Churned: Scotiabank Scene Visa

Welcome back to The Fake Cheap.  It feels good to get back into the blog, I think I last posted in February, but who is counting?  I thought I would add another cc (that’s credit card for anyone not fluent in personal finance) churn, especially since my first churn article seems to also be my most popular post ‘round here. Hopefully someone got that Counting Crowns reference?

Anyway, yes I churned the Scotiabank Scence Visa as the title says, and it did take a while for the plastic to melt down and turn to a delicious fatty tasting butter…ok, so what I actually did for this churn was to sign up for the card, strictly for the sign up bonus, which was enough scene points for 5 free movies!!!  I know, I couldn’t believe it either.  These 5 free movies have a value of about what, $60-$70, I think it’s about $12-$13 per movie ticket these days, well for a “normal” ticket without the shaking seat and the smells,or whatever else they have added now.  Some of you might be thinking who would waste all this time for about $60 bucks?  (Especially any Americans reading, and out of the thousands reading, I’m sure someone is American, our sign up bonuses here in Canada are really just a fraction of what is offered to you)  First I would say, it really took very little time, (less time than writing this article) and second I would say it took me about 30 minutes, so $60 tax free, for 30 minutes of work?  Yes please.  Maybe some of you are underwhelmed at this, because there are better offers out there, and there are, but I felt like hitting this one, plus some offers are better at other times, so you have to time it right because some of the sign up bonuses you can only get once, like the a fore mentioned TD Aeroplan visa I do believe.

So this churn went pretty well, I signed up for the card, it arrived, I believe the scene points were awarded on my first statement, after my first purchase, no dollar amount attached, so that was nice.  Normally you have to spend like $500 over 3 months or something like that, but this was like, nope, buy something..anything, and slap it on this card and BAM!! 5 free movies…on the next statement.  So that was a piece of cake.  Another nice thing about the reward being scene points, is that you could probably cancel the card immediately after you get awarded the points, and since scene points are separate from the cc, you probably wouldn’t have any issue.  What I did was actually held on to the card for a bit, and then cancel it, which was also no real hassle, I just called the number on the back of the card, and said I would like to cancel, and they were like “ok”, I don’t even think they tried to get me to stick around.  And that was it, a quick application for the card, a call activate the card, and a call to cancel the card, maybe 30 minutes work.

How do you get to qualify for these credit cards?   Well you need decent, credit, not even  good credit.  How do you get decent credit?  By following my blog! Pay your bills on time, don’t rack up debt, put something on a credit card once in a while, pay it ALL off  each month so you don’t pay any interest, and you WILL qualify for most of these offers.  Credit isn’t something I’ve spoken much about, but I assure you, there are many other great PF blogs around, maybe check out my blog roll up there on the right, that do discuss credit, and I hope to touch on it more in the future.  You can also get your credit report via Equifax or TransUnion, for free once per year I believe, but ask them, not me.  It should also be noted that if you tend to max out credit cards quickly, then churning likely isn’t for you.  If you end up paying interest on a thousand dollars or two you’ve racked up on the card, any sign up bonus “profit” will be eaten up by the interest quite quickly.

Remember, always be ready to churn, or else let that cash burn!

Save HUNDREDS of Dollars Over Your Lifetime by Doing This

The scanning code of practice.  Ever heard of it?  Like most people probably not.  But you NEED to know what this is.

You know how annoying it is when you go to buy something that you think is $7.99, but then it scans at the cash as $9.99, then you have to have point it out to the cashier (it’s not his/her fault by the way that the price came up wrong, they are just scanning bar codes, so don’t be a jackass during this process.)  that the item should be $7.99?  Then usually someone verifies the price, and says “Yes, it’s marked as $7.99.” So then the cashier makes the change and you get your item for $7.99, right?  WRONG.  You get that item for FREE.  That is correct, for NOTHING.  Well you do if the store follows the “Scanning Code of Practice” as per the good people at the Retail Council of Canada.  And you know who follows the Scanning Code of Practice?  Just about every major retailer, Wal-Mart, Home Depot, Canadian Tire, Loblaw’s (Superstore) and even Costco, check the link for a complete listing.

