An Interac survey being released today finds that more than two thirds (69%) of Canada’s Gen Z generation [defined as Canadians aged 18 to 27] have embraced the mobile wallet, while almost as many (63%) would rather leave their old-fashioned physical wallets at home for short trips. Gen Z’s Interac contactless mobile purchases also rose 27% in the first half of 2024, compared to the same period a year earlier.
Gen Z appears to be more enthusiastic than their counterparts in older cohorts: 60% of Millennials [aged 28-43] embraced mobile wallets, compared to 44% of Gen Xers [aged 44-59] and just 27% of Baby Boomers [aged 60-78.] Only 10% of the older Silent Generation [age 79 or older] did so.
A whopping 63% of Gen Z mobile wallet users have loaded their Interac debit card on their smartphones, and 31% plan to set debit as their default method of payment. For 63% of them, the reason is perceived faster payment times compared to physical card payments.
“Choosing your default payment method may feel like a small step, but it can play a big role in shaping Canadians’ ongoing spending habits,” said Glenn Wolff, Group Head and Chief Client Officer, Interac in a press release. “When consumers tap to pay with their phones, the decision to select a card from the digital wallet is easy to miss. Canadians could end up unintentionally using a default payment method that prompts them to take on more debt. This differs from traditional physical wallets where the consumer had to select the card they wanted to use each time.”
Majority want to be smarter with money
62% of Gen Z want to be “more mindful when spending” with 57% saying they want the option to use debit when paying in store or online; 79% of them say the cost of living is too expensive and 59% feel the need to be smarter with their money.
Interact says this generation’s desire to control overspending is heightened by back-to-school season: last year, family clothing stores saw almost twice as many Interac Debit mobile purchases in September and October compared to earlier that year in January and February. 54% of Gen Zs see the need to develop new habits to stay in control over their finances, while 56% are setting a timeline for this September to introduce new habits. Continue Reading…
Years of capital appreciation due to decades of compounding and proper money management has paid handsomely in the growth of our net worth and financial wellbeing. Now, 33 years later, do we still need to be diligent in monitoring our spending and outflows, or is now the time to seize the day and go first class? Eat in trendy restaurants, be seen and show off our wealth?
This is definitely not our style …
Flying under the radar living abohemian lifestyle is more like us, and we’re still herelivin’ the dream.
In fact, some family members and friends consider us “poor” as compared to their consumer-based standards. That’s fine with us. We have not owned a car for years and we tend to live in foreign countries where we can geographically arbitrage value for money spent. We prefer experiencing cultures and cuisine as compared to a shiny new car, club membership and debt payments.
We are just trying to make it to Friday
There are many ways to live a life, and our choice is unique to us. It’s a lifestyle not a vacation and our approach is one that we created based on our personal values and interests.
We now use more private drivers than chicken buses, stay in pricier hotels (not always a better choice), and we’ve set up a stable, semi-permanent home base in Chapala, Mexico.
We donate freely, giving our time and money, helping others less fortunate, as well as teaching people better money management and life skills.
There are needs everywhere and we do our best to contribute. As always, we want results rather than throwing money at a problem to feel good and brag about it.
Checking back in with the 4% rule, we took a look at what that number would be for us today and both of us asked “How would increasing our spending to that amount change our lives?” Granted, it’s not Bill Gates’ level, but how much more can we eat, drink, travel, be merry and give away?
But that’s us.
What about you?
Is it time for you to flip the switch from saving and being frugal for your future – to enjoying a higher standard of living and giving back to the community?
Below are a couple of suggestions which might clarify this question for you.
Know where you are
Life circumstances change.
None of us know our exit date from this planet. As each day passes, we are one day closer to the end of our adventure. But you could check some actuarial tables to see where you stand in general. We are not saying throw caution to the wind and start “X-ing” out days on your calendar. Rather, utilize this bit of information to get a clearer picture of where you might be.
Imagine if you knew your Date of Death. Would that change your spending habits or the way you live?
Other thoughts
Have you or your spouse had an awakening in regards to health? Do you want to open a foundation that produces results and wealth? Begin a new business or leave a particularly handsome legacy for your grandchildren? Continue Reading…
To help you on your journey towards financial independence, we’ve gathered 15 frugal living tips from financial advisors, founders, and other professionals.
