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From Toronto to the corner of Nothing and Nowhere: it's an adventure!

Browsing Posts published by J. B. Rainsberger

At iwillteachyoutoberich.com, Ramit Sethi asked this recently:

It seems like 98% of personal-finance material (blogs, magazines, books) focus on spending LESS — keeping a budget, saying “no, no, no” to lattes, jeans, and vacations.

Why?

Why don’t they cover earning more, or negotiating, or increasing your responsibilities at work, or understanding the psychology of your own behavior, or all the other things besides cutting down on spending?

I’m trying to formulate 3 crisp answers.

So, what do you think? Why is the vast majority of personal-finance material focused on cutting down on spending?

I answered in his comments, but I wanted to repeat that answer here. I hope you find it useful.

I learned from Your Money or Your Life that for most people, most of the time, spending less is easier than earning more. I found that to work for us, and it was a key step in retiring at 34 instead of in our 50s. Unfortunately, most people conclude that they must limit spending to a predefined budget, and find that difficult to make work. I don’t set budgets.

Budgets don’t work because there’s no such thing as a typical month. I also learned that from Your Money or Your Life. For this reason, we never budgeted, but instead, tracked our expenses, looked for wasteful expenses, then eliminated them. We asked ourselves the question, “Do I value this expenditure?” When we answered “No”, we stopped spending that expenditure. We made a quantum leap when we decided that we didn’t value living in an expensive city like Toronto any more.

Now, fortunately for us, when we reduced our expenses, we had an active profit each month, which we turned into passive income generating assets, and the compounding effect took care of the rest. Some families can’t do this. Even after eliminating expenditures they don’t value, they still run on an active deficit each month. These families need help to start earning more money, which usually demands an investment they already can’t afford.

At the same time, Rich Dad, Poor Dad has pointed our attention to the tendency of families to spend more as they earn more. As a result, earning more does not translate to increased active monthly profit (nor reduced active monthly deficit), meaning that it does not lead to increased passive income and more financial freedom.

I would conclude from all this that first focusing on spending less leads to better results than first focusing on earning more.

Take control of your recordings with Beyond TV

Take control of your recordings with Beyond TV

The bad news came when we ordered a new computer to serve as our home-brew digital video recorder (DVR). We had happily used an old Windows XP machine to do the job, but I wanted a faster machine, better capable of handling the demands of up to four shows recording at once, better capable of compressing GBs of video. I bought an Acer Q6600 and loaded it with 4 GB RAM since, as we all know, more RAM matters more than more CPU speed for most home computer users. Sadly, our TV tuners had a different idea.

After several hours of trial and error and a bit of reading, I discovered that the Hauppauge PVR-150 TV tuners we had used for years wouldn’t work on a 64-bit system with 4 GB RAM installed. Worse, rather than simply refuse to work, the tuners would randomly drop frames and freeze at random instants, making it difficult for me to isolate the problem. It took over six hours.

At that time, I worked around the problem by removing 2 GB RAM from the computer. Bear in mind that I had specifically asked for the RAM upgrade for this computer, and so I had essentially sunk some multiple of $100 into useless RAM and the wasted day getting things to work.

That was over a year ago. My, how times have changed.

Not long ago, I came across a short article that described a potential remedy for the problem. It suggested I configure Windows Vista to voluntarily boot with less RAM. It would never in a million years have occurred to me that Windows would do such a thing. I’d never used an operating system capable of voluntarily using less RAM than available. Before encountering the confluence of 64 bits, Vista and the PVR-150 tuner, it never occurred to me to want or need such a thing. With trepidation and excitement, I tried it.

1. Install the RAM and make sure Windows Vista booted fine. Don’t expect the TV tuners to work.
2. Configure Windows Vista to voluntarily boot to 3712 MB (3-5/8 GB) RAM. Run ‘msconfig’ from the Command Prompt, then choose the Boot tab, then choose Advanced Options…. You’ll find a “Maximum Memory” option you can enable and set the RAM Windows will boot with.
3. Reboot. Even though System Properties reported 4.00 GB RAM, I ran Beyond TV and it worked.

I include this, hoping that it will help you out there. I can’t believe I had to give up 384 MB RAM to make this work. My first five computers could run on 384 MB combined.

