Keep on Working

Posted on February 22, 2012 by Shaun

Yup, that’s what most Canadians are going to do, keep on working past age of 66. Fewer than a third of the respondents to this Sun Life Financial poll said they plan to be fully retired by 66. If I decided to do whatever one else is doing (which is not working if retirement is “maybe 66”) then that means I would have to work for at least another 33 years. Nope sorry that’s not going to happen.

However sadly for most Canadians they will be working past the age of 66 on a 1/3 of the income and a 1/3 of the energy that they used to have when well at my age! What’s even sadder is that a lot of these people are carrying debt with them…that’s just ridiculous. I’m forever grateful that I got around people that helped steward us to get out of debt so that we don’t have that stress in our life and so that we don’t take it to our grave. We’ve got money growing in the bank, not wasted away like some others may think on “tools” and products we’ll never use. That would be stupid, whoever tells you to buy stuff you don’t need, run the other way!

So if you get to that golden age of retirement at the age of 66+ and you want to live off your pension, I’ll give you a little example of what that precious magical pension may be worth. If you are a RN (Registered Nurse) for example, you’d bring in around $1,700 a month. Quite the income there. If your a LPN (Licensed Practical Nurse), you’d bring in $700 a month. These numbers are not fake, my step mother is a RN and that’s what she’s faced with, not to mention others who’ve also confirmed this outside of my family. There are still quite a few people out there thinking their pensions are going to take them to the promised land of retirement and the fact of the matter is they are kidding themselves. You’ll need either some significant investments outside of that or some other way of creating some residual style of income.

The funny thing is, build a solid platinum business with proper width in the Amway Business Opportunity and you could make just over double that pathetic pension of a RN. (not including Q-12 bonus) The benefit of that outside of monetary compensation is that you’ve helped some individuals or families have an opportunity to do the same as what you have. Again I’ll maintain we will never convince anyone to do what we do but the proof is in the pudding with the people we are working with and the many semi-retirement parties that happened last year.

It’s obvious through this article today (and many others) on CTV that the whole Freedom 55 or even Freedom 65 just isn’t working. People are looking for other opportunities and that’s exactly why this business and what we are doing is growing at a steady rate.

http://www.ctv.ca/CTVNews/Canada/20120222/sunlife-retirement-poll-120222/

My Have the Rules Changed

Posted on January 17, 2012 by Shaun

Last week in the Globe and Mail there was a great article on the old rules and new norms for personal finance. The old go to school, get a good education, get a job, get married, have kids and buy a house as quickly as possible is not cutting it in today’s society. I’m starting to see it now that I’m into my 30’s and hearing about people’s finances and where they are in life and how it’s not living up to what they expected.

The article talks about a few different rules that have been passed down by the generation before us. The older generation that used to think the following:

1. Finish school, get a job, get married, have children, and buy a house as quickly as possible. Delay saving for retirement until your 50s.

2. Buy the biggest house you can afford. Have a big family and pay of your mortgage fast.

3. Find a steady job with a good pension and don’t worry about investing for retirement. Stay there for 35 years and retire with a guaranteed monthly income.

I love all of these because I see so many people doing exactly that. While some people are starting to save earlier, most are spending it and their credit like they are drunken sailors. The second one is so especially true because it also ties in with status and buying that huge house, although nobody is paying it off fast. They get the largest mortgage they can with the lowest payments, only to find themselves in deep doo doo when they renew and the interest rates have gone up. Say bye bye house. Lastly the third one, there is no such thing as a steady job, job security is dead. I’ve seen it first hand where I work and if anyone actually pays attention to the news or where they work they’d understand that as well. Gone are the days where people work 20-30-40 years at one job.

So what are the new rules according to this news article?

1. Recognize that life unfolds differently now. If you have no home or family and spend your way through your 20s, saving for retirement will take longer.

