August update

I'm not quite sure how it happened, but yesterday was Labour Day. I'm still trying to figure out where the summer went, but even so, it was very nice to have such a beautiful long weekend to cap things off. We're now well into September, with fall on the horizon.

Let's take a look at how I did last month:

• Reduced my revolving debt to $10,940.26 - At this rate, I'll likely be a few hundred dollars shy of my $7,500 target for year-end, but progress is progress, so I'll take it.


• Emergency Fund grew to $1,781.57 - I had to move some funds around for a few reasons last month. Citizens Bank, which I had joined last winter to take advantage of their welcome bonus, is shutting down its deposit-taking business, so I had to withdraw my funds from that account. I also decided that I would start carrying $100 in emergency cash in my wallet. This gets treated as part of my Emergency Fund (I don't spend it if I can avoid it, and I replenish it as soon as I can when I do), and provides me with a buffer if I need some cash before I can get to a bank machine. This amount is denominated in $20, $10 and $5 bills, so I can also make change if needed.


• Wedding Fund grew to $4,026.73 - Nothing too exciting here; just slow, steady progress toward what we hope will be a cash-only wedding.
  
  NOTE: Since this money is earmarked to be spent on our wedding next year, any valid wedding expense that we pay for from this account will not reduce my progress on this goal. This may seem like funny accounting, but the real goal here is to pay cash for the wedding, so I don't plan to penalize myself for using these funds as intended.


• Reduced our mortgage to $294,437.11 - Ever since we renewed at 2.65%, we're burning through the mortgage much more quickly. It's nice to see such strong progress on this loan, especially with all the news coverage of "upside-down" mortgages.

Now, on to my month-end update:

Assets:
Online Savings - $1,919.02
Self-Directed RSP - $43,737.55
Employer Group RSP - $19,762.56

Debts:
Revolving Debt - $10,940.26
Student Loans - $18,070.60

Net Investable Assets: $36,408.27
Net Liquid Assets: ($27,091.84)

The market recovery of 2009 continued in August, with my RRSP increasing well beyond my monthly contributions. Liquid savings were basically flat, for a net increase of $3,228.53 in my investable assets, accompanied by a $1,144.15 drop in my non-mortgage debt.

Overall, my net investable assets increased by $4,372.68, and my net liquid assets increased by $1,199.36. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage).

July update: In which our blogger takes his sweet time posting

Happy August. Sorry to be posting this so late (theoretically, it should have gone up over a week ago). At any rate, I hope you enjoyed Civic Holiday last Monday. Toronto residents should also be enjoying the fresh air now that the CUPE strike is over, and basking in the afterglow of Caribana and Taste of the Danforth.

As we head into the home stretch of our Canadian "summer", let's see how I did last month:

• Reduced my revolving debt to $11,511.39 - Good, solid progress here. We had no real unexpected expenses in July, so I was able to stick to my debt reduction schedule.


• Emergency Fund grew to $1,730.07 - After the cash outlay for car repairs in June, I'm back on-track with forward motion in my Emergency Fund. $2,000 by year-end still looks achievable.


• Wedding Fund grew to $3,662.86 - July was a strong month on the nuptial front, getting us back in the black with our wedding savings. We're also starting to finalize some of the details of next summer's affair, and we should be able to hit the $6,500 target by year-end.
  
  NOTE: Since this money is earmarked to be spent on our wedding next year, any valid wedding expense that we pay for from this account will not reduce my progress on this goal. This may seem like funny accounting, but the real goal here is to pay cash for the wedding, so I don't plan to penalize myself for using these funds as intended.


• Reduced our mortgage to $295,673.67 - Make no mistake; this is still a freaking big amount of money to owe. The important thing to note, though, is that this is a drop of $1,135.84 from a month ago. Compare that to the $794.73 in monthly principal reduction that we've been averaging over the last two years, and you can see why I'm happy. The new rate on our mortgage has everything to do with this jump. When we renewed in June, we basically cut our interest rate in half, but kept our payments the same. This sends a lot more of our payment toward principal on the loan, and represents the first time that we've really been "ahead" on the mortgage. In three years, when it's time to renew again, we will have made some very strong progress.

Now, on to my month-end update:

Assets:
Online Savings - $1,863.81
Self-Directed RSP - $42,719.10
Employer Group RSP - $17,607.69

Debts:
Revolving Debt - $11,511.39
Student Loans - $18,643.62

Net Investable Assets: $32,035.59
Net Liquid Assets: ($28,291.20)

This is getting repetitive, but I won't complain. Once again, my RRSP was buoyed by market growth. Liquid savings were basically flat, for a net increase of $3,505.19 in my investable assets, accompanied by a $1,242.07 drop in my non-mortgage debt.

Overall, my net investable assets increased by $4,747.26, and my net liquid assets increased by $1,164.64. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage).

More milestones this month, as my net investable assets cracked $30,000, and my net worth crossed the $80,000 mark. Things may not always move forward as quickly as I'd like, but I've made tremendous progress over the last two years, and I'm looking forward to the day in the not-so-distant future when my only debt is our mortgage.

June update

Happy belated Canada Day! We're now halfway through 2009 (today is the 183^rd day of the year), Canada is 142 years old, and the country has mourned the passing of a pop icon.

Now that summer is well under way, let's see how I did last month:

• Reduced my revolving debt to $12,182.64 - We had some financial hiccups this month, so progress was slower than we might like, but we still managed to carve away more than $500 in revolving debt.