Convert voicemail to email

Convert voicemail to email

Earlier I wrote about my unfortunate experience trying to try out (yes) PhoneTag.com, a service that transcribes voicemail and forwards it as email and SMS messages. I came across PhoneTag.com in my reading of The Four Hour Workweek, and I really like the idea of reducing the number of inboxes I need to monitor. After my initial trouble setting the service up, PhoneTag.com’s CEO, Thomas Lesnick, offered me a 30-day free trial of the service, which I couldn’t pass up. I wish I could call the experience entirely smooth, but I also want to make sure PhoneTag.com gets a fair reputation for the good points they’ve earned, so I’ll describe my experience as evenly as I can here.

Rogers: elevating customer service to below the floor

Rogers: elevating customer service to below the floor

First, I found out that I’d have to drop voicemail from Rogers Canada to use PhoneTag.com’s service. This turns out to reflect Rogers’ service, and so counts as a point against them, rather than against PhoneTag.com. Sadly, Rogers Canada managed to give me false information in my quest to cancel voicemail from my service. When I stopped in to a Rogers Wireless store, I asked someone to tell me how my plan price would change if I dropped voicemail. After a few clarifying questions, they told me my plan would decrease in price by $2/month. I told them a few times, “I just want to make sure the cost won’t increase because I’d go from a bundle to a-la-carte services.” Imagine my annoyance when I spoke to a CSR at Rogers on the phone, who informed me that replacing a bundle with a-la-carte services would increase my monthly costs. I managed to show just the right amount of exasperation, because a moment later, the CSR told me she could “make voicemail not work” without charging me any extra money. While I expected a decrease in price by $2/month, no change in price satisfied me, so I went along. I canceled voicemail.

Next, I forwarded all my unanswered, busy, and unavailable calls to the PhoneTag.com service’s phone number. PhoneTag.com was good enough to secure a 902 area code number for me to use. Now since my Rogers Canada plan includes pay-as-you-go call forwarding, each forwarded call would cost me about $0.20/minute, but I considered that reasonable cost to pay to try PhoneTag.com, so I went ahead. Setting up the service took only a few minutes, and I called myself through SkypeOut to test the transcription.

I first left a message without choosing the correct microphone setting in Skype, which meant no audio recorded in the message. PhoneTag.com helpfully pointed out that it recorded no discernible audio and would not charge me for hang-ups. Good for PhoneTag.com! Once I configured Skype correctly, PhoneTag.com sent me accurately transcribed messages by email, but not by SMS. This troubled me, because I wanted to receive voicemail by SMS while away from an internet connection for days at a time, if only so that my book-keeper could contact me with urgent questions. At this point, PhoneTag.com began losing my respect.

First, their support system doesn’t integrate with their service system, so I had to create a second account especially for their support system. Without this, I couldn’t track trouble tickets. I don’t mean to put this rudely, but my calendar reads “2009″, not “1999″. I find no real excuse for this inconvenience. What’s more, to sign up for a support account involves specifying my mobile phone provider, and while I can choose “Rogers Canada” for my service account, their dropdown list does not include “Rogers Canada” for the support account. Worse, when I emailed PhoneTag.com support about the issue, they couldn’t decipher my comment and I had to send them a screenshot of their own support system signup page for them to understand what I meant. Here, sadly, PhoneTag.com and Rogers Canada have roughly equally effective front-line support workers, and I don’t know whom that maligns more.

Finally, PhoneTag.com informed me that in order to receive transcribed voicemails by SMS, Rogers Canada would charge me extra, because of the gateway PhoneTag.com uses to send transcribed voicemails by SMS.

This really bothered me.

When I signed up at PhoneTag.com for a service account, they knew I used Rogers Canada as a mobile phone provider. They should have disclosed the extra fees to receive transcribed messages by SMS at that point! I wouldn’t mind them blaming Rogers Canada for the extra fees, but I don’t appreciate finding out after I’d already signed up for a PhoneTag.com account. The fact that they extended me a 30-day free trial makes their lack of disclosure cost me less, but it doesn’t erase the time I’ve wasted setting up their service and dealing with Rogers Canada and their inept customer service. I notified PhoneTag.com and Mr. Lesnick about my disappointment, telling them that this makes it less likely that I will continue to use the service past the free trial. Shame, too, because I like their core service so far.

