Organizing Your Personal Finances

When it comes to finance, the temptation to just ignore everything is quite simply overwhelming. In a modern world where speed is everything and time is a premium, letting money just sort itself out can be extremely tempting. You get paid, you pay bills, you sometimes squirrel some cash away in a savings account – and that’s that. As long as some people are in the black (or as close as can be), they see no need for any further attention to financial matters.

As with anything, before you can get your finances running smoothly, you will need to invest a little time. With personal finance, the key is organization. You will need to set aside a little time to get a workable system in to place, but the rewards are ongoing. With a little initial time spent, your finances could look much healthier, and your mind could be better off, too. Knowing you have a secure financial strategy in place could put an end to those heart stopping midnight moments when you’re quite convinced you’re financially ruined. In a way, see the initial time as an investment, which is particularly apposite for what you’re trying to achieve.

To begin with, sit down and work out exactly what comes in every month. This may sound simple, but a surprising amount of people aren’t sure of the exact amount of money they have available to them each month – only realizing when there’s a problem. If your wage is variable, due to overtime or shift patterns, it is best to just start with your basic salary – anything on top of that can then be seen as a bonus. Don’t forget to include tax credits and other forms of income, too.

Then write down exactly what goes out every month, on things like your mortgage, groceries, bills and standing payments. Again, for variable bills – such as electricity – work off the basic level, remembering to increase it for seasonal variations.

When these two columns are complete, see how much money you have available at the end of the month. Your goal is now to increase this figure. To do this, look at each outgoing and see if it can be reduced. Is there possibly a cheaper energy plan you could be on? Do you have payments for things you don’t use, such as a gym membership? Is there a call plan that would reduce your telephone bill? Shop around on the Internet to find the answers, using comparison websites where necessary.

When you’ve reduced your outgoings to their lowest possible levels, the main work is complete. Set up a standing order to put a percentage of your surplus money into a savings account. Even if it’s only $10 a month, it may soon build up and can help cover fluctuations in your income and outgoings.

The final step is to write everything down. Every purchase, every bill payment and every time you use your credit card; put it on a spreadsheet. When bills and bank statements come in, check everything against what you were expecting. Errors do occur frighteningly often, and unless you are diligent, you may miss something. By keeping proper records of all incoming money and outgoings, you will see a pattern to your spending and will be able to prioritize more effectively.

Every six months or so, re-evaluate. There may be a new electricity plan that will work out better for you, so keep checking your statistics. The only way to keep your finances running smoothly is to give them the time they need and to remain vigilant to any changes. By paying close attention, you could save yourself a fortune.

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Investment Opportunities Exist Even In A Terrible Market 

As global markets continue to pop like antique light bulbs, the value of some assets is beginning to slide south; even in a country, that has managed its economy as well as Canada. For people with money to spare who are worried that despite the security of Canadian banks their cash will begin to lose its value, it is therefore a tricky situation in which to invest wisely with any measure of confidence. Of course, investment is indispensable for an economy to thrive and grow, and if you’re not satisfied to see interest safely accrue on what you have in the bank then you’ll still be looking around to see where you can invest without having instantly to drop to your knees and pray. You’re not alone.

One investment market that is currently doing just fine is the buy-to-let market. This makes sense if you stop to think about it. With financial uncertainty clouding matters at the moment, renting a home has never been more popular. Fewer people are taking the considerable risk of buying a home, concerned that they might lose their job – particularly if exports begin to tail off as the global economy struggles. This makes it a potentially very profitable time to be a landlord. Real estate prices are falling, so if you have the spending power and the borrowing capability to buy up properties, now is a good time to do so, before doing the necessary work and turning them out on the rental market.

It is at least partly true that where one man is facing a crisis, another spots an opportunity. This may be cruel in some people’s eyes, but someone is always going to be getting rich when other people are having concerns, and when it comes down to it why shouldn’t you be that someone? Another thing to take into account is that property prices will by their very nature increase again at some point, and with senior analysts voicing the belief that the real estate market has bottomed out (or is at least about to) this might just be a fine time to get on the “property ladder”. Intelligent development could pay off in a big way a couple of years down the line.

One word of warning, however. To repeat the final words of the first paragraph, you’re not alone. There are a great many other people looking for an investment opportunity, and where there is a demand for something there will always be someone ready to profit from that demand. That someone will not always be as altruistic as might be hoped.