To add a bit more clarification, if your item scans more, and the item you are buying is $10 or less, you get that item for FREE.  If the item is over $10, then you get $10 off that item, so your $12.99 purchase that came up at $14.99, will be $4.99 after the adjustment.  If you happen to be buying multiple items that scanned incorrectly, then the discount applies to the first item only.  Follow my link above if you want other details, but the examples above are the most common occurrences. And let me tell you, the occurrences can be common, depending where you shop.  I’m not big on calling out the stores which screw up their prices the most since I fear highly paid corporate lawyers who might be looking for something to do, but two really jump out in my mind, one being a large well known pharmacy based store, and another a department store retailer.  Now anytime I go to these places, you bet I’m taking extra time to check the prices on the shelf and match them up with my receipt.  I would estimate that the department store has an inaccurate price about 40-50% of the time, staggering indeed, and the pharmacy store 10-20% of the time.   I am going to take a moment to call out two stores where you can likely save yourself some time, and just stuff the receipt right in your pocket, because I would wager my first born what you were charged was 100% accurate: Wal-Mart and Superstore, I’ve never personally had a scanning error from either of these stores, I don’t shop at Wal-Mart often, and Superstore has been my regular choice for groceries for a few years, so it is very impressive they’ve not made an error, at least not that I have caught, yet.

Getting back to my personal experience when calling out a store for charging the wrong amount, they have actually almost all gone smoothly.  I mention to the cashier that a price has come up wrong when she is scanning in my order, and again be nice here, “Excuse me I think that was $5.99 on the shelf.” or something along those lines will do the trick.  Usually someone goes to have a look on the shelf (I volunteer sometimes and take a picture with my phone) and comes back and confirms with the cashier, then the cashier applies the discount and everybody is happy.  Occasionally the cashier may just update the price without giving you the item or the discount, at which I point I say “I think I get that for free, due to the scanning code of practice right?”Once again, keep it polite, she didn’t just murder your grandmother.   And if the cashier still looks puzzled, then I point of the Scanning code of Practice sign or sticker located by the cash, then usually a supervisor is called.  Now I’ve only had one time where a cashier lady gave me a bit of an issue.  I bought an item which was supposed to be $1.59 or something, but it came up at $1.99 or something like that, which I pointed out, so she just changed the price.  I said something along the lines of “Shouldn’t I get that for free due to the Scanning Code of Practice?”  She said no, because I didn’t actually get charged, as in I didn’t actually pay yet, the incorrect amount.  So I just said something like “Oh really…”.  Now my take is that you don’t HAVE to actually be charged, because the Scanning code of Practice is about price accuracy, the price came up wrong, so the Scanning Code of Practice should be followed in my book.  I would love to hear someone’s take, or from someone with some info in the comments below.  As for this particular event, I just went along with it, because I was on my lunch from work, and didn’t have much time, and also I was also only 99.9% sure I was right.  Afterwards, it occurred to me that this method doesn’t make much sense, since it would take more time for the store and the customer to correct the issue; meaning the customer would have to save the receipt and then to back to customer service and get a refund, rather than the cashier pushing a few buttons.  So now, whenever go to this store, that is what I do, I make sure to actually pay for everything so I have the incorrect amount right on my receipt, and there shouldn’t be an issue, however I don’t go to this place often, so I haven’t had a chance to see if the same thing might reoccur.  One other personal story I’ll add is that I’ve actually also used the Scanning Code of Practice to my advantage once to get the same free item 2 days in a row, and then the same item again a few days later, so it took the store about a week to correct their error.  It was a large bag of chips, I originally bought them because they were on sale for $1.99, but they wrung up at $2.99 or whatever, so I got the item for free.  I went back the next day, mostly out of curiosity to see if the error was fixed, it wasn’t so more free chips for me.  I then went back a few days later and the error was still not fixed, so MORE free chips.  The next day the error was fixed.  So this tells you that very few people check their receipts, because the store wouldn’t  give away dozens of bags of chips everyday.  I told the story to someone at work, and they told me I was ripping off the store.  Hmmm what??  I’m willing to pay the correct amount for the chips, it’s the stores own fault for not updating their pricing, that is my take on it.  Also, how many people paid an extra $1 or whatever for their chips?  That’s all gravy for the bottom line for the retailer.

So there you have it the Scanning Code of Practice in a nutshell.  Thanks to CBC’s recent article reminding me that I had this draft sitting here mostly ready to go.

What is your take on the Scanning Code of Practice?  Should you get more of a discount? Have you called out a store for using the incorrect price, what was the result?   And what about my free chips?  Think I was ripping off the store?   Please leave me a like if you enjoyed the post.  Thanks!!

 

 

 

Net Worth Update: January 2017

Welcome back to The Fake Cheap, your 4th favorite (at least, I hope) personal finance blog and my first post of 2017.