So I like PhoneTag.com’s core service so far, although I find PhoneTag.com’s customer service and fee disclosure policy a little shaky. If you care deeply about receiving your voicemails as SMS, and you’re on Rogers, then you might find PhoneTag.com too expensive. If you really only need voicemails by email, then you’ll find PhoneTag.com more cost effective. I’ll know more when I see my next Rogers Wireless bill. I don’t look forward to seeing how they screwed it up.

Froth Cafe

Froth Cafe

Sarah’s family has a few cottages littered throughout the township of Tiny, Ontario. During this trip back to Ontario, while the Blue Jays have traveled out of town, we’ve spent most of our “down time” in and among those cottages. I have really enjoyed the disconnected time, as it has given me the chance to read The Four Hour Workweek and come up with some new ideas for the next phase of our retirement.

More than this, we recently found out about Froth Cafe, located on Main St in Penetanguishene, about 15 km from the cottages. We’ve only managed two trips there so far, but early returns have looked good for the fledgling cafe.

In short: very good espresso drinks, fresh and bright decor, very pleasant staff, commitment to quality over speed.

Sarah and I visited Froth looking for espresso drinks: Sarah her cappuccino and I my latte. We walked into the shop and immediately noticed the bright, airy feel. Light-colored wood and clean glass dominate the decor. On the blackboard behind the counter, the cafe’s proprietors set a relaxed tone: if you want fast food, then please go elsewhere. I loved it straight away. We ordered our coffees, chatted with the staff for about 10 minutes, and enjoyed what we drank.

We visited a second time, me bringing some technology to keep me busy while Sarah and her family went shopping for clothing for an upcoming wedding. I found it a delightfully relaxing place to sip a latte or two while working away, seated on one of their big, comfortable lounging chairs.

Overall, I really enjoy Froth Cafe, and find it a shame that we might not have the chance to visit it again soon. If you have a cottage in the Penetang area, please visit them and buy some coffee and food. If you live in the area, please support this fine new establishment to help them survive the winter and provide the community with something better than fast food and burnt coffee.


Tim Ferriss Four-Hour Work Week

Tim Ferriss' "Four-Hour Work Week"

I have started reading The Four-Hour Work Week by Tim Ferriss. When I’d read descriptions and reviews of the book, I formed the opinion that I already intuitively understood many of the principles at work, particularly as regards his steps of elimination and automation. Reading it confirmed what I’d suspected: I had already used these techniques and even counseled others to use them in my work as a classroom trainer and consultant. It sprang to mind a particular success story from my early software career.

I worked as a student-on-call at IBM in Toronto in 1997. I started on the Visual Age for RPG project, which entailed my comparing error messages between the older RPG compiler and the newer Visual Age RPG compiler. While they had automated the test that produced all the error messages they wanted to check, they hadn’t automated checking the messages from the two compilers to each other. Instead, I started doing that. I began with 50-page printouts: a master copy and printouts from each test run. I compared the two copies, then reported a defect when I found an unacceptable difference between the two. It took a few days to learn which differences they could tolerate and which ones they decided warranted a fix. It took me several hours to compare the printouts, and I resented the tedium. After a week, I had the thought that all successful people have: there has to be a better way.

First, I asked whether I could use e-copies of both the master copy and the test runs. They arranged for that with little effort. As I waited for that, I looked for patterns in the text I compared by hand, learning how to extract the messages from the surrounding text and how to describe meaningful and meaningless differences. Once I received e-copies of the master copy and a single test run, I started writing a computer program to load the two files, compare them, then summarize the differences, highlighting the meaningful ones as “almost certainly defects” and the meaningless ones as “probably not defects”. This gave me an opportunity to write my first truly useful programs in C, a language I hadn’t much used before, but one that I imagined would benefit me as a professional programmer. I don’t recall how long it took me, but I don’t remember anyone becoming impatient with me, so the time I spent must not have made me a bottleneck.

