Gail Vaz-Oxlade's Blog, page 74

Life Lesson Learned

Some lessons are harder to learn than others. There are things I've beaten my head against the wall on until I thought it would explode. Inevitably when I'm struggling with something it is because I haven't yet realized that in amongst the trees there is a path. All I need do is find the path.

I have come to believe that when we do that head-bashing thing, it is because there is a life lesson we must learn; we must find the path.

There was the month in which every single plan I laid – in an attempt to balance all the balls I tend to keep in the air – went off-track.  The first two times my plans went for crap, I was frustrated… angry even. By the third one, I got it. Yes, I'm a control freak and The Big Lesson was that it didn't matter how well I planned, crap happens. Time to stop freaking out.

So by the time the fourth Change In Direction came along, I was already in a different headspace. I had had my Big Wake-up. I wasn't about to lose my temper or let myself become discombobulated!

And you know what? It feels better. It's a hard lesson, but one well learned.

I have found that some of the hardest lessons to learn are the ones that make the greatest difference in my life. There's a lot of that head bashing, followed by a big "a-ha!" and then the peace that comes from knowing I now know the answer to the question, "What was the lesson?"

Even when I am too busy to listen, the universe talks to me. Sometimes it has to shout to get my attention. Sometimes it must take a hammer to my head.

Perhaps this is one of the reasons why I believe that regret is a waste of emotion. How can you regret the very things that have been sent to teach you some major life lesson? How can you regret growth?

Pushing through the hard cold earth to bloom is tough. When we do get to open our petals to the warmth of the sun, when we become all we can be, we become beautiful. But it takes hard work, persistence and the willingness to push forward.

I consider myself a very lucky woman. It's not because my life has been particularly bless… although it has been with happy children, good friends and wonderful challenges. I think I'm lucky because I learned to ask, "What's the lesson?" And I learned to keep asking until I figured it out, no matter how much my head was hurting.

So, what life lesson did you learn the hard way?

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This & That: Credit Edition

N Wrote:  Hi Gail, I think what you do is so wonderful that I wish there were more people like you around the corner that would help more people!!  And a way to find these reliable people.  Anyway, we are a one income family, we have an older child with health issues and a toddler.  We are in debt and until recently have managed to pay double the amount due on our credit cards.  We have recently lost a sales based commission position, which brought in money but unsteadily but we did rely on it.  We no longer have that money and with the added pressure we were wondering if we should take money from our mutual fund to pay off our $14,000.00 in credit card debt.  Our accountant said no, because credit card debt is not insured and if we ever had to file for bankrupcty they cannot come after us.  I feel that we should get it off our backs, stop paying interest/finance charges and start focusing on saving?  What do you think?

Gail Says:  You do not say whether the money is in a retirement savings plan or outside one. If it is not in your RRSP, then the assets can most certainly be "attached" if you claim bankruptcy, so you would be far better off paying off the debt and creating some breathing room in your cash flow. Then you could rebuild your assets. Put away the damn cards!

Holly Wrote:  Could making bi-weekly payments on a credit card help get the debt down sooner? I find it easier to budget big payments if I can split it by two pay checks.

Gail Says:  The sooner you make your payments, the less interest you pay. So go ahead and make a payment bi-weekly.

T Wrote:  I love the show. I have started to implement a good budget and we have paid off all of my credit card debt. My husband and I are now left with student loans and his credit card debt. We owe about the same amount on his credit cards and my undergraduate loan approx. 10K. He has had his interest rates dropped to 0%-2% on the debt and my student loans have 5%-6% interest rate on them. Just based on interest rates I would like we should pay off the student loans off first (they have about 4 years left on them) but since they are student loans I wasn't sure. Should we send all of our extra money to the student loans or the credit card with the highest interest rate first?

Gail Says:  Since the lower interest rate is an opportunity to get rid of that consumer debt even more quickly, that's where I'd put my focus. Then snowball the money to the student loans.

E Wrote:  I have been discharged from my second bankruptcy for 4 years now.  I have a secured credit card which I have had for 2 years.  I pay my bills on time, have started an RSP and a tax free saving account over the last 6 months.  I currently have a credit score of 627.  Can you please tell me what else I need to do to build my credit back.  This seems to be a very slow process and I'd like to know what I'm doing wrong.  I'm a single parent with one son getting ready for college and am trying to help with this as well.