• Emergency Fund dropped to $1,678.36 - Some car repairs and other expenses needed to be paid from savings. My Freedom Account was able to bear most of the burden, but the Emergency Fund took a small hit as well. We should still be able to hit $2,000 by year-end.


• Wedding Fund dropped to $2,958.88 - I had to pilfer the wedding account for some of the car expenses. We should still hit the $6,500 target by year-end.
  
  NOTE: Since this money is earmarked to be spent on our wedding next year, any valid wedding expense that we pay for from this account will not reduce my progress on this goal. This may seem like funny accounting, but the real goal here is to pay cash for the wedding, so I don't plan to penalize myself for using these funds as intended.

Now, on to my month-end update:

Assets:
Online Savings - $1,941.24
Self-Directed RSP - $40,640.05
Employer Group RSP - $16,104.12

Debts:
Revolving Debt - $12,182.64
Student Loans - $19,214.44

Net Investable Assets: $27,288.33
Net Liquid Assets: ($29,455.84)

Once again, my RRSP was buoyed by the market rally this month, although the stumble in the third week of June kept the investment growth in check. Liquid savings took a substantial hit, for a net increase of $1,267.21 in my investable assets, accompanied by a $1,102.58 drop in my non-mortgage debt.

Overall, my net investable assets increased by $2,369.79, and my net liquid assets increased by $494.60. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage).

One additional metric that I track (on top of my net worth, net investable assets, and net liquid assets) is my after-tax net investable assets. Since my retirement investments would be taxed at the full marginal rate if I withdrew them, I assume the maximum Ontario MTR of 46%*, and only count 54% of the value of my retirement accounts. This essentially adds 54% of my retirement savings to my net liquid assets number. This month, for the first time since I've been tracking my finances, my after-tax net investable assets are actually positive, coming in at $1,186.01. That means, if I were to sell everything in my RRSP and use it, along with our cash savings, to pay off our student and revolving debts, we would end up with nearly $1,200 in the bank. That's another milestone on the road to solvency, a step up from when I first came out of the red last April.

* I'm not actually in the top tax bracket, but using the current maximum of 46% gives me a "worst-case" scenario for the taxes I would have to pay if I cashed out my RRSPs.

May update

What a difference a bullish market makes! After what felt like ages bemoaning the monthly decimation of my investment portfolio, we've had three straight months of continuous market growth. Combine that with the improving weather we've had lately, and I am one happy camper.

Let's see how I did last month:

• Reduced my revolving debt to $12,716.58 - Since I started tracking my finances over two years ago, I've only had one month where my revolving debt increased. Otherwise, I've been making consistent forward progress, and although I'm still in "slow-and-steady" mode, I feel as though I've kicked the habit of blind spending on credit. Now whenever I make a purchase, it's effectively a cash purchase whether I use a credit card or not; either way the money is almost immediately debited from my chequing account, so I always know how much I can afford to spend before my next paycheque. I've still got the hangover from my reckless spending days, but I've learned my lesson, and things look better every day.


• Grew my Emergency Fund to $1,832.23 - I upped my bi-weekly contributions by $10 in May, and I'll continue to do this going forward.


• Grew our Wedding Fund to $3,160.79 - Steady progress on this front, and I'm crossing my fingers that we'll be able to pay cash for most, if not all, of the wedding.
  
  NOTE: Since this money is earmarked to be spent on our wedding next year, any valid wedding expense that we pay for from this account will not reduce my progress on this goal. This may seem like funny accounting, but the real goal here is to pay cash for the wedding, so I don't plan to penalize myself for using these funds as intended.

Now, on to my month-end update:

Assets:
Online Savings - $2,549.22
Self-Directed RSP - $40,635.38
Employer Group RSP - $14,233.60

Debts:
Revolving Debt - $12,716.58
Student Loans - $19,783.08

Net Investable Assets: $24,918.54
Net Liquid Assets: ($29,950.44)

Once again, my RRSP was buoyed by the market rally this month; along with over $600 in contributions, this rally lifted my investment balance by $5,733.85. Liquid savings took a slight dip, for a net increase of $5,673.38 in my investable assets, accompanied by a $1,183.38 drop in my non-mortgage debt.

Overall, my net investable assets increased by $6,856.76, and my net liquid assets increased by $1,122.91. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage).

Who knows if this market rally will last, but for as long as it does, I'll enjoy the ride.

April update

Well, this is a bit late. We're almost a week into the month of May, and I still haven't posted my April numbers. I don't really have a good reason for the delay, aside from a full plate at work and enjoying the nice weather we've been having. At any rate, let's see how I did last month:

• Reduced my revolving debt to $13,333.48 - This means that I am finally below 50% of the $27,610.74 that I started with two years ago. It also means that it's taken me twice as long as expected to pay off my revolving debt, but I've had two years of consistent, strong progress, and there's nothing wrong with that.


• Grew my Emergency Fund to $1,780.85 - This progress is very slow and steady, but until the debt is gone, this fund is more of a "nice-to-have" cushion than a true Emergency Fund, so it can't be my priority at the moment. Still, I'll continue throwing $25 into it every two weeks, until I'm able to get more serious about building up a few months' expenses.


• Grew our Wedding Fund to $2,643.23 - We should be in good shape for our wedding next summer, at the rate we're saving for it. Ms. Loonie has been building up her own wedding cache on the side, which is not reflected here, and we're pretty much neck-in-neck at the moment.
  
