Is it really possible to DIY your personal finances?
Everyone should have a financial plan in place. We all hope to maintain a healthy financial life and be able to reach our financial goals. Many in Fort St. John doubt we can achieve this on our own and think we need to pay for financial advice, leaving the decision-making to the professionals.
However now there is an abundance of online personal finance resources, so that’s not the case. It’s possible to gain control of your finances all by yourself without needing to pay fees for external help.
You can completely customize your approach. You can create your own goals and make your own decisions. Choose your own investments and go at a pace you feel comfortable with; your plan can be 100 per cent personalized. Designing your own financial roadmap can also give you a great sense of accomplishment.
Personal finance and financial literacy
To start, you need to build your financial literacy. This will help you make better financial decisions in each of the three areas of personal finance: saving, spending and borrowing.
“There are countless free online resources available to Canadians looking to improve their personal finances,” explains Caitlin Wood, Chief Content Officer for Loans Canada and Rate Genie. “Consumers should check out the Government of Canada’s website as it covers many money and finance topics. With both Loans Canada and Rate Genie, we are always publishing content to empower Canadians to improve their financial knowledge.”
A free online financial literacy course is available from McGill University. Anyone can enrol and it takes only a few hours to complete. The course is taught by professors from the school’s Desautels Faculty of Management; finish all of the course modules and you will receive a McGill Personal Finance Essentials attestation of completion.
As Wood recommends, the Government of Canada website is another excellent tool that can help you learn how to manage your money. Topics covered include making a budget, banking, credit reports and credit scores, insurance, retirement and estate planning.
Canada’s largest personal loan comparison website, LoansCanada.ca, can also help you make smart financial decisions. The website provides quotes from many different lenders, it can choose the best lender for you and save you time as well.
Steps to achieve better financial health
Everyone needs to learn how to create a budget. A budget allows you to track and control your spending and helps you reach your financial goals. Budgeting can also help you build an emergency fund, which the COVID-19 pandemic has taught us is absolutely essential.
To help you make sound financial decisions and gain control of your money, check out Mint, a free online budget tracker and planner. You might also try YNAB (You Need A Budget), which offers personal budgeting software based on The Four Rules principle.
Next up? Investing. Investing may sound out of reach when you’re just starting to manage your finances, but it’s an essential component of financial planning. Investing allows you to grow your wealth and help you reach your financial goals—especially the long-term ones, such as retirement or saving for your child’s education.
Open a tax-free savings account (TFSA) either online or in-person at your local bank. Or you may want to try using a robo advisor; Wealthsimple or WealthBar are online investment management services and both are easy to use.
Debt management is the next step. You need to start paying down your debts and making sure that you can handle any new debt you take on. There is such a thing as good debt, and it can actually increase your credit score.
You can always seek out the services of a credit counsellor. They can help with basic budgeting, credit health, credit improvement and creating debt repayment plans. If you happen to need a more drastic solution, such as debt consolidation, debt relief, consumer proposal or bankruptcy, they can assist you.
Managing your finances can seem like an overwhelming task, but it doesn’t have to be. Use the resources listed above and reach out for help if you need it.