What is Net Worth? It is simply your assets minus your liabilities, find our more here.

It is that time once again, my semi annual net worth update, I’m going to try to update my NW each January and July.

First, lets reflect back and have a look at my Jan 2016 net worth, which was $115,000.  This is the most recent figure I have provided, although I have still been calculating my NW every two months on my own.

If you are new to recording your net worth, just one net worth statement isn’t super helpful.  It will show you where you are at presently, but for tracking your own, I suggest calculating it quarterly, since this will help keep you motivated by seeing an increase (hopefully) over each  quarter.  If you find that too tedious, you calculate it semi-annually instead.  Or if you really enjoy crunching the numbers, you can also add it up hourly!  I kid, I kid.

Back my own story:  January 2017: net worth $142,000 .

Change from Jan 2016: + 23%  or + $27,000 Amazing!  Pretty darn good, if I were to toot my own horn, and of course I did this while only making small “sacrifices” to my lifestyle, I am The Fake Cheap, remember.

Note that this number is much more than just investment returns (which I estimate at about 8% for us for the year, as per my annual statements that have started to trickle in).  this includes the amount of debt we paid off, the money we put into RRSPs and TFSAs, and other things like our tax refund (which largely went to pay off debt), increase in home value (as per our tax assessment).  Find out more here if you want to know more about how to calculate your net worth.  There isn’t one right way to calculate your net worth, but there sure are some wrong ways!

 

Questions you may have (I’ve left these questions from a previous posting, they aren’t directly related to the above post, but you may find them interesting):

You are off by 2K from your quick calculation from your actual amount, what could cause this?

I would say much of this would be accounted for by 2 main factors: cash we happened to have on hand at the time I calculated my net worth and the remainder would be due to increases in investments.  Even though the Canadian markets are down, other areas are not, also dividends are still being paid by my investments, and mutual fund disbursements also normally occur at calendar year end.  I bought more investments/mutual funds this year, that generally means more disbursement at year end.

Why are you paying off debt and withdrawing from your line of credit at the same time, that don’t make no sense?!

Good question, but work on your grammar.  I could have just as easily made minimum only payments to my low interest rate credit card, and invested the rest for likely a better return.  However, I went the route I did because I will still have this debt at the end of the low rate offer (over a year from now) and yes, there could be more of these offers before this one expires, but there is no guarantee of this.  So yes, I would agree I could likely be doing even better with my money, but I’m The Fake Cheap, remember?

Please leave a comment, a question or a cookie below.  And if you found this post at least half interesting, a like would be nice.  Likewise if you found it a huge waste of your time, I want to know about that too.

Stay tuned, another super fun post is coming in just a few days!  Shocking!!!

Do you want to play a game? How long would your money last?

You said that using the voice of that clown doll from Saw, right?  If not, try again, it is mandatory.

This is a fun game to play, well it is if you like personal finance, and we know you like personal finance, since you are here, right?  So let’s play.

So what you do is first of all add up any savings/investments you have, which is quite easy to do since this information is found in your net worth.

Then you have a look at all your monthly expenses/bills.  For this game I like to calculate any loan payments as the minimum amount, and I would also remove our daycare expense, also no more aside from fancy restaurant meals (which we don’t have many of anyway.)

Then you imagine that you (and your spouse/partner, if applicable) immediately stop receiving any sort of income, and just live off your existing savings and investments.  For simplicity, I don’t bother trying to factor in returns on investments or employment benefits, etc…just straight up how long until we need more money once what we have, or roughly have, runs out.   With that being said…lets play!

So my (our) current savings/investments is about 68K

Our monthly expenses for the use of this game I put at $2,400.  I got to this figure by using the lowest payments for lines of credit, credit cards, etc and day care is no longer an expense, the only other change I would make to my expenses is no more restaurant or fast food meals and no more buying coffee out, also much less gas needed for cars, and we would also stop RRSP and TFSA contributions.  The bulk of the $2,400 comes from my fixed bills like the mortgage payment, and also largely from the monthly grocery bill, the reminder is other fixed expenses like the utility bill, and maybe a sliver of spending money

So we can see that if both my wife and I had no income starting immediately* we would be A-ok for about 28 months.  (68K/2.4= 28).   I thought it might be a bit longer than that, but it is what it is.

Maybe you think this is a stupid game, and you want to make your own rules.  Well go ahead!  Either way send a comment my way with your thoughts and results, maybe you could stay afloat longer than The Fake Cheap.