  NOTE: Since this money is earmarked to be spent on our wedding next year, any valid wedding expense that we pay for from this account will not reduce my progress on this goal. This may seem like funny accounting, but the real goal here is to pay cash for the wedding, so I don't plan to penalize myself for using these funds as intended.

Now, on to my month-end update:

Assets:
Online Savings - $2,609.69
Self-Directed RSP - $37,831.13
Employer Group RSP - $11,304.00

Debts:
Revolving Debt - $13,333.48
Student Loans - $20,349.56

Net Investable Assets: $18,061.78
Net Liquid Assets: ($31,073.35)

Once again, my RRSP was buoyed by the market rally this month; along with over $600 in contributions, this rally lifted my investment balance by $4,530.09. Liquid savings also rose, for a net increase of $5,138.56 in my investable assets, accompanied by a $1,581.23 drop in my non-mortgage debt, helped along by April being a three-pay month.

Overall, my net investable assets increased by $6,719.79, and my net liquid assets increased by $2,189.70. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage).

Not a bad month.

Payday update - rolling over

OK, so this is kind of cool.

I got paid today (as I do every second Thursday), and in typical data-addict mode, I've been updating my financial spreadsheet. This is where I keep track of monthly net worth, as well as monthly and bi-weekly progress toward my various financial goals. Looking at the numbers, I noticed that a whole slew of balances crossed key thresholds today.

Here's the run-down:

• Revolving Debt - Crossed the $14,000 mark, dropping from $14,069.07 to $13,853.02. This finally puts me below my year-end target for 2008.


• Student Loans - Crossed the $21,000 mark, dropping from $21,195.20 to $20,913.86. This gets even cooler when you realize that the two loans making up this total went from $4,023.47 to $3,945.06 and $17,171.73 to $16,968.80, respectively.


• Mortgage - Finally crossed the $300,000 mark for the last time. At $299,116.04, we are at last beyond the reaches of accruing interest. Look out, $200K, here we come!


• Rising Above the Powers-Of-Ten Bias - Most significant of all, my Emergency Fund and Wedding Fund crossed the $1,732 mark and $2,127 marks, respectively, currently sitting at $1,733.86 and $2,160.11!

I've updated my progress bars, as well as the NCN Network chart for my revolving debt, bringing my Total % Paid to 49.83%. I'm so close to half-way I can taste it.

March update

April has arrived, and we're firmly into spring, so let's see how I did last month:

• Reduced my revolving debt to $14,069.07 - Still chipping away... I'm within spitting distance of $14,000 (my 2008 year-end goal), and almost half-way through my debt elimination. Over the next month, I'll be ramping up my bi-weekly payments to get a bit more aggressive with paying this off.


• Grew my Emergency Fund to $1,718.86 - Slowly but surely closing the gap to my $2,000 goal for the end of the year.


• Grew our Wedding Fund to $2,110.11 - I owe less income tax than I was expecting, so I was able to transfer some cash from the tax savings bucket in my Freedom Account over to my Wedding Fund. Ms. Loonie is working on her own savings account for the wedding, so by the end of the year we should have a nice bundle built up.
  
  NOTE: Since this money is earmarked to be spent on our wedding next year, any valid wedding expense that we pay for from this account will not reduce my progress on this goal. This may seem like funny accounting, but the real goal here is to pay cash for the wedding, so I don't plan to penalize myself for using these funds as intended.

Now, on to my month-end update:

Assets:
Online Savings - $1,875.90
Self-Directed RSP - $35,174.22
Employer Group RSP - $9,430.82

Debts:
Revolving Debt - $14,069.07
Student Loans - $21,195.20

Net Investable Assets: $11,216.67
Net Liquid Assets: ($33,388.37)

For a change, my RRSP actually grew this month, thanks to the recent market rally and over $600 in contributions. Liquid savings are down a bit, for a net increase of $3,879.42 in my investable assets, accompanied by a $905.41 drop in my non-mortgage debt.

Overall, my net investable assets decreased by $4,784.93, and my net liquid assets increased by $569.97. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage). I recently re-checked the Canadian Black Book® value of my car, and found that it has dropped substantially since I last checked two years ago. I've reflected this change in my overall net worth calculation going forward.

300 bits of sense and counting

When you start a blog to chronicle your journey out of debt, odds are your emotions are running a bit rampant. In a highly sensitive and impressionable state, you create an online profile, and have to choose a title for your project. If you're like me, you try to get clever and invoke some wordplay when naming the blog, and you end up with something like Loonies And Sense, hoping like hell that it will still seem even a little bit witty in a year's time.

Of course, having chosen a "clever" title, you also feel the need to revisit the play-on-words from time to time, referencing the pun in your post titles. This leads to posts like these, with milestone posts being especially heinous offenders. Eventually, you find yourself writing your 300^th post, and may decide to buck tradition by focusing on the sense rather than the Loonies.

All of which is to say that this post is the 300^th that I've written here, starting when I burst onto the scene back in 2007.

Let's take a look at the highlights of posts 201-299:

Canadian Stuff

• Loonies And Lexicons: Part 2 - I followed up my initial cross-border cheat sheet with some additional comparisons between Canadian and U.S. financial terminology.


• The P2P Lending Minefield - This industry still has yet to get off the ground in Canada, with at least one false start last year. In this economic climate, it will be interesting to see whether this idea gains any traction in the Canadian market.


• Comparisons In The Air - Four Pillars posted comparisons between Canadian and American retirement accounts and education savings plans, as well as comparing the TFSA to the American Roth IRA. Some good information here to complement my own cross-border comparisons.


