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While it’s possible to fix your finances later in life, it can be very difficult, and take a lot of work to accomplish this. A much better approach is to start out right. If you start, in your 20s, to keep your finances on track, you will end up in much better shape later on.

Here are 6 tips that can help you with a solid financial head start now:

1. Make a plan

When you’re in your 20s, it doesn’t often seem as though a plan is necessary. You might not even think to make a plan for your money or your future! However, if you want to direct your financial resources appropriately, you’ll want to make a plan. Setting financial goals helps ensure that the most important priorities you have are covered, and that you have a roadmap to future success.

Sit down, and think about what your money to accomplish on your behalf. Look at your career plans, investing plans, and long-term financial goals. Create a plan based on how you want to move from where you are now to where you want to be.

2. Avoid debt

While you may need student loans to help with your education, try to avoid debt as much as possible. When you do borrow, only take the absolute minimum and negotiate for the lowest possible interest rate. If you have debt, consider getting credit counselling and make a plan to pay off the debt as soon as you can. Nothing will erode your wealth like paying interest to someone else.

3. Contribute to tax-advantaged accounts

It’s never too early to begin thinking of saving up for retirement, as well as saving up for other goals. The Canadian government offers a number of great tax-advantaged accounts. You may be done with the RESP for your university education, but there are other options. You can contribute to a Registered Retirement Savings Plan (RRSP) and to a Tax Free Savings Account (TFSA).

These tax-advantaged accounts allow you to get more bang for your investing buck, and can help you secure your future. Contribute as much as you can, up to the maximum each year, to each of these accounts. That way, you will be on the right track to saving for a bright future.

Even after you have contributed what you can to tax-advantaged accounts, continue to invest. The power of compound interest works better the longer you have the money in the account. Investing in your 20s can mean hundreds of thousands of dollars more when you retire and gives you a huge jump relative to waiting to invest in your 30s. Continue Reading →

By Kevin Mercadante

Many people assume that the information on their credit reports is all good because they pay their obligations on time and always have. While that’s the basic way credit reporting works, it isn’t without its flaws.

Different organizations can put information on your credit report, and not just the ones you have an ongoing business relationship with either. Information can come and go on your report and you’ll never know that it does or when it will happen. The only way to know for sure what’s happening is by checking your credit reports on a regular basis.

Most people are most concerned about their credit scores, and there are a few ways to check your scores without incurring expense in doing so.

But apart from your credit scores, there is other information that you need to monitor on your credit report.

Creditor Errors

You may have an excellent payment record with a given creditor, but there can still be reporting errors. For example, let’s say you’ve had a car loan for the past two years with an excellent pay history. A keystroke error could lead to the reporting of a 60 day late 5 months ago that could cause your credit scores to fall by 50 points for a single delinquency—one that never happened. Unless you know about it, you won’t be able to do a thing to fix it.

Another event that’s not at all unusual is reporting of collection accounts. Let’s say you’ve had dealings with a medical provider and paid all that you were billed for. There may have been a small bill at the tail end, as little as $50, that the provider fails to bill you for. As time goes by, the medical provider enters the amount as an unpaid collection, and now you have a derogatory entry on your report. This was never reported to you, and unless you get a copy of your credit report you will never know about it.

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This is a guest post from Mike Collins, owner of WealthyTurtle.com

My nephew and his girlfriend are both college students and at a recent family dinner they were complaining about the lack of part-time jobs available.  They’ve both applied to all the usual retail and customer service jobs that students typically go for but there are just far too many applicants for a limited number of jobs.  In these uncertain economic times, many employers are hiring fewer workers than in years past.  And many of the jobs that are available are being filled by more experienced workers who have been laid off by their old employer.

Though they were understandably frustrated at their lack of success, I tried to encourage them and get them to think outside the box when considering ways to make money over the summer.

After brainstorming a little we came up with four ways they could earn money on their own.  Maybe one of them will work for you too:

Tutoring

I know, I know…you deal with enough of your own school work.  The last thing you want to do is deal with someone else’s homework.  But tutoring elementary or high school aged kids is a great way to make extra money.  You can have a flexible schedule and if you line up a few children to tutor you can really rake in the cash.  And there’s a good chance it could turn into a long term gig instead of a one-time tutoring session.

Continue Reading →