From delaying big-ticket purchases, to asking for deals to save money, these experts share their best practices for frugality and financial independence.
Delay Big-Ticket Purchases
Master Budgeting and Tracking Spending
Align Budget with Personal Values
Plan Meals to Control Food Budget
Distinguish Between Needs and Wants
Prepare Lunch at Home for Savings
Leverage “Stoozing” for Mortgage Savings
Track Expenses for Financial Insight
Eliminate Unnecessary Subscriptions
Use Technology for Financial Management
Prioritize Spending with Budget Tracking
Cut Expenses from Seldom-Used Subscriptions
Invest in Experiences, Not Impulse Buys
Wait a Month Before Impulse Buying
Ask for Deals to Save Money
Delay Big-Ticket Purchases
When climbing the pay ladder, I purposefully delayed purchasing big-ticket items such as a newer or more expensive home, car, or luxury item. When I review my spending in detail, I’ve found it typically isn’t an $8 latte (or several of them) that puts me over the discretionary-spending edge, but rather something like a luxury handbag that I felt I deserved at the time, yet doesn’t bring me sustained happiness.
That is to say, in hindsight, it would feel better to see my investment portfolio increase than to have a closet of designer wares. It’s important to build a budget for yourself, but equally or more important, to reconcile your past spending and decide whether to make an adjustment to the budget or your spending to be more accurate moving forward. — Morgan Jarod, Financial Advisor, Royal Private Wealth
Master Budgeting and Tracking Spending
There are many clever ways to cut expenses or generate extra income, but there is no replacement for the discipline of budgeting. A budget is the daily application of your long-term goals. It serves as a compass for your financial journey, making sure you are consistently moving towards your destination.
There are two parts to every great budget: planning and tracking. First, you need to write out a plan for how you are going to spend every dollar of income you will earn in a given month. Then, you need to track your spending to ensure you are following your plan.
It would amaze most people at how much progress they can make toward their financial goals by simply using a budget to align their spending with their goals.
Luckily, becoming a master budgeter is easier today than it has ever been thanks to several budgeting apps that make the process simple and convenient.
When meeting with someone serious about their financial goals, the first recommendation is almost always a budget. — Ty Johnson, Financial Planner, Peak Financial Management
Align Budget with Personal Values
Review your budget so that it aligns with your values, not what society tells you to value. Many of us get trapped in consumerism and in looking the part. Society tells us that, in order to prove that you are wealthy, you must have an expensive car, home, and wardrobe.
What happens if you value none of those things? You spend more money than necessary, proving you have money. Look at your expenses. Do they truly align with what you care about? If they don’t, change it and be free. — Tremaine Wills, MBA, CFEI, Financial Planner | Investment Advisor, Mind Over Money
Plan Meals to Control Food Budget
Plan your meals for the week on the weekend before. Make your grocery list from your established menu. This habit keeps you from buying groceries you don’t need and helps avoid the late-afternoon query, “What should I make for dinner tonight?” that often ends up with something quick and less healthy, or convenient but more expensive.
Additionally, planning out your menu helps maintain variety. In our home, we have an outline we tend to follow: Sunday’s meal has pork; Monday tends to be a hearty soup or salad; Tuesday is “Breakfast for dinner” (egg bake, blueberry crepes, etc.); Wednesday is a chicken dish; Thursday’s dinner has fish or sausage as a base ingredient; Friday is Pizza night (make yourself or order out), and Saturday is a beef dish. — Keith Piscitello, Certified Financial Planner, S2 Wealth Planning
Distinguish between Needs and Wants
Frugality is about mindset and intentionality more than deprivation. One of the most impactful practices for me has been to shift my mindset around needs versus wants. It’s easy to fall into the trap of feeling like we “need” the latest technology, furniture, clothes, cars, etc. But most of these are simply wants. Focusing on true needs — food, shelter, basic clothing, transportation to work — frees up a lot of money.
