pre-made! You can make bread, pizza dough, soups, spaghetti sauce and more very simply!

Read More: How To Budget Biweekly

Food Shopping On A Budget

Choose Your Store Carefully

The store you choose to shop at can make or break your budget. I live in Canada and we usually shop for groceries at Walmart. No Frills is another great grocery chain for cheaper prices. 

Calculate As You Shop

To stay on budget, you may want to calculate as you shop. Use your phone calculator to add up the prices, and if you are going over budget then you might need to put something back. Adding as you shop keeps you from having to figure out what to do at the check-out. 

Consider Grocery Pick-up

I just used grocery pick-up for the first time this past week, and it was great! I knew how much my groceries would cost in advance, and was able to compare prices online. Although there can be a fee for this service, it can save some time and may help keep you on budget by helping you avoid impulse purchases.

Bulk Bin Shop

Shopping from the bulk bins can help you save money in 2 ways – sometimes it is cheaper to buy an item in the bulk bins, and sometimes it helps you save money because you can buy only what you need. For example I needed only ¼ cup of flax seeds for a recipe, so that’s all I bought and it cost me $0.13! A bag would have cost a few dollars and may have gone to waste in my pantry.

Read More: Can Going Green Save You Money?

Get Rainchecks

When an item is on sale, and there’s none left on the shelf, head to the customer service desk to get a rain check! That way you can still get the item on sale when it is back in stock even if the sale has ended.

Store Food Properly

Learning how to store food properly will help extend the life of your food! Love Food Hate Waste has a great resource section on how to store all types of foods.

Bring Your Own Bags

Here in our house we focus on saving money, and the environment and bringing your own bags accomplishes both! Most stores charge you to use their plastic bags, and some stores here don’t even have plastic bags for you to use! I know it’s usually only a few cents but it does add up.

Buy Generic

Generic or store brand items are usually the same quality as the brand name ones, but much cheaper! It’s an easy switch.

Shop The Sale And Clearance Sections

Don’t forget the sale sections for food that is close to it’s best before date. Things like meat or bread you can freeze. 

Look At Unit Prices

Sometimes it’s hard to tell what item is the best deal because the sizes aren’t the same. That’s when the unit prices come in handy! As you can see below, one box of spaghetti is twice the size so you might think it’s a better deal, but when you look at the unit prices, you are better off buying 2 of the smaller one!

How To Save On Household Items

Consider Making Your Own

There are a ton of recipes out there for homemade cleaners! We tend to use a lot of vinegar for cleaning.

Don’t Buy Disposables

Another one that saves money and the environment! We limit the use of paper towels to really gross stuff, and try to limit things like plastic wrap and tinfoil. We bought prep bowls with lids for storing food without plastic wrap, and use dish cloths to wipe the counters instead of paper towels.

Shop At Wholesale Stores

Places like Costco can be a great place to buy household items like toilet paper and laundry detergent. We usually buy laundry detergent, dishwasher detergent and paper towels here once every 9 months to a year or so, and it lasts us that long!

Subscribe and Save

Amazon offers a subscribe and save program for household products. You can save from 5% up to 15% off the price of the product!

Compare Products

Always remember to compare generic to brand name and check the unit prices!

Final Thoughts

Wow! That was a lot of ways to save money on groceries! I hope that helps you when you are trying to stay on budget with food.

Unfortunately a financial emergency can happen to all of us, at any time. We see it all the time, people lose their job, get sick, get in an accident, or sometimes there’s an apocalypse and suddenly we can’t leave our homes. Ideally you prepare before these things happen but that’s not always the case! I’m going to walk you through what to do if you have a financial emergency and how to prepare for the next one.

Unexpected Financial Events

You know how one day everything is totally fine and then you’re hit by a truck? It happens! No one really expects these things to happen (that’s what they’re called unexpected…) but everyday people incur large expenses or income loss. Some examples:

• Car accident – need to replace or repair the car unexpectedly
• Medical emergency – hospital bills and loss of income
• Natural disaster – damage to your home & belongings
• Job loss – loss of income
• Divorce – loss of one income / lawyer fees
• Worldwide pandemic – loss of work 

See how often some of these things happen to people we know? This is how Walter White turned to making drugs… which made for great TV, but not so good if it’s your real life. 

What To Do During A Financial Emergency

There are really two types of financial emergencies: one time (large) expenses like a bill, and loss of income. Here’s what to do in each scenario. 

One Time Expense

If it’s a one time financial emergency like a car repair/replacement or a medical bill here are the steps to take:

Figure Out How Much You Owe – Add up all the bills associated with the unexpected expense

Look At Your Current Finances – How much do you have in savings that could go toward this bill? 