2. Consider whether – and when – home ownership makes financial sense. Think about buying a smaller house or renting until you have a big down-payment.

3. Recognize that you are in the driver’s seat. If you don’t have a job with a secure pension, you have to make sure you plan and save for your retirement.

A lot of these make simple sense yet sometimes people cannot wrap their heads around it or they are counselling with their parents on the old style rules which is only causing people to fail in life. Now this doesn’t apply to everyone however if you’ve been keeping up with the news you’ll see that debt to income ratio is at an all time high of 153%. One positive note is credit debt is finally slowing down, but its taken a very long time for that to happen.

The key to this story is right here “recognize you are in the driver’s seat”. That is why so many people are looking for other opportunities outside of their full time job. That is why so many people are looking at an opportunity like Amway or other Network Marketing Opportunities. That’s why when I talk to some people they are already involved in something else part time outside of their job be it another job, Network Marketing, Home Business, or starting their own traditional business. Amway North America and Network Marketing is growing and that trend isn’t stopping despite what you may read elsewhere. It’s growing so much they are actually teaching it in College now.

So get in the drivers seat and take control of your finances, stop relying on the government or your job to take care of you because they won’t.

Living Paycheque 2 Paycheque

Posted on September 17, 2011 by Shaun

Yet another interesting article last week that comes out from the Canadian Payroll Association saying Canadians continue to struggle. Honestly it’s no surprise as people continue to spend more than they earn and continue to take on more and more debt.

The survey found that 57% of Canadians would be in a tough spot if their paycheque was delayed by just one week. I don’t know about you but that’s pretty damn scary that people cannot even live without their paycheque for one week. You may think your in a good spot but the real test is to try it out, you may think your okay but in reality maybe not. Now not everyone is in this boat and I’m sure a few of the people who read this blog will be quick to say they are just fine. That’s great because your in the minority then at 43%! The other interesting report is that 40% of the people that responded to this survey will need to retire later than planned. So much for “Freedom 65”, and it’s quite apparent as many older people are working longer and longer into their old age just to pay for the necessities of life. What ever happened to being able to relax and do the things they really wanted to do and live life?

It doesn’t matter what industry your in or how much you make, people are not getting the message. I honestly think it’s because of the low interest rate. People figure the money is cheap and they will just “pay it off” later or what not. I’m just assuming there. When the interest rates go up, and they will, people will be at their knees crying because they cannot even put food on their table.

I’ve never said Amway is the answers to your financial woes and have never tried to convince anyone to do what we do, however you better figure out what your plan B is going to be. People are looking for opportunities of some kind, some way to make extra money to pay down debts, however whatever it is will take hard work. Nothing is going to be quick and easy, it was easy to get into the mess you made by maxing our your credit cards however it’s going to take 10 times the effort to get out of that mess.

I think the biggest challenge many people have and why they spend more than can afford is because of association, plain and simple. The whole mentality of “keeping up with the joneses” or “I gotta have that now” is what’s killing people. I should also mention that status is another thing that kills people, people feel the need to look the part or cannot be seen as not having money and it just drives them further and further down the debt hole. Again I assume this is what’s happening but by watching the people at work and seeing how some friends act it’s quite clear I’m not that far off base.

So watch your association and maybe start meeting people who have a different take on life. People who live a life of delayed gratification, people who save now and then pay later, people that don’t care about status, people that just want to live a debt free lifestyle. There are MANY different ways you can do that such as www.meetup.com or other sites of that nature. One of the things we’ve done with our involvement with Amway is to utilize the training and support system called World Wide Dreambuilders or World Wide Group that teaches things like delayed gratification, living a debt free lifestyle, marriage, and a bunch of other great principals that not many systems of companies stand for. Anyway that’s what we’ve chosen to do and have been blessed many times over for doing that. Debt free and money in the bank that’s growing certainly puts us in that 43% that’s for sure.

Stat’s don’t lie, what are you doing today to make sure your in the 43% and not living paycheque to paycheque?

