4/20/2020

Must read personal finance books!

The question a lot of people, myself included, ask when they start their journey is, what are the must read personal finance books. Reading has been an essential part of my journey, and I will highly advice anyone trying to reach financial independent to try and read a book a month. Here is a list of books that I've personally read and will recommend for people that want to learn more about personal finance.

4/11/2020

Neighbour Joe - April 2020 Net Worth



Asset
Chequing: $300.00
TFSA Investment: $97,466.04
(Market Value)
RESP: $4,192.89 (Market Value)
Real Estate: $224,000 (Purchase Price of my house)

Real Estate Rental Property: $200,000 (Purchase Price of the house)
Define Benefit Work Pension (Transfer Value): ~$278,000(Last checked in December 2019)

*Automobile is not included (No monthly car payment)

Liabilities
Mortgage: $117,698.99

Rental Mortgage: $193,974.95
Line of Credit: $5,942.00
*Credit Card is paid in full every month


Current Net Worth: $486,342.99

Passive Income
TFSA Passive Income: $4,844.08/Year or $
403.67/Month 

So in the last month when the stock market was taking a hit, I took leverage up and took money from my line of credit to max out my TFSA contribution for this year. I  brought a lot of quality dividend stock such as Canadian Banks which is why my passive income has increased.

3/13/2020

Net Worth Update & Comments on Market


Here is my net worth update for both February and March 2020. My investment took a big hit due to the recent market downturn, but I was able to see all my Amazon shares at near the peak back in February. I have since put all those cash back into the market, picking up some stable blue-chip stock on the way down. 

There is a lot of fear and panic going on right now, my advice for those that are in the market is to stay put and look for opportunities to buy. There is currently a lot of good companies that are trading at a deep discount right now, some of these company have a good track record of safe and reliable dividends. As the saying goes, "Be greedy when others a fearful." 

1/14/2020

A money tree that gives you $1 a day.


As the saying goes, "What, Do you think money grows on trees?". Well, I am going to show you that money does grow on "trees" and how you can get your hands on such a tree. This idea came to me the other day when I was talking to my wife about the current materialistic culture that we lived in. She said people don't want to invest in stocks because they can't show off their investment. I started thinking, what if you can buy a tree that gives you $1 a day, how many people will buy such a tree and how much will it cost? I can't answer the first question, but I can roughly tell you how much it should cost.

1/06/2020

Neighbour Joe - January 2020 Net Worth



Photo by Jamie Street on Unsplash
Happy New Year, hopefully, you had a wonderful 2019. Here is my first net worth update for 2020.

Asset
Chequing: $271.34
TFSA Investment: $
105,801.22(Market Value)
RESP: $4,311.772 (Market Value)
Real Estate: $224,000 (Purchase Price of my house)

Real Estate Rental Property: $200,000 (Purchase Price of the house)
Define Benefit Work Pension (Transfer Value): ~$278,000(Last checked in December 2019)

*Automobile is not included (No monthly car payment)

Liabilities
Mortgage: $118,640

Rental Mortgage: $194,949

*Credit Card is paid in full every month


Current Net Worth: $498,741.33

Passive Income
TFSA Passive Income: $3,774.92/Year or $312.08/Month 


The biggest change here is my Work Pension value, I recently checked my transfer value and it has increased significantly, almost double from the last time I checked. 

12/16/2019

Neighbour Joe - December 2019 Net Worth


Here is my net worth for December 2019.

Asset
Chequing: $311.96
TFSA Investment: $105,942.34(Market Value)
RESP: $4,051.82 (Market Value)
Real Estate: $224,000 (Purchase Price of my house)

Real Estate Rental Property: $200,000 (Purchase Price of the house)
Define Benefit Work Pension (Transfer Value): ~$153,000 (Last checked in Jul 2017)

*Automobile is not included (No monthly car payment)

Liabilities
Mortgage: $118,942.14

Rental Mortgage: $195,272

*Credit Card is paid in full every month


Last Net Worth Update: $369,917.66 
Current Net Worth: $373,091.98 (+0.86%)

Passive Income
TFSA Passive Income: $3,774.92/Year or $312.08/Month 

11/10/2019

Neighbour Joe - November 2019 Net Worth



Here is my net worth for November 2019.

Asset
Chequing: $321.10
TFSA Investment: $103,734.37(Market Value)
RESP: $3,709.19 (Market Value)
Real Estate: $224,000 (Purchase Price of my house)

Real Estate Rental Property: $200,000 (Purchase Price of the house)
Define Benefit Work Pension (Transfer Value): ~$153,000 (Last checked in Jul 2017)

*Automobile is not included (No monthly car payment)

Liabilities
Mortgage: $119,253

Rental Mortgage: $195,594

*Credit Card is paid in full every month


Last Net Worth Update: $364,930.51
Current Net Worth: $369,917.66 (+1.37%)

Passive Income
TFSA Passive Income: $3,574.64/Year or $297.89/Month (TFSA only, RESP and rental property not included)

10/02/2019

Neighbour Joe - October 2019 Net Worth


Here is my net worth for October 2019. Last month I put some money into my TFSA and invested into Canopy Growth (TSX: WEED) as well as TD Bank (TSX: TD). The market was doing well in September but as soon as we entered October it has been on a decline. Hope you are enjoying the fall weather. 