Gail Says:  What you did wrong was go bankrupt TWICE. What you're doing now is right, but you need to be patient, consistently demonstrate good financial management and recognize that it'll take some time for lenders to trust you again.

B Wrote:  I am an 18 year old student who is planning to go to university in the upcoming fall. I have approximately 2 thousand dollars saved of my own and my parents don't have any money put away for me. I have one parent who is working and another parent who is retired, at fifty thousand dollars a year with four children and lots of expenses I'm not very confident about receiving very much financial assistance from my family. I am applying for bursaries, and scholarships as well as government assistance but my biggest concern is that I'm going to barely scrape by for the next four years and then come out of school with 60 thousand dollars worth of debt. How can I try to manage my money better so all my problems can be dealt with at least to some degree?

Gail Says:  You're very smart to be thinking about the debt you may have when you graduate, and ways to minimize it. You don't say if you plan to live at home (in which case you'd just have tuition and school supplies) or if you plan to live away from home (which would be more expensive, but a different experience). In the first case, you can bank on spending about $9,000 a year, depending on your degree. In the second case, look at spending about twice as much. I have a bunch of worksheets on my site (look under my blogs in the "students" category).

It'll be important that you earn as much as you can as you go to minimize your overall debt at the end. Working the four months between school years will make a big difference. But you must apply early for jobs (start in Jan for a job in May). You may have to piece together work, doing part-time at several different jobs to make enough. Aim for about $500 a week. If you can also work part-time while in school, great!  But don't let work detract for school.

If you live away from home, how you live (sharing space versus living on your own, cooking for yourself rather than eating out a lot) will also have a big impact on how much you have to spend. Remember that school is about learning and growing, not just academically, but also in life skills.

J Wrote:  We love your show & follow your tips & use the jars!  3 years ago, we put $30 000 of consumer debt on our mortgage (due to my husbands large purchases he put on a line of credit). Currently, our mortgage is our only debt we have (no car payments either).

My husband now wants to put an extra $10 000 a year (on top of our weekly & top up payments) on the mortgage to pay it off sooner and remove the consumer debt portion. We currently do not max our RRSPs but do save 10-15% and we have an emergency fund. What should we do with the extra $10 000?

We are both 34 year old, I'm currently on Mat. leave but when not on leave, our gross salary is $115,000. Our current mortgage forecast is that we'll have it paid off in 19 years. Combined we only have $60 000 in RRSP, plus my husbands union pension.

Gail Says:  Since the $30K you consolidated to the mortgage is consumer debt, your husband is correct in wanting to get that paid off sooner rather than later. You say you do not max your RRSPs but save between 10-15% of your income and have an emergency fund. So you're saving enough. I would follow your husband's lead to pay down the consumer portion of the mortgage debt. Once that's gone (a little less than 3 years), top up your RRSP and have some fun!

A Wrote:  My husband refuses to believe that we can live without a credit card.  He is just coming out of a bankruptcy and will be applying for a secured card "for emergencies." In spite of both of us learning the hard way how an "emergency" can pop up when it seems we have the means, he feels that getting this card is something that we need to do.

I would rather not do this. We are on week three of using our money jars and I can see a light at the end of the tunnel. He, however, says that if he doesn't get this card than we can't do things like rent a car when we (eventually) go on a vacation.

Is he right? Is there any way to secure rentals and such without the use of a credit card?

Gail Says:  Your husband is correct that there are a number of things for which you need a credit card: car rentals, hotel bookings, and the like. And a credit card used wisely can help to rebuild your credit rating. If you are serious about using the card only for these types of things, then get your husband to agree not to use it for "credit." Before you buy anything, you must prepay the card. That way you are only ever using your own money. That'll keep you out of trouble.

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RRR: Old Doors

Old is making a comeback. Or maybe it's just that as I get a little bit older, I'm seeing more "older" stuff being repurposed beautifully.

I went by an old friend's house the other day, and she'd used a old door as a backing for a set of book shelves. First, she took the old door, painted it white, and then distressed it a bit so it looked old again. Me, I'd just have given the thing a good washing and started from there. I don't get all the work that goes into "distressing"… but I'm lazy. Then she installed shelves evenly spaced, six in all. I think I might have put more space between the two bottom shelves for bigger items, and maybe only put a half-shelf on the very top. All in all, the thing looked great. And the best part, she only anchored it at the top to stop it falling forward, so it's completely portable – great for a rental.

