Sep 302011
      I saw my wealth shrink by $6500 this month. This is so exciting! If I wasn’t working 2 jobs I probably would have lost $10,000 this month. This shows me how fickle the economy can be sometimes, and how necessary my job is to me, and how far I still need to go to reach financial independence. The TSX Comp dipped to a 5 year low. My existing investments dropped 9% but overall, my entire portfolio only lost 3% of its value because of some last minute, additional stocks I bought last week.  September’s Income was steady, and there was less discretionary spending than usual because I didn’t go out much. Details below…

*Dividend Income:
  • Discount Brokerage = $300


*Discretionary Spending:
  • Eating Out = $100


  • Others = $100


*Net Worth:
  • Assets:


  • Cash = $3,500 (+$300 MoM)
  • Stocks = $49,700 (-$2,100 MoM)
  • RRSP = $19,700(-$300 MoM)
  • Home  = $243,000 
  • Liabilities:
  • Mortgage = $209,400 (-$400 MoM) 
  • LOC Balance = $7,000 (+$6000 MoM) 
  • Other Loans = $17,500 (-1,200 MoM) 


Total Net Worth = $82,000 ( -7.34% MoM) 

      Funny how it was only last month that we saw record gold prices, but it’s fallen about 15% since then. We’re seeing some huge swings in the markets. But this can be good. Because it means that at some point in the future the markets will become more steady and investors will have more confidence, and when that happens stocks should definitely go higher. Buy low, sell high, and it’s pretty low right now which is why I’m a buyer! In fact, since I’ve invested all of my savings already, I borrowed $6000 from the bank earlier this month to invest. It’s a bit risky, but hopefully this leveraged investment will pay off in the near future. 
* Numbers are rounded to the nearest $100.
Sep 272011

Here is another tip I use to save money by actually doing less work. 

People do laundry because our clothes get dirty. And the only reason they get dirty or sweaty is because we wear them. So the less they are worn the less they have to be washed. If you are like me and only spend about 10 hrs a day outside your home, and 7 hrs in bed, then consider spending the remaining 7 hrs you’re at home, in your undergarments only. 

By limiting the time you are dressed to only the necessary 10 hrs a day where society can see you, you can cut your clothing exposure by 7 hrs a day, and limit the opportunity (10 hrs instead of 17) for your clothes to get dirty/smelly/oily. Therefore, you can reduce the frequency of doing your laundry by more than 40%

Criteria: You must either live by yourself, like me, or live with people who don’t mind you walking around in your underpants (parents, boyfriend, etc.) In Vancouver, even though it’s almost October my room temperature is still in the mid 20s, and I don’t yet have the heat turned on. If you don’t live in an apartment or otherwise warm surrounding, consider doing this for the summer months only, if temperature permits.

Estimated annual time saved on doing laundry? 6 Hours

Estimated annual savings? $36

*Additional benefits: Making our world a greener place. Your clothes won’t wear or fade as quickly. And if you like to hang your clothes up to dry, this is a huge time saver.

Sep 222011

Making money in the stock market isn’t always easy. Here is a simple technique that I use to increase my chances. The volatility index “VIX” is a measure of how nervous investors are. The VIX moves in opposite directions from the stock market for the most part.

In the 5 year graph below we compare the VIX (blue) and the stock market index (red.) See how they usually trend in opposite directions?

In the past the VIX rarely goes higher than the 40 point mark. And when it does, it’s usually short lived. Today VIX jumped to 41.35, and the stock market dropped to 1129.56. I consider this to be a buying opportunity. My technique for swing trading is to buy increasingly more stocks as the VIX grows past the 40 mark, and sell when it drops back below 30.

So today, 09/22/11, I bought 60 shares of SNC Lavalin (SNC.TO) at $42.42. and 75 shares of Halliburton Co (HAL.N) at $33.10.
Total bought = $5024.70
All this money is borrowed from my bank at 5% interest rate. I’m using leverage because I don’t have any spare cash right now.

My exit strategy? I will sell both stocks when either the VIX drops to 30, or I can make a $1000 profit by selling both. If you’re not comfortable choosing your own stocks, just buy an ETF that tracks the index like (VTI.N) for example, the principle is the same.

I will follow up this post with another entry when I sell my holdings, hopefully soon. Or in the unlikely chance the VIX moves even higher to 50, I will be buying more stocks.

Sep 202011

“How much income do teachers make?”
“He’s a book keeper? I wonder if his income can support his family.”

Sometimes we assume a person’s income level based on their line of work. But this mindset is dangerous and can limit our earnings potential. Because if we accept the idea that our jobs dictate our incomes, then our motivation to earn more income will be constrained by the limitations of our jobs. However, a job salary is just a piece of the income pie. So instead of getting stuck thinking about how to get a promotion, let’s focus on the bigger picture. How to increase our income, period. Which of course will include how to get that promotion.

Income can appear in many different ways. We can invest and slowly turn our savings into investment income. Or get a part-time job. Income can also come from rent.  If we had any technical skills, (writing, drawing, speaking) we could do freelancing. Or find online micro jobs from sites such as AmazonMechanicalTurk or MicroWorkers to make a few extra bucks.  Even recycling plastic bottles can be a small but stable source of income if we so choose.

So let’s avoid the income/career trap and think outside the box. Think about how we can increase our income from any source possible, rather than just how to increase our income as employeesヽ(´ー`)ノ

Sep 162011

Our household net worth for the country is about $6.4 Trillion. On a per capita basis, the average person living in Canada has a net worth of $184,300. I am surprised at how low this number is but I think as the population ages, we should see this figure grow. If not, then we are in deep trouble.

What might be worrying now is seeing household debt continue to grow as a result of both higher mortgages and more consumer borrowing (this, I am guilty of.) I still have a long way to go before my net worth reaches the national average but I wonder how much of that number is over inflated due to the prolonged environment of low interest rates.

A big chunk of Canadians’ net worths are in our homes. Our housing prices are 7% higher year over year, but our GDP growth hasn’t even come close to that.  If rates continue to stay this low I wouldn’t be surprised if real estate prices grow by another 7% by this time next year. In any case it would certainly be nice to have at least a million dollars in investable assets before I retire.

Source: statcan