Asset
Chequing: $650.41
Savings: $610.53
TFSA Investment: $98,826.87(Market Value)
RESP: $2,804.00 (Market Value)
Real Estate: $224,000 (Purchase Price of my house)

Real Estate Rental Property: $200,000 (Purchase Price of the house)
Define Benefit Work Pension (Transfer Value): ~$153,000 (Last checked in Jul 2017)

*Automobile is not included (No monthly car payment)

Liabilities
Mortgage: $119,554.40

Rental Mortgage: $195,914.90

*Credit Card is paid in full every month

Last Net Worth Update: $363,756.24
Current Net Worth: $364,930.51 (+0.32%)

Passive Income
TFSA Passive Income: $3,574.64/Year or $297.89/Month (TFSA only, RESP and rental property not included)

9/18/2019

How setup a low cost RESP?


Hello, today I'll be writing about RESP and how you can open and manage your own RESP to avoid paying a hefty management fee. First off, for those that don't know what RESP is, it stands for Register Education Saving Plans. Like the name suggests, it helps with parents saving for their kid's education fund. There are two big benefits to this plan, the first is that the gains are not taxed if the money is used for education. The second benefit is the Canada Education Savings Grant (CESG), which is the government's contribution to the RESP. The government will contribute a maximum of $600 into the RESP depending on your income and contribution.

For more information with regards to CESG, you can find it on the CRA website. Here is the link: https://www.canada.ca/en/revenue-agency/services/tax/individuals/topics/registered-education-savings-plans-resps/canada-education-savings-programs-cesp/canada-education-savings-grant-cesg.html  

There is also a lifetime contribution limits of $50,000, again I'll suggest you check out the CRA website for all the information.

Opening an RESP
Well, first of all, you must be a parent to open an RESP. Sorry, if you are just planning to become a parent, the government won't let you plan that far ahead. Once your child is born then you can go to any organization that can sell investment or securities and open an RESP account. I myself opened an RESP Direct Investing account through my bank, similar to what I did for my TFSA. A lot of people think that just because it's an RESP you have to go through some education mutual fund company. However, you can buy individual stocks, ETF or index fund within an RESP account. Banks will never tell you that option because they'll want to sell you one of their mutual fund for your RESP, therefore you'll have to specifically ask for a direct investment account.

Why do you want to do this? Because this way you can invest in a low-cost index fund for your RESP instead of a high-cost mutual fund. One of the RESP funds I saw had an annual management fee of 3% compared that to an index fund where the management fee is around 0.05-0.5%.

Managing your RESP
There isn't much management to be done, once you have an account open, set up for an automatic monthly contribution of $210, this will max out the government's contribution. Then you can go in every month to buy a low-cost index fund, mine is currently invested with the TD e-series Index funds. Then in a few months time, you'll see the government's contribution automatically being put into your account. I usually spend 5 minutes a month managing the RESP, so it is completely doable for any parents.

Watch it Grow
Then now you can sit back and watch your child and the RESP grow for the next 18 years.


9/16/2019

Tips to reduce monthly expenses!


Here are some cost-saving tips that I have learned over the years. My post about my monthly budget also talked about a few cost-saving tips that my wife and I use.
  1. Utilities Cost Doesn't matter if you rent or own a house you'll still need to pay for utilities. Depending on where you are living the price of utilities vary drastically (i.e Ontario vs Alberta). The thing about utilities is that the less you use the less you paid. A very obvious statement that a lot of people fail to use to their advantage. Here are a few things that usually cost you the most but are easy to cut back on:
    1. Heating - Setting your house to a high temperature so that you can wear a T-Shirt around the house in the winter is a very costly habit. A few degrees less can save you big time over the span of winter.
    2. Shower - Taking a long shower does two things, uses water and uses electricity or gas to heat up the water. Just remember that it is not just the water you are using but also the boiler for the hot water.
    3. Dishwasher - Dishwasher is the same as shower, it uses hot water for washing then electricity for drying the dishes. Set your dishwasher for air dry if possible, it'll take a little longer to dry but will use less electricity.
  2. Auto Insurance A very simple cost-saving measure is to increase your deductible on your insurance. This means that if you ever decide to claim insurance you'll have to pay more out of pocket for your repairs. If you think about it, most people don't claim insurance for the minor incident and when you require major repairs the cost will be much higher than your deductible. Also, remember your insurance policy gets taxed so having a more expensive plan means paying more tax. Increase your deductible, pay less tax and save the difference. 
  3. Internet/Cables You don't need the fastest internet available unless you have a lot of people living with you. The cheapest plan is often enough for all your internet needs such as Netflix or gaming. If you need more then upgrade to a better plan after. As for TV, I realize that a lot of on-demand option such as Netflix or Sports TV subscription will still end up being much cheaper than a cable package.
  4. Repair > Replace When something breaks in your house you can either repair it or replace it. Sadly a lot of people opt for the latter and end up spending way more than they need to. I remember when my refrigerator broke my first instinct was to get a new one to replace it. After some research on Google, I was able to diagnosis the problem and end up buying a replacement part for $70. If you try to replace things when they break then you will spending a lot of money.
I'll share more saving tips whenever I discover them myself. Feel free to comment if you have any saving tips that you'll like to share.