I've also seen old doors used as headboards. Turned sideways, or in multiples (though vertically they usually have to be trimmed), doors make very interesting alternatives to the traditional bed head.

Or how about taking that old door and insetting a mirror to make a beautiful accent for a living or dining room. Add a short mirror, a shelf just below and a couple of large hooks down the sides and now you've got a very useful hall tree.

Put your old door on pedestals of some type — old saw horses, inverted large planter pots, whatever your imagination can come up with – and you've got a table you can use for dining or as a desk.

Attach an old door to the back of a small table, add a simple bracket shelf and you've got a potting table. Install a planter hook or two off the sides and you've can hang a couple of vines on it for extra oomph.

If you're artsy, take that door and paint it, and then inscribe the sayings that remind you of how lucky you are or what you want to focus your energies on. Then you can hang it on a wall or prop it up somewhere. Using different type styles and grouping the ideas you're writing will make your new piece of art that much more interesting.

If you're really handy, you can even repurpose an old door into a blanket bench. This one's a little too ambitious for me, but what a great place to collect your memories!

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Take Control of Your Money

Why are some folks so bad with money? It's partly because no one every taught them even something as simple as tracking what they're spending. And perhaps because they haven't been taught to manage their money, they think they don't have any control over it.

You do have control. If you accept the fact that you have control, your next step will be to exercise that control. I know that there are days when you don't want to do it, when you say, 'I just can't be bothered.' But you must. You work hard for your money. It's time to take control of it.

Tracking what you earn and what you spend doesn't have to be hard. Get yourself a notebook and a pen. Those are the simplest tools to use. If you're more ambitious, you can create your own spreadsheet, find an app or signup with an online financial aggregator. (Careful about choosing one that doesn't require your PIN numbers since handing them out is a big no-no.) No matter how you choose to track your money, these are the steps:

1. Write it down: Keep a spending journal where you write down every penny you spend and deduct it from how much you have left in the bank. This will help you keep track of all your spending and figure out which expenses are unnecessary.

2. Deduct your fixed costs automatically: At the beginning of every pay period, deduct exactly how much money is coming out of your account to go toward fixed costs. Those might include mortgage payments or rent, insurance, heat, hydro and all your other fixed expenses. Then you'll know exactly how much money you have left to spend on your variable costs.

3. Mitigate your risks: You must have both an emergency fund and enough of the right kind of insurance. These are non-negotiable. The idea of not having enough money in the bank to do something I have to do is anathema to me. I can't even conceive of not being able to buy my kids food or pay my hydro bill.

4. Pay off your debt: Yup, you've got to do whatever it takes to eliminate your consumer debt licketysplit. That means three years or less. Forget paying the minimum payment. If you owe $2,500 on a credit card with an 18 per cent interest rate and you just pay the minimum payment, you'll end up spending more than $4,000 in interest.

5. Stop using credit: Using credit means you're spending money you haven't yet earned. If you want something, save up the money and buy it with cash. Once upon a time there was no credit and we were fine. Now we spend gobs of time working to pay interest on crap we bought that we didn't actually need all because we didn't have the discipline to say, 'Not yet. Not until I've saved the money.'

6. Save for the future. It's a'comin' and if you're not ready with some money, it'll be a sad life being old and poor. It doesn't have to be a lot to start. Just start. Then look for ways to build your savings. And remember, the earlier you start, the less you have to save to have what you'll need when it comes time to hang up your spurs.

Once you take control of your finances, you'll be happier for it. Until you have experienced the freedom that comes from knowing you have money in the bank – of knowing that you can cope with just about anything life throws at you — you can't even imagine the sense of balance that control will give you.

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Poll Results: How You Shop

Thank you for answering the polls each week on my site. It not only makes for interesting reading, it also let's me see where I need to put some focus from time to time as I'm writing.

One of the questions I am asked over and over is how much a person should be spending on groceries. I can't answer that question because I don't know. You have to decide what a "reasonable" amount of money is. It's your money! And it's your belly.

I did ask this community, "How much do you spend on groceries a month?"

Of the over 500 people who answered this question:

almost 20% said less than $300,
53% said between $300-$600 a month,
19% said between $600-$900, and
about 8% said more than $900 a month.

How much you are spending is affected by all sorts of things including where you live, how many people you're feeding and what your dietary restrictions may be.  Stats Can considers the average household to be 2.5 people, and the average annual food expenses for a Canadian family is about $500-$600 a month.

