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Gail Vaz -Oxlade personal finance guru
Gail Vaz -Oxlade personal finance guru

Earlier discussion

Ask Gail Vaz-Oxlade Add to ...

My only problem is this: Both our paycheques are on a bi-weekly basis, and your budget breaks it down by week. I'm having trouble figuring out how to get it started, using my biweekly pay. I can't ever seem to find enough to fill the jars with each pay. Right now I allocate my loan payment to one pay, and mortgage to another, and it's worked, but I really want to try your budget, but can't seem to figure out how to make the switch. Can you help?

Gail Vaz-Oxlade: Skelly, the budget is actually a monthly thing; it's the jars that are broken out weekly. Hey, if doing it bi-weekly works better for you, just do the math and make it so. I'm not sure why you can't find enough to fill the jars unless you've allocated too much money to each budget category and are over-spending. As long as the budget balances, you should have the money available for the jars. You may need to do the food and transportation weekly, and use another rhythm for things like clothing and gifts and entertainment. Good luck.

George V. writes: Several years ago, I watch you on a program and you were discussing and RSP Mortgage. I am considering an RSP Mortgage along with a conventional lending product to finance my home purchase. I do know that I need to have the RSP Mortgage (portion) insured.

What are some things of which I should be aware should I undertake this financing option?

Gail Vaz-Oxlade: George, this is a big question... Okay, fees... Figure out the one-time fees like the mortgage set-up fee, appraisal and legal fees. Then there are the ongoing fees like the RSP admin fee and the mortgage admin fee. Most people believe you should have a mortgage of $100K or more before these fees are covered. Since mortgage rates are really low right now, this is doubly important since if you're paying high fees and earning a low return your RRSP will languish. I will tell you that at one point I had an RRSP mortgage and I loved it! But you need a smart advisor to get you through the process.

Connie writes: We are 41 and my hubby makes 20-30K (he is a sales guy so it may be smaller this year). I make 80K on a disability pension. My company has filed for bankruptcy and it looks like we will at some point lose my income. We have no debt (except the mortgage).

Budget approximate (it varies):

6000 in

2700 Housing (mortgage, utilities, taxes)

750 Food (I have 5 family members and a couple of unofficial foster kids who almost always eat here)

400 Auto gas (own our cars outright)

300 Rogers bill (lots to cut here if necessary)

700 charity

450 savings

200 entertainment

300 other (haircuts, school stuff, sports for kids)

How do we prepare? I don't think I can work (unless I can find something that I can do a couple hours a day).

Gail Vaz-Oxlade: Connie, you make $80 K on a disability pension? Really? Wow! If your income is going away then you have to find ways to cut costs and replace some (or all) of the income you are losing. You may have to sell your home and downsize. And you should be working now to build up a big, fat emergency fund while you still have your income. Good luck.

Joanne writes: My husband and I are both employed and collectively net approximately $5600/month. He is 31 and I am 28. We both contribute to RRSPs ($400 and $250 respectively), we own our house ($1200/mth), have approximately $1000 owing on credit cards and no other debt except a car loan that is $10,000 at 5%.

Our expenses are as follows: House $1200, Utilities $300, Car Payment $800 (accelerating the payments), Car Expenses (gas/insurance) $375, Groceries $350, Entertainment/Retail purchases $1200, additional savings of $600-$1000 whenever possible (we would like to put a lump sum on the mortgage of $10,000 by the end of the year).

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