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Sunday, July 12, 2015

Your spending habits may ruined your investing dreams - or maybe not

How? Well, its pretty easy to understand. The more your spend, the less you have available to invest. And I am currently experiencing something similar to that, for several reasons.

From what I had experienced so far, the more I earn money, the less easier it is to actually save money. But shouldn't be exactly the opposite? Not in my case. I do not work at several jobs like I used to do. I make a similar salary than before by holding on - or trying to - one job + my dividend + my sometimes online income. But other than that, I don't have many sources of income, I work less, but I spend more. Why is that?

I have more free time. And having more free time on hands mean that I have more time to spend money. I don't do extravagant things, I go the movies, I usually go to all of the Montreal festivals you could imagine, I go out a lot, I drink a lot, I eat a lot outside, I shop, I buy clothes, jewellery, makeup, diet pills... yeah, but read it right, DIET PILLS. lol.

Generally speaking, I do spend more than what I used to. Now that I hold more or less 100k in net worth, I got very lazy, but I would say that I invest on a regular basis anyway and I am still good on shooting out good investments. Not including my RRSP money, my dividend income is at $6 200+. I expect to hit on the $12 000 income in the next 4-5 year or so. The overall picture is not that grey despite my current spending little nature.

Among my spending habits, ones are daily spending and other are what I name as generic spending if not over drive spending. I guess you never heard of that type of spending flare. Like you stop by a drugstore and buy a new lipstick but you really don't need a new one - see what I mean?

And comes the more or less daily expenses that I could live without, or maybe not. I cannot live without my daily coffee, a $2.60 in the morning, and an Americano in the afternoon, $3. And I really often buy 2 coffees per day. I discovered a new pleasure in life - be ready reader - aha - manicures and pedicures. Both cost $55 every 3 weeks. I have thin curly hair, but a lot of hair - and I need a hair cut every 8-6 weeks as the roots get dry and messy. That's a $28 right there. I also do my coloration at home, $14 a box - every 6 weeks or so because I had been coloring my hair since my mid twenties and I look better that way. And I start having white hair one or 2 years ago. I sometime wake up late to get to work - I take a taxi, its $10 to $14 the ride depending of the traffic. If I don't organize my lunch week during the weekend, forget about it, I will have to buy something to eat. I also really often finish work after 5 pm, what to you thing happen when I do so? I go get something to eat.

Not to turn into a wild beast, I go visit New Brunswick at least 4-5 times a year. Ticket is $175 + other expenses. I spend money on my folks for Christmas, Easter, birthdays. And I am very generous. Its $500 that do for Christmas. Certainly a $100 on Easter. And $100 on birthdays in not a bit more. My rent had been increased of $10 recently, its now $635 - but I am closed to everything including work, no need for a metro pass that might be close to $90 a month now...

Despite all of this dramatic degeneration, I had a bill of $985 on my credit card last month. Its not too bad knowing that it included my Internet and cell phone bills. I like putting everything on my credit card because it help me managing my expenses. For last month, my expenses were about $1 700, but I still had left $800 in free cash for savings - and that does not included the money earn in dividend. So life is all good. Why should I say no to manicures and pedicures???

1 comment:

BeSmartRich said...

Haha. I enjoy your honest articles and this time was no exception. We are all human after all :)


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