Zero Money to Hero Money

Well it’s been close to 6 months since I made my last post, I haven’t forgotten the blog, or saving, or paying off debt, but rather got side tracked, but kept my spreadsheets going.  I’m heading down to Mexico for 10 days tomorrow, but already worked out most of my goals for 2010.  I updated my side bars to reflect the new goals, as well as the accomplished (and almost accomplished) goals from 2009.

The plan for this year is to accumulate roughly $20,000 worth of cash with my girlfriend for a down payment on a new home.  We currently own the condo, having paid down more than $15,000 of the mortgage in the first year alone.  I’ve cut back on the mortgage payments so that we can hopefully meet this strict and pretty ambitious savings goal.  We’re looking to purchase an old home in the downtown area, preferably already designated as a duplex, with the hopes of renting one of the apartments out, while living in and fixing up the other.  We’re going to keep the condo we have now, which is over 25% paid for, and rent it out.   My other goals are similar to last year, a little less emphasis on the additional income, and not quite as much saving.

Last year was quite successful for the TFSA, I had contributed the maximum amount ($5,000) by November.  I had decided from the get go that I’d buy stocks and see if I liked the stock market.. I’m still a bit uneasy, but I turned my $5,000 into $6,800, not bad!  I’ve since taken the money out to pay off some debt, put some in savings, and paid for my trip down south.  Lets see where 2010 brings us.

I’ve udpated my goals and my networth.  Things are going well.  I’ve reached my goal of $6,000 in side income this year, but haven’t received a lot of cheques yet, that would put me over that.  I also started up a business recently, subscription based online, it’s starting off not bad, so far I have about 40 customers paying a yearly subscription of $20 each.  Hopefully I can grow that number to 400 customers.

I also figured out with my bonus, my additional income and my yearly salary, if between now and December I can make an additional $8,000 I’ll hit 6 figures for the year.  I picked up a new contract that seems to be promissing in terms of work, so I might actually make that.  It would be pretty cool to say the least!

Goals are going well, my emergency fund is almost at $1,000 now, and I have $300 put aside for just random fun spending.  I’m doing much better over the past month of staying within my budget too.

Today was a great payday, because of the bonus I received back in April, my CPP and EI premiums are fully paid off for the year.  Which results in an extra $200 per paycheque on all my next pay cheques.   This is 100% awesome, and I’m going to invest 100% of them.  I’m planning on increasing my RRSP contributions to $450 per paycheque or $900 a month, and increasing my mortgage payments by $100 per pay cheque.  

I also reached one of my 2009 goals this month! Contributing $2,500 to my RRSP, because of this, I made a new goal to try and get to $7,500 worth of contributions by January 1st.   My TFSA is also doing well, I’ve made $3,300 worth of contributions, and it’s worth just over $4,500.  Not a bad return so far!  I’m pretty excited to see how much “interest” I’ve made on it come January 1st.  Because I’m enjoying managing my TFSA so much, I decided to open an RRSP with Questrade as well, this is where my extra $100 per month will be going.

I’ve got a couple contracts coming in as well, so it’s time to start aggresively attacking that line of credit and car loan.. it’s just not as much fun as putting the money into stocks!

Another paycheque, another goals update, and another slide on the line of credit.  Even my networth fell a little bit this month, mostly due to decreasing the actual value on my car.  I struggle so much with debt, it’s pretty ridiculous, I don’t know at what point in my life that I started to think of a couple hundred dollars as pocket change, but I wish I could go back and slap myself in the face.  I seem to accumulate debt very easily, mostly by purchases that are in the $200-500 range.  My latest acquisition has been some new strobes, and battery packs for my photography business.  I’ve been out using them once and have recouped about 15% of my investment, a few more shoots and they should be paid off.  So this update I have TFSA, RRSP, Emergency, Mortgage and Additional income up!  And LOC down by 35%  ugh.

