This summer was a busy one at Pamela George Financial Literacy Inc. (PGFL). This summer, I received more Facebook and email questions than I have received for all of the first half of 2021.
I welcome these questions, as most times it is usually the beginning of more questions and a more in- depth conversation with me. But more importantly, it starts an internal quest for answers and an internal dialogue with the sender.
For this month’s blog, I decided to pull the top seven (7) questions that I received. Here they are in no particular order:
I saved about $7,000 since Covid started, what do you suggest I do with it?
Congratulations! My suggestion would be to keep about $2,500 in a savings account and put the rest towards your highest interest debt.
I want to work and have my own money, but my husband says I don’t need to work. He says I can be a professional housewife. Should I be worried?
I don’t know your situation, so I am just going on the information you gave me and what I have seen in my practice. I would caution you that this could be a red flag. A spouse, deterring his/her partner from working when they actually want to work, could be a sign of financial abuse.
What are the things that you have seen your clients use their emergency funds for?
Clients have used their emergency funds for things such as:
- Replace an air conditioning unit or a furnace that broke unexpectedly.
- Pay for a child to travel back home early after the pandemic was declared.
- Pay living expenses after they lost their job.
- Pay for emergency medical care for their spouse.
- Pay for emergency shelter and supplies for their family after a tornado tore their house apart.
How do I know or find out how much to pay myself?
This starts with doing a personal budget so you can learn how much you need to live.
Then you need to make enough money in your business to pay taxes, pay business expenses and pay yourself the amount that showed up when you created your personal budget.
Is it true that the government matches 100% of my RRSP contributions?
No. The Canadian Government will add up to 20% to your RESP account, up to $500 per year.
How much should I put aside annually to my house maintenance/repair fund?
Of course, this varies depending on your unique situation, but as a rule of thumb, I usually suggest that you save 1% of the market value of your house, annually. E.g. if you value your house at $500,000, I suggest you put aside $5,000 a year towards the maintenance and upkeep of your house. This works out to be about $400 a month.
What’s the average age you recommend I start talking to my child about money?
I think around 4-5 years old is a good age to start talking to your child about money. Of course, the conversation needs to be age appropriate. A good place to start at that age is with the introduction of a piggybank.
So, there you have it, the top seven (7) questions I received this past summer. Keep the questions coming and maybe yours will make it to my blog in a couple of months.