I ask myself, “Do I really need this, or just want it? Will this purchase add value and enjoyment to my life, or am I buying it just to have it?” Distinguishing needs from wants has allowed me to dramatically cut discretionary spending. I buy very few material items now, and focus my time and money on experiences, relationships, and personal growth. — Brian Meiggs, Founder, My Millennial Guide
Prepare Lunch at Home for Savings
Wherever possible, prep your lunch at home if you’re eating at the office or somewhere other than your home. Over the course of a month, the savings really stack up! This could be as easy as batch-cooking at the weekends, ready for the week, or just making a homemade sandwich in the morning. — Jordan White, Financial Planner, A Money Thing Happened
Leverage “Stoozing” for Mortgage Savings
In financial strategies, one unique money-saving hack I’ve employed is using an offset mortgage combined with savings. This approach, popularly known in England as “Stoozing,” can significantly reduce monthly mortgage payments.
Stoozing involves utilizing the funds from 0%-interest credit-card offers. Instead of spending this money, one deposits it into a bank account linked to an offset mortgage. This approach effectively reduces the mortgage balance temporarily, leading to significant savings on mortgage interest.
As the 0% period on the credit card nears its end, the “stoozer” then pays off the credit card using the deposited funds, having benefited from reduced mortgage costs in the interim. At one point, I had over £100,000 on credit cards, but this was sitting in my bank account, significantly reducing the interest payments on my mortgage. It accelerated my financial independence by at least 10 years. — Shane McEvoy, MD, Flycast Media
Track Expenses for Financial Insight
As a wealth-management specialist, one frugal-living tip I recommend to new clients is to track and record all your expenses. While this may seem time-consuming, it’s a great way to gain insight into where you are spending your money and how much you’re actually saving each month.
Making sure you can see exactly where your money goes will help keep it in check and prevent impulse purchases that add up quickly. This is especially important when trying to reach financial independence because every dollar saved means more freedom for the future. — Adam Fayed, CEO, AdamFayed.com
Eliminate Unnecessary Subscriptions
Getting rid of subscriptions and simplifying my monthly budget has played a significant role in speeding up my journey towards financial independence.
Subscriptions might seem harmless, but the costs can really sneak up on you if you’re not careful. For years, I was paying over $100 a month for cable. I also was spending $50 on various streaming services, had an expensive gym membership, and would occasionally try services like meal delivery kits. And I hadn’t negotiated my Internet or phone bills in years.
One day, I realized I was spending well over $350 per month on these services, some of which I wasn’t using. I cut cable out completely, got a cheaper phone plan, and moved to a more affordable gym near me. I also scrapped the meal delivery kits and just cook myself now. This saves me $200+ a month easily, and it hasn’t impacted my quality of life.
I suggest other people take a look at their monthly spending to find sneaky recurring charges they can trim quickly. — Tom Blake, Founder, This Online WorldContinue Reading…
There aren’t many financial gurus willing to call out financial companies by name for their bad behaviour, but Ramit Sethi is one of them. In his book I Will Teach You to be Rich, he promises “a 6-week program that works,” and he includes advice on which banks to use and which to avoid.
The book is aimed at American Millennials; Canadians will learn useful lessons as well, but much of the specific advice would have to be translated to Canadian laws, banking system, and account types. The book’s style is irreverent, which helps to keep the pages turning.
It may seem impossible to fix a person’s finances in only 6 weeks, but this is how long Sethi says it will take to lay the groundwork for a solid plan and automate it with the right bank accounts and periodic transfers. The execution of the plan (e.g., eliminating debt or building savings) will take much longer.
Sethi is rare in the financial world because he will say what he really thinks about banks. “I hate Wells Fargo and Bank of America.” “These banks are pieces of shit. They rip you off, charge near-extortionate fees, and use deceptive practices to beat down the average consumer. Nobody will speak up against them because everyone in the financial world wants to strike a deal with them. I have zero interest in deals with these banks.” For the banks he does recommend, “I make no money from these recommendations. I just want you to avoid getting ripped off.”
People have many reasons why they can’t save and are in debt, but Sethi sees them as just excuses in most cases. “I don’t have a lot of sympathy for people who complain about their situation in life but do nothing about it.” “Cynics don’t want results; they want an excuse to not take action.” He urges readers to “put the excuses aside” and get on with the business of making positive changes.
