By Sheryl Smolkin

This is the last Best from the Blogosphere for 2015 and I’m taking a break, so the next one will be published on January 25, 2016. We wish all savewithspp.com readers a healthy, prosperous New Year.

As we look back on 2015 and ahead to 2016, there is much to think about. We have a new Federal government, the loonie is at an all-time low and Canadians have extended extraordinary hospitality to Syrians and other refugees from war-torn lands.

Here are some interesting stories we are following:

In TFSA vs. RRSP: How are Canadians saving? I interviewed Krystal Yee (Gen X), Tom Drake (Gen Y) and Bonnie Flatt (Boomer) to find out how Canadians are taking advantage of the tax-sheltered savings vehicles available to them.

In What Sean Cooper Really Achieved By Paying Off His Mortgage In 3 Years Robb Engen from Boomer and Echo tells us that Sean Cooper didn’t just pay off his $255,000 mortgage in three years; he taught us all a lesson in personal branding. Mr. Cooper, a pension analyst by day, mild-mannered blogger by night, took an almost Machiavellian-like approach by achieving fame through mortgage freedom at age 30.

Jim Yee offers some Year End Finance Strategies that will take advantage of ongoing changes to our tax rules. For example, in 2016, the new Liberal government will be lowering the tax rate on the middle income bracket from 22% to 20.5% so those individuals making more than $45,283/year but less than $90,563/year, deferring income to next year might save some tax dollars.

On the Financial Independence Hub, Doug Dahmer writes about the timing of CPP benefits. He says the CPP benefit for a couple can be in excess of $700,000 over their lifetime and the study demonstrates that the difference between starting your benefit at the least beneficial date and starting at the best date can be more than $300,000.

And finally, Rob Carrick at the Globe and Mail offers some thoughts on how to prepare for a frugal retirement. Frugality is assumed to be a virtue in the world of personal finance writing, but on the outside, frugality is sometimes a synonym for cheap. He refers to a blogger on Frugalwoods who argues that making the choice to be frugal is about asserting your independent thinking about money.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?” Share the information with us on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

By Sheryl Smolkin

I don’t often review personal finance books because it seems to take an inordinate amount of time to wade through yet another statement of the obvious just to glean enough cogent information to give readers a taste of what the book is all about.

But when I read accolades from the likes of Gail Vaz-Oxlade, Preet Bannerjee, Roma Luciw, Dan Bortolotti plus a whole bunch of my other favourite personal finance bloggers in the introductory pages of the book, I thought I’d better keep on going to find out what all of the fuss is about.

Author Robert R. Brown says Wealthing Like Rabbits is written to be a fun and unique introduction to personal finance and suggests that any book that includes sex, zombies and a reference to Captain Picard is “an absolute must read,” regardless of genre.

Brown starts out by asking how many rabbits there would be after 60 years if 24 rabbits were released on a farm on a great big island. Before providing an answer to this question, he introduces the need to save for retirement, although he doesn’t begin to predict how much you or I will need. His only conclusion is that “more is better” because it is better to be 65 years old with $750,000 saved than 65 years old with $75,000 saved.

Then he reveals that there would be 10 billion rabbits after 60 years and launches into a discussion of the history and key features of registered retirement savings plans (RRSPs) and tax-free savings accounts (TFSAs). Subsequently he riffs about how many zombies there would be in England if France sent 100/week for 40 years.

If you are still with me, you may wonder — what is the point of all this?

Not surprisingly of course, it’s to illustrate the power of compounding, whether in relation to rabbits, or money or zombies. We learn that just $100/wk deposited in an RRSP earning 6% for 40 years will add up to a nest egg of $624,627.

But the positive and the negative impact of compounding interest are also very cleverly brought home in later chapters. I particularly liked the comparison of brothers Mario and Luigi who both had similar incomes and $100,000 for a down payment on a house. They went to the bank to find how big a mortgage they were eligible for.

Mario’s banker told him “he could afford” to buy a house for $525,000. Luigi told the mortgage specialist he needed $10,000 for closing costs and the $90,000 balance had to cover at least 20% of the purchase price of the house so the most he would be willing to spend is $450,000.

The story continues with Mario buying a 3,000 square foot home for $525,000. Luigi sticks to his budget and buys a 1,600 square home nearby for $350,000. Over 20 years, compound interest on the mortgage means that Mario ends up paying $807,538 for his house while Luigi only has to fork out $538,359.

Similarly, when it comes to debt, Brown illustrates that high interest credit card debt can quickly escalate if balances are not paid off every month. Even I did not realize until recently that if you miss your payment due date by even as little as one day, the interest-free grace period completely disappears. In fact you have to pay interest on the amount of each transaction from the date each and every purchase was made.

Brown also reviews the characteristics of a line of credit; a home owner’s line of credit; bank loans and consolidation loans. While generally he believes all of these can cause severe damage to your financial health, he recognizes that when handled properly, they each have their place.

But he draws a line in the sand when it comes to payday loans. Never, ever get a payday loan, Brown says.

He gives the example of Buddy who borrows $400 from a payday loan place because his furnace broke down. He is charged $21 for every $100 he borrows for just two weeks. Two weeks later he pays the payday lender $484. That’s 21% for only 14 days, which works out to 546% annually. And that’s only the beginning.

