All posts by Financial Independence Hub

5 Best Apps for Budgeting & Financial Planning

Image by unsplash/Kelly Sikkema

By Devin Partida

Special to Financial Independence Hub

Budgeting is hardly exciting, but it’s key to getting finances under control. However, making a budget and sticking to one isn’t always easy. That’s why we could all use some help now and then.

Consider using budgeting and financial planning apps to maintain disciplinary action. Here are the best budgeting apps on the market.

1. You Need a Budget [YNAB]

YNAB earns a spot on this list because of its proactive budgeting approach. It offers the ability to sync bank accounts, import data, and manually enter transactions.

Once users sign up, they can create a budget and assign each transaction to a purpose. For instance, they might like to use the app for car payments or mortgages.

The app’s goal is to get users one month ahead. That way, they spend money they earned over a month ago. Essentially, the app gives customers a complete budget overhaul. It also provides users with top security to protect their information and gives them additional resources for staying on track.

This app costs US$98.99 per year or $14.99 per month and offers a 34-day free trial. [All figures below are in US$]

2. Goodbudget

Goodbudget has a free version with ads. Or, users can pay for an ad-free version that costs $7 per month or $60 annually.

Goodbudget is a useful budgeting app that allows users to create and stick to budgets – and keep track of their debt to pay it down faster.

In addition, it helps with money management. That way, users know where their funds are and how they perform.

Users also have easy access to their accounts, as they can use them on the web and on multiple phones. In turn, people can easily share their accounts with others and stay financially connected. This is valuable for some, as it prevents miscommunication and mishaps.

The app also syncs each transaction to the cloud. And some reports show the finances in greater detail – as well as pie charts and other updates to track spending.

3. Mint

Mint is another great budgeting app, as it has high ratings in the App Store and Google Play. It’s also free and syncs with various bank accounts, including checking and savings, loans, credit cards, and more.

Mint works by tracking users’ expenses and placing them within budgeting categories. You might have categories of your own ready to go in a spreadsheet. Mint lets users more fully personalize their categories and set limits to maintain their budgets. Once users approach those limits, Mint will notify them within the app. Continue Reading…

 Budget and Stick to it: 18 Steps

Image courtesy Terkel/Pexels Kindel Media

To help you create a budget and stick to it for achieving your financial goals, we’ve gathered advice from 18 professionals, including CEOs, founders, and VPs. From leveraging public accountability to reviewing and adjusting your budget regularly, these experts share their top steps to take for effective budgeting and saving. 

  • Leverage Public Accountability
  • Negotiate Lower Fees
  • Celebrate Budgeting Successes
  • Automate Your Savings
  • Identify Cost-Cutting Opportunities
  • Track Expenses and Income
  • Eliminate Unnecessary Expenses
  • Create a Realistic Budget
  • Prioritize Necessary Expenses
  • Monitor Financial Metrics
  • Automate Savings Consistently
  • Use the 50/30/20 Rule
  • Utilize a Monthly Bill Calendar
  • Limit Online Shopping Access
  • Establish a Purpose and Set Goals
  • Use Cash Stuffing With Discipline
  • Create Organized Sub-Budgets
  • Review and Adjust the Budget Regularly

Leverage Public Accountability

In my personal journey toward financial wellness, one of the most effective strategies I’ve employed is leveraging public accountability to create a budget and stick to it. I started by sharing my financial goals with my circle of trusted friends and family, which made the goals feel more real and tangible. 

Whenever I felt tempted to stray from my budget, the thought of explaining my overspending to them motivated me to resist. In fact, one time I was really close to buying an expensive gadget on a whim, but the idea of having to admit this unnecessary expense to my accountability partners made me rethink, and I decided against it. 

Using public accountability in this way can be a powerful tool to reinforce your commitment to your financial goals, and I encourage you to try it.  Antreas Koutis, Administrative Manager, Financer

Negotiate Lower Fees

One example of a strategy not commonly undertaken when creating a budget is to negotiate lower fees on existing bills such as cable, internet, or cell phone plans. 

As the market becomes increasingly competitive, companies are more likely than ever before to reduce customer bills if they know they may otherwise lose that customer’s business. 