• Deposit Insurance at Canadian Credit Unions - With the number of American banks that failed over the past year, deposit insurance has become a real hot topic. I've written in the past about insuring deposits and securities using CDIC and CIPF, respectively, but this post covers the insurance available on deposits at credit unions in each province.

Blogging

• 376 Days And Counting - A slightly belated celebration of my first blogaversary.


• The Worst Financial Advice I Ever Gave - I've been pretty light on the memes here at Loonies And Sense, but I liked this post about all the ways I led myself astray.


• Income From Blogging - I've also been pretty light on the blogging revenue, since I consider it my hobby and don't really run it as a business.

Milestones

• One Year Of Progress: Charting The Trends - I decided to chart my financial progress graphically, and the trends turned out to be very interesting.


• Payday Update: Under $300K Edition - The Loonie mortgage dropped below $300,000 for the first time this month. Since then, accruing interest has twice brought the balance owing back above this threshold, but with this Thursday's payment, we will owe less then $300K, at least for as long as we stay in our condo.

Taxes

• Making Sense Of Income Tax - This is one of the longest posts I've ever written. It takes a very detailed look at how income taxes are calculated, and explains the impact of credits and deductions on taxes payable.


• Getting The Most From A Group RRSP - I make the lion's share of my RRSP contributions into a group plan provided by my employer. As a result, the tax benefit of these contributions is immediately reflected on my paycheque, and I don't wait until April to get my refund.


• Claiming The Tax Credit For Charitable Donations - I took a look at how to optimize the tax benefit of donating to charity.


• Start Getting Your 2008 Taxes Ready Today - Whether it's setting up a folder to hold all your tax-related documentation, or setting aside cash to cover your tax bill next April, you'll be much more relaxed when preparing your next return if you've started thinking about it a year in advance.


• Feeling Some Property Tax Relief - After building up a surplus in our property tax account, the tax portion of our bi-weekly mortgage payment was reduced last August. We're up for renewal this year, at which time we'll look into paying the taxes ourselves.

Investing

• The Market Can Make You Crazy - With the toboggan ride the stock markets have been enjoying, sometimes you just need to step back, breathe, and tell yourself why you're investing in the first place.


• Time Changes Everything - A big rally can actually be as unnerving as a big drop. It's hard to keep your emotions in check.


• Some Perspective On A Month Of -38% Returns - A "terrible" (remember, this was written prior to October 2008) month in the market prompted me to check the data point against a trend line. Turns out it was actually right on target.


• The Loonie Portfolio: Asset Allocation And Half-Year Performance - I took a look at the allocation of my retirement investments, and how they stacked up through the first half of 2008.


• How Much Are You Up Or Down? One Ugly Chart, And One That's Not So Bad - Everyone's investments have taken a beating. That's part of the reason that I put so much emphasis on paying off my revolving debt: $500 of debt repayment will increase my net worth in any market.

Looking Back

• Remember The Tape Deck: A Lesson In Delayed Gratification - When I was 12, I saved up $100 (plus tax) for a dual cassette deck. To this day, $100 stands in my mind as a significant-but-attainable amount of money.


• Financial Archaeology: Unearthing Past Behaviour - A detailed look at the outstanding balance and accrued interest on my credit accounts before I "saw the light" in April of 2007.


• How Do You Think Of The Stock Market? - Gordon Korman introduced me to the stock market in his novel Go Jump In The Pool. It confused me at the time, but I think I'm finally getting the idea.

When you can afford to make the "wrong"choice

Trent at The Simple Dollar recently bought a new 2009 Prius, and took out a loan at 4% to cover the majority of the purchase price. Those who have been reading Trent's blog over the years know him as an advocate of frugality and paying cash, so this decision to finance the purchase has generated a lot of discussion among his readers. He addressed these concerns in a post today justifying his decision.

A lot of the thinking behind the pay-cash-don't-finance argument follows the line of "Won't it feel great when you walk into the dealership, write a cheque for the negotiated price of the car, and drive off the lot without a new loan hanging over your head?" The planning and discipline that it takes to save up enough cold, hard cash to pay for a new (to you) car are the same traits that help people get out of debt, plan for retirement, and become financially independent. When you look at the number of people who still live well beyond their means, spending more each month than they earn and mortgaging their future for today's wants, it's not hard to see that "save up and pay cash" is well-needed advice.

The difference here, though, is that Trent had saved up enough to pay for the car, and chose to finance the purchase (at a very low rate) in order to keep cash on hand for emergencies and any other opportunities that might come up along the way. This is very different than someone living paycheque-to-paycheque signing on for a 7-year loan at 12%. The interest on the loan may well cost him in the long run, but he's worked to put himself in a position where he can find a compromise rather than needing to make the perfect, by-the-numbers decision.

Much like the idea of getting ahead of the treadmill as opposed to getting off it, the message here is that, when you plan and save, you put yourself in a position of choice, and it can be surprising just how many options become available to you.

My life as a hamster

Back in 2007, a post by Trent at The Simple Dollar introduced me to the concept of the financial treadmill. The idea is that, if you're living paycheque to paycheque, and spending every dollar you make (or, worse, dollars you haven't made yet), you're basically running in place (or even falling behind).

I've written about this a couple of times, looking at my financial progress to see whether I can "get off the treadmill". So far, I still feel the treadmill spinning away, even though I've brought my cash flow out of the red, and built up a small savings cushion.

A post today at Generation X Finance put the treadmill dilemma in a slightly different light. The focus here is to "stop running in place and start making progress."

