Monday, May 25, 2009

Fortuna Finds... a job

Wickedly long hiatus for the purposes of nailing down my next contract. The truth is, another is likely to follow as I shape up and ship out for three months of international off the grid ocean faring life.

I could tell it like some blogs I read and say I simply charted a course and made it happen. The truth is, it was pretty anxiety inducing. I'd negated to work on much of a Plan B and it was getting down to the wire: would I have something lined up for when I got home? Should I be looking in another city? Would the unresolved status of things compromise my professional reputation?

Soul searching and complaining to close friends commenced. There may have been one particular day resulting in a brief bout of tears while my boyfriend petted my head. (I want to be honest about this because I have been helped in the past by others being honest about challenges and dealing with them. Colloquially, it sucks.)

And now, for another year, it's over.

I have an event Friday and I don't have to dodge the "next year" question.

I can enjoy my sabbatical without beaming resumes out from afar.

I can develop the next step in the game plan.

This next job, and tax return, should dispense handily with outstanding loans. I don't yet know how much I'll bank but I have a $20K range and would be very surprised if it were very far outside. Yes, that's right, I didn't talk salary yet.

Even though I work contract to contract, this next job is key in upgrading my skill set in a way that makes what I earn not completely relevant. I know the ballpark will be near what I earned this year, an amount I was very comfortable with. I'm choosing to work at a specific place because I like the people there and I know I will be able to focus on my work rather than toxic politics. People underestimate this vastly, in my fairly green opinion.

I'll feel completely relieved when it's all hashed out, as I always do, but in the meanwhile things are looking pretty good in this crazy world.

Wednesday, April 29, 2009

Show Me the Experts

First, today, I went to a computer store to get an adaptor switched. I was annoyed at having to go back to the store in the first place and when I got there a debate ensued about the problem. Eventually I got the new adaptor but I think it's actually a lack of compatibility. I was relying on knowledge on when I went all the way to the store and paid more than I would if I had ordered the adaptor online. The whole thing was a fairly annoying waste of time in a week where I'm tying up a lot of loose ends and moving.

Then I got a call. My tax return arrived, paying exactly what I'd suspected it would (score!). However, investigations revealed for the past five years way too much was paid to do my taxes erronously, errors worth at least $1500. That's right, based on "advice" from a "professional" - and a legit one, not some mall kiosk - not paying attention earlier to what was going on because I thought I had no income and therefore no issues resulted in errors on my behalf. I literally had maybe three relevant pieces of paper at tax time. It's not rocket science to offer a little planning.

The are going to get a letter inquiring what, exactly, they were paid for.

The error, for your interest, was picking the wrong province to file in, something that should have been incredibly obvious. Sadly, I'm not the first person from my professional background to have a similar error. I could have saved myself the fees, had my refund quicker, and had a better command over the paper trail (they were having me submit absurd things you don't actually use to file).

The fact is, few have your financial interests at heart. If someone is doing something you don't understand, just telling you they have a better understanding of the system and how it works, how willing are you to trust them? Smart people get bad answers from accountants, overbilled, and at worst find themselves Ponzied. There are great studies about how investors, people whose profession is to invest the money of others, actually do worse than a basic tripartite portfolio barely managed (see: Couch Potato Investing; tripartite being domestic/american/international splits). Similarly, accountants have given me nothing but grief this year. Every mistake is worth money, and not small amounts. It's amazing how much PF writing there is about 'errors at the till' and ways to save on ATM fees yet a serious lack of troubleshooting in checking the work others are doing for you.

Monday, April 27, 2009

Taxes in 2009: A CRA Snapshot for the Young, Childless Types

In thinking about how much I want to make next year, this comes into consideration.

The increase of the basic personal amount (the primary deduction) isn't terribly exciting, offering about $50 to your single middle income earner. A small boost to the lower tax brackets is more than welcome in a year where I won't be earning a lot but I'd like to keep what I do earn - and it gives me an an amount to aim for.

If I cash out my pension it's likely I'll lose at least a quarter of it, assuming I have a job in the Fall. If I don't have a job in the Fall I can probably cash it out without risking those consequences. It kind of serves as an emergency fund until otherwise designated - yet is making a decent rate of return in an economy where that's not typical.

Even if I can't move the funds into a TFSA, putting $5000 into an RRSP would go a long way towards making $25K available (temporarily and penalty free) when I might finally be ready to throw down on property in a few years. The fact is, I don't have anyone else to provide a down payment (or dowry... or inheritance...). Am I saying I'm going to buy somewhere and stay put? Not necessarily. I do know if I move with my Other next year then I may be establishing a five to ten year base in whatever community we wind up in and a mix of owning and renting out a basic piece of property would be timely.


I ran some numbers today and in a couple of days my financial house is rapidly coming into order. The money to pay for my time off is flowing into the bank and I can't wait to bust out in about a month. Most of the stuff on my financial 'to do' list, like making sure claims and reimbursements get filed, has been done. The taxes are filed, I owe no one rent, and my phone will quietly decline in thirty days and wait with the rest of my stuff for a return. Within forty days I'll be somewhere on a beach... until Fall. I really can't imagine not taking these three months and doing exactly what I want this year because too soon it will be next year.

Sunday, April 26, 2009

Biweekly Breakdown: Waiting for Godot?

Right now I'm waiting for what seems like everyone I know to pay up. Health insurance, work reimbursements, a damage deposit, two paycheques, my tax return, you name it... I want it! As fun as spreadsheet projections are I feel a little better when it's visible in my account and at my behest.

