Cost of Hobbies

Three weeks ago I finally managed to get back to one of my hobbies and I was surprised by a sudden cost. I play hockey once a week during the winter in an adult hockey league. This is more of an activity than a hobby but it’s at a very low level and I treat it as a hobby. The sudden cost that I encountered was my skates were mysteriously damaged. Thankfully I’m able to still use them but I can’t continue to do this for long and I’m going to need to put some money into fixing them or replacing them. My hobby was unexpectedly costing me money I hadn’t accounted for

All of this lead me to thinking about the cost of hobbies and when we take on a new hobby or even continue to an existing one we need to keep in mind the costs associated with them. I use hockey as my hobby and it’s a bit of an expensive one because of all of the equipment involved. Hobbies don’t necessarily have to have a large start up cost associated with them but there is usually one. As you’re getting into your new hobby you need to keep the cost in mind.

With all of the changes in my life and the tight finances I would be completely remiss if I ignored the cost of my hobbies when I was putting together my budget, but that’s what I did. Its easy to overlook this as a regular budget item because the costs are typically infrequent. The cost of fixing my skates really brought this to the forefront for me. Keep the cost of your hobbies in mind especially if you have an expensive hobby like golf.

The Relief of a New Job

When I first started this blog I was making a very good salary, $75,000 to be specific. Since that time I have had a couple jobs where I made progressively less money with each one. The reason for the first move was great opportunity where I would expand my management experience. I learnt a great deal but it was a very stressful year. I parted ways with that company back at the end of January of this year. At that point I was approached by a company to work for them helping them with business development. For lack of a better term I was responsible for sales. This position was presented to me when I was capable of taking a significant pay cut to gain more experience.

While I enjoyed both of these positions and I learned a great deal there was a significant drawback to these positions and that was money. The first position took me from my $75,000 down to $50,000 which made keeping up with my finances very challenging but I was able to do it. The second position had a starting pay of $30,000 and it was raised to $39,000. At the beginning of the second position I had some extra money to cover any extra expenses. Unfortunately this money quickly vanished and I started running into difficulties in paying my bills and all of this was made more difficult with the move and the baby.

Yesterday I resigned this second position because I was offered a position at $72,500 for a good company doing something I believe that I can do very well. I’m glad that I was able to find this position because my finances were starting to look grim. I am extremely relieved that I got this position and I believe its time for me to bring some stability back to my life. I learnt a lot in the past two years both about my work and myself.

Site Problems

It seems that I am having some technical issues with the site at the moment. Hopefully they’ll clear up soon as I have some big news to announce.

Investing is Long term

We’ve all heard about the stories where people made an investment and within weeks or months they were able to turn that around into a huge profit. In some cases these people were able to retire off of their profits. While this does occur I would hazard a guess to say this is the exception rather than the rule.

Investing is long term

When we make an investment the goal is to maximize our returns over a period of time. With the markets in the crappy situation they’re in many people are seeing investing as risky and shying away from it. The reality is that I’ve always seen investing as an activity that is tempered by risk tolerance.

Assume the quick buck doesn’t exist

If you go by the assumption that an investment is going to be a long term activity you’ll plan your risk and potential return based on that. My retirement portfolio had lost over 30% when I checked it last a couple months back. While its slightly demoralizing to see my money simply vanish its also something I knew could happen and I wasn’t worried. I won’t be needing my retirement money for another 30 or so years so there is no point in worrying about it just yet.

Keep an eye on investments, don’t obsess about them.

If you put your money into an investment and simply forget about it then you run the risk of loosing it without knowing about it. Conversely if you’re watching your investments and changing them around too much you also run the risk of moving money at the wrong time.

Investing money you need is stupid

There are very few investments that warrant going into some form of debt for them and even then I would warn against it. Invest money you can potentially stand to loose (at least in the short term). Investing in things like mutual funds, index funds or even specific stocks are long term and should be treated that way. This is especially important to keep in mind when the markets go through a correction like we’re experiencing.

