Give Me Back My Five Bucks

Q2 Review: 2012 Goals

The year is half over, and I can’t believe it! Things haven’t gone completely as planned over the past 6 months, but I’m happy and looking forward to what the rest of the year has in store.

Financial

  • Earn $70,000. In order to make this goal, at the end of Q2, I needed to be at the $35,000 mark, and I currently sit at around $27,000. :| Most bloggers have suffered from a significant decrease in advertising income, and I’ve felt that as well. Although, most of my freelance income is from writing, so I’m still on pace to make over $50,000 this year (which I think is pretty decent for my first year as a freelancer), and I anticipate that things will pick up by the end of the summer.

Personal

  • Travel. By the end of the year, we will have visited about 20 different countries in Europe. I don’t know how to express how extremely grateful I am to have this kind of opportunity. It actually makes me feel really spoiled.
  • Go on a trip by myself. CHECK! I’m headed to Ireland, Scotland and Iceland on a solo trip at the end of August. Plus, I’ll be headed to Toronto for CPFC12 in September, but I can’t really count that because I’ll be surrounded by a bunch of PF bloggers. :)
  • Learn basic German and French. I still need to have my boyfriend teach me French. I understand some French if people talk slowly… and I have the basics of reading and writing… but I can’t have a real conversation with anyone. As for my German, I am currently learning pronunciation through my German-English phrase book, and online tutorials.
  • Read 12 novels not related to marketing or personal finance. CHECK! So far this year, I’ve read 37 books! The long train rides are perfect for reading, and I’ve always been one of those people to go without sleep in order to finish a book. :) I’ve also joined the website GoodReads, so if you’re on that website too, feel free to add me!

Professional

  • 2012 Canadian Personal Finance Conference. There conference is SOLD OUT! Our sponsors are in place, the speaker list is looking amazing, we have a wonderful venue, and I’m really, really excited to finally have all of Canada’s top personal finance names under one roof.
  • Write one guest post each month on another blog. FAIL. I’ve only gotten around to writing one guest post, and that was really just in interview-style. I’ve already got so much on my plate at the moment, plus I’m trying to work on another website, which has priority over writing guest posts.
  • Take all of my own photographs. So far I’ve been able to do this. It hasn’t been easy, but I plan on setting up a photo shoot sometime soon.
  • Post a new photo every day while abroad via Tumblr. Because I didn’t think you guys would want to be bombarded by a million photos of Europe while I’m gone, I decided to create a Tumblr account instead. I’ve been posting new photos every day, although sometimes I get a little behind. I’m also posting pictures via my Pinterest account.
  • Take on three steady freelance assignments. I have three ongoing assignments, but my income isn’t steady. Some months I will have a full load of assignments, and other months I’ll only have half the work. It’s weird, but I don’t mind. That’s the way freelancing goes, I guess!

Five months as a freelancer

Well, I’ve been a full-time freelancer for the past five months, and it’s been a really good learning experience. While I am not on target to hit my $70,000 income goal for the year (I’m sitting at hitting around $55,000), I’m still making an average hourly salary of $56.58. Here’s how:

In the last five months, I’ve worked a total of 81 days – or an average of 16.2 days per month. This is due to travel, holidays, etc. Each of those 81 days I worked, I probably spent 6 hours actually working. Because we don’t have internet at home, I have to do all my personal stuff on the internet (e-mailing, reading the news, travel planning, uploading photos, etc.) during the days.

81 days x 6 hours = 486 hours worked

$27,500 / 486 = $56.58/hour

Now, that’s not to say that if I increased my hours worked, my hourly wage would stay the same. Realistically, it would go down. And I think that even if I was working a normal 35-40 hour/week, I wouldn’t be able to keep pace with my $70,000 target. Most bloggers have been hit pretty hard with advertisers disappearing this year, and I’ve felt it too. The advertising income I was earning last year has been slashed in half this year. That being said, the majority of the income I make is from writing, so I haven’t had it as bad as others.

As a freelance graphic designer, my rates would range from $45-60/hour, so with the workload and advertisers that I have right now, I’m comfortably within how I’ve previously valued my time. Yet, there are freelancers in the PF world that are making double, quadruple what I’m making per hour, and more. So even though my hourly wage is double what I used to make at my FT job, I’m just an average blogger making an average income.

But I know I could be working harder. I’m working an average of 6 hours a day? Considering I used to work 12-14 hours a day not too long ago, I feel almost ashamed. My evenings could be spent working on side projects that I’ve, well, pushed to the side. I could be pitching myself more, and I could be writing more. But it’s hard to work at a coffee shop or a library for more than 8 hours a day, and we’ve tried the mobile internet stick in our apartment (the reception is terrible). So even though I thought I’d be working 12+ hours/day like I used to, I’m somewhat content with the situation I have right now.

Heading into the fall, our travel schedule will be slowing down quite a bit, so I will most likely bump up my hours worked to a more traditional 8-10 hours/day.

