15 Feb

A blog within a blog: Confusing loyalty with silence


Posted by: Ian Vowles

For me, the timing of Seth Godin’s latest blog could not be better.  My friend who I wrote about in my last blog was recently let go from his job.  When we met to talk about he lamented about how he may have hurt himself by speaking out in a leadership meeting with the executive against a decision coming from the top.  My friend is intelligent, articulate and was very passionate about the well-being of the company and its employees.  He is also politically astute.  He knew he was “putting himself out there” when he openly questioned a particular strategy that was being endorsed by the company’s leadership.  He did it because he wanted what was best for the company.  Isn’t that what you want from your employees?  Isn’t that leadership? 

I guess he will have to find out somewhere else. 



14 Feb

The Importance of Multiple Income Streams


Posted by: Ian Vowles

Yesterday afternoon, I met up with a friend to catch up on life.  He informed me that he had recently been let go from the company he had worked for over the past 8 years.  I know he was extremely competent and gave everything he had to the company.  He was informed that the organization was taking a new direction and he was no longer a “fit”.  He had never been let go from a job in his life.  He is 53 years old. 

What now? 

Sadly, my friend’s situation is not uncommon.  As I moved up the ranks of the corporate world, I witnessed many good people fall to the wayside as they reached their 50s, a critical time in the financial planning life-cycle.  This is supposed to be the key earning years to help with the final push towards a comfortable retirement.  In most cases, these people did not see it coming and were completely unprepared. 

The world is changing and we need to be able to prepare, adapt and change with it.  Unless you are already independently wealthy, relying on one income source is no longer advisable nor practical. 

If you are in a job, earning a good living but you don’t love what you do, find a part-time passion and turn it into income if you can. 

If you love what you do and you are making money at it, keep doing it, but make sure you have a fallback position. 

There are lots of ways to earn income.  Start up a part-time business, rent out a suite in your home or take on a student, but whatever you do, make sure you have a plan in case the income you are relying on today is suddenly gone.

6 Feb

Budgeting can be overwhelming: Here are a few ways to simplify it.


Posted by: Ian Vowles

I had an amazing boss and mentor earlier on in my career who gave me some sound advice when it came to improving results.  “What gets measured gets done.”  Its simple enough in principle but the toughest part is deciding what to measure and being consistent. 

As a Certified Financial Planner, I have always believed in budgeting because not having a budget is like driving a car without holding onto the steering wheel.  You will get to wherever you are going and the end result will probably be a crash.  The problem is knowing where to start and then having the discipline to stick to it on a regular basis. 

Here are a few tips that have worked for me and for my clients:

1.  Budget monthly based on your net income.  If you get paid bi-weekly, make sure you take your net pay, multiply it by 26 and divide by 12 months to get the correct amount.

2.  If possible, budget only off of your net regular pay.  Overtime and bonuses may fluctuate so it is best to be conservative and live off of what you know is coming in.

3.  Separate your expenses into two categories:  fixed and variable.  Your fixed expenses are the ones that don’t change over the course of the year.  This would include; rent/mortgage, property taxes, vehicle insurance, car payments etc.  Your variable expenses are ones that will change from month to month and include:  entertainment, home maintenance, groceries, gas, clothing, vacations etc.  It is important that you don’t forget any expenses and even if you are not sure what a particular expense will be, you need to estimate and budget for it. 

4.  Set up a simple Excel spreadsheet.  Put your Monthly net income at the top of the page in one cell.  Put all of your expenses below that, starting with all of your fixed expenses and then listing all of your variable expenses.  Add up the total of all your budgeted expenses using the “SUM” function.  The difference between your net income and your total expenses is your “Monthly Variance”.  If this total is POSITIVE, you should set an allocation for savings.  If this total is NEGATIVE, you need to make changes to your budget. 

5.  Finally, you need to track your expenses on a monthly basis.  The good thing is that you ONLY need to track your VARIABLE expenses.  Set up another simple Excel spreadsheet with a tab for each month.  As you spend, simply keep your receipts and put them in a box in the kitchen where you will see it every day.  Every few days or even weekly, enter the description of the expense, the category (see below) and the amount.  At the end of the month, total it up to make sure it is within budget.  If it isn’t , you may need to go back to your budget to make changes or simply alter your spending.

Here is a list of possible categories for VARIABLE expenses:

Groceries/Gas/Home Maintenance/Vehicle Maintenance/Pet Care/Kids Activities/Entertainment/Health and wellness/Household Items/Clothing/Gifts

This is the most simple and effective way that I have found to create a budget and stick to it.  It is working for me and for my clients.  If you need help in setting it up, feel free to contact me.