The above video was a promo for the upcoming annual Royal Nova Scotia International Tattoo.  It's the largest indoor military tattoo in the world.  From personal experience I can also say that it's one of the most entertaining events held in Halifax every year.  The problem is tickets cost about $50 each or even more.  If you have a family, you're easily looking at shelling out $100 to $200 to see this event.  For many people this amount of money just isn't in the monthly budget.  If you happen to be a smoker though, you probably smoke anywhere from $200 to $400 of cigarettes a month without even realizing it ($11 here, $11 there, and before you know it you're broke.)

Let's do some money saving math for a minute here.  Suppose for a moment that you are a pack a day smoker and the brand you like costs about $10.  If there are 30 days in a month, that's $300.  Now I know that quitting cold turkey is hard to do, but the beauty of the Wealthy Smoker plan is that you don't have to quit outright to make it work.  Even if you don't like bagpipes, I'm sure you can find something fun to do with an extra $300 every month or two.

Here's how it works:

Step 1:  Calculate the cost per cigarette for the brand you smoke.

For example, if your brand costs $10 a pack, and there are 20 cigarettes in that pack, then $10 divided by 20 cigarettes equals $0.50 per cigarette.

Step 2:  Figure out how many cigarettes you smoke a day and how much this costs. 

If you're spending $0.50 per cigarette and you smoke 10 cigarettes per day, then this amounts to $5 per day in cigarettes.  If you smoke 20 cigarettes a day then that would mean you're spending $10 a day.

Step 3:  Create about 5 to 10 "fun goals" of various sizes and costs.

Let's say you would like to take your family to the Tattoo we saw in the video, and let's assume that cost would be approximately $200 for your family.

You determine you would also like to pay off your car loan a bit quicker too, and figure out that each bi-weekly payment is about $120.

Your next goal is to take your family out to a nice restaurant for dinner.  You feel that will run you approximately $75 by the time everything is said and done.

Another goal might be a nice haircut at a salon:  $35 if you're a man, $135 if you're a woman (a joke, but pobably not far off).

And a small goal:  Order a pay-per-view movie for your family and buy some popcorn - a $20 cost, you figure.

Step 4:  Divide each goal in to "daily chunks."

Let's look at the 10 cigarette a day example.  That means, a day of not smoking would save $5.  Rounded to the nearest $5, that means the "dinner out with the family" goal would represent 15 full days of not smoking.

Alternatively, smoking only 7 cigarettes one day, 8 cigarettes the next day, and 5 cigarettes the third day would add up to 10 less cigarettes smoked, and therefore $5 total saved.

Create a spreadsheet (or any kind of chart) with an appropriate number of "one day chunks" for each goal.  Each time you save a full day's worth of money/cigarettes, check off one box.  You can check off the various boxes in any order you please (e.g., you may choose to check off a box for the movie first, and next the car, then the hair cut, then the hair cut again, and then maybe the car again, and next the Tattoo, etc.)

Step 5:  Purchase your goal guilt-free.

Once you fill up all of the boxes for a given goal with check marks, you can choose to purchase that goal (e.g., take your family out to dinner)  Or you can choose to save that money into an investment of your choice.

I hope this works for you.  Check back for the full version of this plan with its own page, created with the help of my friend Super Saver Chris.
 
 
Recently I've been inspired by a couple of friends who have started to wean themselves off of cigarettes in an attempt to save money.  I've been watching the process and noticed the power of having something fun to save towards.  Here are some ideas you can use to put smoking in its proper context.
 
 
I'm sure you know a few people who have threatened to move "off the grid" when their power bills get too high.  You probably even thought it once or twice yourself, too.  Well, here's a resourceful chap who actually did just that.  Enjoy this inspiring video.
 
 
How many times have you heard the statement "it takes money to make money?"  I bet you've heard it so often you can say it backwards in your sleep.  Well, it may be true, but this touching story below will prove that it doesn't take as much money as you think.
 
 
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To continue on with my last post from Sunday, here are some of the rest of the great practical suggestions from the query I posted on my personal Facebook account asking for budget and saving tips.

5)  Tomas linked me to a fantastic website called Budget Bytes, which contains a lot of very delicious and very cheap recipes for those of you trying to save money on meals.