That "start making progress" piece is a subtle but important difference in the approach to the problem. It really suggests that, instead of looking to get off the treadmill (which really only happens at retirement), you should look to keep ahead of the treadmill. When you look at it this way, it takes "no, I'm not off the treadmill yet, but I'm getting closer," and turns it into "yes, I've come so far, and I'm getting better every day."

Forward motion is success, and helps to motivate future success. My debts (consumer, student and mortgage) are getting smaller every month, and my savings are growing consistently over time. If I have an off week, I may lose ground, but I still end up ahead of where I could be.

I'm still on the treadmill, but I'm running at my own pace.

Ah, to be young and naïve again...

Today was payday, and I've updated my progress bars and NCN Network chart. In looking at the chart, I noticed the "goal date" I set for myself when I started the blog.

My goal at the time was to be free of revolving debt by April 30, 2009.

At the risk of spoiling the ending, I have to say I'm not going to make it. A two-year payoff turns out to have been a bit unrealistic. On the one hand, I'm kind of bummed to see myself so far off this goal (I'll still have nearly half of the $27,610.74 I started with when the goal date rolls around). My shortfall is due to the choices I've made; it was possible to meet this goal, but I haven't made debt elimination enough of a priority to get there.

On the other hand, I've now reached a point where I always know exactly what my credit balances are, and I track my (ever increasing) net worth on a monthly basis. I've brought my credit usage under control, and have managed to pull off two consecutive cash-only Christmases. I have a small Emergency Fund, and Ms. Loonie and I are well on our way to saving up for our wedding next year.

Could I have been farther along if I'd made different choices? Absolutely. However, I'm miles ahead of where I was financially two years ago, and that counts for a lot.

Payday update - under $300K edition

I haven't done one of these in a while, but with today being payday, I thought I'd provide a quick update of my financials. My NCN Network chart has been updated with my latest revolving debt numbers.

Revolving debt is down to $14,212.71, which means I've paid off over 48% of the $27,610.74 I had when I started keeping track in April of 2007. Another $407.34, and I will have paid off half of my revolving debt. That's highly motivating.

Student loans are also dropping nicely. I recently renegotiated Ms. Loonie's interest rate, so both our loans are now at a fixed rate of 5%. Two more payments will bring my loan under $4,000, and hers under $17,000. Compare that to the respective $7,687.35 and $26,000 that we started with, and you can see the progress we've made over the past two years.

Finally, the really exciting news is that today's mortgage payment brought our principal down below $300,000, and we currently owe $299,883.42 on our mortgage. Granted, two weeks' accrued interest will boost the amount owing back up above $300K, but this is a huge milestone for us. It seems like only yesterday we finally bid adieu to our CMHC premium, but now we have a new first digit, and with our renewal date approaching and rates at all-time lows, we are in better shape every day.

I think it's safe to say that I'm happy with our progress.

February update

For such a short month, February seemed to last forever. Between work and personal commitments, I felt like I was being pulled in about fifty directions, but I did accomplish a few things since last month:

• Reduced my revolving debt to $14,413.42 - This was just keeping up with my regular bi-weekly payments. The drop of $377.82 was a little lower than last month, because I had to pay off my 0% credit card. This ended the "interest amnesty" I've been enjoying on my revolving debt since last January, and meant that the banks carried more heft in the tug-of-war of my debt reduction. Still, less than $30 in interest is nothing to gripe about. I'm looking into starting a new round of 0% offers this month, so let's see what I can find.


• Grew my Emergency Fund to $1,686.35 - Just a $33.06 increase this month, but even in slow-and-steady mode on this goal, I'm still on track to make $2,000 by year-end.


• Grew our Wedding Fund to $1,684.29 - I have just over $600 of this in a TFSA with ING, but the rest is available for any deposits we need to make over the coming months.
  
  NOTE: Since this money is earmarked to be spent on our wedding next year, any valid wedding expense that we pay for from this account will not reduce my progress on this goal. This may seem like funny accounting, but the real goal here is to pay cash for the wedding, so I don't plan to penalize myself for using these funds as intended.

Now, on to my month-end update:

Assets:
Online Savings - $2,211.34
Self-Directed RSP - $32,949.57
Employer Group RSP - $7,440.61

Debts:
Revolving Debt - $14,413.42
Student Loans - $21,756.26

Net Investable Assets: $6,431.84
Net Liquid Assets: ($33,958.34)

My liquid savings (which don't include our Wedding Fund, since this money is already pretty much spoken for) grew slightly, mostly through contributions to my Freedom Account. This month saw yet another slide in my RRSP, in spite of over $600 in contributions. These changes translated to a net decrease of $2,057.05 in my investable assets, along with a $936.74 drop in my non-mortgage debt.

Overall, my net investable assets decreased by $1,120.31, and my net liquid assets increased by $1,397.63. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage).

January update

January is over, and we're into the second month of 2009. Let's take a look at how I did with last month's goals:

• Reduce my revolving debt to $14,800 - Bingo. I ended January at $14,791.24, a drop of over $400. Not a bad start to my year of debt reduction.


• Grow my Emergency Fund to $1,650 - Another triumph: I'm currently sitting at $1,653.29. Not a huge growth from December's $1,589, but it's moving in the right direction.


• Grow our Wedding Fund to $1,260 - I hit this one, too, ending the month at $1,318.03. We'll likely need to put down a deposit for a photographer within the next month or two, so it's nice to have this cushion set aside.
  
