Category Archives: finance

All the gory financial details

My mom wanted to know if she needed to make any emergency funding arrangements for me, so I sent her a 24-page report of all the financial transactions I recorded since I moved to Canada.

It's arranged by category and then by month, and it includes each and every single line item. I might be missing one or two hotdogs here ard there, but in general, it's a good picture of how I've been spending money.

Gnucash makes it _fun_ to record my expenses, and creating reports is a breeze. Totally awesome stuff.

Going from pre-paid to post-paid

I want to keep in touch with enough people now that the limits on my phone are Rather Annoying. I would like free incoming calls so that I stop worrying about minutes and so that people feel free to call me any time of day instead of saving it for evenings and weekends. I want to be able to hear people's stories and insights as they happen. I'd also like unlimited text messaging, or at any rate more text messages than most people here probably send all their lives. ;) I don't really need a lot of daytime or evening minutes.

Martin Cleaver suggested that I go for a 3-year plan without hesitation. He said that I'd probably easily find a company here that's willing to sponsor me for a work permit. If I decide to work elsewhere, the company that hires me might be persuaded to buy me out of my plan. Even if I do end up going home after my master's, I just need to put aside enough money to cover the cancellation charge just in case I don't manage to sell my contract to someone else. It's a relatively small expense compared to the freedom of being able to connect.

I don't have a credit history, though, so that might take some more persuading. I need to first establish a North American credit card. I'll try persuading President's Choice Financial to grant me a credit card, considering my bank account with them. If not, I'll switch to TD's secured credit card, and I'll probably switch my savings and current account to them as well in order to facilitate payment.

Bell.ca is the only provider with an unlimited text messaging plan, I think. It offers unlimited text messaging for $10 per month. That plus the $25 unlimited incoming plan works out quite well. Additional minutes are 30c (ouch!), but I have unlimited nights (9 PM onwards, what the heck?!) and weekend minutes. Additional fees include the 6.95 system access fee and a 75c 911 fee. Unfortunately, it doesn't seem to offer the Treo as an option, and Bell phones tend to be, well, Bell-specific... WAAH!

Rogers seems to be the only one offering Treo, but their plans suck.

Ooh, Fido. I can do Fido. $25 for unlimited incoming (sign up before Aug 8), and then $5 for 100 messages or $10 for 1000 messages. 1000 is close enough to unlimited, I think. <laugh>

Fido is GSM, so if I can find a second-hand Treo that I'd be happy with, that would work too. I want a Treo or some other Palm-based device because I want to be able to sync my data over from Emacs and BBDB. The Treo's picture-taking capabilities also sound really tempting. It's a rather expensive device, but if I can make it worth it by writing - must look for more things to write for! - that would be totally awesome. I'd love to be able to use it the way Martin does...

The Hiptop looks tempting, but I'll get it only if I know it works with Linux. I want to be able to refer to all of my notes. Otherwise, my current phone works fine. Rumor has it that I can run Linux on the hiptop, but I'll only do that if I keep access to all the interesting functionality. I want to be able to take pictures.

... Maybe I should just look for a Linux-based smartphone.

Okay. Breathe. Priorities. First things first.

The very next thing I need to do in order to make this happen is to get myself a Canada-based credit card so that I can sign up for plans without getting it charged back to the Philippines.

The next thing I need to do is sign up for unlimited incoming and text messaging plans. Wireless providers usually give a substantial discount if you choose a phone together with a plan, and there's a $300 discount (reducing the cost to $200) if I get the Hiptop together with a contract. However, I might be able to get a monthly plan without a contract, then sign a contract if I'm firmly convinced that it's a good phone and that I can make it work.

But the very first thing I need to do is establish credit. I can do that on Thursday.

Random Japanese sentence: 妖精は王子を猫に変えた。 The fairy changed the prince into a cat.

Setting up financial details

Von Totanes and I are at the TD Canada Trust at Bay and Bloor to set up accounts. I've decided to finally go for the secured credit card so that I can establish a credit history, which will be handy later on.

I'm going for the CAD 1000 limit credit card because I find myself occasionally needing to book a flight. It's still not going to be enough to book a flight home, but that's okay: we need to start somewhere. Two options:

  1. Open a checking account and maintain a minimum daily balance of CAD 1500 in order to avoid monthly fees of CAD 3.45.
  2. Secure the deposit with CAD 1000 in a 1-year GIC with 3.75% interest, freeing up CAD 500 to put into, say, my 4% savings account. Open the checking account and pay monthly fees of CAD 3.45, but avoid keeping a minimum balance. EARN: 57.50 SPEND: 41.40 NET: +16.10

Approach 2 earns me CAD 16 extra per year, compared to the opportunity cost of tying up CAD 1500 in a non-interest-bearing account. For the purposes of simplifying my life, however, I don't mind giving that up for now. If I were here for longer, I might've secured it with a longer-term GIC, maybe even get up to 4%.

