I Heart Money » Points

I (Heart) Money Book Tour!

Dave Lester — Thu, 05 Aug 2010 22:52:33 +0000

I’m on a book tour and I’d love for you to come out to one of my event dates to meet me and talk money. I’ll be signing my new book I (Heart) Money at the following Chapter and Indigo locations. Hope to see you out and keep loving your money!

August 7th – 1pm -5pm

Chapters Bayview Village

2901 Bayview Ave Unit 132

North York, Ontario

M2K 1E6

August 21st 1pm-5pm

Chapters Woodbridge

East Woodbridge Centre, 3900 Hwy 7 West, Unit 1

Woodbridge, Ontario

L4L 1A6

(905)264-6401

August 28th 1pm – 5pm

Indigo Richmond Hill

8705 Yonge Street

Richmond Hill, Ontario

L4C 6Z1

(905)731-8771

September 25th 1pm-5pm

Chapters Woodbridge

East Woodbridge Centre, 3900 Hwy 7 West, Unit 1

Woodbridge, Ontario

L4L 1A6

(905)264-6401

Indigo Yonge and Eglinton – Coming Soon!

Chapters Square One – Coming Soon!

My Chosen Credit Card

Dave Lester — Tue, 27 Jul 2010 18:29:05 +0000

If you’ve been following my blogs you’ll know that I prefer to use cash when I can. I love hard currency for a number of reasons. For instance I find that you spend less, you have a natural spending ceiling (it’s gone when it’s gone), you get better prices for big purchases, and it is harder to part with than just swiping away.

I do however use credit cards when there is a financial benefit to me. I calculate all of my monthly expenses that can be charged to my card and have them come off automatically each month. This saves me time and service fees – I’ve made sure that I can never miss a payment now. All my gas is charged to the card and I also charge large payments like computers, hotels or airline flights to extend their warranties and add travel protection. My choice of credit card reward program is an annual fee free card that gives me some sort of points. If I charge $590 a month I used to get .5% cash back on everything and 1.5% back on my gas purchases, which would give me $59.40 back a year for free just from my monthly resources not including my big purchases like trips, furniture and electronics. Remember that I didn’t pay a yearly fee so that money is all gravy for me! I have found a new card that saves me even more which I have outlined after my expenses.

Monthly Charges:

Mobile Phone $60

Television/Internet $80

Electricity $40

Gym $50

Gas $200

Car Insurance $145

Home Insurance $15

Just recently I have found a no charge cash back card. It’s called the MBNA Smart Cash MasterCard and it is no annual fee card that gives 3% on gas, 3% on groceries and pharmacies, and 1% on everything else. Based on my spending it dramatically increases my cash back at the end of the year! They even have a promotion right now where you can get 5% back on all purchases for 6 months. On the same purchases from above I’d get $118.80 a year before my large purchases. That equals some cool shoes that I can enjoy for free based on my financial prowess and saves me a ton of time not paying all of those bills independently. Time that I can be kickin’ back with my new free kicks.

Have an awesome Tuesday,

Dave

I Heart Money – The Money Book for Today!

Dave Lester — Tue, 06 Apr 2010 17:10:53 +0000

My book is here! Anyone who loves my blogs can now purchase a money manual with all of my strategies and philosophies on investing, borrowing, saving and life. Purchase it right here from my blog and you’ll receive free shipping and handling! I know you love saving money too.