What Can You Do To Make Up The Difference – Can you work some overtime? Sell something that is sitting around? 

Work It Into Your Budget – If you know you need $500 by next month, then you’ll have to work on how to save $250 each paycheck (if you’re paid biweekly) Read how to biweekly budget!

If The Difference Is Substantial – If you won’t be able to make up the difference quickly, you’ll need to look into payment plan options, or in extreme cases; borrowing. 

Loss Of Income

If you’ve lost your income, or your income is reduced, here’s what to do:

Start With Your Budget

If you’ve already been budgeting then you’ll have a leg up, but if you haven’t you’ll want to start with figuring out how much your income will be in your new situation.  Read about how to make a zero based budget.

Prioritize The “4 Walls” – When starting to make your budget, make sure to prioritize the “4 Walls” first – Food, Utilities, Housing and Transportation. These are the things you absolutely need to make sure you have food on the table and a roof over your head.

Pause Sinking Funds – If you’ve been saving for Christmas, travel, etc. in a sinking fund then consider pausing to make your ends meet. Read more about sinking funds

Stop Extra Debt Payments – You may need to stop your debt snowball or debt avalanche right now in order to make ends meet. Still pay your minimum payments, or if you can’t, try the next step.

Negotiate With Lenders – Some lenders will be able to help you if you tell them your situation. You can usually defer mortgage payments (which adds them on to the end of your term), and you may be eligible for interest only payments on things like student loans.

Research Government Programs – You may be eligible for employment insurance (EI) which will pay you while you look for work. If you are off work due to a disability or sickness, there are programs for that as well. You can access local food banks to help you put food on the table. Please don’t be scared to get help if you truly need it, these programs are in place for a reason! 

Be Wary Of Loans And Credit Cards – For the love of all that is holy please do not go to a payday loan place. You will owe them forever, please please please do not go there. Also try to avoid using your credit card to make up the difference in income. You will have to pay it back eventually. 

How To Prepare For A Recession

What exactly is a recession anyway? Basically a recession is a decline in economic activity across the market for 2 or more quarters. It happens when the total value of the goods and services produced (called the Gross Domestic Product, or GDP) is in decline. Usually this comes with an increase in unemployment, a decrease in the housing market and a decrease in the stock market. 

A recession may be coming, but they are impossible to predict! If it does it may have an impact on your finances, especially if you lose your job due to cutbacks. It doesn’t have to be the end of the world, here’s what you can do to prepare yourself for a recession.

Pay Off Debt

One of the best things you can do to prepare for a recession is pay off your debt. If you can’t get it paid off, get it down as low as possible. Not having a debt payment while suffering a job loss will make life so much easier!

Build An Emergency Fund

If you don’t have an emergency fund, now is the time to think about building one. Never invest your emergency fund. If your emergency fund is invested 1) it’s hard to get to because you’ll have to wait a few days to withdraw, and 2) when the markets go down, so will your money. Keep your emergency fund in a high interest savings account where you can transfer the money to your main bank account quickly online. How much you’ll need is personal, and depends on your budget, but if you’re trying to save quickly, save as much as possible!

Remember your sinking funds that you may have paused? They can become emergency money too!

Read More About Emergency Funds

Live Within Your Means

Living within your means is how you’ll get through any financial tough times. As long as you do not spend more than you earn, you’ll be in a great place when the markets turn around. You may have to cut out things like travel, eating out and other non-necessities for a while in order to make ends meet. 

Read More About Living Within Your Means

Consider Upgrading Your Education

Now may be the time to upgrade your education or change fields. Consider fields that are in demand at the time.

Focus On The Big Picture

It can be scary to see the markets take a nosedive, but now is not the time to cash in your investments. Especially if you’re young and 10+ years away from retirement, think of it as “stocks are on sale”! You’ll be able to buy more shares which should be worth more in the future. Keep investing!

Final Thoughts

Financial emergencies and recessions can feel scary and impossible to recover from, but the reality is they happen to all of us and things can and do turn around eventually. 

If you plan in advance, you’ll be better able to respond when the next financial emergency hits. If you’re experiencing this right now, just know you are not alone!

What is Lifestyle Creep?

Basically lifestyle creep is what happens when you make more money, and you also spend more money. It often happens when people get raises because they have more income, they start spending more and more. It can start small, like going out to dinner more often, then buying more expensive clothes or shoes, then it turns into buying a fancier vehicle and possibly even a bigger house. As you can imagine buying a more expensive car and home can have a huge negative impact on your ability to save money. 