A competitive market is the ideal breeding ground for scammers and hustlers, and it is important to vet any investment opportunity more than once over before committing. A once in a lifetime, too good to be true opportunity might just be exactly that. Scammers will not always e-mail you pretending to be a retired Nigerian general with millions of dollars to invest – sometimes they’ll look you in the eye and smile at you. If you have doubts, contact the Investment Dealers Association of Canada. They police investment professionals, and there are few scams they haven’t seen.

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Current Financial Crisis and Housing Market

When the current financial crisis hit, the first industry shaken was the housing market. After all, one of the catalysts for the so-named “credit crunch” was the vexation in the United States’ “sub-prime” mortgage market, where irresponsible lending at unsustainable levels caused banks to lose solvency with terrifying rapidity.

As a result, the real estate market in the US and beyond fell victim to a major crisis of confidence, and the knock-on effects of this continue to shake the world’s economy. Injections of capital by some governments, and lock, stock and barrel takeovers of banks by others have introduced some measure of stability, but even now that stability is under almost permanent threat.

The consequence of this uncertainty has been a fall in house prices, as home owners have defaulted on mortgages and had to sell up and the market, for so long a seller’s domain, has turned to favour the buyer. Getting a mortgage to buy for the first time may have become a little more difficult, but for those of us lucky enough to have amassed some disposable income the market suddenly looks altogether more favourable.

Although house prices have fallen in Canada – just as has happened everywhere – the fall has been markedly less steep than elsewhere, particularly just south of the border in the US. In the past year, the Canadian real estate market has seen a drop in prices to the tune of 8.9%, and sales themselves have fallen month-on-month. But despite the more troubled market, Canadian banks continue, thanks to judicious management, to make mortgages available to those looking to buy a house. Set against the open panic in the States, where once it was too easy to get a mortgage and now has become a quest on a par with the search for the Holy Grail, this is resulting in a far more serene market in Canada.

Indeed, in some cities it is believed that the market is bottoming out in Ca nada, and ready to at least stabilize if not yet commence an upward climb. While prices have fallen, senior analysts are making the point that even if they continue to fall, the rate at which they are falling has slowed, and anyone waiting for the housing market to hit rock bottom so that they can jump on board will have a long and forlorn wait. As more potential buyers realize this, it is likely that we will see the numbers of sales starting to rise again. If, however, the strong employment numbers nationally take a hit, then the market could yet have austere days ahead of it.

The moral here certainly seems to be that sensible and realistic management of the banking and lending system is equipping Canada to see out the current global crisis in much finer fettle than many of its more storied counterparts. It could just be the case that Canada becomes a model for the other nations to follow.

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Canada Income Tax Software – Web Version

Read Canada Tax Preparation Software 2008 Windows Version Review Here

Each year, I review Canadian income tax preparation software programs. However, you will never find me reviewing brand name and # 1 best-selling software programs. Fancy software programs have fancy price tags, and I don’t see any reason to use those. A low-cost, regular software program should do the job fine and my objective is to show you a few of those. In this article, I will review a few web based software programs. To read my review on Windows version tax programs, read - Canada Tax Preparation Software 2008 Windows Version Review

Canada Tax Software – Canada Personal Finance Website’s Top Picks

After researching all online based software programs, the following programs are my picks for this year. I have not picked too many to keep things simple. Go through each of these I mentioned and choose the one you think most suitable for your needs.

ACE Tax

• Has the ability to copy your tax information from past years.
• Once you are done with your return, you can delete all your information from Ace Tax servers.
• One user ID lets you file up to 20 returns.
• Price: $8.99 for first time user. Returning user pays $6.99

MBO Tax

• Two filing to choose from. One for experienced users and one for new users.
• Friendly user interface provides flexible and easy data entry options.
• Easy explicit links take you to related forms and worksheets
• Price: $9.95

Two other software programs worth mentioning:

Cute Tax and Each Tax.

Remember, these software programs are totally free if your total income (line 150) is less than $25,000.

Quick Fact

• Deadline for 2008 Tax Returns: April 30, 2009
• Penalty for late filing: 5% of your 2008 balance owing, plus 1% of your balance owing for each full month that your return is late, to a maximum of 12 months. For more info, visit Interest and the late-filing penalty
• EFILE: Don’t mix up EFILE with NETFILE. EFILE is a service that lets authorized and professional service providers send individual income tax return information to CRA by Internet. Tax professional cannot use NETFILE. They must use EFILE. Therefore, when you submit your own tax return = you use NETFILE and when tax professionals submit your tax return = they use EFILE.

Quick Fact Source: Canada Revenue Agency

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