How to tell if it’s time to switch banks

Switching banks can be a huge hassle, which is probably why we rarely do it unless absolutely necessary. Sometimes we leave due to poor customer service, and other times it comes down to dollars and cents. Although, I know so many people who hate their bank, but because it actually requires doing something to make a change, they never do.

Some people remain loyal to their bank for life (like my parents), but with so many different financial institutions available to you, there is absolutely no need to stay if you don’t think you’re getting the service you deserve, and at the price you want to pay! Banks are a business, and you should always be on the lookout for the best deal possible.

Here are a few things to consider when choosing a new bank:

Bank fees

If you’re paying bank fees for a service that can be obtained for free somewhere else – like monthly account fees, debit card transaction fees, cheque ordering, or other miscellaneous banking charges – it might make sense to start thinking about leaving your bank.

Up until I graduated college, I did all of my banking at TD Canada Trust. Because I was a student, my chequing account was free, and I had basic services like a savings account, line of credit, and a visa card. It wasn’t until I graduated that I learned I would need to start paying $12.95/month for my chequing account.

However, most financial institutions that charge a fee for their chequing account will usually waive the cost if you keep a minimum monthly balance. For example, TD would waive the $12.95 fee if I kept a minimum of $3,000 in my account at all times. But as a recent graduate, I didn’t (and still don’t) have an extra $3,000 that I can have siting in an account not earning interest. Granted, interest in savings accounts are minimal right now, but something is better than nothing.

So, desperate to avoid paying banking fees, I moved over to PC Financial‘s free unlimited chequing account. That was over 5 years ago, and I have saved over $775 in banking fees alone just by making the simple switch. Since then, I have also opened up a second chequing account with ING Direct. ING offers things that PC doesn’t offer, so when I need to utilize those services, I initiate a free money transfer, and use ING instead. (If you have yet to sign up for ING Direct, consider using my Orange Key for a $25 bonus: 30874855S1)

Customer service

When you put your hard earned money into the hands of a financial institution, you have to be able to trust them. Whether it’s a bad experience with one particular employee, a pattern of poor customer service, or unacceptably long telephone hold times every time you call in, if you aren’t comfortable using their services, it’s time to take your money and run. The runaround I got with TD Canada Trust last year was one of the worst customer service experiences of my life. Nobody knew how to help me, I kept getting passed back and forth between customer service and the branch – and nobody once offered me a solution.

Social Media

I’ve actually proactively opened up an account with a bank because of their actions through social media. ING Direct is a great example of a company that gets how to market their financial products to those engaged through social media. They understand that in order to gain the trust of potential customers online, they have to become part of the conversation and part of the community. Because of their terrific customer service and social media influence, I now have a chequing account, three savings accounts, and a TFSA account with them.

Convenience

If your bank is not conveniently located, it makes perfect sense to switch to one that is. Perhaps you first chose your current bank because it was closest to your house. But over the years, you’ve moved to an area with no branch close by.

Convenience can also vary between distance to your nearest branch, to the services offered by the bank itself. If you need business accounts, 24-hour ATM access, online banking, mobile apps, or more personalized service, finding a bank that fits your needs is crucial. Sometimes we can get so stuck in a routine that we forget there are other options available out there that will help us increase our daily productivity and lower our frustration levels.

Interest rates

When you deposit your money into a savings account with a low interest rate, you are potentially losing out on free money. TD Canada Trust’s Every Day Savings Account earns 0.25% for balances up to $5,000 (0.50% for anything above that), and their “High Interest” Savings Account earns 0% for anything under $5,000. Meanwhile, ING Direct offers 1.35% with no minimum balance required.

Once I was speaking with a friend who had about $4,000 in a “savings” account that offered 0.05% interest. Yes, you read that correctly. 0.05%. I asked why she didn’t move her money to a bank with a higher interest rate (at that time, PC Financial was offering 4% interest), and she replied by saying “I don’t need the money.” Um, what? The comment just destroyed me. Apparently I found the one person in the world who doesn’t like free money. :)

Why you shouldn’t switch banks

While it’s a good idea to do research and know what other banks are offering, you might find that what you currently have works for you. Additionally, you should always ask your current bank what they can offer you to keep your business. A major benefit of staying with a bank is maintaining a long account history. Sometimes it’s easier to get what you need – like a loan – when the bank can see that you have a long-term account that is in good standing.

I personally have absolutely no loyalty when it comes to banks, and have accounts with PC Financial (chequing/savings/TFSA/credit card), ING Direct (chequing/savings/TFSA), TD Canada Trust (line of credit/RRSP/TFSA), VanCity Credit Union (mortgage), and CIBC (credit card). It all comes down to dollars and cents to me, and it’s worth the hassle of switching banks every few years if it means that I’m getting the most for my  money.

What are some of the reasons you’ve switched banks for?

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A beginner's guide for Canadians looking to get their financial life in order. Get great info on budgeting and saving, RRSP's and pensions, investing types, insurance, and where to go for additional resources.

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