Term vs. Whole Life

by John Moakler | Oct 29, 2020 | Uncategorized

How to save money in a pandemic: Part three

by John Moakler | Jul 15, 2020 | Uncategorized

July 15, 2o20

Today: Good debt vs. bad debt — and yes, there is a difference!

The third in a three-part series by John Moakler, BMath, CFP, CLU, CSC

With many people out of work, or with their income drastically reduced, the pandemic is the time to manage your cash flow more carefully than ever. And, with our opportunities to spend so drastically reduced, new spending habits are taking shape — so this is the perfect opportunity to think about making them permanent.  Today, we look at good debt vs bad debt — and yes, there is a difference!

Nobody is going to knock on your door and say, “I would absolutely love to buy your credit card debt.” Likewise, don’t hold your breath for someone to ring your doorbell and announce that they want to buy your car loan. So you can understand why we consider these kinds of debt to be “bad.”

However, somebody will indeed knock on your door and offer to buy your home. Your mortgage in this instance is, clearly, “good” debt. Making that debt even better, the value of your home will generally increase over time.

 So, be more willing to incur good debt than bad. And, look at restructuring your bad debt. For example, if you own a home with a mortgage — and you have a car loan, or you’re having difficulty paying off your credit card on a monthly basis — look at consolidating these debts into your mortgage payment. Why? Because credit cards have incredibly high interest rates, and also because interest on your credit card and car loan is compounded monthly — or in some cases, daily — which makes the overall bill higher. Interest on a mortgage, on the other hand, is only compounded semi-annually, which will serve to shrink your overall debt.

 Here’s something else: more than 50% of home owners who have paid off their mortgages have a Home Equity Line of Credit (HELOC) with an outstanding balance. Are you one of them? If yes, your outstanding balance can be in the thousands or hundreds of thousands of dollars. The interest rate on a HELOC is compounded daily, and what often happens is that you get into the habit of only paying the interest each month — which compounds your debt problem even further because you are not paying down the principal.

If you have a mortgage and not a HELOC, you can be much better off — because every payment has some portion going to pay interest, and also a portion that goes to paying down the principal.

If you truly want to get a handle on your expenses during the pandemic — or at any time, for that matter — seek the advice of a professional Certified Financial Planner (CFP) or Chartered Life Underwriter (CLU), two crucial certifications I have earned. Get help with developing a monthly budget. Most financial planners have developed their own tools or templates to help you with the budgeting process. 

JOHN MOAKLER
BMath, CFP, CLU, CSC

President and Senior Executive Financial Planner
Moakler Wealth Management Inc.

1 416 840 8544
info@moaklerwealthmanagement.com

How to save money in a pandemic: Part two

by John Moakler | Jul 8, 2020 | Uncategorized

July 8, 2020

Today: The Latte Factor

The second in a three-part series by John Moakler, BMath, CFP, CLU, CSC

With many people out of work, or with their income drastically reduced, the pandemic is the time to manage cash flow more carefully than ever. And, with our opportunities to spend so drastically reduced, new spending habits are taking shape — so this is the perfect opportunity to think about making them permanent. Today, we consider The Latte Factor:  the seemingly minor expenses that add up to a big difference.

It is absolutely amazing how much we actually spend on coffee at Starbucks, Tim Hortons, McDonalds or wherever else we get our java fix. Especially if we are buying $4 or $5 lattes. Then there is the money we spend on drinks and dinner, lunch whether for business or pleasure, etc. etc. The money just seems to magically disappear. 

It’s something I call the Latte Factor.  Here’s the super-simple way to beat it: over a three-week period, monitor what you’re buying. By tracking what you are spending on — surprise, surprise — you will have a better understanding of where your money actually goes.

Then, review the products and services you’re buying each month and ask yourself: “Do I still need to buy this stuff?”  Often, we get into habits and continue to pay for services we no longer need, or we could reduce.

Also pinpoint at least one or two expenses you can slash right in half. That’s right: by a full 50%. Once you come to terms with how much money you’re actually spending on things that aren’t that important, you might be surprised how easy it is — and how satisfying it is — to cut back. 

Then you can develop a monthly budget — and stick to it. And if you do, retirement will be within reach before you know it.

 If you truly want to get a handle on your expenses during the pandemic — or at any time, for that matter —seek the advice of a professional Certified Financial Planner (CFP) or Chartered Life Underwriter (CLU), two crucial certifications I have earned. Get help with developing a monthly budget. Most financial planners have developed their own tools or templates to help you with the budgeting process. 

JOHN MOAKLER
BMath, CFP, CLU, CSC

President and Senior Executive Financial Planner
Moakler Wealth Management Inc.

1 416 840 8544
info@moaklerwealthmanagement.com

How to save money in a pandemic: Part one

by John Moakler | Jul 1, 2020 | Uncategorized

Today:  Give your credit card a timeout

The first in a three-part series by John Moakler, BMath, CFP, CLU, CSC

With many people out of work, or with their income drastically reduced, the pandemic is the time to manage cash flow more carefully than ever. And, with our opportunities to spend so drastically reduced, new spending habits are taking shape – so this is the perfect opportunity to think about making them permanent. In the first post of this three-part series, John asks some tough questions about your credit cards.

When was the last time you put away your credit cards, and only used debit or cash to make your everyday purchases? If it’s been awhile, it’s something I strongly suggest you try.  You’ll be amazed at how much more conscious you become of your spending.  Because the truth is this: constantly using your credit card blurs the reality of what you can afford – versus what you simply want to purchase. It’s a question of what you want, versus what you actually need. 

So, try putting away your credit card for just three weeks. 

And then ask yourself, “What am I really buying?” Only using debit or cash provides you with an awareness of what you are actually spending on. Consider this statistic: according to Bailey Peterson, a research analyst at ValuePenguin, people are willing to spend as much as 83% more when they use a credit card versus cash or debit. 

Just ask yourself: “How would I like to have 83% more money in my pocket right now?”

 Exactly.

 If you truly want to get a handle on your expenses during the pandemic – or at any time, for that matter – seek the advice of a professional Certified Financial Planner (CFP) or Chartered Life Underwriter (CLU), two crucial certifications I have earned. Get help with developing a monthly budget. Most financial planners have developed their own tools or templates to help you with the budgeting process.

JOHN MOAKLER
BMath, CFP, CLU, CSC

President and Senior Executive Financial Planner
Moakler Wealth Management Inc.

1 416 840 8544
info@moaklerwealthmanagement.com

We’re going to achieve your financial goals.  Here’s how.

by John Moakler | Jun 24, 2020 | Uncategorized

John Moakler discusses how to put “bumper guards” around your financial plan, in this classic interview from 2006.