# Any suggestions for my saving plan?



## Pilycow (Apr 5, 2015)

I came to Canada in 2006 as an international student and finally got permanent resident after 7 years. This is my first milestone in my Canadian life. Now the second milestone will become a home owner. Hope I can get some help I have to admit that I am not good at saving at all. But thanks to my boyfriend, I started some saving plans since several months ago. Below is my current situation:

Income: 42,500 plus commission (variable; it is average 35$ biweekly) 
Rent: $450 per month
Car loan: 341.46 per month (6-year loan, 4 years left; 0% finance)
Car insurance: 274.83 per month
Transportation (go train): 215 per month
Gas: 80 per month
Mobile bill: 67.8 per month
Grocery plus eating out: 360 per month
Other expenses: 250 per month

I save for about $600 a month. I started putting $125 per cheque (bi weekly) to mutual funds since several months ago. I had around 1,150$ in my TFSA account. I realize that I am very bad at saving. Can somebody give me some suggestions? My goal is to save a downpayment for a small condo in several years.


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## OnlyMyOpinion (Sep 1, 2013)

Congratulations on getting permanent resident status. Hope it wasn't the horror we read about so often.
Understanding your expenses - as you have - is the first step. Having your goals aligned with those of your boyfriend is probably the second important piece.
I'm not sure if your numbers are combined - or just your side of the income/expenses?
I see $3,612 of monthly income (42,500/12 + 75/mo), and I add up $2,639 of monthly expenses including the $600 of savings? So I'm missing ~$1000/month of income? In any event, $600/mo of savings is 23% of $2,639/mo. That is not too bad a savings %. If you want to be really agressive though you need to look through your expenses. Does your boyfriend also own a car? If so, consider getting rid of one. Even keeping one you can see how expensive it is - nearl $700/mo for car loan, gas and insurance - and you take the Go Train, so it probably sits all day?!. Do you need to own any cars for the short term? 
Remember, it is all about picking your priorities. If your priority is saving then you may have to make other sacrifices.

I'll let others chip in on best places and types of investments to consider if your saving is for a house.


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## pooja.majorgainz (Apr 7, 2015)

I agree with MyOpinion and would suggest you to get rid of that car and as you already taking help of train for travelling then try to reduce your transportation expenses as well as the other expenses.
As you haven't mentioned your other expenses then I think you need to look on it as it seems to be too much.
Do your other expenses include shopping, clubbing and any unnecessary thing then please revise it.


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## My Own Advisor (Sep 24, 2012)

For perspective:

Car loan: 341.46 per month (6-year loan, 4 years left; 0% finance)
Car insurance: 274.83 per month
Transportation (go train): 215 per month
Gas: 80 per month

That's just over $900 to own a car (depreciating assets, spend money) and commute. That's double your rent.

Ideally you want the bulk of your income to be going towards appreciating assets or money-making assets = investments. The sooner you have money making money, and that money makes more money, the better off financially you will be.


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## james4beach (Nov 15, 2012)

Congratulations on the permanent residence; that's really great. It's nice that your rent is low... that's really helping you. Your food costs are also reasonably low. As a single person, I spend more than you do on food & eating out, despite being very careful with my money.

I presume you're already using Go passes or the most efficient commuter fares?

Your car-related expenses are very high and I agree with others that you get rid of the car. The loan plus insurance alone costs you over $600 a month. Instead you could rent a car (I use Enterprise and National) for between $25 to $40 a day, as an all-in cost after fees assuming you have a credit card which includes rental car insurance already on it.

So maybe think more about your need for a car. e.g. if you just rented a car for one full week each month, it would cost you approximately $250 (+gas) versus your current $616 (+gas), which is $366/month you can save without forfeiting having a vehicle. (This is what I do personally... I rent as I need, and it's far cheaper than owning a car).

That, for example, would let you save as much as $1000 a month.

Another thing is to keep looking for new jobs to increase your income. Don't get complacent. Increasing your income and reducing your expenses are the two greatest factors, by far, in building up your wealth. It's much more important than "investing" or choosing the right mutual funds.


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## Pilycow (Apr 5, 2015)

Thank you for your suggestions. They are very helpful. 

Regarding the car expense, I did realize it was very expensive as I am a new driver (insurance is still pretty high; but eventually it is going to come down if my driving record is good). My boyfriend and I discussed several times of my car expenses. First of all, it is not a good time to get rid of my car because the current car value (14,000) is less than the car loan (16,400). New car depreciates a lot. We think the best way is to keep it for 5-6 years at least; Second, I still need car to drive to the Go Station, buy grocery, go to gym or potentially make extra cash because of part time job maybe.

I am thinking to get a weekend job. I do love my full time job and I believe it has a lot of potential in the future and I will stay here for as long as I can. Actually I am spending more time on this job after 5pm to catch up as I am still new to the industry. Commission will increase eventually and I am very confident about that part


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## Pilycow (Apr 5, 2015)

sorry, it was my bad that I didn't explain clearly. I am making about 44K before tax and that is around 2,640 after tax per month. The numbers are just mine. Our combined income is 100-120K (he has his own business and I have variable commissions). I stay with my bf at his house in the weekend but we are not living together. I am considering getting a side job in the weekend.


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## amitdi (May 31, 2012)

My Own Advisor said:


> For perspective:
> 
> Car loan: 341.46 per month (6-year loan, 4 years left; 0% finance)
> Car insurance: 274.83 per month
> ...


+1. If you have to commute by public transport to save on gas, AND also have to have a car for weekends, then go for a cheap car. A 4-6K car will serve the same purpose for you, plus cheaper insurance.


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