The Other Side: Earning More

Posted by Canadian Dream on November 25, 2010

As blog writers we tend to be guilty of fixating on the cost cutting side of the equation for the majority of our posts.  We talk of ways to pay off debt, live better on less and frugal tips instead of looking at the other side of the coin: earning more.  Why is that?

I will speculate that writing on living better on less is easier.  There is a large body of tips, tricks, books and theory developed on living frugally.  Meanwhile many people just don’t have any experience of their own to speak of on earning more money.  After all the concept of working even more strikes people as silly since when you are looking at early retirement you typically have some dislike of your current job.

Yet for a good lot of people earning more offers three potential benefits that are often overlooked:

1. You can expand your skill set and learn something new and interesting to you while earning money.
2. You expand your income base so you will be at less of a risk from a job loss.
3. You might actually do so well at earning more you can be ‘free’ of the job you dislike earlier than you predicted.

So earning more can be a good ground to test out income producing hobbies or even earn extra money to take some extra trips, dinners out or buy some electronics (what ever turns your crank).  The point of the matter is earning more can offer you several different benefits that could out weigh you initial reluctance to ‘working’ more.

Now this is where earning more divides itself into two main camps of thought: 1) you can just pick up a second job with flexible hours or 2) you can start a small business.  The first method is by far the more common when you speak of earning more.  Most people don’t go looking to start a small business since they fear the amount of work involved and putting their own money at risk.  Yet what is over looked in that fear is the potential to earn significantly more after all the tax system is designed for business and investors.  After all where else can you take money you have earn, pay no tax on it and turn it around and expand your business and the government is ok with that.

Yet small business is really a very flexible thing that can encompass most activities that you can do to earn money and many of them can be done with minimal investment of your own money.  Often people just fall into a small business idea because it is something they like to do and they happen to be good at it.  Also I run into a misconception that people have to expand a business, which strictly speaking isn’t true.  You can choose to say no to new customers and clients and keep your business small if you want.

I know in my own experience so far with this blog is I’ve fell into some things I was never really planning on doing when I started writing it.  I never really planned to self publish a book.  That idea developed when I realized that I was never really going to find the book I wanted on early retirement.  I was going to have to write it myself and I came to realize that it would likely have limited appeal to a traditional publishing company.  I certainly didn’t plan to get into freelance writing at this point in my life, but when the opportunity came up I decided to take it.  Yet both in the end I hope will result in earning more in the long run.

So what is your reason for not trying to earn more?  Or if you do earn more could you please share what you do?

Contest II Winners

Posted by Canadian Dream on November 24, 2010

Hi everyone,

Sorry for the delay on the public announcement, but I finally got the draw done yesterday.  Wow, double checking all the tweet and link entries took longer than I thought.

Winner of The RESP Book – Fiona (comment #2)

Winner of the Kobo eReader - Steve (comment #21 – note when I do prize draws I don’t count my own comment).

The winners should check their spam folders for an email from me (often these emails do get sucked in).

Thanks everyone for your entries and your kind words of support.  I really do enjoy writing this blog because of that.

Tim

Leaving a Trail

Posted by Dave on November 23, 2010

This is a guest post by Dave, is also looking to retire no later than 45, but unlike Tim has no kids and doesn’t want any.  Dave is from Ontario and is working towards his CGA certification.

One of my main jobs at home is to manage our household finances.  Currently this is a somewhat boring exercise as it amounts to paying off our house as quickly as possible.   Once a month I set up the mortgage prepayments and watch the balance decrease slowly but steadily.  On a whole, I make the majority of the financial decisions that take place in our house, generally in consultation with my wife.  My spouse is not really aware of the exact mechanics of such things as our insurance policies, my company pension, my investment accounts or my various bank accounts.

As of yet, we have not created Wills – this is something we will be doing in December, when I have completed my current accounting course and have time to do something other than study.  At this point in our marriage, we really don’t have much in the way of assets to disperse.  In a previous discussion with our lawyer it was explained to us that a Will is more useful in dispersion of assets outside of the marriage (family and friends) to meet our wishes.

Besides a Will, I am creating a list of names and numbers for my wife to use in the circumstance that I am unable to provide them.  With this list, my spouse will be able to get in touch with all individuals who have assets that she can get at.  Over time, as we invest more money, I hope to be able to teach her why these investments are made and the strategy behind this, but for now just getting her access to the funds should be enough.

In an age where money can be placed in a myriad of locations, it is important to leave a trail so that people in your life are able to access your assets.  Even outside of your spouse, others noted in your Will should be able to find your assets easily.  This can be done via a search of your SIN number, but a regularly updated document would be much easier to update and would provide one place that people involved can easily resolve estate questions.

This isn’t really something that I’m super excited about (which is probably why I don’t have a Will) but it is important.  In a situation where I am not necessarily dead, but am unable to provide details to my spouse, I would hate for her to have to hunt for money that is rightfully hers.  For the ten minutes it would take, I would know she would be able to find all of our assets quickly and easily.

Perhaps my houses finances are unique because we keep everything completely separate, but I’m wondering if anybody else has created a reference document like this?  If so, where do you keep it (we’re thinking fire-proof safe)?