  NOTE: Since this money is earmarked to be spent on our wedding next year, any valid wedding expense that we pay for from this account will not reduce my progress on this goal. This may seem like funny accounting, but the real goal here is to pay cash for the wedding, so I don't plan to penalize myself for using these funds as intended.


• Run an average of twice per week, and play squash at least once per week - Whoops. I did manage to play squash once a week, but only ran once, and briefly at that.


• Try two new recipes, with a focus on doing as much as possible from scratch - Another flop. Our weekends ended up being far more chaotic last month than we anticipated, and although we weren't too bad about eating out, we didn't get to be creative in the kitchen.


• Write detailed posts on three subjects - I did manage to churn out three posts (besides my update posts), but hardly the treasure trove of insight I was hoping to produce. Shall I now throw down the gauntlet and attempt to redeem myself during the year's shortest month?

Now, on to my month-end update:

Assets:
Online Savings - $1,750.45
Self-Directed RSP - $29,744.12
Employer Group RSP - $13,164.00

Debts:
Revolving Debt - $14,791.24
Student Loans - $22,315.18

Net Investable Assets: $7,552.15
Net Liquid Assets: ($35,355.97)

My liquid savings (which don't include our Wedding Fund, since this money is already pretty much spoken for) held steady, with some expenses coming out of the Freedom Account offsetting the Emergency Fund growth. This month saw a jump in my RRSP, due to my year-end bonus and some payroll contributions. These changes translated to a net increase of $4,590.72 in my investable assets, along with a $987.62 drop in my non-mortgage debt.

Overall, my net investable assets increased by $5,497.34, and my net liquid assets increased by $850.72. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage).

December update; 2008 in review

Happy New Year! I don't know about you, but I'm happy to see the end of 2008, and I certainly hope that 2009 has a little more sunshine to offer.

This is the my second New Year's post, and the end of my first complete year of blogging, so let's take a look at how I did with my 2008 goals:

• Propose to Ms. Loonie - I did this in November, and we are now engaged to be married in 2010. We couldn't be happier; this was probably my most important goal for the year, and the only reason it took so long was that I really wanted to pay cash for the ring. Long story short, I now have a beautiful fiancée with a paid-for ring, a tentative wedding date, and a whole lot of planning to do.


• Reduce my revolving debt to $14,000 - Not quite. I ended the year with $15,204.77 in revolving debt, a drop of $8,192.94 that put me at 87.2% of my debt reduction goal for the year. I would have liked to hit this target, but 87% is a lot better than the 75% of progress I made last year. The good news regarding my debt reduction is that I managed to have my second cash-only Christmas, thanks to my Freedom Account. It's amazing how good it feels to start the year without a holiday debt hangover.


• Grow my Emergency Fund to $1,500 - My Emergency Fund is meant to be small for the time being, until I pay off my revolving debt. However, I'm still looking to make continuous, small contributions to this cushion, just to keep the saving-for-saving's-sake habit alive and well. I closed the year with $1,588.90 in emergency savings, an increase of $425.94 that put me at 126.4% of my savings goal for the year. This is the net increase in my Emergency Fund, after taking out a few hundred dollars toward the end of the year to top-up Ms. Loonie's engagement ring fund and some car repairs.


• Give $2,000 to charity - I don't buy into the notion of a religious tithe, but I definitely believe that it's important to give. I contribute to a number of United Way charities through bi-weekly payroll deductions, and also make monthly donations to a local listener-supported radio station. On top of this, we sponsored a few friends in fundraising activities, and bought into casual Fridays at work. All told, we made $2,002.00 in charitable donations this year, which nails my goal for the year, and is a big improvement over the $1,300 we gave in 2007.


• Grow the readership of Loonies And Sense to 100 RSS subscribers - At this point, it starts to look as if I simply stopped reading my list of goals. I currently have 54 RSS subscribers, which is a far cry from 100. That's really my fault, however, because my posting schedule really fell off in the second half of the year.


• Lose 25 pounds - Things looked so promising, as I started running and playing squash on a regular basis, as well as walking consistently to and from work and eating a healthier diet. However, I got laid up with some really bad heel blisters just before the holidays, and coupled with a bounty of Christmas treats I'm back to square one. All is not lost, however; I received a digital scale as a prize through work, and I'm well-equipped to get back into the saddle in January. Let's see those pounds disappear!


• Adopt and maintain a version of Getting Things Done - D'oh! I'm well shy of having this system in place. I have made some improvements in my organizational system at work, including using more folders to manage my paper, but I still struggle with staying on top of my to-do list. This really needs attention in 2009.

A few significant misses on this list, but my finances made significant progress in the right direction, and I've taken my relationship with Ms. Loonie to the next level, so I'm happy with what I got accomplished (especially considering how much bad news was flying around throughout the year).

Now, on to my month-end update:

Assets:
Online Savings - $1,887.35
Self-Directed RSP - $31,092.25
Employer Group RSP - $7,169.25

Debts:
Revolving Debt - $15,204.77
Student Loans - $22,889.27

Net Investable Assets: $2,054.81
Net Liquid Assets: ($36,206.69)

Holiday shopping and car repairs put a $1,661.98 dent in my liquid savings this month. However, my retirement savings finally had a flat month, growing by $2.57 after three straight months of multi-thousand-dollar drops. Combined with debt reduction, my net investable and net liquid assets decreased by $415.59 and $418.16, respectively. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage).

2008 in review

Besides the financial progress detailed above, here are the rest of my 2008 milestones:

• I knocked off 35% of my revolving debt from the beginning of the year. This leaves me with only 55.1% of the $27,610.74 in debt I had in April of 2007. That's a significant chunk of cash, averaging $682.75 per month.