If Buddy can’t pay in two weeks the payday loan company will charge him an NSF penalty and continue to accumulate stratospheric interest rates on the whole amount. Further defaults mean he will likely be hounded both by telephone at home and at work day and night. The file may be handed over to an even more aggressive collection agency.

In the second last chapter, Brown offers a brain dump of financial tips (which he doesn’t call “Fifty Shades of Brown”):

• Spousal RRSPs are cool.
• MoneySense magazine is a great source of personal finance information.
• Eat dinner at home. Then go out for a fancy coffee and desert to Starbucks.
• Buy life insurance, not mortgage insurance from your bank.
• Read Preet Banerjee’s book Stop Overthinking Your Money for the skinny on life insurance.
• Use the noun“wealth” as a verb. So instead of saving $150/week in your RRSP you will be wealthing your money.

And finally, Brown’s parting words at the end of the book are “you’ve got to show up.” Put some money away for your future. Live in a house that makes sense. Be smart about how you spend your money. Spend less than you earn. Be comfortable living within your means. He says it really is that simple.

Wealthing Like Rabbits is funny and engaging and it hits all the personal finance bases. Regardless of whether you are a Millennial, a Gen Xer or a Boomer, you will find lots of tips on how to save more, spend less and still have a lot of fun along the way. 

The book can be purchased in hardcover for $16.95 and the epub and kindle versions are available for $7.99.

By Sheryl Smolkin

After two weeks away, my inbox is chock full of great new blogs.

For sheer entertainment, you can’t beat Kerry K. Taylor’s account of how she got evicted from WalMart while taking pictures for her latest Squawkfox blog Target vs. Walmart: Where’s the best deal?

It turns out the answer depends on what you are buying, but Kerry preferred the shopping experience at Target including designer-style fashions and Starbucks coffee on tap.

If you are working hard to save for an early retirement, check out Tim Stobbs’ blog Know Thyself on Canadian Dream: Free at 45 to find out what personality traits may help you to meet your financial goals.

Many people believe downsizing in retirement will free up capital needed for travel and everyday living expenses. However, on Brighter Life, Dave Dineen explains why downsizing in retirement doesn’t always work.

Other financial decisions like taking on a super-sized mortgage, a second job or going out of your way for a bargain also may not make good financial sense, according to Boomer.

And if you do have savings but you don’t like the investment returns you are getting, on RetireHappy.ca Jim Yih shares some ideas on how to be a better investor.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere. Share the information on http://wp.me/P1YR2T-JR and your name will be entered in a quarterly draw for a gift card.

By Sheryl Smolkin

This week we catch up with some bloggers who share stories and ideas about spending.

Million Dollar Journey suggests 7 smart ways to spend your tax return.

The Blunt Bean Counter shelled out for an well-deserved vacation, but he says  Air Canada lost his luggage when he went to Dominican Republic at the end of tax season.

On boomer & echo, boomer considers how to pick a perfect mortgage.

Pete the Planner thinks giving yourself an allowance when you are in debt is stupid.

And Gail Vaz-Oxlade reminds us that “keeping up” with others can keep you from saving.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?”  Send us an email with the information to so*********@sa*********.com and your name will be entered in a quarterly draw for a gift card.

By Sheryl Smolkin

The May 4^th article Not your grandfather’s financial website: The new, fresh face of money sites in the Financial Post by Melissa Leong highlights a new wave of bloggers and personal finance gurus who are shaking up how young people get information about money.

She says some of the sites get millions of hits on any given month, embracing readers’ voyeuristic penchant for personal stories and catering to their  anxiety about money and hunger for information. We follow many of these bloggers already and we will follow more of them in future.

Consistent with this theme, today’s Best from the blogosphere draws your attention to some blogs that may be of interest to both parents and their offspring.

On Youth and Work lawyer Andrew Langille focuses on workplace law issues relating to young people, including his major area of interest which is illegal, unpaid internships. While he primarily focuses on Ontario law, his provocative ideas cross provincial boundaries.

One of the major problems that face Canadians approaching retirement is that they are often still supporting unemployed or underemployed offspring. On boomer & echo Boomer comments on Lending Money To Friends And Family.

For young people managing their own money for the first time, on BrighterLife.ca Brenda Spiering writes New grad? Four money tips you need to know.

If your kids are a little younger, you still have time to enhance their financial literacy. On retirehappy.ca, Sarah Yetkiner discusses Setting Kids Up For Financial Success.

And finally, from the mainstream media, check out this press release, Boomers risk straining finances to support boomerang kids: TD poll.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?”  Send us an email with the information to so*********@sa*********.com and your name will be entered in a quarterly draw for a gift card.

By Sheryl Smolkin

There is lots of interesting reading in the blogosphere this week.

Squawkfox Kerry K. Taylor counsels husband Carl on what to do with the $100 bill he found.

On boomer & echo Boomer comments on senior discounts vanishing from our banks.

Marissa is a 20-something recent grad with credit card debt and student loans. On Thirty Six Months she talks about being a good consumer by voting with your wallet.

Timeless Finance blogger Adina J. says if she had the choice, she would earn more instead of spending less to stay solvent.

And finally, Riscario Insider reviews Toronto Star consumer columnist Ellen Roseman’s terrific new book Fightback: 81 ways to help you save money and protect yourself from corporate trickery.

Do you follow blogs with terrific ideas for saving money that haven’t been mentioned in our weekly “Best from the blogosphere?”  Send us an email with the information to so*********@sa*********.com and your name will be entered in a quarterly draw for a gift card.