Take These Five Steps to Secure Your Finances in 2015

By: Nelson Smith on January 6, 2015

The tree is taken down, the stockings are put back into storage, and all the leftover turkey is either already eaten or thrown into the garbage in frustration. Yes, 2014 is finally behind us.

Now it’s time to focus on 2015. New Years’ resolutions can range from the mundane to the life-changing, but they usually include something aimed at sprucing up your finances. With that in mind, here are 5 easy steps you can take to start 2015 off on the right financial foot.

1. Pay down that holiday debt
Many Canadians get a little stretched during the holiday season, a direct result of buying too many gifts and perhaps spending a little too much on travel and food.
Don’t kick yourself if you’re part of that group; instead, focus your energy on doing something about your predicament. Taking small steps like brown bagging your lunch, walking (or taking public transit) more often and cutting down your cell phone plan can all add up to $100 per month in savings. Take that cash and apply it to your debt.
You can also save a few bucks in interest by transferring your credit card balance to a cheaper card. Our Scotiabank Value Visa is currently offering a 0.99% interest rate to new customers who sign up before February 28th, good for six months. If you currently have, say, a $5,000 balance at 18%, that’s a savings of roughly $450. Plus, we throw in a $25 gift card when you get approved.
2. Check your credit report
Each calendar year, the fine folks at Equifax and Transunion will let you check your credit report once for free. Since most companies consult Equifax when they do a credit check, I tend to focus on the larger of the two credit bureaus.
Getting a copy of your credit report is easy. Just head on over to Equifax’s website, print out a form, and you have the choice to either mail or fax it in, along with a copy of your ID. Although Equifax won’t supply your actual credit score unless you’re willing to pay for the privilege, it’s still important to check the report for errors. As long as you’re paying your bills on time and making sure your report is clean, I wouldn’t worry about the score. It tends to take care of itself.
3. Make RRSP contributions
The new year is the perfect time to make your 2014 RRSP contributions, since you only have until the end of February for the tax exemption to count on your 2014 taxes.
Say you made $85,000 last year, which would put you in the 22% tax bracket federally, as well as sneaking you into the 11.16% tax bracket in the province of Ontario. By contributing $5,000 into an RRSP, you’d be looking at an additional tax refund of about $1,650.
It’s nice when the government rewards you for saving for your future.
4. Challenge your bills
January is a great time to phone up each of your utility providers and see if you can negotiate a lower rate.
Getting a discount on power and gas is probably out of the question, but it’s easy to save a few bucks on cable, internet, home phone, or your cell phone plan. Simply check your junk mail, phone up your existing provider, and see if they’ll match the sign-up offer a competitor is advertising. Since keeping a current customer is much cheaper than signing up a new one, chances are they’ll go for it.
5. Make a budget… sort of
A budget is just an allocation of your limited resources. There are a few different ways to do it, and I’m all for picking the easiest one.
Here’s what I do -- I choose how much I want to save and immediately take it off the top whenever I get paid. I’m left to spend the rest however I want.
I find that this way I naturally allocate money to the areas that are important to me, while sacrificing stuff that isn’t. Traditional budgets do the same thing, but with a whole lot more work. I’m a big fan of simplifying saving money, especially for folks who aren’t so savvy at it.