Will You Miss the Canadian Penny When It’s Gone?
Canadian pennies are being phased out. Apparently the USA is considering this, too.
The penny apparently costs more to mint than its value. Therefore the Canadian government says it’s getting pulled from circulation at the end of 2012 and they’re going to phase it out. With all the bad pennies lying around it’ll likely take ages for the penny to go the way of the Dodo and for retailers to be able to round things up or down by the nickel. It’s being said that if you pay by debit or on credit you’ll be able to continue to pay the exact charge. (But paying everything on a debit card is what gets many people in financial trouble because most say they spend less when they ‘see’ how much they’re spending and have less of a chance of living in overdraft!)
Canada isn’t the only country considering making pennies obsolete and several countries have already done so. Apparently, the country is also looking at ways to reduce the costs of minting higher value coins. What happened to money being truly ‘worth’ something? At a point in time there was gold in reserve for all the money in circulation.
What’s going to happen to all the sayings,
“A penny saved is a penny earned”
“A penny for your thoughts”
“My two cents worth”
(In the MP3 generation we’re in my kid didn’t know what I meant when I told him I felt like a broken record! I can imagine someone some day saying “What’s a penny”)
Is this penny situation ‘no big deal’ or do you disagree with the action?
What do you think about this? And is it going to make much of a difference to you?
(Or are you thinking you should melt down all the copper in your house because you’ll make a tidy profit?)
Find the Right Mortgage and Ease Your Financial Pressures
Shopping for a mortgage can be a formidable task, especially if you have never done it before or if you have previously owned a home that was financially underwater. However, thorough research and knowledge can lead you to find a home financing option that can save you money and ease your financial worries. Read ahead for tips on how to find the best mortgage rates.
Research several types of mortgage providers before choosing one.
This is not in reference to an institution’s brand but rather how it operates to provide you with a mortgage contract. One of the most common ways to find a mortgage is to consult your primary bank. However, you should also look into companies that deal specifically with mortgages as well as credit unions. Choosing one of these institutions may offer your more advantages than another. Credit unions, for example, are seen as more reliable because their primary goal is not to make a profit, unlike commercial banks. Also, some mortgage companies use brokers instead of lenders to offer their services, and the difference is bigger than just semantics. Brokers often earn money through fees added to your mortgage contract while most lenders do not.
Ask for a break down of the total cost.
In order to decide which mortgage is best for you, you should obtain both the total cost of the mortgage as well as an individual account of all fees and interest. This will help you decide which mortgage contract is in your best interest (remember, some brokers charge fees that you could avoid paying elsewhere) as well as arming you with negotiating power. You may be able to convince the seller to pay some of those fees instead of asking for a lower price on the home. You may also be able to negotiate with your lender to lower or do away with some of these fees altogether. When you’re ready to meet with a lender, come prepared with information. You can find valuable input for mortgage rates with ratesupermarket.ca.
Pay points on your interest upfront.
If you have a little extra cash on hand, you may want to consider investing it in your home, and there are several ways to do so. You could make more than the minimum down payment, which will take years off of your mortgage terms, thereby saving you interest. You can also pay for points on your mortgage, which will give you a lower interest rate.
Consider the benefits of an adjustable rate mortgage.
If you are purchasing a starter home or plan to upgrade or downsize within the next decade, you may want to research adjustable rate mortgages. These contracts usually offer the benefit of a lower interest rate with the stipulation that the rate can change after a certain period of time. While this is not a wise strategy for homeowners looking to settle in a house for life, having a lower interest rate is an appealing factor for other kinds of homeowners as long as they can sell the home by the time the adjustable rate would take effect.
Money Bytes: Stop Using that Debit Card
money jar
Here’s today’s budget tip: Stop using your debit card! Stop it for a little while and see what a different it makes.
ATM cards are convenient. And debit cards can be used nearly anywhere. When we spend with them, we are much less cognizant of just what we’re spending and even more importantly…what’s left in the bank. Try switching to a cash budget for the next week or two and see what a difference it makes.
Living on a Cash Budget:
Try using money jars or budget envelopes and taking the cash that you’ll need out for the week. It’s a real eye-opener for most people! Factor in food, gas or other transportation expenses, and other things you’ll need during the week. This budget should not include your fixed payments such as rent, utilities, and loans or credit card payments. You’ll want to manage that separately. We’re talking about the money you spend regularly and ‘live on’.
Tip: Be sure to have a separate envelope or jar with a small amount of money for overflow expenses. $10-$50 usually covers is.
Don’t use your debit card at all! Don’t use credit cards at all!
It might take a bit of tweaking to assign the right weekly budget but you’ll soon get the hang of it.
By seeing how much money is left in various parts of your budget you’ll become much more conscientious of your spending. You’ll realise you can’t afford more than $x for lunch or for groceries. Most people find that they go from over-spending to having money left over because they think more about how much money is left for spending. Instead of living above your means or right at your means, you’ll have a better chance of living below your minds, resulting in being able to pay off debt and save money. If you start doing this and allocating an amount to your savings account each payday you’ll also see that it’s much easier to save.
Do you treat money differently when you can see and feel it in your hands? Feel free to share your opinion and outcome of this or similar experiments in comments.