 
* Yes, I realize this is an extremely unlikely scenario due to severance from our employers and likely payments from Canada’s Employment Insurance program, and also likely increased government child benefit payments, but it’s just a game, remember?

The Way Everyone SHOULD Be Saving for Retirement

So as you may know, I am a huge supporter of not only saving for retirement, but saving for early retirement.  Not only does the saving have all sorts of benefits for the individual saving, such as having money for emergencies, health problems, lay offs; it also teaches just a bit of discipline which can come in handy in a financial pinch if it is ever needed.  It also makes us buy less crap, and the world needs less crap.

I was thinking the other day what if instead trying to get everyone on board to do the usual, and start putting money away at 40 or 50 or whatever you want to call a typical age to start saving for retirement (probably closer to 50); well what if the reverse was the case?   That is, we DID actually all start saving at a nice young age, we would all have a uuuuuggge nest egg by the time we reached 50.  Let me explain further.

Let’s say we use age 23 at a starting point, since most people have graduated or are starting their working career by then.  And let’s use a monthly amount of $375 per month, certainly not a small amount of money, but not really a huge amount either.  Now here comes the best part: this is how EVERYONE STARTS out in life, and if you want to opt out of this, or lower your amount you can, but you need to take that ACTION, and let’s face it, people are generally lazy, actions are not taken.  So basically what we’ve done is instead of trying to attempt to get people to voluntarily save money for retirement (which is working about at about a “meh” level); we have moved to a model where everything is set up for you and steps are needed to AVIOD saving for retirement.  Lets also add in the further deterrent that if you opt out of savings for a calendar year, then you loose the ability to contribute the amount later.  You know wile we are at it, lets make this an “ULTRA TAX FREE ACCOUNT” so you get the best of the RRSP and TFSA all in one shot.  For anyone not familiar, you would get a tax deduction for the amount contributed, and the amount would grow tax free, AND the amount would not be taxable on withdraw. What’s not to like???

 

Let’s run the numbers and see where this gets us.

So at a kind of whimpy 4% annual retrun, here is how much money we would ALL have at age 40 ,50 and 60:

40 –  $108,580           50 –   $215,735        60 –   $374,352

And at a 7% return:

40 – $143,179.     50 – $345,799.   60 – $744,348

And buckle your seat belts if we really knock things out of the park* and reap a 10% return:

40 – $190,669.  50 -$569,496.  60 – $1,550,000 (ok even I wasn’t expecting that)

*The average 30 year return of the S&P 500 is actually 10.98%, as per awealthofcommonsense.com.  For those of you who do math at the the speed of a sloth, 30 years isn’t too far from 27 years, the time from age 23 to age 50, so these numbers are not unpossible.

So looking at those numbers, yeah I think everyone would be fairly set, unless you CHOOSE not to be, instead of having to take the initiative to choose to be.

Some final thoughts and questions:

Don’t forget that under the “ULTRA TAX FEE ACCOUNT” you pay no taxes on any of these funds!

I hope you take away the power of compounding interest.  The biggest one is probably the 10% return has over QUADRUPLE the returning power of the 4% return over the 27 year period, even though 10% is only 2.5 times  4%.

$375 a month, that’s a lot of money I can’t afford that!   

Look at those results, you can’t afford NOT to afford the $375. But seriously go and read a few of my other posts on saving money or any of the other great personal finance sites about saving money, it’s much easier than you think.

What if someone wanted to take their money out or stop paying into this?

Well they can.  But it would be unwise if you stop early…again look at those numbers.  And you would also loose the ability to contribute more in the future to catch up.

This isn’t fair…what if I got a 4% return on mine, and my friend got 10% on theirs, they would have more money!

Yes, life is not fair.  I don’t get into actual investing much on my site, but take on some risk and reap the rewards.  Again search around for investment originated sights.

I wish this was in place now so I can do it!

YOU CAN do it now, call your bank, seriously, like right now, and talk to them about putting away $375 per month. Of course this won’t be the ULTRA TAX FREE ACCOUNT, but it will be the next best thing.

How could the government afford to not collect taxes on all that money?

Well the government would SAVE money in the form of lower OAS and GIS payments they make now.  I will fully admit that I’ve not done any research on this, so maybe it would be a loss..maybe it would be a gain?  Please feel free to conduct your own research.

Thanks for tuning into The Fake Cheap and taking a few minutes to listen to a little of my outside the box thinking.  I think the world needs more outside the box thinking.

