As I stated in my first post, I work as an Accounts Receivable Rep for my family’s small business. Basically, all the money coming into the company comes through me first. Since it’s a pretty small operation (less than 50 employees), I also handle the credit department as well. I spend about half my day making phone calls, asking for money on overdue accounts. How I handle my payments has a lot to do with what I do on an everyday basis.
Because of my job I know that the second a payment is missed, a red flag goes up on the account. I don’t want any red flags. I have only missed a payment once, when I didn’t get paid until a couple days after the due date- I called my credit card company and explained the situation, and they made sure I wasn’t flagged. Since then, I’ve never missed a payment because I pay twice a month. The day I get paid, I transfer a chunk to the balance. That way, if there’s an emergency and I really can’t put anything towards my balance, my previous payment will cover it. As far as my rating goes, I have an R1 on both of my cards. That’s even better than most of my family, who are pretty good with their finances.
Since I’m meticulous with my payments, I have really good credit for my age despite my 52.9% debt ratio. I was looking at getting a car loan through my bank a couple of months ago (thank god I didn’t), and the person I spoke to the day I applied for it informed me that with my credit score, I’d be approved for almost anything I applied for at my particular financial institution. At least I’ve done something right with my cards. If I sustain this payment rating and get rid of my balance, in a few years I’ll 100% be able to get a mortgage and buy a house; though that’s a whole other post entirely, because I plan on being able to put down a HUGE down payment. A girl can dream, right?
I also want to open an RRSP and max it out every year for as long as I can. I don’t want to rely on the Canada Pension, because it will most likely be long gone by the time I’m old enough to benefit from it. If I’m living rent-free and paying no bills, I want to take full advantage of the saving power that gives me. I don’t need much since work and school take up so much of my time.
The biggest expense I have is definitely smoking. In an average 30 day month, it costs me around $255 to smoke a pack a day- I have expensive taste at approximately $8.50 a pack. Starting tomorrow I’m going to be buying a carton of 8 packs for $35, which will cut that down to $140. It’s still not great, but it’s a savings of 45% until I can kick the habit. That gives me an extra $115 to work with.
My other expense is my phone bill, which without overages costs about $80.00 a month with two add-ons totaling $18. That amount includes taxes. That might sound insane, but I got a good plan from Telus when I got an iPhone after 5 months of being phoneless. I get unlimited texting, 10 favourite numbers that I can call for free and are changeable at any time, data, conference calling, voicemail, free local nights from 6PM and weekends, etc. I also noticed that I was paying a LOT in long distance (about $30 over on average), so I put an add-on in place today to keep that in check with 100 extra minutes. I work in Toronto but I live in the far East GTA, so long distance is pretty inevitable. I have 18 months left on my contract with Telus, and every month I look at the plans they have to see if there’s something better. So far, for my usage needs this is the best plan available. Between school and work I use a lot of data, and I text almost constantly- it helps to have those two options already worked into the plan so that I don’t have to worry about overages. I split my phone payments into 2 payments as well, because 2 $40 payments are easier to budget with than 1 bulk payment. Hopefully now I won’t be having any surprises come the beginning of April.
Anyways, that’s where I am so far with trying to cut back where I can. Other than that, I’ll just try to avoid spending money as much as possible, and every spare cent I get will either go towards debt or savings.
This is proving to be so much easier with a clear-cut plan! Does anyone have any suggestions besides the obvious “quit smoking”? I’m working on that, I swear.