While using coupons is one way to save money, we Canadians (at least at this site) aren't really a couponing bunch. Only 30% of yous guys say you often or always shop with a coupon; 52% do so occasionally and the rest can't much be bothered.

How much you spend can also be reduced by a little time spent meal-planning. But only 25% of you always make a meal plan. 13% never do. And the rest of you kinda… or maybe you just don't want to admit you don't.

You do love your plastic! When I asked, "What is your primary means of payment when you shop?" you said:

39%  Credit card, but I pay it off in full
4%  Credit card, and I carry a balance
12%  Debit card, but I'm in sometimes in overdraft
27%  Debit card, but I'm never overdrawn
18% Cash

I'm heartened to see all the people who are not using credit to fill the gap!

Loads of you are driving by the drive-thru, maybe because you're making it yourself now that you're such smart shoppers. A whopping 41% of you say you spend nothing on take-out coffee/tea each week and 26% of you claim to spend less than $5 a week. Really? I wonder how Timmies and Starbucks are making so much money since only  9% of y'all say you spend more than $15 a week.

Of course, we're a self-selecting set of smarty-pants in this community. Many of us have bought the message: Live Within Your Means. Now we have to get busy spreading the word to those who still need help.

What do you do to share your knowledge with friends and family? Do they listen? What do you think it'd take to penetrate their shell of complacency or denial?

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Gratitude

I am often offered gifts. Some I accept and some I decline. I always try to do so gracefully. And I've tried to teach my children how to accept gracefully.  It takes the constant reminder that everything they receive is a blessing. And it means helping them learn to acknowledge that none of what they get is owed to them.

While we've actually been taught that giving is good, we really haven't been taught how to receive with grace. Even the words, "giver" and the word "taker" elicit different feelings when we hear them. "She's a giver" makes us feel warm; "She's a taker", not so much. And yet they are the yin and yang of the exchange. One cannot exist without the other.

To receive gracefully is to feel gratitude wash over and through you. Gratitude does not reside in a polite, "thank you." Saying," thank you" can, in fact, be a substitute for real gratitude.

Think of the last time you were given something that you didn't really want. If you said, "thank you," you were polite, but there was no gratitude – no graciousness – in your acceptance. Only when the gratitude swells from inside – gratitude for the thought, if not for the specific gift, or gratitude for the generosity, or gratitude for the gift itself – is it real.

Some people feel no gratitude because they feel entitled. Entitlement is the antithesis of gratitude. And entitlement is often expressed in complaining.  Feeling owed, entitled people are never satisfied with "good enough." They must have "the best."  And they must have it ALL. When their expectations aren't met, they feel cheated or deprived.

It requires a certain amount of humility to be grateful. If you think the sun gets up to hear you crow, gratitude probably hasn't found a home in you. And if you think that it is everyone else's purpose to serve your needs, it's very unlikely you feel grateful.

North American society has come to feel a huge sense of entitlement and that's reflected in the heaps of kids who believe their parents owe them the best of everything. Princess, I call them. The big lesson their parents failed to teach them was to be grateful.

Do you experience real gratitude? How often do you say, thank you, for what you receive… even when there is no one listening? And how have you taught your children to express (and experience) their gratitude?

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Oh! The Places You'll Go!

This is one of Dr. Seuss's most pointed books about personal power. Y'all know I'm a huge advocate of taking control of your life. I love this book and you should read it to yourself over and over and over if you're not yet convinced that you're in charge and can make your life anything you want it to be.

You have brains in your head.

You have feet in your shoes.

You can steer yourself any direction you choose.

Yes, you can! But you have to know what direction you want to go in. One of the biggest mistakes people make is not deciding what they really, really want. So they head off in all different directions without a clear sense of what they have to do to achieve what they really want.

Once you know what you really, really want – do you want to save a downpayment for a house, or eat out three nights a week? – you have to get moving. Action begets action.

And when things start to happen,

don't worry. Don't stew.

Just go right along.

You'll start happening too.

To be happening, you have to be moving. Put momentum on your side and you'll keep going. Open up that pay-yourself-first downpayent savings account, and move the $400 a month you've decided to commit automatically. Now there's no money for dinners out, but you're growing your stash of cash that will take you to where you really, really want to be: in a home of your own.

Don't expect the journey to where you're going to always be a smooth one. Life happens, and you have to be flexible enough to cope.

I'm sorry to say so but, sadly, it's true

that Bang-ups and Hang-ups can happen to you.

