your money or your life

Personal Finance - Part 2

This is the second installment in a three-part series about personal finance for the conscious green Edmontonian. It will cover:

  1. day to day finances
  2. retirement
  3. investments

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Retirement

Freedom 55. You may remember the phrase as part of a brilliant ad campaign (not sure if it’s ongoing) that promised a millionaire’s life upon turning 55. Just follow our advice…invest in us…this could be you.

The meaning of the word retirement has changed dramatically in the past 75 years. Pensions were first introduced in Canada in the early twentieth century. My grandparents became eligible for Old Age Security and the Guaranteed Income Supplement in the 1960s, sources of income that kept them and other pioneers and homesteaders from the Slave Lake region going through the 1970s and 1980s.

But these hardworking people did not “retire”, as we have come to know it. Most of them worked in some capacity until they were no longer able, and work was a source of pride and joy rather than a grinding burden.

These days, we have put idleness on a pedestal. Retirement seems to mean the time in your life when you lounge about all day. That may seem tempting when viewed through the screen of our Blackberry as we answer our fourth work-related email of the day at 7:20 in rush hour traffic.

But I don’t think that doing nothing every day (or golfing every day or sitting on the beach every day) is all it is cracked up to be. In fact, I think that having no work to do, ever, would spoil most leisure activities. People need the satisfaction of contributing to those around them.

The worst part is that we have become retirement slaves. Our financial planners tell us that we need $1,000,000+ dollars in order to do nothing all the time when we retire. So we invest in the stock market, continue our 50-hour/week jobs and demand that the economy keep growing until we cash out. We can’t afford to not invest in coal and mining companies because, after all, we need to hook up with that beach time when we’re older!  read more... »

Personal Finance - Part 1

This is the first installment in a three-part series about personal finance for the conscious green Edmontonian. It will cover:

  1. day to day finances
  2. retirement
  3. investments

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Your Money or Your Life: One of the most important books that I’ve every read.

Day to Day Finances

My family (myself, my wife, and our two kids) got very lucky when the universe handed out its socio-economic status cards. We were raised in one of the world’s richest countries, we received subsidized, world-class educations, and we are entitled to free health care. The vast majority of humanity has never known the riches that we do.

Still, it is possible to waste any amount of money, and in my opinion much of the wealth in Canada and Alberta is wasted. It is spent on things that don’t provide much benefit to the spender, and in some ways it negatively affects the spender’s mental and physical health.

The answer for my family has been Your Money or Your Life. My wife and I read this book a dozen years ago, and it helped to set us firmly on the path of voluntary simplicity. For us, voluntary simplicity means living a materially simpler life in order for it to be more fulfilling. It means less paid work, but more time with friends and family. Less stuff, more fun. And less shopping, but more playing.

Your Money or Your Life provides nine steps to improving your relationship with money. It helps you realize that when you’re working for money, you are trading your life force, your precious hours on this earth, for dollars. Wasting money, spending it without getting full value out of it, is therefore wasting your life.

I highly recommend this book (reserve it at the Edmonton Public Library). It has helped us to live a low-impact (for the western world, anyway) lifestyle that includes the following things:  read more... »