For a lot of us this picture paints a pretty realistic future.

Here is what the CPA said last year this time – http://www.nupge.ca/content/3571/poll-finds-six-10-canadians-live-payday-payday

Just a Little Debt Update

Posted on August 29, 2011 by Shaun

Well more news today on the debt front. To no surprise many Canadians are going to find themselves in debt many years longer than expected. CIBC held a survey which found Canadians holding some form of debt feel they will be deb-free by age 55. However, only 35 % in the 55 to 64 age group are actually debt-free. Is anyone actually surprised by this? With the many debt related news articles that have come out over the last year I don’t know why this is new news. I think it could be coming out now as we are on the brink of another recession, the double dip recession.

Jim Yih some financial expert says “the older you are the more you’re going to deal with the necessity of debt”. That is such a load of BS. Who says that debt has to be a necessity? It doesn’t HAVE to be and the more that people keep saying it’s OK to have debt the more society is just going to keep accepting that. Okay so a house is your “necessity”, I’ll *maybe* buy into that, but even still you don’t HAVE to have a mortgage. There are many ways to go about not having a mortgage, and no I’m not saying you have to do what we do to make that possible.

The moral of all these stories and news related items is focus on your debt repayment, and focus on staying out of debt. At the very least focus on your consumer credit and remove it. People who are 10’s of thousands in consumer debt are that way most likely because they are instant gratification people who have no self control on their spending. It’s the now mentality, I MUST have that new pair of jeans that I cannot afford, or I MUST have that new XBox, or whatever. How about have some restraint and delayed gratification and SAVE for it. Now there’s a novel idea!

Lastly towards the end of the article they say how getting out of debt is a slow and steady approach, it doesn’t have to be. Depending on where you are at, what you can streamline, what you can cut out, you can actually hit your debt hard and repay a lot faster than you think. It all depends on how serious you are. We paid off over $100K in consumer debt in less then 2 years, it doesn’t need to be a 10 year journey. We got serious about it and streamlined and cut back, we did it because we had huge goals and being debt free by the time we had kids was one of them. Kids are expensive enough let alone having a huge debt load on top of that. Sometimes you need that motivation to change and that was ours.

Interest rates are not going to last this low for long, once they go up that’s when you’ll be in a world of hurt. You’ll have nobody to blame but yourself. So what are you doing today to get out of debt? What did you do to get out of debt? Feel free to share.

CTV News Article – http://www.ctv.ca/CTVNews/TopStories/20110829/debt-poll-cibc-110829/

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“Buried Treasure”

Posted on August 24, 2011 by Shaun

I caught the last 1/2 hour of “Buried Treasure” where Leigh and Leslie Keno are what they call “modern day treasure hunters”. The premise of the show is people around the US have all this treasure and they have no idea is worth something. The Keno brothers go in an assess what the people have and let them know if they have treasure or if they have junk that’s not worth anything.

What I find really sad is a show like this is a prime example of just how desperate some people are to make a quick buck. People are willing to sell collectables and part ways with family heirlooms just so they can have a few thousand dollars. These are items that should continue to be passed down or treasured within a family but because people are so strapped for cash they reach out to shows like this to hawk off their stuff and hope to get out of their financial woes. Yet they will only realize their quick buck will never fix the real problem, its just a band-aid. The real problem is still there, lack of mentorship, poor association, poor financial planning, and the list goes on. It’s no different than lottery winners typically ending up broker than when they started. If you don’t know how to steward money in the first place, coming into money won’t change that, it just makes it worse and extra money highlights that.

Obviously this is my take on why this show is on however its pretty coincidental this is happening now when the US is facing even worse financial crisis that is going to put Canada back into a recession. TD even released a news article based on the fact we could be going back into a recession again. Yet some people think we are doing okay… give your head a shake, its going to take more than a few years to climb out of where we are and where the US is.