And when you're in a Slump,

you're not in for much fun.

Un-slumping yourself is not easily done.

This is what separates those who are serious about achieving their goals from those who are just dreaming. The folks who are waiting for whatever they want to fall into their laps end up confused by the wiggly roads they must venture down. But waiting around for "the fish to bite" or "a better break" won't get you to the place you want to be.

If you're serious about what you want to achieve you won't be happy to wait to see what life brings you. You'll want to take charge, make a plan, take a step… a carefully planned step 'cos you'll "remember that Life's a Great Balancing Act."

And will you succeed?

Yes! You will, indeed!

(98 and ¾ percent guaranteed.)

If you're not yet convinced you're in charge of your life, buy this book and keep it beside your bed. Read it and read it and read it again. And if you have children, this is one of the best messages you can ever impart: you're in charge of your life, and if you know it, Oh! The Places You'll Go!

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Juggling Textbooks & Chequebooks

Know a kid heading off to university this year. Pass this on!

So, you're heading off to the halls of higher learning. Now you'll get the chance to experience life on your own. The freedom can be intoxicating. 'Course, the responsibilities can be somewhat mind-boggling too. And right at the top of the I-don't-know-how-to-do-this list: money management. Here are ten tips to help you manage your money so the last two months of the semester aren't spent slurping ketchup soup.

1. Ferret out the free money: Canadian governments, universities, companies and nonprofit groups sponsor more than 60,000 awards, ranging from $100 to $50,000 or more. Check out Studentawards.com, which has tens of thousands of awards in its database. If you don't apply, you won't get a penny!

2. Make a plan: Knowing how much money you have and how you plan to spend it puts YOU in control. The best way to manage your money over the course of the school year is to sit down and map out a spending plan. (You're gonna spend that money, you might as well have a plan!) If you look under Resources from the main page of this site you'll find two excel spreadsheets available for download: Student Lump Sum Money Worksheet and Student Cash Flow Worksheet. Make sure you build some Good-time Money into your plan so you can have some fun without blowing your budget.

3. Check it twice: Even if you think you've done a pretty good job estimating your expenses, once you get to school track your spending for the first couple of months. You may be surprised at how little things can nibble away at your plan.

4. Pace yourself: Don't be fooled by that deceptively large balance in your bank account at the beginning of the semester. While you may be feeling pretty rich, that money has to last you all year. Spend, spend, spend at the beginning of the semester, and you could end up eating a lot of macaroni-and-cheese.

5. Be smart with your credit: One quick way to spend beyond your means is to charge everything. Ooops, now you're in trouble! To avoid temptation, have one credit card and keep your credit limit low — $500 should be enough. Only charge what you can afford to pay off each month. Paying bills on time and staying out of debt are the keys to a good credit rating and your ability to borrow in the future.

6. Life happens; be prepared: Even with the best planning possible, something's going to happen to push you off track. That's life. Go ahead and have fun. Just be prepared to buckle down on future spending to get yourself back on track.

7. Look ahead: Whether it's a road trip with friends or an auto insurance bill, if you know a big expense is coming, start putting some money aside to pay for it. It's way easier to set aside $25 every month than to come up with $300 when the bill is due.

8. Look for ways to save: Differentiate between what you want and what you truly need. And always be on the lookout for ways to save. Use the library for borrowing books, catching up on your favorite magazines and as a study space. There's less of a temptation to spend money at the library than there would be in a coffee shop. Read your campus newspapers for university-sponsored entertainment events.

Reconcile yourself to the life of a poor student while you're in school and you won't have to live like a poor student when you're done. Many graduates enter the work world weighed down by debt, which can linger for years and years. Don't let this be you.

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The A, B, Cs of Money: S

SAVING: The act of taking money you have not spent and putting it somewhere for use at a later date.

SAVINGS ACCOUNT: The place you put money when you want to accumulate it but also want to have easy access to it. If you've still got your money in a traditional bank's savings account paying you 0.25% you're not a smart saver. If you can get 2% in a high-interest account at another institution, why aren't you?

SCHOLARSHIP TRUST: This is another name for a pooled RESP and you should definitely avoid these products. The government did research that shows they're expensive and inflexible. Stick with an individual or family RESP available at a bank near you.