I love money. I’ve always loved money. Loving money has allowed me to start my own ideal coaching business, buy my dream car for FREE, horseback ride every Thursday, travel more, and spend time with the people in my life I truly love. You should live your ideal life too. This book will teach you how to dream your ultimate life then realize it by allocating the financial resources. Learn to optimize everything financial in the following book chapters:

1. Love Your Money – Simplify Your Financial Life
2. Live Like You’re Already Rich – How to become wealth like rich people do
3. Setting Goals For Your Ultimate Life – Dream your ultimate life than live it
4. Budgeting For Your Goals – How to track and save to pump back into your happiness
5. How to Use Money and Credit – How to win by using cash and cards
6. Investment Portfolios – How to build a zero dollar portfolio
7. Wealth Equals Income Steams – True wealth is built on multiple streams of income and how you can do it!
8. Mortgages and Loans – How to borrow to benefit you and save tens of thousands on your current mortgage
9. Insurance – How to only buy what you need!
10. Shopping – How to shop like a pro and save
11. Money and Relationships – How to pick the perfect money match
12. Financial Checkups – How will you know when you’re wealth?

Love your money and it’ll love you back with an Ah-mazing life!

Dave

La Petite Mortgage!

Dave Lester — Thu, 01 Apr 2010 04:03:56 +0000

It scares me that the word “mort,” which means “death” in French, is in the word “mortgage.” Here are a few ways to take the Grim Reaper out of your payment plans.

We are at the bottom of mortgage interest rates and it is time to consider fixing your rate to save money and time off of your amortization. The Bank of Canada promised that we would have these low levels until June and June is only a few months away. We don’t know how fast interest rates will rise but we do know they will start to rise from here. The economy has shown signs that it is improving, and the major banks started raising fixed rates. It just might be time to fix.

If you do choose to lock in, be sure to shop around and get the best rate. If you choose to use a mortgage broker you will be locking in for 5 years as low as 3.49% as of today. Even BMO has advertised a rate of 3.75% and it gets cheaper if you have other products with the bank.

If you decide to lock at these super low rates make two extra steps to get the most bang for your buck and literally save thousands of dollars over the amortization period of your loan.

1. Set your payments from monthly to bi-weekly–or even better weekly. Bi-weekly payment means you make one extra payment per year compared to monthly. Over the amortization time of your mortgage these extra payments will save you thousands.
2. Round up your payments. If your bi-weekly payments are $829.68, for example, round them up to $900. The extra $70.32 bi-weekly will save you even more over the amortization of your mortgage.

It is so hard to step away from your prime minus variable rates when they are so low. I had a rate of prime -.85 before I sold my place. If you do decide to stick to your variable rate and hope that interest rates climb slowly over the next few years, increase your payments so that you are making the payments that you would be in a five year fixed. There are two advantages to this:

1. You will be paying down your principal very quickly, which will equal less principal to pay back when rates go back up. It will save you bundles in the long run.
2. You’ll also be used to the payments at a higher interest rate. When you need to renew or decide to go with a fixed rate, you’ll have a few years of already making payments at that higher rate.

Try out some of the mortgage calculators online like the one below to see how much interest you save with the different options, along with how many years you’ll “bump off” your amortization, instead of it bumping you off. And mortgage free years are years that you can spend that mortgage money on your extra special life!

www.canadamortgage.com/calculators/amortization.cgi
Have a great week,
Dave

Build Your Own Mutual Funds

Dave Lester — Wed, 10 Feb 2010 15:08:40 +0000

As you’ve probably already read, 80% of mutual funds under perform the market. Why would I ever pay up to 2.5% in management fees to under perform anything? You can really see that they don’t have our best interests in mind. When the market was correcting huge in 2008 and 2009 did any of the managers go to cash? Any strategic moves? No way. The reason for this is that if the market had swung upwards at any point during the correction and they had not participated in it, they would have been fired. So over the cliff we all went. As long as the managers stay close to the index, -30 may that be, the safer their jobs were.

That doesn’t sit well with my love of money, and that is why I manage my own money. I know at this point you feel queasy at the thought of going through company annual reports, balance sheets, and listening to conference calls, right? Well it is so much easier than that. What I do is find a mutual fund or index fund that I believe in and then I copy it and save the management fee. I, for example, love dividend yield. I’ll search for the best dividend funds or index funds and then rip off their top holdings for $5 a trade at my discount brokerage. That way I’m in control of what I do with my dividends.

