Personal Finance Stack: “The collection of tools, banking partners, and investing services you’ve chosen to manage your assets and financial life.” (lebel.io)
Here’s how I manage my finances. Happy new year!
Dashboard & Budgeting
Wealthica (dashboard)
Oddly enough, there aren’t that many options in Canada when it comes to properly tracking your net worth and getting a birds-eye-view of your money. When you have accounts from 5+ institutions, it can be difficult to keep track of
your transactions
how much money is in each account and
your investment performance
Wealthica is the best one I’ve found for the task.
All you have to do is link up all of your accounts once, and Wealthica does the work. There are also a lot of third-party extensions that provide you more insight on your money - everything from balance sheets, income tracking, and more.
Wealthica homepage. My net worth? Definitely not 25 mill
You Need A Budget / YNAB (Budgeting)
Assign a job to every dollar you have. I’ve been using YNAB for a year and it’s great - I use it to budget every loonie I make to a specific category of spending. Like Wealthica, you can link your bank accounts to YNAB to assign which category your transactions fall under and see how you’re doing.
Since it requires DAILY UPDATING, you’re forced to review your purchases and see if you’re still respecting the budget you’ve given to each category. (And if the purchase is worth the guilt you get from seeing how much you spent.)
What YNAB looks like
YNAB offers a 34-day trial - after that’s over, YNAB is $84 USD / year. And I’m pretty sure I’ve saved more using YNAB to my advantage than the money I needed to spend to use it.
Income
Employment Insurance
As of January 2021 I’m currently receiving EI at the rate of $517 per week. I’m eligible for 45 weeks, which is truly a blessing as it allows me to take my time while I look for my next job.
Since I’m living with my parents right now it’s more than enough to let me deposit some cash to my investment accounts as well.
Prior to this I was working as a production assistant in the Vancouver film industry. It was around 2-3 days a week, with each day being $300 worth of pay. This is how I’ve kept myself busy in the latter half of 2020.
Chequing
Tangerine Chequing Account
You get everything you need in a bank account for free with Tangerine.
No minimum balance. Unlimited transactions. No monthly fees. Visa debit. Free e-transfers. Free linking to other bank accounts. Pyramid scheme-esque $50 referral bonus. Easy access to ATM’s as its under Scotiabank’s network. Orange is a sick colour. Did I mention I used to work for them?
I’ve been using Tangerine since 2016 and I don’t see any reason to stop.
Saving
EQ Bank Savings Plus Account
It does a lot
The best for no-nonsense savings. EQ Bank has one of the highest interest savings accounts in Canada with unlimited e-transfers and transactions, capability to pay bills… it does it all. I use this account for my emergency fund and keep around 1 month of expenses inside. (It used to be 3 but I’m living at home at the moment.)
Interest rate: 1.5%
Tangerine Savings Account
Because I already have a Tangerine chequing account, it’s a lot easier creating savings accounts with them to hold short-term money - money for rent and credit card payments.
Occasionally, Tangerine offers promotional interest rates for 6 months that are higher than EQ Bank. Right now the promo rate is 2.0%. All I’ll say is that I’m not particularly loyal to EQ when that happens…
Interest rate: 0.1% (lol)
Credit Cards
American Express Cobalt Card
The Amex Cobalt is a points-based credit card with a $10 monthly fee that kicks serious ass. You earn 5 points for groceries and restaurants, 2 points for travel, and 1 on everything else. Points can be redeemed for a variety of rewards (e.g. Amazon, Ticketmaster), but the big thing here is Amex’s Fixed Points Travel Program where you can use points for round-trip flight tickets.
Once the pandemic is over… this is gonna be juicy.
What’s the redemption rate like? Let’s use the Canada/US (Long Haul) flight for example since I want to make trips from Montreal/Toronto to Vancouver (it’s the reason this card first got me curious).
If we use the redemption rate of $700 per 40,000 points, 1 point is approximately $0.0175. If you earn 5 points per food-related purchase, your reward rate is 8.75%. For travel, it’s 3.5%, and that leaves 1.75% for the rest.
If you spend $115 on food per month, you make your $10 monthly fee back and start profiting right after. And I know you spend a lot more than that on food.
At 8.75%, let me know where you can find a better return on spending.
Did I mention you can earn up to 30,000 points for free as a welcome bonus if you spend $500 per month? That basically pays for a flight by itself. Consider introducing this into your life - it’s ranked Canada’s #1 credit card by creditcardGenius for a reason.
Lastly, there is no income requirement for this card.
Tangerine World Elite Mastercard
When businesses REFUSE my Amex this is the go-to backup. This is a no-fee, straightforward cash-back credit card that distributes my cash reward on a monthly basis (most only pay it out annually). I get 2% back on 3 categories I choose (groceries, restaurants, and pharmacies), and 0.5% on the rest.
Scotiabank SCENE Visa Card
You get 1 “Scene Point” per $1 spent - with the ability to redeem 1000 points for a $10 discount on select restos and 1,250 points for a Cineplex movie ticket, the rewards rate is 0.8-1.0%. I don’t use this unless I have no choice. Fun fact: this was my first credit card!
Investing
I’m covering the investing stack in a separate post - stay tuned!
Education
r/PersonalFinanceCanada
This is a great community of Canadians talking all things personal finance. Everything from the sad state of housing prices to discovering you don’t have to pay an additional 8% sales tax in Ontario for restaurant purchases under $4 happens on a daily basis.
Yeah, Twitter. There are a lot of smart people and great discussions about money, investing, careers, and more over there. I’d encourage anyone to give Twitter a shot. It really is about finding the right people to follow - and if you’re inclined, joining in the conversations yourself.
Some great people to start following (there are many more):
Brian Feroldi @brianferoldi
10-K Diver @10kdiver
Ram Bhupatiraju @rambhupatiraju
Adventures in Financial Independence @adventuresinfi
Morgan Housel @morganhousel
What else?
I’ll go in-depth with my investing stack soon - this includes what brokerages I use and why, resources for fundamental & technical analysis, and how I generate ideas.
As the year goes on I’ll continue updating this if there are any changes.
You’re currently reading V1 - published on Jan 24, 2021