SECURED CREDIT CARD: A credit card on which you must leave a deposit in order to qualify for the card. If you want a balance of $500, you'll likely have to place $1,000 on deposit as security. These cards are useful for people who have no credit identity or those who are re-establishing a credit history after a bad bout of boo-boos.

SHARE: A legal document that represents ownership in a corporation. If you buy a share, you're a shareholder.

SHORT SALE: When you sell a stock you do not yet own at today's price because you think the price will go down and you'll be able to buy it back later for a profit, that's called am short sale, or selling short.

SPREAD: The difference between two interest rates or yields. Also the difference between the values of two currencies. If you put your money in the bank and the bank pays you 0.5% interest, but then lends your money to another customer at 5.5%, the difference of 5% is the spread.

SPOUSAL RRSP: An RRSP to which one partner in a relationship contributes on behalf of the other partner. The contributor gets the tax deduction. The planholder makes all the decisions relating to the plan, including how the money will be invested and when it will be withdrawn.

STAGGERING MATURITIES: Sometimes referred to as "laddering", this is the process of dividing investment dollars into different pools and having each pool mature at a different time to average out rate changes.

STOP LOSS ORDER: A preset price at which you want to sell an investment so that you can limit the downside. Sometimes an investment's value drops so fast it skips over a stop-loss order and your SOL.

STRIP BONDS: Bonds have two parts: the capital portion and the coupon portion which reflects the annual interest payments.  Typically strip bonds trade at a discount and mature to par value. The owner of a strip-bond is entitled to the bond's par value at maturity, but not the annual interest payments. Sometimes called zero-coupon bonds.

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OD Privileges Come with Thorns

Here's something thorny to think about: What would you do if your bank suddenly decided to withdraw your overdraft limit? While your bank may have been allowing you to treat your overdraft protection like a line of credit, don't think it'll go on forever.

Overdraft protection is sold to people as a way to ensure that if your account runs dry your debits won't bounce. OD can be useful for people who occasionally get to the end of the money before they get to the end of the month. I recommend it to people who are going through a big change of some kind: moving, divorce, widowhood. With lots of balls in the air, a slip at the bank could happen if you end up not having enough money in your account for a pre-authorized bill. Having OD means no NSF fee because a payment is declined. And if that payment was to your credit card company, your credit history won't get bruised resulting in a lower credit score and higher interest rates.

While overdraft protection is positioned as a big ol' favour the bank is doing you to ensure you don't bruise your credit history, the bank is, in fact, selling you credit. You'll pay for the privilege of using that credit when you run short of your own money both in fees and interest charges.

But make no mistake, the bank considers overdraft protection a privilege, one it can withdraw at a moment's notice.

For a lot of people, having overdraft means they can totally ignore how much money they have in their accounts because OD is their safety net. Some people live in overdraft, treating it like a line of credit and never being on the plus side for months on end. If you're this can of OD abuser, don't be surprised to find your bank accounts frozen because the bank wants its money back and it's not taking "no" for an answer. You won't be able to make deposits, withdraw cash, or write cheques. And the next thing you'll know, your "debt" been sent off to collections for being delinquent.

Can the bank do this?

You betcha buba.

Remember that overdraft agreement you signed? Didn't read it? If you had you'd know that if you stay in overdraft too long banks can suspend your overdraft privileges and freeze everything until you make good. Too long can range from days to up to six months, so every bank is different. And banks can get pretty heavy-handed when they decide to enforce the rules.  They're making the point that overdraft isn't a line of credit. And if you treat it as such, don't be surprised if you get a slap on the wrist.

'Course, if overdraft is only supposed to be a short-term solution to cover the odd misstep, one wonders why a customer would ever need coverage at the limits many banks hand out: up to $10,000. And if OD is only supposed to be a short-term solution, why have banks let so many customers live in overdraft for so long? Could it be the whopping interest and fees – sometime higher than credit card rates – they've been getting?

Don't use your overdraft protection as a license to ignore your cash management. The answer to running into overdraft is not overdraft protection, it is to better manage the money in your account so you don't try to spend cash you don't have.

Get yourself a notebook. When you put money in your account, add it to your balance. When you spend money from your account (be it a cheque, bill payment, a debit card transaction, or a cash withdrawal) deduct that amount from your balance. Keep your eye on the bottom line.

If you think that sounds like too much work, you're a dope. You'd work at least this hard to find where gas is selling for a penny less, or where tuna is two for $1.39, or where wings are all-you-can-eat for $3.99. Staying out of overdraft is one of the best deals going.

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