• We've paid off $9,646 in mortgage principal, and $7,209 in student loans. This is all due to our automatic bi-weekly payments, with no lump-sum prepayments.


• My retirement savings have dropped by $3,732, in spite of over $11,000 in RRSP contributions. This rather sizable black cloud has two silver linings: 1) I'm getting my first taste of a serious bear market, and a chance to see how I react to a period of horrible market performance; and 2) I've spent a good chunk of the year buying stock and mutual funds at a deep discount, holding up the "buy-low" side of the investor's mantra. Since I have no need of these investments for at least two decades, I'm content to sit back and enjoy the ride. Besides, it's hard to imagine 2009 being any worse in terms of market performance.


• My net worth has increased by $21,396 (72%), while my net investable and net liquid assets have increased by $11,750 (124%) and $15,482 (30%), respectively.

Goals

I'm getting back on top of posting my monthly goals. Over the next couple of days, I'll be posting my goals for January, as well as my year-long goals for 2009. Stay tuned!

How much are you up or down? One ugly chart, and one that's not so bad

When I calculate my net worth for the month, the data get fed into some dynamic charts that I've created, to provide a visual representation of my progress over time. I've posted these charts a couple of times, but this month's output really stopped me in my tracks. Behold the majesty of my retirement investment performance since I started tracking in April of 2007:

Despite contributing roughly $18,500 to my retirement accounts since April 2007, my investments have gained only $2,171.50 in value.

Yippee.

Now, I need to point out a couple of things here:

• This chart only shows the month-end value of my investments - I haven't done any adjustments to show "what $10,000 invested on April 30 of 2007 would be worth today", or the like. This is a very basic "what was my investment portfolio worth on X date?" view of my RRSP's value over time.


• This graph starts at a value of $36,087.43 - Although a quick look at the chart makes it look like I've come full circle, there is actually another 6 years of progress prior to April 2007 that got me up to that point. I have to keep in mind that I'm really "up" by $38,258.93 over where I was at the beginning of my career (namely $0).

Since the beginning of the year, my retirement investments are down by 7.9%. I'm OK with that, since this money is for the long term, but it still hurts to see such a pronounced drop-off over such a short period.

A post at Clever Dude made me stop and think about how I'm really doing this year. True, my investments are down (by a lot), and my net worth has been slowly declining the last couple of months as a result. However, I've been making consistent progress on paying off my revolving debt, and tucking some cash away in my Emergency Fund and Freedom Account. As a result, my net worth is actually up by 71.8% over where it was at the end of 2007, my revolving debt is down by 32.1%, and my cash savings are up by 96.0%:

There's no question in my mind that I'm moving in the right direction, and although net worth has been stagnant the past few months, I'm laying a very solid groundwork for the future. By starting with a small base, and sticking to the plan, I've survived a huge drop in the market and actually grown my net worth by over 70%. That's not too shabby.

How is your big picture looking? Is market performance overshadowing the rest of your financial life, or are you seeing small changes add up to something better?

November update

Somehow, December is already here. I'm not entirely sure how this happened, but the holiday season is upon us, and we're in the final stretch of 2008. How are your holiday savings coming along? Have you been planning ahead for the shopping season? Are you scaling back on your purchases this year?

I didn't set specific goals in November (two months in a row equals a big slap on the wrist for Mr. Loonie), but here's a summary of my progress for the month:

• I reduced my revolving debt to $15,892.86 - This $498.99 drop pales in comparison to the $1,041.94 I paid off in October, but it's still a good-sized chunk of debt that's now gone. Not much new to see here, but it's movement in the right direction.


• My Emergency Fund dropped from $2,067.70 to $1,701.46 - What happened??? Did I have car repairs? Did I need to cover a health emergency out of pocket? No, things are fine in the Loonie household, which brings us to the third point...


• I proposed to Ms. Loonie, and she said yes! - The slowdown in debt repayment and the slight dip in my Emergency Fund are due to my purchase of an engagement ring last month. For most of the year, I've had some money stashed away in a savings account, and I finally put it to good use to pop the question to the woman of my dreams. We're looking at dates in early 2010 for the actual wedding, but for now we're just basking in the glow of being engaged.

Now, on to my month-end update:

Assets:
Online Savings - $3,549.33
Self-Directed RSP - $31,128.93
Employer Group RSP - $7,130.00

Debts:
Revolving Debt - $15,892.86
Student Loans - $23,445.00

Net Investable Assets: $2,470.40
Net Liquid Assets: ($35,788.53)

My liquid savings grew slightly in November, which reflects some substantial contributions to my Freedom Account, offset by the withdrawal from my Emergency Fund. This month had a much smaller drop in my RRSP, which shed only $2,789.20 (as opposed to $6,200.26 in October). Still, the last time my retirement savings were this low was July 2007. These changes translated to a net decrease of $2,590.82 in my investable assets, more than offsetting the $1,066.52 of progress I made in reducing my non-mortgage debt.

Overall, my net investable assets decreased by $1,524.30, and my net liquid assets increased by $1,264.90. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage). The market took a much smaller bite out of my retirement savings this month, which is a relief. The continuing forward motion in my net liquid assets is good to see, considering that the Loonies have a wedding to plan. Let's keep building those savings and shrinking that debt!

October update

Hello there. Remember me?