This can lead to significant savings without having to decrease spending on existing items. With the resulting saved money, you can then allocate it towards your financial goals, more easily allowing for what was once considered unattainable! — Carly Hill, Operations Manager, Virtual Holiday Party 

Celebrate Budgeting Successes

Creating a budget and sticking to it, in my opinion, is difficult work. Celebrate your accomplishments along the way. In the long run, I believe that this will make it easier for you to stay on your budget and will help keep you motivated. 

Treat yourself to a small reward if you reach a savings goal or pay off a debt, for example. Just make sure the prize is within your financial constraints! Bruce Mohr, Vice-President, Fair Credit

Automate your Savings

A lot of people tell you to pay yourself first. I think a better approach is to save for yourself first. Set up automatic transfers to your various retirement and savings accounts. That way, the money isn’t just sitting in your checking account and tempting you. 

This works even better when you have high-yield savings accounts and retirement funds that aren’t linked to your main bank account. Spending habits are hard to break, but it can be easier to form new ones if you automate your savings. Temmo Kinoshita, Co-founder, Lindenwood Marketing

Identify Cost-Cutting Opportunities

Of course, the goal of budgeting is to save money, but one step you need to take in order to be successful and reach your financial goals is to look for ways to save. You can do this by reviewing your budget and pinpointing areas where you can cut costs to save money. 

For example, if you find that you spend a lot of money on going out to eat, you can cut down spending here and instead cook your meals, which ultimately will be the cheaper alternative. 

You may also cancel subscriptions you don’t use or negotiate your bills with your service providers to see if you can get a discount. Overall, there are multiple ways to cut down your spending and save money—you just need to figure out which areas you can negotiate or compromise! Bill Lyons, CEO, Griffin Funding

Track Expenses and Income

You can find areas where you might be overspending or where you can reduce expenditures by keeping track of your expenses and income. Additionally, you may utilize this data to make wise decisions on future purchases and investments, ensuring that you are deploying your resources as effectively and efficiently as you can. 

You may keep yourself motivated and on track to accomplish your goals by routinely evaluating your financial accounts and your progress toward them. Additionally, it can assist you in seeing future difficulties or obstacles, enabling you to modify your plan and change the route as necessary.Michael Lees, Chief Marketing Officer, EZLease

Eliminate Unnecessary Expenses

A major problem people have when sticking to a budget is the little purchases they make along the way. Many of us are guilty of ordering takeout after a long day of work, picking up a daily Starbucks order, or wasting groceries. 

While these small purchases may seem innocent enough, they quickly add up and get you off track toward reaching your financial goals. Before making a purchase, ask yourself, do I need this? Or if you need extra motivation, consider how many hours of work it takes you to purchase these daily items. 

By cutting out or at least reducing some of these mundane purchases, you’ll notice your bank account feeling a little healthier and lower stress knowing you have enough money to put towards your financial goals and still pay your bills. Brandon Brown, CEO, GRIN

Create a Realistic Budget

Often, I see people attempting to budget just for the sake of budgeting without considering its implications on their overall lifestyle. If you want to religiously follow your budget, make it realistic. Realistic financial goals will provide you with a head start in creating an achievable and sustainable budget.

Create a budget that takes into account not only your financial goals but also your lifestyle behavior and the situation you are in right now. If you regularly eat out, set aside money for that based on how much you anticipate spending and how much you are willing to spend.

Moreover, don’t make your spending plan too strict. What’s the purpose of working if you can’t occasionally treat yourself to a sumptuous meal or a new pair of boots? After all, you deserve to feel human.

If you don’t make room for the things you want, you’ll eventually give in and ruin your spending plan. Just make sure to plan ahead and remember that the ultimate goal is financial security and independence.Jonathan Merry, Founder, Moneyzine

Prioritize Necessary Expenses

Pay all your bills before buying anything discretionary. When you’re trying to save money, it’s essential to cover all necessary expenses before you try setting money aside. This way, you have a better idea of how much money you have left for casual spending and savings. 

Paying any obligations first allows you to avoid surprise expenses after you’ve already started spending, which in turn helps you avoid having to pull money out of your savings. The best way to stick to your budget is to pay what you need to first. Max Ade, CEO, Pickleheads

Monitor Financial Metrics

Entrepreneurs should track financial metrics to monitor their success. A metric for entrepreneurs to measure is customer lifetime value, which is the total amount of revenue that one customer generates during their entire interactions with the business. 

