Best of Million Dollar Journey Oct 2009
Book Winners
Seems that there was quite a bit of interest in the book “Super Trader” as there were numerous entries. Out of all the entries, 3 were randomly chosen as winners of a free copy. Here are the winners:
- Linda
- Jeff W.
- Desmond C.
Top 5 Posts of October 2009
- How Alternative Minimum Tax (AMT) Works - With the big hype about the tax efficiency of dividend income, the AMT makes sure that the government gets their share.
- Prepaid Credit Card Comparison - After receiving a generous prepaid credit card as a gift, I wrote a review discussing the merits and pitfalls.
- Tips for buying and selling on Kijiji - Staff writer Kathryn discusses some tips when doing business on Kijiji.
- Why Don’t Financial Planners Plan Finances - This article lists various reasons why financial planners don’t create basic financial plans for their clients. What do you think?
- Creating a Frugal Halloween – Even though Halloween has just passed, here are some great tips for Halloween in future years.
Top Referrers
Top Comment Contributors
- cannon_fodder
- Four Pillars
- Ms Save Money
- Canada Deals
- Kathryn
Why Canadians Don’t Redeem Coupons
According to the Coupon Industry Association of Canada*, in 2006, Canadians redeemed 100 million of 3.6 billion coupons available.
Canadian consumers that did redeem coupons saved over $134 million dollars.
This sounds like a lot of coupons redeemed, but when you calculate the amount of unredeemed coupons it is astounding.
With an average face value of $2.02, the amount of unredeemed coupons is approximately $7 billion dollars.
Some reasons why Canadians do not redeem coupons?
Coupons are not for all consumers. There are several reasons why consumers do not use them.
Cutting them from magazines or newspapers, printing them from various websites like, Grocery Alerts , or sorting them from the mail is time-consuming. It takes time and effort to clip coupons and organize them. Having to carry them to the store is too much of a hassle for many shoppers, whether they save a few dollars or not. Most consumers could not be bothered.
Another possible reason why some Canadians might not redeem coupons is that they might spend more money. A coupon’s purpose is to entice shoppers to try a new product. Some consumers are brand loyal and do not wish to switch brands to save some money. The discipline required to not spend additional money may be lacking from some shoppers.
Coupons are typically for name brand products for items such as Tide and Sunlight. If a family on a budget and needs to choose between Tide when using a coupon and the store’s private label brand, the final price could show that the private label brand is cheaper even if the coupon is redeemed. Therefore, using a coupon would not be beneficial
When I was a teenager and went grocery shopping with my mother, I always saw the people that redeemed coupons and I perceived them as being “cheap.” The possible embarrassment or being labeled as “poor” or “cheap” is why some people don’t use coupons. The stigma attaching to using coupons probably still remains, especially at long lines at the grocery store when someone is trying to redeem double coupons.
Some Canadians still redeem coupons
However, the recent recession has changed the general public’s mind when it comes to redeeming coupons. In tough economic conditions, families are forced to stretch their budgets further. This includes redeeming coupons on everything from oil changes to clothing stores to laundry detergent.
Thanks to the Internet, several grocery stores (Real Canadian Superstore, Save-on-Foods, Safeway Canada) have added coupons to their websites and new websites have propped up to aid in gathering more coupons.
The fact that more and more merchants are offering coupons shows the demand for them.
Final Thoughts
Personally, I carry a grocery coupon binder (just a simple tupperware container), that organizes all my coupons into different categories for easy redemption.
I have had terrible experiences at stores explaining that they do not accept photocopied coupons and when you inform the cashier that they came from a retailer’s website or from our website, it does not make a difference. Speaking with the manager at the local Save-On-Foods if the coupon came from the retailer and that it has a valid bar code, a valid expiration date, and a valid Canadian redemption address they typically redeem the coupon. This is something to look out for if a cashier or merchant ever refuses to take your coupon. Just explain that the printed coupon has everything they need to redeem.
It is not a lot of money saved typically, but I do find the coupons add up when you combine them when an item is on sale.
Here is a recent transaction.
This copy of the receipt shows that I saved 75 cents off the Glad Wrap. This does not sound like much money, however, since the item was on sale at $2.99 using the coupon saved me an additional 25% off the sale price.
How do you tend to use coupons? Do you find them more hassle then the savings?
* – http://www.couponscanada.org/index.html
Author’s Bio: The author is Steven Zussino, Founder of Grocery Alerts Canada (http://www.groceryalerts.ca/) – Home of grocery deals and money saving coupons. He enjoys personal finance and saving money in beautiful Victoria, BC.
Funding Your Childs Post Secondary Education
A recent article by the Globe and Mail regarding the increasing cost of Post Secondary tuition hit close to home. In the article, it is projected that a child born today going to University 18 years from now would face a cost of over $100,000 for a typical 4 year program. To add salt to the wound, the $100,000 is for a child who lives at home – it could cost over $130,000 for the students who move away.
As Baby FT was born in 2008, I assume the projections for the cost of University will be fairly close to what the article states. As we started an RESP in 2008, will it be enough to fund Post Secondary Education?
We decided to use the RESP program which allows up to 20% of your (after tax) deposit annually will be matched by the government, up to $500 per year. So to max out the government grant, $2500 would need to be deposited annually. Investments can grow tax free within the account, but withdrawals will be taxed in the hands of the student which shouldn’t be a problem as they typically make very little income at that stage.
With regards to the RESP investment strategy, we decided to with the TD e-series to index the portfolio over the next 17 years or so. The plan is to gradually reduce our equities exposure as the withdrawal period closes in. We deposit $2500 lump sum annually with the government depositing $500. This results in $3000 in new cash every year to invest with.
My assumption is that the portfolio will grow 5% annually after inflation which, after 17 years of growth, will result in a portfolio size of approximately $88,000. This is not too far off the $100k required IF our child decides to live at home during University years. If moving away is the plan, then I the difference will have to be made up somewhere. Whether it’s student part time work, student loans, or if Daddy needs to open up his wallet once again – a plan needs to be put in place.
The issue of who should pay for post secondary education is a well publicized. Some believe that post secondary education should be the child’s responsibility while others feel the bill should be covered by the parents. I’m in between the two camps. I managed to pay my way through school without student loans by working part time, choosing a degree that had paid work terms, staying at home and living frugally. However, even that (and RESP money) may not be enough in the future with rising tuition and living expenses.
My initial thoughts (which may change over the years) are that we’ll cover all education expenses, but baby FT will be responsible for living expenses. The amount that baby FT will have to come up with will depend whether or not they want to live at home. If the kid(s) decide to live away from home, then they’ll most likely need to fund their living expenses on their own (or a portion of) though part time work, loans (eligible if using RESP?), or scholarships.
Who knows, if we can ingrain a good savings habit in them early, then perhaps they’ll have some cash to cushion the blow.
What are your thoughts on the rising cost of tuition?
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