Thursday, March 15

Found Money and Found Debt

Recently I have had cases of both found money and found debt happen to me in large amounts: $800 and $950 respectively and it made me think about personal habits that help your finances. We tend to think more about the "finance" side (i.e., the dollars and cents) of personal finance, but there are some schools of thought out there that claim that the "personal" side can have a much larger impact. For example, books titled "Think Yourself Rich" and "Secrets of the Millionaire Mind" --neither of which I have read by the way :).

But on a smaller scale, I think that there is daily impact from your personal approaches and habits with your finances. For example, found money implies that you lost it first. Of course it's great to find it again, but what if you never did? Not so good, and you would never know that it was even missing.

Here's another example: We all know that late bill payments can affect our credit rating, but what about waiting too long to collect money that is owed to us? From my own business experience and others I have spoken to, it seems that your best chance to get someone to pay you is right away, while they remember their reason for doing so. If you wait weeks or months, then it gets harder to collect the money that someone owes you for buying their expensive theatre ticket or lending them $20 when they forget their wallet at lunch. And eventually you may become too embarassed to even ask. I know that I do.

And another one that I'm guilty of: Forgetting to use up near-cash assets like reward points or gift certificates. My estimate is that I currently have about $1,000 in such assets for a variety of places, including Shoppers Drug Mart ($75+), Superstore/PC points ($250), Holt Renfrew ($250), Starbucks ($45), PetroPoints (unknown), Amex/Telus ($300), spa ($50) and maybe even more that I can't remember. These arrive as gifts, or build up gradually, and I often forget about them until they are expired or lost. What a waste!

So to come back to yesterday's post for a moment, I'm still thinking about taking the Quicken plunge again. I would like to do one month and then see if I need to go longer (or if I can handle it). This kind of organization is also a personal habit that I feel will have a very positive effect on my finances and I'm thinking of doing it for the month of April.

But my conclusion is that we are self-sabotaging through these wasteful and counterproductive habits. Each step I can take to close holes in my personal "systems" that are money losers is a step that increases my income or decreases my spending, usually very painlessly.

And speaking of points and gift cards, maybe I should be going shopping tonight....

Today's billable hours: 2.5
Today's contracted hours: 3.5

6 comments:

nancyz said...

Hey - maybe we should have a National Personal Treasure Hunt day in Canada, in which we find our unused gift cards, and write friendly reminder notes to people who owe us money. What a fun weekend we could have, eh?

If you want an excel spreadsheet, I've got a pretty good one for keeping track of spending etc. It's not a good as Quicken, but I found Quicken drove me a bit nuts with glitches, plus, if I ever got off the habit of using it, it was hard to restart and catch up. Just e-mail me if you'd like to check it out; happy to pass one your way.

S. B. said...

From what I understand, it is very profitable to issue gift cards, travelers checks, etc. The customer (or gift giver) basically pays several months in advance, and then in some cases never uses the card! This is essentially free financing for the company involved.

You are right; there does seem to be a thousand painless ways to save money that we eventually stumble upon...

As for Quicken, it's an amazingly badly written program that is unfortunately still better than everything else. I would switch tomorrow if I felt there was a realistic alternative for me. I assumed that like a lot of software, it would get better in later versions, but it definitely has not.

the money diva said...

Re: National Personal Treasure Hunt Day

What a hoot that would be! Hopefully we wouldn't receive more calls for IOU's than we make....

And thank you for the offer, Nancy. I'd love to see your spreadsheet but I don't have your email. You can send it to me at the.money.diva@gmail.com.

s.b. - Good point about the profit that companies are making on gift cards, etc. Anything that is an easy profit centre for a company is rarely a good thing for consumers. (I'm thinking extended warranties as another example.)

Canadian Money said...

My cash flow tracking method has been posted.

Anonymous said...

I would love to know if you used Nancy's Excel spreadsheet for tracking and how it worked out...

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