Monitoring this metric helps entrepreneurs understand how much revenue can be expected from a single customer and what marketing strategies are most effective at keeping them engaged. 

Additionally, tracking customer lifetime value allows entrepreneurs to maximize their returns on investment as they can target customers who spend more money and reward existing customers who have already demonstrated loyalty and commitment.Julia Kelly, Managing Partner, Rigits

Automate Savings Consistently

Automating savings is a surefire way to help you stick to saving money and reaching your financial goals. Too many situations can thwart your best intentions to regularly add to your savings yourself: mainly forgetfulness since an additional task is the last thing anyone needs.

If you don’t automate, you may rationalize not regularly adding to your savings account because of an extra purchase you think you need or deserve. That could snowball into a pattern of doing it less than you initially wanted or not at all.

“Out of sight, out of mind” is an advantage of automating your savings: If you don’t see that money sitting in your checking account, you won’t spend it.

Disabuse yourself of the notion that you need a large amount of money for an automatic savings plan. Start with $5, $10, or $20 at a time. You can increase that by looking for ways to decrease your expenses, such as comparison shopping for your car and home insurance or requesting lower interest rates on credit cards. Michelle Robbins, Licensed Insurance Agent,

Use the 50/30/20 Rule

To create a budget and stick to it, prioritize your expenses and allocate your income with the 50/30/20 rule. This rule suggests that 50% of your income should go towards necessities like rent, utilities, and groceries, 30% should go towards discretionary spending such as dining out and entertainment, and 20% should go towards saving and paying off debt.  Continue Reading…

How much do you need to retire early at age 40, 45, 50 or 55?

By Bob Lai, Tawcan

Special to Financial Independence Hub

It’s never too early to start looking forward. I’ve been doing this on my site for some time and doing a bunch of assumptions and simulations on what our financial independence retire early might look like.

I also have interviewed many Canadians who are financially independent and/or retired early in my FIRE Canada Interviews.

Having some plans on your hands is better than no plans at all. Furthermore, having some quantitative targets available will allow you to set up different financial milestones and goals each year. Doing so will help you to stay focused and work your way to achieve them.

If you aspire to retire or semi-retire earlier than most people, how much do you need to retire early at age 40, 45, 50 or 55? Thanks to my friends at Cashflows & Portfolios, I have that answer today.

‘Traditional’ retirement vs. the ‘new’ retirement

For those not familiar with Cashflows & Portfolios, it’s a site started by two long time Canadian bloggers, Mark and Joe. Mark runs My Own Advisor, which I started reading before I started this blog. Joe was the brain behind Million Dollar Journey, which I have been following for over a decade.

All three of us believe we need to retire the term: retirement. To be more specific, we believe it’s time to change the ‘traditional’ definition of retirement. It is also important to make sure you know what you’re retiring to. 

Back in the day, when you turned 60 or 65, and once you had grown tired of working by already clocking decades of company time – trading those years in the workplace for your workplace pension to supplement income for your senior years.

Well, workplace pensions are dwindling and more and more, pursuing retirement in any traditional sense seems rather unhealthy today. A traditional retirement can be unhealthy physically, emotionally and financially.

On a physical level, retirement has traditionally meant a decrease in activity. You no longer have a driving reason to get out of bed in the morning, grab a coffee and get to the office – so you take it easier. That may not be beneficial to your wellness and based on my personal fitness experiences, not something that appeals to me.

On an emotional level, retirement for some could lead to social isolation. Potentially, you’ve identified and linked your self-worth to your organization, your co-workers and your manager.

Retirement means you’re leaving your workplace but the organization will undoubtedly continue to work without you being there. Unfortunately, life just works that way; it doesn’t stop for anyone. So, I believe it’s important to maintain a modest level of stimulation at any age, including retirement.

Not remaining socially engaged with other people in retirement could lead to mental health struggles.

Finally, retirement is not cheap, financially. Unless you have a workplace pension (and let’s face it, many Canadians don’t, me included!), you’ll need to rely on your disciplined, multi-decade savings rate to maximize your retirement income stream at age 40, 45, 50 or 55 – by giving up your regular paycheque.