The pension plan informs me that a quick switch last summer has meant averaging 5.8% on my "investments." Impressive in the year of mass depreciation. This has made me consider whether I should leave the cash in the account during the impending sabbatical, as high interest savings right now aren't paying close to that and my student loan rate remains fairly low. The plan would look like this:
Pension - hold
Bank account - $5000
All excess - student loan

The $5000 is essentially the trip budget ($3500) plus $1500 to negate bank fees plus provide a cushion for damage deposits and start-up expenses upon returning home. When I get back I can look at rolling over the pension to an approved investment (avoiding the tax consequences) or cashing it out and applying it to my loan, whatever appears more reasonable. Especially attractive would be some way of moving the money into a TFSA (tax free savings account) investment, but I'm not sure if that's allowed and produces the result I want. If it is possible, my TFSA amount would be essentially maxed out in one shot, I would avoid some tax consequences, and I would have relatively accessible cash earning tax-free interest.

Doing my taxes this year was very educational. Although I knew a bit beforehand having to actually do it has given me the knowledge to streamline document management in the future. It also made me aware of when and how I might want to incur certain expenses and where I want to file in the next couple of years. If I had known while going through school how valuable this knowledge would be I would have been managing my own returns much earlier.


Staying with my Other has been really awesome. I've offered to cover more but he's pretty content with how we usually do things, i.e. switching off who pays for groceries and entertainment, and has no interest in rent as he owns the house and has a couple of tenants to cover the mortgage (he's a pretty finance savvy Mr.).

We tend to eat in because both of us can cook well and we like our food a little healthier than most restaurant fare (says the girl considering what she can get for take out from her Vietnamese joint in a few minutes), and both of us like dabbling in in the gourmet sections of delis and experimenting. Picking up groceries, making food and cleaning up is and always has been one of the major ways we spend time together.


Also: cleared all rewards programs lately. At least one has quietly announced some changes, I suspect more will follow. I used one particular reward to satisfy the niggling Spring shopping urge I wrote about, another for some movie tickets.

After getting a particularly good gift-with-purchase last week, full of small products, I paused to wonder why sizes can't be smaller in general. I like tiny tubes of gloss and little bottles of polish because it's likely all I use in a year. Similarly, in a lot of other countries you can get more expensive but single-size amounts of things like baking powder. For a solo household, or even one with two people, fairly attractive. I've read articles about this being standard practice in minimalist countries like Japan and dream of the day the world realizes I don't need super sized anything.


Follow up: my friend from this post is actually a guy. I guess one of the things I'm always interested in is how gender roles (and expectations) might affect money management.

Tuesday, April 21, 2009

Into Temptation

(Written from an undisclosed rent-free location.)

Downtown without an office means mall lunches, i.e. smoothies en route. Malls in Spring are dangerous, all little dresses and bikinis and unscuffed flat shoes. Bronzing this and lipstick that. Suddenly, I feel as though I need a makeover. And to release my winter skin into the light, limb by limb.

As of Friday, 90% of my personal effects were relocated and the prohibition on acquiring new things because they would have to be packed is a harder sell. Instead, I remind myself of how much I like this minimal life and that I have everything I need right now and that I'm soon unemployed and that the exchange rates are doing me no favors...

Wednesday, April 15, 2009

Conversations About Love and Money

A good friend of mine is recently single, one of those amicable late mid twenties splits between people whose lives were going different directions. One of the things we talked about was how an unhappy marriage can seriously affect your financial habits.

First, my friend admitted for the last year materialism totally replaced love, the void was filled with expensive clothes and meals. My friend was decidedly non materialistic when we met, a socially oriented type we all thought would quickly end up doing good things.

Because the marriage became all about keeping up appearances, appearances became the only thing that mattered. When it dissolved, it was easier to put things back into perspective. To think about moving back into the artsy 'hood and out of the glistening condo mecca. It became easier to decide on a career change.

It was an interesting perspective on how difficult it may be to get your financial house in order if there are things consuming all of your energy, and impeding growth, in your personal life.

Second, after the break up, my friend discovered a secret credit card with a multi thousand dollar balance on it. Interestingly, the ex was known for being frugal and running a tight ship, almost to the point of being cheap. This was really upsetting for my friend -- though they weren't happy, couldn't they have been honest? It was a type of financial infidelity not so easily forgiven.

If you make yourself unhappy enough, you will never have enough money.

Now, my friend is dating again. The most recent love interest was an engineer with an $80K sports car, not atypical among the single yo-pro single set. Our conversation:

Friend: I knew from the car that it wouldn't last. What's the point of that, even when you can afford it. Somewhere nice to sit in traffic every day, I guess.

FF: I just look at it like a lot of potential freedom. For $80K you could take an entire year off and live pretty well.

Friend: For $80K you could spend a year in Italy and drink a bottle of wine every single day.

FF: It would probably be the best year of your life.

And there we sat, on a balcony in the sun, contemplating that very fact.

A little test: after reading this, is my friend male or female?

How Have I Been Reacting to the Recession?

Harvey Schacter writes about different consumer reactions to the economic pressures. The categories are a little tidy but made me wonder about my own behavior.

In most respects I'm probably under "Live For Today." I'm still eating what I was before, buying nice clothes when I feel like it, and willing to pick up a bar tab. But am I really living for today? That sounds so... frivolous. It sounds like the antithesis of someone interested in holding the personal finance ship steady.

I think a strong grounding in personal finance actually insulates against some of the broader economic pressures (and ensuing psychological stresses). Practice being rational with money makes you more rational in the face of challenge. Maybe he sees a young urban person living for today but I'd characterize my position as a young urban person who has positioned herself financially for good times and bad, and who has used finance to ensure consistent quality of life.

If you never live like it's a boom you may not have to live like it's a bust.