To simplify matters, I'll probably also do most of my banking at TD. The savings account offers 3% interest with a minimum balance of CAD 5000.

The savings account has a maximum of two transactions per month, so I can't do the kind of financial juggling I'm doing with PCFinancial, but I guess it'll work out better in the long run. The account's actually a better deal than my previous PCFinancial savings account, but I'm on the 4% savings account at PCFinancial now, so I'll need to think about that for a bit.

I think I'll start off by just using the checking account at TD for a while, using it to autopay my credit card and transferring more money into it once in a while. It's handy because it's another way I can get cash; their daily withdrawal limit is higher. I'm going to need to be more careful managing my accounts and making sure I'm keeping track of everything.

I'll close my Scotiabank USD account, at least. I'll keep the PCFinancial savings account for the extra 1% (which is still quite an amount), move most of my current account to TD, and keep a checking account at PCFinancial for bill payments, checking, and the occasional debit transaction. I can use the TD account to pay rent every month in order to make sure the account is active, and I'll use scheduled transfers to make sure the money is there each month. I'll also top it up right after I charge something, treating it as a charge card.

Credit card

Finally sorted out a Canada-based credit card. Yay! I no longer have to course credit card purchases through the Philippines, getting dinged on the exchange rate. Too bad I didn't get it in time to pay for my flight.

The credit card representative handling my activation call was really hard-selling me on credit balance insurance. I wasn't too sure I needed it because I plan to pay the balance off in full each month, which is the proper way to use credit cards anyway. He was really pushing me to go for the 30-day review, but I was, like, ehh... Something about hard sells raises my hackles, and I was rather suspicious of the fact that I couldn't go without and just opt in afterwards.

So I Googled for "do I need balance protection insurance" and found the Government of Canada's helpful factsheet on credit balance insurance, which led me to the totally awesome list of consumer publications from the Financial Consumer Agency of Canada.

Hey, governments can rock after all. =)

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Splurging on a cab

The bus stop is just 1.5 km away from my residence. I'm splurging on a cab ride anyway as I want to minimize the number of things that could go wrong (and besides, the fall chill is starting to get to me).

=)

In other news…

I'm back on the wagon of tracking every expense. There's a certain satisfaction in knowing that every cent is accounted for. This time, I'm using John Wiegley's excellent Ledger command-line accounting tool. It works with plain text, of course.

I've just figured out how to do my fancy earmarked accounting thing. I've partially sorted out my cashflow, but I'm not sure how much I'm supposed to receive over the next few months or what'll happen when I start working. For peace of mind, I've earmarked enough money to cover tuition, rent, and food.

I want the earmarked money to be tracked separately from my real savings so that I know how much money I can actually touch, but I want to leave it in my regular high-interest savings account so that I can earn interest on the whole amount. So I need two reports: one showing what I can consider free and clear, and another that reconciles with the account summary from the bank (includes earmarked accounts).

Here's the transaction setting up earmarked rent:

10.28 Earmarked for rent
   [Savings:Earmarked:Rent]      $4365
   [Assets:Savings:PCFinancial]

and every so often, I'll post transactions that look like this:

11.02 * PCFinancial ; Transfer for rent payment
   Assets:Savings:PCFinancial     $-485
   Assets:Checking:PCFinancial    $485
   [Assets:Savings:PCFinancial]   $485
   [Assets:Checking:PCFinancial]  $-485
   ; Automatically transfer rent money from Savings to Checking ($485)
   ; This is still part of my earmarked savings until it goes out of Checking
   ; So ledger -s -c bal shouldn't show it as part of my real checking account
   ; or my savings account, but as part of Savings:Earmarked
   ; but ledger -R -s -c bal should show an increase in checking and a decrease in savings
11.05 ! University of Toronto
   Assets:Checking:PCFinancial    $-485
   Expenses:Rent                  $485
   [Savings:Earmarked:Rent]      $-485
   [Assets:Checking:PCFinancial]  $485
   ; Now decrement my earmarked savings
   ; And make sure that Checking reflects actual balance
   ; And that savings is unchanged from before with virtual transactions

The ! signifies a pending transaction that has not yet been cleared, while * signifies a cleared transaction. ledger can do partially-cleared transactions too. This is pretty nifty.

Makes me want to have more to track...

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Random Emacs symbol: shell-script-mode - Command: Major mode for editing shell scripts.