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Tuesday, May 27, 2008

Budgeting budgeting budgeting

I am getting sloppy with my expenses! It’s been 2 months in a row that my expenses reach more than 1 400$! What’s going on with me!!?

I took a lot of my expenses for the month of May so far…… and it’s not looking good at all:



Various expenses put on credit card: 674.77$
Rent: 520$
Student loan: 165$
Metro pass: 67$
TOTAL: 1 426.77$

I know I could easily save around 360.85$ in those expenses. I just need to be more vigilant about eating out and I need to slow down on coffee. At some point, I buy 2 coffees per day, one for the morning, and the other one before I hit my full-time shift.

It’s a good thing that I don’t have a phone, cellular, Internet and cable bills to pay, it will just ruined by budget. For the Internet, I am quite lucky, I get thought it the Wireless, and instead of a phone, I have a little pager. Its working fine for me, as I purchase a 20$ card to place calls. One of those cards last for about 3 months.

This week is the last week of May and I promise myself not too spend a penny more that what I have spend so far. It won’t be that difficult, knowing I had about 100$ in cash. A part of the money will go to my metro pass.

2 comments:

stockpicker said...

I think you are doing a great thing by focusing on your finances and making it a goal to have 50K by end of next year. The 3 things you are doing: earning, saving and investing, are definitely the 3 most important steps to achieve your goal in this regard. I think another very important part is learning. I am sure you are learning a great deal by your researches, and also by reading good books on investing. I would suggest reading The Intelligent Investor by Benjamin Graham.
I have couple of suggestions for you.
(1) There are way too many funds in your portfolio. It takes too much time and effort to manage and monitor such a large number of funds. I would suggest you to use following strategy to reduce this number:
Please note: When you decide to sell an investment, always sell it when it is making you a profit. But don't be greedy and wait for even more profit!! But don't sell at a loss, because that will make you very sad and you will remember it all the time....
(a) Sell your Seg Funds. These are costly and don't provide as much return as possible. Please read up on why I am saying this about Seg Funds (which are sold by insurance companies).
(b) You don't need a whole lot of Monthly Income Funds. As you are already working, you should focus on stock/fund price increases rather than monthly income. Monthly income funds are mostly suitable for retired folks who need that money for their monthly expenses.
(c) Some of the sector funds like the Entertainment & Communications, or TD Energy or TD Precious Metals are probably too expensive (high MER). If you are interested in investing in a particular sector, look for low cost index funds that are focused on those sectors. Low cost index funds usually have MER of 1% or less. Actually this is true for any situation when you are deciding on a mutual fund. Index funds are almost always lower cost than mutual funds, and many mutual funds aren't even as good as the index funds.

(2) You have a longterm time horizon (50+ years), so I think you can take bit more risk by investing on growth oriented large and mid cap funds, and reducing your GIC and other Bond funds.

(3) If you have more time to spend on research and study, I would suggest you to learn how to find individual stocks. I have found this to be much more fun and productive thing to do than invest in funds. This way, you learn valuable lessons and they will always come in handy. Learning how to buy a good mutual fund is like learning how to find a good car repair shop, whereas learning how to buy individual stocks is like learning how to fix a car yourself!! If you can spend more time on it, I think the reward will be worthwhile.

That's my 2 cents worth and thanks for reading this long comment!!

Sunny said...

Thanks for your kind advice, I really appreciate.

 

Thank you

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