Even worse, some people use credit cards to spend more than they make. This is definitely the worst kind of lifestyle creep since you will have to pay it off eventually. 

But I Deserve It!

This is almost always the reason behind lifestyle inflation. You get a big raise, you work really hard so you deserve that (insert thing here… house, boat, fancy car, designer bag, etc.). No doubt you do work hard, but spending it on wants isn’t always the best way to use your money. You don’t have to stop shopping altogether, but balance is key.

How To Avoid Lifestyle Creep

Luckily there are so many ways to avoid lifestyle creep from negatively impacting your finances. Most of them are pretty easy to implement too!

Make A Budget

I’ve said it before and I’ll say it again, a budget is the best thing you can do for your finances. I do a bi-weekly budget and pay myself first by saving money every paycheck for retirement, travel, gifts, etc. By making a budget I know exactly how much money I am making and spending. By budgeting every paycheck I am checking in with my money often and I can make adjustments if necessary. Check out this Youtube video on exactly how I budget:

Budget In Fun

Not budgeting in any fun money is a surefire way to make sure you never stick to your budget. Every month my husband and I get some personal fun money, and we also budget in some fun activities with friends. You can make sure you budget in your coffee with friends, date nights and vacations, then you are not missing out on the fun but you are still accomplishing your money goals!

Automate Savings

Every payday we have money that automatically transfers into our savings accounts and retirement accounts. Making your transfers happen on payday means that you’ll pay yourself before you spend the money on wants. Automated means you don’t have to think about it!  Check out how I organize my money here: 

Take Advantage Of Employer Matching

If your place of employment has an RRSP matching program (Canada) or 401(k) matching program (USA) then you should be taking advantage of it! Usually your employer will match any contributions you make up to a certain percentage. If you contribute 6% of your income, that means any raise you get you’ll be automatically investing more as well! 

Keep Your Goals In Mind

Having a money goal helps you keep focused. When we were paying off debt we used this tracker on our fridge so that we knew we were making progress! Now that we are debt free, our big goal for 2020 is to save $10,000 for a new car! I love the charts from my friend over at Debt Free Charts, a lot of them are free! Start printing and watch your goals come true. 

Read More: How we paid off $26,500 in 21 months

Final Thoughts

Some lifestyle creep is generally okay, like going from living in an apartment with 3 roommates to living in your own home with a spouse, but the type of lifestyle creep where you are just buying more expensive items because you got a raise is going to significantly impact your ability to be financially independent and debt free. 

In reality,

It's not your salary that makes you rich, it's your spending habits - Charles A. Jaffe
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Here are some frugal Valentine’s Day, or just general date ideas! Many of these we have actually done ourselves.

Cook Dinner Together

Cooking doesn’t seem that exciting, but you could try to recreate your favorite takeout dish, or if you want to take it up a notch you could have a Chopped competition and see what you each make from ingredients you already have. One thing we used to do was have an “International Date Night” where we would pick a country and one of us would make the main dish, and one would make an appetizer or dessert, you didn’t know what the other was making until the day of! It was really fun and a great way to try new food.

Play A Game Together

I love games. I grew up in a family that played games all the time and it’s one of my favorite things to do with my husband or a big group of people. You could play a board game, a video game or card game together. Take it up a notch by betting that the loser has to make dinner!

Make Cards

Cards are expensive, although I admit that I love them and keep them all. To keep costs down you could make cards for each other. Try to be as creative as possible! I personally love funny ones.

Make Fondue

We’ve done this one a couple times on Valentines Day! We got a fondue pot as a gift a long time ago, but you could always melt cheese or chocolate on the stove for a delicious fondue!

Walk or Hike

I love getting outside, even in the winter! Going for a walk in a local park, or a hike on a trail is a great way to spend time together and enjoy the outdoors. If it’s snowy where you are maybe you could try snowshoeing! In Halifax where we live, you can rent snowshoes from MEC for $15 a day.

Read Also: No Spend Date Night Ideas

Skating

Even if you’ve never skated before, it can be a fun activity! Local arenas may have skates for you to borrow for cheap or free, and family skates are usually cheap or free!

Brewery or Winery Tour

If you live close to a brewery or winery you may be able to take a tour, or at least go in for a tasting flight for pretty cheap. It’s also a great way to try a new brew before you commit to a whole bottle or case!

Go For A Drive

Sometimes it’s fun just to go for a drive and see where you end up. Put on a podcast, or your favorite playlist to sing along to. Stop wherever looks interesting!