Weekly Budget – Week 27 (Nov 24-30)

Over the past month I have started to notice that I am short on money from pay to pay and although my wife is helping out with the week to week expenses with money from her maternity leave its not enough. This week will be a bit of a test to see if we can make a generous budget work. The goal for this week will be to spend a grand total of $275:

Weekly Budget
Nov 24-30
  Budget Actual
Alcohol $30.00  
Food-Lunch $0.00  
Food $125.00  
Gas $25.00  
Entertainment $0.00  
Smokes $30.00  
Misc $40.00  
Transportation $15.00  
Stupid $10.00  
Total $275.00  

The goal is to get back on track – the majority of this month I’m going to chalk up to dealing with the unexpected expenses of having a baby. I won’t get into details but the baby was a minor portion of the costs. The rules definitely change when you have a baby. We are starting to find a balance to day to day life although sleep is still a rarity that I’m hoping to get back in the next month or two.

Why should you have an emergency kit?

For most of my life I have lived in apartment or condo building and my only concern was myself I wasn’t worried about what if situations. Now that I have a house and a baby I have been contemplating putting together an emergency kit. The first question that came to mind was why should I have an emergency kit?

I don’t live in a place that is prone to natural disaster but that doesn’t mean a kit might not be useful one day. All it takes is a big snow storm to knock out power and make roads inaccessible. Granted this isn’t an emergency compared to a hurricane but it’s a plausible scenario.

Having an emergency kit provides you some back up just in case something does happen. I will be putting one together in the coming weeks now that we’re into fall and winter will be coming (one of the few scenarios that might require an emergency kit). The security of knowing that you have something to fall back on just in case will provide peace of mind especially when it comes to your family.

The final consideration is the fact that this peace of mind doesn’t have to be costly there are some off the shelf emergency kits that you can purchase. Rather than buying a boxed kit I’ll be putting one together from scratch to make sure it covers our unique needs.

Remembrance Day

Today is Remembrance Day and I just wanted to remind everyone to take a moment and remember all of those that have died giving us our freedoms. Although this blog is read by people around the world I think its important not only to pause and remember the soldiers have died giving us our freedoms but to remember and value our lives. There are many parts of the world that are war torn and people struggle just to live safely. Be grateful for what you have and don’t complain about all of the little things in life. Remember that in parts of the world, 10 year old kids are kidnapped and forced to fight wars and missing a school bus would be a very minor issue.

Be happy for the little struggles that you have in your day to day life because you don’t have to fight for your life and the lives of your loved ones.
Remembrance Day
Veterans Day

Weekly Budget – Week 25 (November 10-16)

I missed writing a budget last week and I’m sure had I written one I would have missed it by a lot. Last week was an expensive one and part of this is adjusting for the fact I’m paying for more of the regular expenses such as food while my wife is on maternity leave. Unfortunately another part of it is the fact that I simply spent too much money on things that aren’t all that important in the grand scheme of things like alcohol and smokes.

This week I need to put my budget in writing again and start tracking it closely for the next few weeks. The biggest reason for this is to get a handle on my finances again and to start getting a good sense of how much I’m actually spending. One of my last posts was about how I budget and making sure I keep track of everything is how I approach it – this trial and error approach isn’t full proof but it will give me a good sense of where my weekly expenses stand.

Weekly Budget
Nov 10-16
  Budget Actual
Alcohol $40.00  
Food-Lunch $0.00  
Food $125.00  
Gas $50.00  
Entertainment $0.00  
Smokes $30.00  
Misc $50.00  
Transportation $0.00  
Stupid $15.00  
Total $310.00  

The goal for this week will be to keep the expenses down to $310, I believe this is achievable but it I think the amount of money I spend on food might be a bit low. I guess time will tell how this turns out but by putting the budget down in writing is a first step.

Odds and Ends

A me update

I sit here writing this post with a month old baby sleeping against my chest. Her breath is quick and she is so reliant on me and my wife for maintaining her life. The past couple of weeks have been difficult, fatigue and uncertainty have really taken their toll. The baby is by far the most important aspect of my life and she will be for the rest of it. This means that the rest of my life needs to start coming together. I’ve been thinking about my finances, my working life and my happiness in general and honestly a large portion of my life is uncertain. I have my wife’s support and help but the unknowns are things that will need to be resolved. This will be a process that I’m sure will take time but it’s been a while since I was certain about things such as my work and my finances. I lost my self confidences and assertiveness and I happily live in complacency when I shouldn’t. I would like to have these back and the uncertainty removed.  Stay tuned I’ll post my results and thoughts.

Carnival of Personal Finance – my post about how I budget was included in last week’s carnival hosted by Sun’s Financial Diary