I don't know if you've noticed this, but a lot has been going on during the past month. Between the bailout in the U.S., the injection of cash into the Canadian mortgage market by the CMHC, and the rest of the turmoil going on in the markets, it's been really tough to keep on top of everything that's going on. Frankly, it seems to have turned me from a commenter to a spectator, as I try to wrap my head around it all. It's taken all my "finance sense" just to reassure myself while watching the decimation of my retirement accounts, and I just haven't had the wherewithal to post on any of the financial goings-on in October.

In spite of my complete radio silence this month, I have still been bringing in a paycheque, and I have been doing things with that money, so let's take a look at how I did. I didn't get around to posting any goals for the month, but I can still post my financial progress:

• I reduced my revolving debt to $16,391.85 - A three-pay month is always welcome when looking at my debt elimination progress. I was able to knock more than $1,000 off my debt, which feels good. I'm not sure whether I'm going to hit my $14,000 target for the end of the year, but at least I'm maintaining forward momentum.


• I grew my Emergency Fund to $2,067.70 - I'm well above my year-end target of $1,500, so I have a nice cushion for the days between my payday and Ms. Loonie's paycheque.

Now, on to my month-end update:

Assets:
Online Savings - $3,350.95
Self-Directed RSP - $32,794.73
Employer Group RSP - $8,253.40

Debts:
Revolving Debt - $16,391.85
Student Loans - $24,012.53

Net Investable Assets: $3,994.70
Net Liquid Assets: ($37,053.43)

My liquid savings grew substantially in October, thanks to the three paycheques that fell during the month. However, my RRSP shed another $6,200.26 in value, bringing my retirement savings below where they were one year ago. I'm thankful that I'm dealing with this market crash so early in my saving process; as long as the markets do rebound, the coming years should provide some very favourable rates of return. It still hurts to watch my balance sheet decrease by thousands of dollars each month. These changes translated to a net decrease of $5,270.17 in my investable assets, which dwarfs the $1,888.72 of progress I made in reducing my non-mortgage debt.

Overall, my net investable assets decreased by $3,381.45, and my net liquid assets increased by $2,818.81. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage). I'm glad that I calculate my net liquid assets each month, because this metric keeps me focused on the items I actually control: debt reduction and cash savings. Other than setting an asset allocation I'm comfortable with, my investment performance is largely out of my hands, so being able to see the impact of my behaviour on my bottom line is very important. It's been well over a year since I had a month-over-month drop in my net liquid assets, so I must be doing something right...

September update

For a month with only 30 days, September seemed to go on forever. Now we're into October, and the Christmas merchandise is already starting to crop up in stores everywhere. Have you been setting aside cash for holiday shopping? If not, now might be a good time to start.

Let's take a look at how I did with my September goals:

• Reduce my revolving debt to $17,500 - I nailed this one, closing the month at $17,433.79 in revolving debt. That's still a lot of revolving debt to have, but it's $644.41 less than I had a month ago, so I'm happy with the progress.


• Grow my Emergency Fund to $2,000 - Done. After interest posted to my accounts, my Emergency Fund balance was $2,018.33. That puts me at a point where I can ease off my emergency savings and focus on other areas that need the funds.


• Run at least twice per week - Not quite. I did get out running five times this month, which is more than once per week, but unless my math is wrong, it falls short of twice a week. We also played squash a few times, so my activity level wasn't bad, but I didn't quite get there.


• Try two new recipes for foods that we would usually buy prepared - Not so much. We've been a tad lazy on the cooking front this month, and haven't been flexing our creative muscles in the kitchen.

Now, on to my month-end update:

Assets:
Online Savings - $2,420.86
Self-Directed RSP - $38,853.91
Employer Group RSP - $8,394.48

Debts:
Revolving Debt - $17,433.79
Student Loans - $24,859.31

Net Investable Assets: $7,376.15
Net Liquid Assets: ($39,872.24)

Due to some items being paid out of savings this month, even with the growth in my Emergency Fund, my cash savings dropped by $187.45. Also, thanks to the shenanigans on Wall Street this month, my retirement investments once again showed a month-over-month decrease, dropping by $4,343.09 in spite of over $600 in RRSP contributions. This translates to a net decrease of $4,530.54 in my investable assets, which more than offset the $1,205.93 of progress I made in reducing my non-mortgage debt.

Overall, my net investable assets decreased by $3,324.61, and my net liquid assets increased by $1,018.48. My NetworthIQ profile has also been updated (including loose cash, home, car and mortgage). Over the 17 months I've been tracking my progress, this is only the fifth time I've had negative growth in my net investable assets, and each time this has been driven almost entirely by a drop in investment value. The silver lining to this is that I'm maintaining forward progress on the items I can control (like debt reduction and cash savings), in spite of the factors I can't control (like investment returns).

Payday update

I never did get around to posting payday updates in August, what with vacation and a generally hectic schedule. Today was payday, though, so I've brought my progress bars and NCN Network chart up to date, and I'm making continuing to make headway on my revolving debt and Emergency Fund.

As of today, my revolving debt currently sits at $17,778.20, which is less than two-thirds of what it was when I started tracking last April. That's not bad progress. I'm working toward a goal of $17,500 by the end of the month, and I'm well-positioned to hit that target.

My Emergency Fund is at $1,927.41, spread between a few online savings accounts, an account at my primary bank, and some cash in an envelope stashed at home. Hitting the $2,000 mark for September shouldn't be too much of a stretch, so it will be nice to have that buffer in place.

Nothing too exciting, but I'm continuing to move forward, and I'm a lot better off than I was when I started this blog. That feels really good.