6)  Yana echoed AJ's suggestion - urging us to run to work when we can and shop at second hand/thrift stores.  She also added that we should do a type of self-consolidation by transferring high interest credit card ballances to lower interest lines of credit.

7)  Matthew gave a great tip for saving on electricity.  He shared his own personal method of plugging all of his electronics in a room into one single surge protector/power bar.  At night, or whenever he leaves the room, he unplugs the bar.  On average the TVs and other electronic devices in your home increase your power bill about 10% just by being plugged in over night.  That is quite a few pennies!

Again, thank you to all of my friends who contributed.

 
 
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Recently I put a request out on my Facebook page for some savings tips from my friends.  I received a lot of great ideas.  Here are some of the best.

1)  Tasha suggested doing your budget based on how often you get paid.  For example, if you get paid bi-weekly create a bi-weekly budget.  All of your excess/spending money should be taken out in cash which will help keep everything straight in your head.

2)  Lindy added the timeless wisdom of preparing your lunches in advance and packing your own Thermos of tea or coffee instead of going to Tim Horton's or Starbucks.

3)  A.J. suggested stocking up on sale items you know you will use regularly, and only buy clothes from second hand stores when possible.  She also suggested riding your bike as often as possible in the summer.  (Editor's note:  I suggest if you want to do this that you save all of your gas receipts and compare them at the end of the year to see how much you saved during the months you rode your bicycle.  I did this personally last year and the result was quite eye-opening.)

4)  Julian reccommended adding a "savings" heading in your budget.  Treat it as an expense and go through your budget and look for any unneccessary extra spending you can cut to increase the amount you can "spend" on savings. 

For time and space reasons I will stop here for now.  Look for the second set of reccommmendations coming soon.  Thanks to everyone who contributed their ideas.

 
 
If you've been keeping up with your reading on Finding North the past ouple of weeks, then certainly you've noticed that I'm a big fan of saving.  My friends know this and the other day one of them asked, "how much should I start saving every month?"  My answer was, "anything!"  I wasn't joking either.  People worry about the interest rate on their investments, when they don't even have anything in their investment at all. 

That said, for those of you who are curious, I took the liberty of adding the basic compound interest calculator below so anyone interested can see how saving even a little bit each month can really add up over time.

Hint:  If you don't know what to put for Interest Rate, then try this.  If you're saving for something within the next 5 years use an interest rate of about 2% or 3%.  For goals ranging 5-12 years in the future, use a 5% or 6% interest rate, and for anything over 12 years, you can try 7% to 8%.  That will give you a fairly safe, conservative estimate.
Compound Interest Calculator
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The government places a lot of taxes on us that take money out of our pockets.  Here's a tax that will put it back in your pocket.

I came up with this idea a few years back when I had just moved to Halifax and was trying to live on a budget and save money for any unforseen emergencies.

The first step of course is to determine your budget and use the envelope budgeting system to keep yourself on budget.

Every time you make a purchase though, instead of recording just the price you paid, also record a second entry titled "savings tax."  Set your tax at whatever you feel comfortable with.  For me, I added an extra 10% at first, and later changed it to 5%.  It's your choice.

The result will be two benefits.  Not only will you have some extra savings building up that you can take out of your bank and save elsewhere in multiples of $20, but you will also limit your frivelous spending because you won't want to go through the hastle of making all of those extra budget entries.

As always, check out the A Penny Saved... Challenge page for more savings ideas.

 
 
So now that you have your budget prepared, how do you make sure you keep your budget?  Discipline helps, but what helps more is envelope budgeting.  Many truly wealthy people (not just those pretending to be wealthy) only carry as much cash as they need to make the purchases they want.  Most of the rest of us forget how much we've spent/owe and end up buying things with money we didn't realize we had already spent or need to spend.  Envelopes or "money jars" or whatever tool you use can really help.  The following video explains how.
 
 
I think many of us feel that if we could just make it big or get a lucky break we would be able to solve all of our problems.  That's not always true though.  We've all read about or heard about the family that won the lottery and then went bankrupt a few years later.  The above video usually brings about a "holier than thou" response from viewers who think they would be much smarter than these "dumb athletes" but how sure are you about that?  Can you honestly say you've never made a purchasing decision because of how you thought someone else might think of you?  I know I can't.  As Dave Ramsey would say, winning the money game is "more behavioural than mathematical."