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Scotia Wealth Management

Mastering personal finance with Ashley and Lora

The Richard Dri Podcast

November 14, 2019

In a change from the Richard Dri podcast’s usual proceedings, today Richard’s colleagues Ashley and Lora are having an enlightening chat about what you can do to get your finances in order. The vast majority of people, unfortunately, are not taught the ins and outs of personal finance while growing up, and as a result, many young people find themselves deep in debt with no idea of how to break out of it. But a solution is within their grasp!

In this episode, Ashley and Lora help you visualize your financial goals, explain how little contributions can turn into big savings, and emphasize the importance of paying yourself first.

LISTEN TO THE PODCAST – DOWNLOAD THE TRANSCRIPT

Highlights:

  • You won’t have an idea of where you want to end up financially before you try to understand what your current situation is.
  • Define your short-, medium- and long-term financial goals, then craft budgets to determine your spending habits and how you need to spend your money in order to achieve these goals.
  • Figure out which of your expenses are essential or non-essential, then pare down the latter—but know you don’t need to do it all at once!
  • Through compounding, the initially small amounts of money you put aside in a savings account can gain massive value over time.
  • “Pay yourself first” by regularly putting 10% of your earnings into a savings account; setting up a pre-authorized contribution plan makes these transfers automatic so you don’t risk forgetting about them.
  • Take note if your employer will match a certain percentage of your RSP contributions; depending on the amount you’re basically receiving free money from your work!
  • If you have a credit card balance, pay it off in its entirety every month; if your balance is growing every month, that means you’re spending more than what you make.
  • Even if it’s not possible to pay off your balance all in one go, don’t just pay off the interest as it will naturally compound over time; be sure to pay off at least some of the principal.
  • Paying a little bit extra on your mortgage every month can rapidly close the gap on how much longer you need to pay.
  • Try to avoid “lifestyle creep,” where you increase your expenditures to match your salary; increase your savings contributions or loan repayments instead.

Quotes:

“Financial freedom is attainable! And it actually starts now.”

“In order to know where you want to go, you must understand where you are presently.”

“If you can save more, save more. I can’t stress enough that the earlier you start, the more you save, the better off you will be.”

“Free money does actually exist!”

“Please, don’t get sucked into lifestyle creep!”

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