I’ve decided again, to start an e-fund, and set it as one of my sidebar goals.  I’m pretty good at keeping on track with the goals when I have them visually represented.  I don’t have a ton of extra money to be tossing around, so for now I’m going to throw $50 per paycheque (Salary or additional income) into the e-fund, with an end goal of having about $2,000 in there by January 1st.  

With my large bonus last paycheque, my EI and CPP premiums are almost full for the year, which means starting June 15th, I’ll have an extra $50 on my paycheque, and by July 1st, I’ll have an extra $200 per paycheque.  I’ve already decided that I will put $100 into my RRSP, and $100 into my mortgage.  That will bring me to $800 a month into my RRSP and $1650 onto the principal/interest of my mortgage.  I received my first pay yesterday and my raise amounted to the whooping $50 extra after taxes, so I just boosted my RRSP contribution by that $50, no real change.  

Once again I had a bit of a setback, and purchased $1,200 worth of camera equipment over the weekend, on credit. I went out shooting and realized most of my gear that I haven’t used since the fall was pretty beat up, and some of it wasn’t even working. So I invested a bit of credit card money into some new strobes that I had been eyeing, they should pay for themselves fairly quickly.  I got news yesterday that I had a couple of photos in the latest issue of a magazine.  I’m going to have my old gear repaired and place it on E-bay which should net me a couple hundred dollars, the magazine article about the same, and then 1 paid shoot and I shouldn’t have to worry about it.  

Why do I juggle money around so much??

I’m having a bit of a crisis these days, I’m working on a project at work that’s being pushed through way too quick, and I’ve realized it’s going to fail miserably.  With the exception of my co-workers who are assisting me on it, nobody else will acknowledge that it’s just not going to pan out, including my boss.  This makes for some tough times ahead, especially considering we’re dealing with more than 15% of our companies annual revenue relying on this to go smoothly.

I’ve been contemplating for a few years now to leave the permanent job solution, and focus on consulting.  I had a meeting last week with a “pimp” and will hopefully have another one this week.  For the next couple of weeks/months I’m becoming more focused on leaving this job, this terrible project, and moving on to contractual work, hopefully with the government.   It will give me a chance to really legitimize my side income/business, makre more money, and work on new projects regularly.  It’s become pretty apparent (I switch jobs like clockwork every 16-18 months) that I don’t like working for one company for long periods of time, I enjoy new work environments, and new challenges.  When things start to get mundane and I understand everything that’s going on, it loses it’s appeal.

I have a blog?  I’ve been neglecting it pretty hard, maybe because a little bit like debt hater I was up to no good, and my money was all over the place, but somehow I came out of it all with an increase in my networth of just over $12,000!

March was a tumultuous month, I had tons of extra income coming in, as well as a bonus, and a raise.  I also had to buy a new computer for my business, and well, since I only like buying new PC’s every 4-5 years, I went all out and built myself a 64-bit super computer.  From that and a few other things, my LOC crept up to just over $11,000!! 

Then March 31st hit, I got my bonus of 19.5% of my annual salary, and got notice of a raise effective immediately.  The raise was a little disappointing 3.25%, however I was ranked in the top at the company, and best in my group.  This week I also managed to collect another chunk of money for some work I did back in February.  The outstanding balances owed to me would be enough to pay off my line of credit, and work is still coming in!  So things are really looking up these days.

I’ve updated my sidebar, I didn’t include my bonus in my “additional income” since it would basically blow it out of the water, but did include it in my LOC pay down.  I’ve got $1,100 left to go, and I’ll be out of debt.  TFSA and RRSP are still going well, nothing new to report other than I made a killing with LVS.

I updated my sidebar, unfortunately I still haven’t been paid for work I did last month and in January.  It’s building up to over $2,000 and I have about that much in work coming up in the next couple of weeks.  This pay cheque that happened over the weekend, was the first one where my mortgage payments increased (by $125 semi-monthly), and also where I increased my RRSP contributions to $250 per pay.  