Sure, while there are other retirement income streams to enjoy eventually, like Canada Pension Plan (CPP) and Old Age Security (OAS), many readers of this blog probably don’t want to wait until ages 60 or 65 to tap those income streams respectively.

Let’s get one point straight, it’s a privilege to be able to retire early at age 40, 45, 50 or 55. Early retirement isn’t for everyone and those who can “retire” early typically enjoy some sort of privileges in their lives. Such privileges need to be highlighted more within the FIRE community.

The reality is that you do need to have a certain level of income to build up enough assets by your 40s so your portfolio can withstand some drawdowns in the subsequent decades. A relatively high savings rate combined with a certain level of income will help and is in my opinion crucial. Continue Reading…

How to Live Life to the Fullest when you don’t have a Lot of Money

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By Beau Peters

Special to Financial Independence Hub

They say that money doesn’t buy happiness. But when funds are tight it sure can feel as though life is a little constrained. You may constantly feel as though you’re missing out on opportunities or fun events.

Learning to live within your means is a hard lesson, but many people who achieve it never feel as though they are going without. In fact, most have found ways to live their lives to the absolute fullest. Sometimes all that is required is a change of perspective or a minor reorientation of values.

It may come as somewhat of a surprise, but having a great and fulfilling life often isn’t tied to how much money you make or the fancy things you’re able to spend it on. Some of the most important things that really make life worth living don’t cost much and many come for free.

Improve Life, Save Money

Entertainment can be one of the draining items on your budget. A couple drinks with co-workers after work one night, going to a show with a gal pal another, maybe paying for tickets to the big game the next. It seems like everything fun costs money and over the course of a week or a month that really adds up.

But not all hobbies have to cost a lot of money, or really any money at all. Rather than grabbing drinks after work, you can invite people over to your house to hang out around the fire pit and have a potluck-style barbeque. Or instead of going to a show with a friend, you strive to attend free local events like music in the park, farmers’ markets, or explore new neighborhoods. Maybe instead of paying for a ticket to the big game, you can invite your friends to a tailgate in the parking lot. Continue Reading…

Checking in on our U.S. stocks

By Dale Roberts, cutthecrapinvesting

Special to Financial Independence Hub

Eight years ago, I bought 15 U.S. dividend growth stocks as a real-life portfolio demonstration. More than a demonstration, it was the total value of our U.S. holdings in our retirement accounts. The strategy was to create a more defensive and retirement-ready portfolio. The portfolio slants to quality, profitability and business moats. The 15 stocks were added to three companies that were already held – we’ll call those stock picks. The portfolio mix beat the S&P 500 by 3.2% annual while delivering better risk-adjusted returns.

Here’s the link to my recent Seeking Alpha article – the dividend growth portfolio 8 years later. You might be able to get one of three free reads for that post on Seeking Alpha. But just in case you can’t I will share a few of the key details.

And keep in mind the post and stocks that I mention is not advice. Do your own research, and know why you do what you do.

The U.S. dividend growth, plus picks portfolio

I sold my VIG, and purchased 15 individual holdings from the top 20-25 of the index. The 15 companies that I added are 3M (MMM), Pepsi (PEP), CVS Health Corporation (CVS), Walmart (WMT), Johnson & Johnson (JNJ), Qualcomm (QCOM), United Technologies (UTX), Lowe’s (LOW), Walgreens Boots Alliance (WBA), Medtronic (MDT), Nike (NKE), Abbott Labs (ABT), Colgate-Palmolive (CL), Texas Instruments (TXN) and Microsoft (MSFT).

I also have 3 U.S. stock picks by way of Apple (AAPL), Berkshire Hathaway (BRK.B), and BlackRock (BLK). For the record, these stocks are held in my wife’s accounts and my own accounts.

United Technologies merged with Raytheon (RTX) and then spun off Carrier Global Corporation (CARR) and Otis Worldwide (OTIS). We continue to hold all three and they have been wonderful additions to the portfolio. In fact, from the time of the spin-off, the 3 stocks have greatly outperformed the market (IVV) and the dividend achievers. Given that the United Technology stocks are not available for evaluation from 2015, I have run the performance update with the remaining 14 dividend achievers. Continue Reading…