What do you think?  Could a system like this ever work?  Are there more ways this could be improved?  Please share your thoughts or comments below.

Jan 2016 Net Worth Update…in September?

I had no idea that I never posted this so here you go about 9 months late, my bad!  I am going to start getting posts up again, maybe as soon as tomorrow so run, don’t walk to my blog next time!

It is that time once again, my semi annual net worth update (yes, it is 2 months late, thank you)

Jan 2016 net worth: $115,000
Change from July 2015 + 0%. (Actually a small increase, but not large enough to worry about)

Change from Jan 2015 + 12% Sweet..I’ll take a yearly return of 12% everyday of the week!

So we are up about 12K year over year.  I’m happy with that especially with the downturn in the Canadian market over the last few months, where we have a good chunk of our investments.  Yes,  we are diversified internationally, but still the majority of our investments are based in Canada.

Does the number make sense for us?  Let see, nice tax refund of $4,000 last year, house went up about $3,ooo in value as per our tax assessment.  We invested about $6,000 in RRSP and TFSAs, and also paid off about $5,000 in debt.   We also actually withdrew about $4,000 from our line of credit* for home renos.  Quickly adding up the assets I just named 3+6+5 = 14 and  subtracting the 4 = 10K, that is reasonably close to the 12K increase I found, so yes those numbers seem to jive.  Remember when I’m doing my net worth calcs, I don’t sweat the small stuff, and I recommend you don’t either.   This isn’t an income tax audit, just some numbers to show you are (or are not) on the right track.

*The balance of this was immediately transferred to a low interest rate offer on a credit card.  And by low rate I mean less than 2%.

Questions you may have from the paragraphs above:

You are off by 2K from your quick calculation from your actual amount, what could cause this?

I would say much of this would be accounted for by 2 main factors: cash we happened to have on hand at the time I calculated my net worth and the remainder would be due to increases in investments.  Even though the Canadian markets are down, other areas are not, also dividends are still being paid by my investments, and mutual fund disbursement also normally occur at calendar year end.  I bought more investments/mutual funds this year, that generally means more disbursement at year end.

Why are you paying off debt and withdrawing from your line of credit at the same time, that don’t make no sense?!

Good question, but work on your grammar.  I could have just as easily made minimum only payments to my low interest rate credit card, and invested the rest for likely a better return.  However, I went the route I did because I will still have this debt at the end of the low rate offer (over a year from now) and yes, there could be more of these offers before this one expires, but there is no guarantee of this.  So yes, I would agree I could likely be doing even better with my money, but I’m The Fake Cheap, remember?

I pay someone to move my snow…..me.

After a recent snowstorm in my neck of the tundra, many comments were heard.  People were commenting how much they enjoyed the luxury of keeping nice and warm inside and not having to go out for snow removal duty, because they had hired someone to come and plow their driveway.

At least they got that part right, luxury indeed.  I know this service runs around $500-$600 a season.  The alternative is to remove the white stuff yourself.  You can do this in two ways: manpower, or horsepower, as in the horsepower in your snow blower.  The great news is manpower is free.  However I must admit that even I, The Fake Cheap, do not use simple manpower for this job.  Have you ever shoveled 30 cms (that is about a foot for you Americans) of snow?  This is truly backbreaking, hard work.  It would take me about 2 hours of work to clear our double wide drive way to make enough room for us to easily get in and out of our cars.  I usually break it into 2 sessions, when I manually chuck the white stuff.  It is too much for this fit 30 something male to handle in one shot.  Hence, I made a very, very wise investment a few years ago.  I bought a snow blower.  A used snow blower at that,for the mere price of $200.  I was hoping at the time (way before I became The Fake Cheap) that I would get a winter or two out of it before I had to buy a new one.  Well I have news for you, I still have that same snowblower…7 years later!!!   I have been clearing my driveway for less than $50 a year (including gas for the snowblower about $10-$20 per year) and these other suckers are paying $500 a year, or about 10 times as much!  You could also look at it this way, I would say in an average winter I snow blow 6 times, so I pay myself about $80 each time!  Add in the fact that this is after tax money, and the $500 spent on plot service is really more like $800!  INSANE!!!!

After just 10 years of saving $450 per year, and having that money wisely invested returning 6%, I would have over $6,200!!!!  See how easy saving for retirement is?  

How do most people handle snow in your area?  Make sure you’re hard earned money isn’t going up in snow!