The Program
The first step in the program is to “Optimize Your Credit Cards.” I found it interesting that Sethi focused on credit card perks before he covered eliminating credit card debt. He wants readers to “play offense by using credit cards responsibly and getting as many benefits out of them as possible” instead of “playing defense and avoiding credit cards altogether.” This approach sets him apart from many other experts on getting out of debt. While he does teach methods of eliminating debt, his focus is more on building wealth steadily.
The second step is to open “high-interest, low-hassle accounts.” Interestingly, he wants readers to open a chequing account at one bank and a savings account at another bank. Among his reasons are that the psychology of a separation between accounts makes us less likely to raid savings. Some might think opening a savings account is pointless if they have no money to deposit, but Sethi insists that you need to lay the groundwork now for a better future, even if you’ve only got $50 to deposit.
The third step is opening investment accounts. The author favours very simple investments, such as a Vanguard mutual fund account invested in a target date fund. “Don’t get fooled by smooth-talking salespeople: You can easily manage your investment account by yourself.” Unfortunately, Vanguard mutual funds are only available to Americans. Canadians can find one-fund solutions with certain Exchange-Traded Funds (ETFs).
To create the cash flow to reduce debt and invest, the fourth step is about “conscious spending,” which is “cutting costs mercilessly on the things you don’t love, but spending extravagantly on the things you do.” Achieving this involves tracking spending in different categories, but not traditional budgeting. Continue Reading…
Navigating the financial challenges of saving for a home while starting a family can be daunting.
To help you find a balance, we’ve gathered ten insightful tips from CEOs, business owners, and financial experts.
From creating a realistic family budget to exercising patience and smart spending, let’s explore these strategies to help you achieve your financial goals.
Create a Realistic Family Budget
Leverage First-Time Homebuyer Programs
Reevaluate Spending Habits
Establish Separate Accounts for Goals
Prioritize Consistent Savings and Budgeting
Consider the “House Hacking” Strategy
Avoid Lifestyle Creep, Automate Savings
Trim Expenses, Seek Additional Income
Explore Alternative Homeownership Strategies
Exercise Patience and Smart Spending
Create a Realistic Family Budget
My top tip for balancing the financial goal of saving for a home while starting a family is to create a realistic budget. Take the time to review your current budget and account for earnings, current expenses, and estimates for future expenses. Kids are expensive: they can cost $20k or more in the first year alone.
Your priority is to keep your kid safe, fed, and loved. Kids don’t care if you’re a homeowner. Once you have a good sense of what you’re doing with your money each month, put aside a reasonable amount each month to save for your home.
If you’re a few months out from buying, consider investing the funds in something with a fixed interest rate, such as a CD. It’s safer than investing in the stock market and has a higher return than most savings accounts. — Jeremy Grant, Founder and CEO, Knocked-up Money
Leverage First-Time Homebuyer Programs
First-time homebuyer programs are designed to make homeownership more affordable and accessible. These programs provide benefits like down payment assistance, lower interest rates, or reduced closing costs.
Research and identify the programs available in your area, offered by government entities or local financial institutions. Eligibility criteria may include income limits or credit score requirements, but many programs have flexible guidelines. If it all seems overwhelming, work with a knowledgeable mortgage lender or loan officer to navigate these programs effectively. — Mike Roberts, Co-founder, City Creek Mortgage
Reevaluate Spending Habits
Sit down and have a priorities conversation. Are you spending a lot of money in areas that don’t actually make you happy, just because you’ve always had the income to afford it? Just because you can, doesn’t mean you should.
Of the three to four things you spend lavishly on, what if you kept only one of those things — whichever makes you very happy to spend lavishly on it — and you downgraded the rest?
Every family can find at least one area of money being spent every month that doesn’t nearly matter that much to them but has become a habit. Which ones bring you true joy, and which ones have just become “the way we do it”? — Alex Boyd, Owner, Mindfully Investing
Establish Separate Accounts for Goals
The one tip I recommend for balancing the financial goals of saving for a home while starting a family is to have different accounts for each goal. I started doing this after reading The Richest Man in Babylon.
I started by saving 10% of my income, then divided everything else to pay for household bills and debts. After a few months, I increased this amount to 12%, then 15%, until I hit 35%. Continue Reading…
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