90 Days to Financial Stability

I know I have written on budgets before but because it is such an important topic, here are some more tips. When creating a budget, there are a few rules you may want to use. One of them is the 50/30/20 format. The theory behind the 50/30/20 is that 50% of your income is applied to housing and bills. 30% is allocated for wants and entertainment and 20% goes to savings, investments and paying off debt. There is also the 80-20 rule: 20% for financial goals as in savings etc. and 80% for everything else. That is the ideal. Sadly, many of us can’t adhere to those rules. I live in Vancouver, BC, which is a very expensive city to live in. Property is expensive and so are rents.   50% of income going to pay rent or a mortgage is not unheard of. Too often, people don’t have the funds to be able to put away 20% of income. So what do we do? The best we can. Personally, I would feel hopeless whenever I read some of these budgeting rules. I would feel desperate – wit...

There are many ways to get out of debt and I will be discussing those in later posts but today I want to talk to you about perhaps the most important factor for getting out of debt. Taking responsibility for your actions. By taking responsibility, I don’t mean that you have to blame yourself. There is no blame here.   What I mean is that you acknowledge the fact that you were the one that got yourself into debt or allowed someone else to. Here’s what I mean.   In 1999, I went from earning minimum wage as a part time sales clerk to making $20,000 a year when the federal government hired me. Six months later, I more than doubled that income when I transferred to another position.    Just before my one-year anniversary, I woke up partially paralyzed on one side of my body. The doctors diagnosed me with multiple sclerosis and within three months, I went on disability and took a 30% cut in pay. The problem was that for that year I spent money as i...

Jill is a divorced woman in her forties. She lives from paycheck to paycheck, trying to make ends meet. There are months she isn’t sure that she’s going to have enough money to meet her obligations and then Jill has to scramble, taking money from one bill to help pay another. She makes a decent income but doesn’t know why she is always broke.   She knows she has to do something so she decides to start a budget.   She makes a list of her income and all her expenses and sticks with the plan. For a little while. Soon though, Jill finds herself slipping back into her old habits and struggling to pay everything. Jill is convinced that she can’t stick to a budget and budgets don’t work. Does that sound familiar? Have you ever gone through something similar? Have you started a budget only to fall off it within months? You aren’t alone, many people do this. There are many reasons this happens. 1.        The budget is too ...