There are many options when I’m in control of the dividends. I could save the dividends up and buy another high yielding stock when I have enough funds to do so. Which adds diversification to my portfolio for free. I could also set the dividends up on a drip (dividend reinvestment plan) program. My dividends would then buy me more stocks every quarter as they got paid out. This way you naturally buy stocks higher and lower as the market changes over time. The indie term for this is dollar cost averaging. Quarterly I would receive more stocks that the following quarter would buy me even more stocks — and all for free. This is a great way to accelerate growth over the long run. If I’m having a good month I might even pay myself my very own management fee and have an amazing dinner out with friends or family.

If you share my love of dividends, look up the top holdings of XDV, the iShares dividend index. This ETF mirrors the 30 top stocks in the Dow Jones Canada Select Dividend Index. You can grab the list of stocks right off their web site, plus their weightings. To keep down my trading costs I buy just the top 15 stocks–making up 63% of the index. If you own them you’ll be participating when the index rises–in the last year it went up roughly 36%. You are given each stock’s weighting in the index which I could match, but with such small percentage differences between the top 15 I just buy them in equal weightings. If you did purchase the later you would have a 4.8% yield and some of Canada’s top dividend yielding companies. When the dividend index is going up I know that I’m participating in the growth, and I have to keep checking back once a quarter or so to see if any of my 15 have fallen off the list. I then simply make the appropriate trade to match the new top 15. This is all on top of those sweet sweet dividends that are paying me quarterly.

Make your own Mutual Funds and pay yourself instead of the managers. You’ll love your money so much more.
Dave

What’s the Points?

Dave Lester — Sat, 14 Nov 2009 20:38:59 +0000

Count right now how many points cards you have clogging up your wallet? When was the last time you actually went on a free trip or got some sort of reward from them? Have you ever thought how much more money you spend travelling across town to use that store or extra dollars you put on your credit cards to get a few more points?

Due to the fact that I’m always trying to get the best “bang for my buck,” I’ve crunched all of the numbers and my chosen points system is the one that is the longest running. It’s called cash. I can use it to buy luggage, or gift certifcates, or travel on any airlines and my wallet is free of any cards of any kind. It can be used everywhere and I can even save the tax or get a better price at some places when I use it. I’ve crunched the numbers and using cash for everyday spending saves you money.

I recently tried to redeem two different points systems to get a trip to Calgary. A ticket that would have cost me $371, including tax, to buy with cash would have taken $45,000 worth of spending with one credit card and $25,000 with another card. Then on top of that they would have charged $187 or $114.80 respectively on top of my points for taxes and extra charges. I really don’t see how these point programs add up. Here is my logic:

1. Using cash saves people up to 20% compared to using cards. You simply spend less money when you have to actually plop it down. Using cash puts a ceiling on your spending; if you’re spending virtue is in question–if you’re being naughty with your money–it’s very helpful. What I do is take $400 out of the ABM every Monday and that is my discretionary spending for the week. It has to cover everything from clothing and coffee to eating out for the whole week. If I drop it all on a crazy Monday night bender, then it is gone. I have to wait a week to get another $400 of play money.

2. The average yearly fee for points credit cards is around $120 a year. To build the points to fly to Calgary it would take me two to three years to charge $25,000 on my card, plus two or three years of fees. Remember, the flight only costs $371. Yikes!

3. “”Perfection is achieved, not when there is nothing more to add, but when there is nothing left to take away.” – Antoine de Saint-Exupery.

Using a simple money clip is so refreshing. And elegant. Seriously, look through your wallet and see all the tacky crap the retailers get us to carry around. If they were not making money off the card, they wouldn’t offer them, so therefore we’re paying extra to use them.

Cash really is king. It keeps a ceiling on my spending, simplifies and streamlines my wallet, and gets me a better price on many things. Now that’s a points system I can love!

Dave