Tuesday, January 15, 2013

If You Need Any Help, I’ll Be Here

I was talking about finances one day with an old co-worker of mine. I told him about my dividend investing strategy and he thought I was crazy for risking my money like that. I then asked him what his strategy was for saving for retirement. He told me he saved all of his money in a default RRSP account  for an RRSP matching program through work. I asked him what percentage he was making on his savings and he replied “0.005%”.


I then explained that inflation averages from 2-4% every year and that the half a percent he makes doesn’t even cover that. His reply was, ” Well at least my money will be there in the future when I need it”. I explained how his money will not have the buying power it once did and when a loaf of bread costs $50, he will end up spending all of savings very quickly. He then replied, “But there is no risk, my money will still be there when I need it”. I started drawing on a piece of paper a large pile of money that was slowly being depleted by tiny inflation monsters; still nothing. I then drew a large pile of money and a TV, and over time I showed the price of the TV increasing in price yet his saving didn’t increase very much at all. I could see the light go on in his head and he stated, “Well then, I better start saving more money! ”
I politely smiled and changed the subject to something else.

Facepalm

I’ve learned over the years that you can’t help people who don’t want to be helped, no matter how hard you try. I really wanted to help my co-worker realize the danger he was in but he couldn’t see the inflation for the rising fees. Sometimes people approach me and ask for help to get their finances in order. The first thing I tell them is to make a budget, pay down debt and start living within their means. I never hear from those people again because people don’t like hearing that it takes work. They want a magic, easy fix for their financial problems and they just don’t exist.

That’s why I gave up trying to help people face to face and settled on writing a blog. The Loonie Bin was started as a medium for me to easily show my friends and family the magic of dividend investing. Over the years it has slowly grown from a few visitors to a solid dozen or so each month! I started sharing how I save money, my favorite stocks on a watchlist, and even how I invest in my health. Not many people like the health posts but they will see the error in their ways and thank me later when they live longer and collect more dividends!

When people have had enough and they make a conscious decision to help themselves when it comes to their finances, then hopefully they find their way here. Until then I will keep the home fire burning and possibly roast a marshmallow or ten.

This article was written by The Loonie Bin. If you enjoyed this article, please consider subscribing to his feed.

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