Bake Bread (Add Wine & Cheese)

Most people have the ingredients to make bread already in their kitchen, but if not, pick up some ingredients along with wine and cheese and make yourself a little cheese board. Artisan bread is easy to make, even for those less experienced with baking! Try this tried and true recipe.

Final Thoughts

As you can see, there are so many things to do together that aren’t expensive! Sometimes you just need to think outside the box a little. Are you doing something frugal on Valentine’s Day?

What Is FI/RE

It stands for Financial Independence / Retire Early. But what does that really mean? Let’s break them both down:

Financial Independence

Financial Independence is perhaps the most complicated one to understand. What it boils down to is that your investments exceed your expenses so you don’t need to work. You are independent from your job, which means you are free to do what you want! Sounds amazing right? How is it possible?  

The 4% Rule

If you want to know how much money you need to be financially independent, you’ll need to calculate it using the 4% rule, or the “safe withdrawal rate”. If you withdrawal 4% of your investment per year, you won’t* run out of money. 

To find out how much you need to retire, first you’ll need to calculate what your yearly expenses are. Let’s say you need about 4000 a month X 12 months = $48,000 a year. Times your yearly expenses by 25 and that is your retirement number, so $48,000 X 25 = 1.2 million. 

*You shouldn’t run out of money if you only withdraw 4%, but you know, the stock market and all, things happen.

People are achieving financial independence through high savings rates (50-60% of their incomes), combined with frugal living to save a large amount of money in a short amount of time. They invest that money in low cost index funds to make sure their money grows.

Retire Early

Most people think that retirement happens at 60 or 65, but people in the FI/RE movement are retiring in their 30s and 40s! Their retirement might not be the way you picture it. Some of them are still “working”, but for a job they love, not for the money! 

FI/RE ultimately gives people the freedom to do what they want with their time. 

So Are We Trying To FI/RE?

Right now, no. We are focused on traveling, saving for a new car, and enjoying being debt free! We are not trying to put away 50% of our income. I can definitely see us retiring earlier than 60 though! 

If you’re interested in more in depth info about FI/RE I really enjoyed reading Playing With Fire by Scott Rieckens. Also the “original” idea came from Your Money Or Your Life By Vicki Robin and Joe Dominguez.

Mr Money Mustache runs a blog, after successfully retiring in his early 30s. He has lots of great info and I enjoy reading his posts!

Well the past few weeks I have noticed that our account was getting lower and lower. I read an article recently about the difference of living within your means, vs below your means, and I realized that we have been living within, but not really below our means. We have not gone into debt, but we haven’t been saving as much as I want to either. 

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Within Your Means vs Below Your Means

You may hear people say to “live within your means” but what exactly does that mean? Technically living within your means can mean living paycheck to paycheck. As long as you aren’t going into debt then you are within your means, however that doesn’t mean you are saving any money. Not spending more than you earn is of course very important, especially to those with financial goals, but where the magic really happens is when you live below your means.

Living below your means requires you to spend less than you earn, but also you don’t need your whole income for your budget; there is money left over for long term and short term savings.   

How To Live Below Your Means

Step 1 – Income

First off, you need to know what your means are. Add up your monthly income, and if your income is irregular, then take an average over the last 6 months. As I am self employed my income varies, so I make an income goal for the month, and I know exactly how much I have to work to achieve that. 

Step 2 – Budget

There I go again with the B word! You should know by now that I believe that budgeting is your ticket to financial freedom. Start by figuring out your fixed expenses, then estimate your variable expenses. Ideally there would still be 15%- 20% of your income not accounted for which you can add to savings! For more info about budgeting, check out all you need to know in my zero based budgeting guide!

Step 3 – Savings

This is what makes it below, instead of within your means. Saving money every single month will help you in emergencies, help you pay for large irregular expenses, and help you take that vacation you’ve been dreaming about! I suggest making automatic transfers every month to a high interest savings account that you can’t access with your debit card, then you can’t spend it on a whim!

Tips For Getting Started

If you’re having a hard time living below your means, then you’ll either need to increase your income or decrease expenses – or both! 

Tracking your spending is absolutely essential to knowing if you are living below or within your means, or maybe you’re spending more than you earn! The only way to know is to do the math.

It’s hard to live below your means with debt dragging you down. Making a debt repayment plan will help you become debt free faster and stay that way.

My bank account is lower than I want it to be, here’s what I’m doing about that:

1. Instead of spending all of our paycheck, leaving some in the account so that it builds back up
2. Reducing expenses for the next few weeks
3. Taking my credit card out of my wallet so I’m not tempted to spend.

Final Thoughts

Hope that helps you understand why you need to live below your means! If you have any questions please leave them in the comments!

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