Bill's Bulletin Board
By Bill Rea

It was an interesting talk I took in Thursday morning at King City Secondary School, as James Cunningham of Funny Money Inc. talked finances with the students.

In essence, he spent about an hour delivering a comedy routine to a couple of hundred kids while offering up some helpful tips on how to manage their personal finances.

Some of his jokes were pretty funny. I ought to know, since I laughed at them myself. And I was the butt of a couple of his gags too. I recall him calling me creepy a few times, which is an occupational hazard if you're going to be an aging, graying bearded character running around a school brandishing a camera. But it's okay. The principal and several members of the faculty recognized me. Besides, I've been called a lot worse things. You should read some of the e-mails I get.

But what was really good, aside from the jokes, was the advice he gave these kids, because I believe that managing finances is one of those essential lessons in life that a lot of people never seem to be exposed to.

How often do you max out on your credit cards. I know a guy who used to think he was financially solvent if he was below the spending limit on his Visa. I think he's worked a bit on getting his act together since then, at least I hope so, since he's now the father of three and needs to make sure money is available to address those associated needs.

When it comes to credit cards, I usually get by with just my Visa, and I've only hit my spending limit once, and that involved very exceptional circumstances, and I was able to quickly restore order to that financial chaos.

It all seems like common sense to me. It always has. If you have a credit card, you know you are going to receive bills at regular intervals, and if you don't pay them off in good time, you're going to get dinged with some pretty serious interest. Yet a lot of people don't get that message.

I guess people can be excused for missing such messages because they are young, and as Cunningham pointed out in his talk, the companies in charge of issuing credit cards are counting on a certain amount of youthful irresponsibility. I missed falling into that trap for a couple of reasons, the main one probably being that I lived with my parents until I was 30. Starting wages in the community newspaper business have never been that great (they don't exactly set the world on fire for editors either), and Mom and Dad were obliging, so why not? It wasn't like I was exactly underfoot. I had established my workaholic tendencies by that point, and was spending most of my waking hours on the job any way.

Not every kid on the verge of graduating from King City Secondary is going to have the opportunity or inclination to live at home as long as I did, so where are they expected to pick up their lessons on managing finances? Cunningham indicated a lot of them are going to get the word from their parents. But one point he left out is what if the parents never learned how to manage money? I fear there are lots of people like that around.

Again, I was lucky. My late mother had spent a number of years working in the payroll office for a company of chartered accountants, and I believe she could have lectured Greg Sorbara on things like budgeting and tax law (she got mad at me for expressing similar thoughts in a column some years ago). But she did know how to manage money.

One piece of advice that she gave me, which I follow to this day, was at the start of each year to estimate as much as possible what my expenses are going to be for the coming 12 months; things like phone, car insurance, rent (later mortgage payments), etc. I have since worked in estimations for car repairs, vacation, Christmas shopping, etc.

The result is I have a total of the estimated expenses for the entire year.

Then I divide that figure by 26, since that's the number of pay cheques (such that they are) that I receive every year. So every two weeks, when I put my cheque in the bank, I divert that certain amount into a separate account to make sure I will be able to handle those various expenses when the bill come in.

Simple, but effective.

There were a couple of other useful points he made. One that struck me was the amount of garbage people carry in their wallets. Thus inspired, I pulled out my wallet and did a quick inventory.

In the interests of privacy, I can't offer you a full account, but there were some interesting items, such as a five-cent Canadian Tire coupon I had forgotten was there; a couple of sales slips from the IGA store near where Beth and I frequently holiday, all dating from around Christmas (I have no idea why I would have kept them); a hospital card dating from a visit I made some time ago, listing my address as I place I moved out of more than eight years ago; a ticket for a draw held last fall by the Alliston and District Humane Society (I guess I didn't win the $1,000 first prize); a card stating I'm a member in good standing of a certain organization, except the card expired in December (the updated card is around the house somewhere, I just haven't gotten around to putting it in my wallet yet); my university alumni association membership card, which I have never used; my organ-donor card, which I am not anxious to use; a couple of bank cards, which I use frequently (but responsibly); my brand new Visa card; and my old Visa card, which expired about a month ago and which I shouldn't have still been carrying around (it's since been pitched).

There were a few other items that, while bulky, have some use to me and are therefore going to stay in my wallet. I wish there was a lot of cash was among those items.

Managing money, while a simple topic, has a lot of implications, which Cunningham couldn't have covered in the time he had (not without dropping some of his jokes). For example, he never mentioned RRSPs, which my parents insisted I start investing in from the time I started working. Having spent a couple of evenings last week fussing with my income tax, I'm very glad I do invest. True, retirement is probably not high on the list of priorities of a high school kid, but Cunningham did make a few points about what is commonly known as the magic of compounding, and how if you start putting aside a little bit when you're young, by the time you're old, it can add up to something substantial.

It's sad that messages like this aren't driven home more, not just to kids, but to a fair number of adults out there who could use lessons like this.

Now I know I'm not the greatest when if comes to dealing with my finances, and there are probably a lot of things I could do to clean up my act. But I do believe I am better at it than most people, and I have a lack of creditors pounding at my door to prove it.

And managing money is neither particularly difficult or painful.

Indeed, my wife and I are able to eat out fairly frequently.