Sunday, February 5, 2012

The Ten Month Salary

This page will document my attempts to save money on a big scale! I am always so inspired by those news stories of individuals who have miniscule incomes and still manage to get out of huge debt in a year or so. I'm setting a goal that by February 4, 2013, I will have no debt and my house will be at least 50% paid off. I'm also going to put more money away.

Yesterday a colleague told me that she heard on the radio that they are raising the age of Canadian Old Age Pension from 65 to 68. I've always been told that it wouldn't be there for me to collect when I am of retirement age. These are not serious predictions but rather, truisms floated about and repeated by people who may not have the knowledge to know.

But then the conversation turned to my generation. We are a generation that lives in debt , the newer, more expensive, first-to-have, envy-of-all-your-friends type of debt. Ady many of my friends don't have any savings put away for the long haul. So, while we tell each other CPP won't be there for us, we are probably going to need it more than the last generation...

When I went to Teacher's College (an old descriptive term that is very outdated but still is used to describe the years spent as a student in the Department of Education at an accredited University), I met with a financial adviser (he some job like that) and he said he makes all his money off teachers. Teachers, he continued, are terrible with money and those that are paid on a ten-month schedule but have to stretch it over 12 months always come up short. His job was to give them short term loans (so I guess he was a loans officer).

Now, I generally don't believe the ramblings of every would-be preacher-type that I meet, but this guy made sense. Fast forward a few years to when I had a job outside Atlanta, Georgia. The school board there gave foreign teachers a 10% advance on their income, interest free, so that they could set-up their living accommodations. All the teachers I met, from Canada and other places, took that $5000 and went to town. No expense was spared. We received the money on a Friday and by Monday most people had spent it! Those who hadn't spent every cent on their houses lived out the next month in such fine style that my mother would have thought them a Rockefeller! I spent my money a lot more cautiously - I bought a mattress, box spring, bed stand and a table and two chairs. I had brought pots, pans and a coffeemaker from home. The rest of the money went into the savings account. I was after all, expecting to be paid in a week.

That year, I saved a tremendous amount. I lived on a budget. I'm going to do the same this year....

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