My next paycheque will be my single biggest I’ve ever received, on top of my usual pay, I’m getting my bonus.  My bonus of $13,650 before taxes!!!  I can’t believe it, our company has a great business model that is basically fail proof, even in hard economic times, but still, that’s huge!!  I’m looking forward to paying my line of credit off completely with that sucker, I’m also getting money from the girlfriend who’s now moved in, once I have all the new bills sorted out, and their amounts, I’ll probably try to increase my savings even more.  Currently I’m doing this per pay:

• $250 rrsp
• $200 tfsa (this will be maxed in october, at which point I’ll move more into rrsp)
• $125 extra to the mortgage (mortgage is now down to 9.6 years)

Looking forward to my networth update next month

This month has been pretty hectic, the girlfriend moved all her stuff in, we pawned her bedroom set off on a friend with a new house for his spare room, my parents are temporarily holding on to her couches, and the rest of the stuff, I’ve sold on usedOttawa.com.  I sold 2 tv’s, a desk, 2 dvd players, and 2 tv stands.  Basically we cleaned house.  

We spent a bit of money fixing up the office, we both got new desks, and unfortunately I ended up dropping about $2500 on a new photo editing pc after mine died on the weekend.  I was planning a new computer for the past couple of weeks for when my bonus arrived (I’ll get to that further down) but when my current one crashed and wouldn’t reboot, i had no choice but to get a new one asap.  Too much work coming up that I need a computer for.

I haven’t updated my additional income because I haven’t been paid yet, currently I’m sitting on $1800 that is owed to me which should be coming in any time now.  I also have a bunch more contracts coming up for both photography and web-design, so I should be making quite a bit of additional income and really getting close to my goal for the year.

Now the amazing news, our company announced our bonuses last week, we met all our targets, actually we exceeded them.  My personal performance was 100%, so I got that part of my bonus guaranteed.  Long story short, my bonus is just under $14,000 before taxes!!!!  I was expecting something big, but not that big, I get the feeling this is a once in a lifetime bonus, part of the merger/acquisition to keep us happy.

So the bonus will be used to:  pay off my line of credit, pay off the computer purchase, put the rest onto any debt where possible. (car loan, tv loan).

I’m pretty excited for the next couple of months, bonus is paid out March 31st, and girlfriend is paying $1100 for housing/utilities a month starting next pay.   All this extra money sure is going to clear up a lot of my finances and I’ll start putting more away/paying off debt.

The last of my awesome news, is that mortgage rates in Canada dropped again, that means my interest on my mortgage is at a whooping 1.74%, probably the lowest I’ll ever live to see a mortgage rate.  Since girlfriend is helping pay the mortgage, we increased the payments by $200 a month, or $100 per payment, it’s now down to under 10 years

After last weeks 100% performance review, I was handed the companies Bonus Policy documents, on the 2008 year end bonus, and how it was slightly different due to the merger of the two companies.  In short, there was an added bonus for the product I work on, to get everyone working equally as hard on it, as they were their other products.  If we meet our targets in revenue for that product, each employee will receive 7.5% of their salary as bonus.  Additionally if we go over, or slightly under, it is pro-rated to other % amounts.

Then I got to the second page, a performance bonus, which is based merely on your performance that year, and it’s up to 7.5% of your salary as well!  Well I got 100%, so I believe that means I will be automatically getting a bonus of 7.5% but more likely 12.5-15% with the target bonus tacked on.

I don’t know for sure if this is the case, but regardless I’ve already been planning on what I will do with the money.  I’m going to use 99% of it to pay off debt, the other 1%: treat myself and my girlfriend to a nice dinner.  My plan is to pay off my line of credit in full, and  any money left over, to put on my TV financing, to try and eliminate it as quickly as possible.  I almost feel like I’m cheating by getting this big bonus, but then again, I don’t get to do anything with the money.. it’s already been spent and I’m just paying myself back for those fun times..