Ah, the beginning of January! A wonderful time – in a normal year, anyway – to be a gym owner, diet consultant or wellness app.
My New Year’s Resolution is to lose 15 pounds. And it’s going great so far! Just a week into the new year and I only have 20 pounds to go!
Unfortunately, most of these great intentions aren’t in place by the time we get to February. Many of us settle into familiar patterns – making long term changes is tough sledding.
But here is the trick to make at least one of your resolutions stick: take it out of your hands and make someone else responsible for it.
In our financial world, that means making things automatic. For a lot of people, they have financial goals: they want to get money into savings. They want to start an emergency fund. They want to save for their kids’ education. They want to get insurance in place. The problem is, for many of them, they’re going about it all wrong. People talk about putting their extra cash at the end of the month into their savings – but the reality is, our spending tends to inflate in line with our pay (and sometimes in excess of it). Trying to budget for savings ends up feeling like heading to the gym in the darkness of early morning – it’s takes a force of will to make it happen.
The secret? Pay yourself first. For long-term savings, set up your Group RRSP so that your payroll department contributes to it every month. Take it off your hands to put money in. You can still spend what’s left over at the end of the month, because you will already have paid yourself. To build an emergency fund, start a Group TFSA (Tax-Free Savings Account) and have contributions come out of your bank account every month – whether you remember or not. You can do the same thing with an RESP (Registered Education Savings Plan). If you already have these in place, when was the last time you looked to see how much you were putting in? Chances are, if you’re more established in your career, you have more room to contribute than when you first got started. Sign into your online access or reach out to us to ask how!
If you’ve been meaning to sign up for Life Insurance or Critical Illness Insurance and just haven’t gotten around to it, simply send a note to us letting us know you’d like to get started. If you want, we can even take remembering to do this out of your hands. Just let us know that you’d like to be reminded constantly to do this until you tell us otherwise, and we’ll make sure to keep you on track. Doesn’t that sound easy?
Believe it or not, it actually is. Signing up for your Group RRSP, TFSA or RESP can take you less than five minutes – and for the rest of the year, you’ll be able to gloat that you’re one of the tiny fraction of people who actually stuck to your resolution. Insurance can take a bit longer, but the peace of mind is hard to beat – especially in a time when there is so much health uncertainty in the world.
To get started, please feel free to reach out to us or sign up for your Group Savings Programs right here.
And Happy New Year from the whole team at Capital Planning!