The first day, I used my new program to on the next test run, but verified the results by hand. I noticed that my program took about 30 minutes to run: I had an old computer, I didn’t know how to write particularly quick programs, and don’t forget the test runs amounted to 50 printed pages. At first, I looked around the office while my program ran for something to do, as I didn’t have access to the internet on my computer. I flipped through a few manuals, including a C manual that I thought might help me. That day I processed two test runs, the same as any other day, but noticed that my manual checking went quicker, because I could check the meaningful differences first, then the meaningless ones, then double-check the rest of the document to ensure that program didn’t miss any defects. To my delight, it performed more than well enough for me to start trusting it within a week.

Now the time had come to harvest my productivity crop. I collected that day’s test run and a new master copy, loaded them into my program, ran it, then wandered around the building, knowing I had about 30 minutes. I hadn’t realized the size and complexity of the old IBM building in Toronto. I began to understand the need for its intricate room addressing system, right down to numbering hallways, odd numbers running north-south and even numbers running east-west. I walked back to my office after about an hour of wandering to look at my program’s result. I reported two defects, then wondered what to do next. I had to wait for the next test run, and they wouldn’t run one for another couple of hours. I wandered the building some more and stumbled upon something of interest: a dart board in the cafeteria.

I started playing darts.

In less than two weeks, I’d gone from a terrifically tedious job checking two 50-page documents to one another by hand to IBM paying me roughly $150/hour (as a starving undergraduate student!) for about one hour per day, with seven hours of playing darts, reading, or generally relaxing. All this by finding an ineffective work process and streamlining it with a little elimination and a little automation. I had gained some relative mobility, as I only needed to spend about an hour a day in my office, reporting defects or fixing my test program.

Now I need to confess something: my program did not operate perfectly. Every two weeks or so, I’d notice something my program missed: a difference that my program interpreted as meaningless that I needed to report as a defect. This meant that, every so often, I reported a defect later than I could have. I was performing at far less than 100% efficiency. Funnily enough, it did not matter at all! I didn’t understand the theory at the time, but I experienced it then: the project had a bottleneck somewhere else in the system that moved more slowly than I reported defects, so I could generate no extra value by reporting those defects more efficiently!

Imagine that: producing better results wouldn’t have mattered at all, so it didn’t matter that I produced my results less than perfectly efficiently.

Since I didn’t understand bottlenecks at the time, I felt bad about “cheating” and added more rules to my program to handle these increasingly subtle distinctions between meaningful and meaningless differences. The resulting program did work better and did automate my work even more, allowing me to go from one hour of work per day to closer to 45 minutes; but if I hadn’t been refining a skill I would use later to make a lot of money, then I would have looked back on that as a waste of time. Had I known any better, I might not have bothered at all, and simply played more darts!

Long before I started reading The Four-Hour Work Week, I managed to use some of the principles he describes to turn an $18/hour job into a $150/hour, one-hour-per-day job where I got to play darts, read, and otherwise relax most of the day. I didn’t wait to perfect my time-saving system; I just started using it as soon as I reasonably could, even though it cost me extra time for the first week! Since then, I’ve managed to combine the goal of mobility with the principles of elimination to retire at 34 on passive income streams worth 1.5 times my family’s essential living expenses. You can do it, too, and I recommend The Four-Hour Work Week for beginners to read to help form their vision of a new life, and then to re-read a year or two later to refine your approach to freedom from the tyranny of tedium.

CBC Newsworld

Disinformation at the CBC?

I saw a news item on CBC Newsworld reporting on a study that claims that organically-produced food does not deliver any more nutrition than conventionally-grown food. Whoever wrote the piece claimed no additional health benefits from organically-produced food, as though this second claim followed logically from the first.

Sorry, but it does not. It represents a second claim with which I vehemently disagree.

First, let us safely ignore the bias issue here. I don’t want to debate the merit of the study based on who commissioned it and why. Yes, Monsanto might have commissioned it as part of a disinformation campaign. I don’t care about that here.

Next, let us safely ignore the possibility of a flawed study. Yes, the researchers might have made 37 mistakes in conducting the study. I don’t care about that here, either.

On to my point: the flaw in logic that warps the message of study. Logic does not dictate that “no additional nutrition” implies “no additional health benefits”. Indeed, Sarah and I immediately looked at each other after hearing this news item and said the same thing: organically-produced food doesn’t have more nutrition as its goal, but rather less toxicity.

Let me repeat that: of course, organically-produced food doesn’t have substantially more nutritional content than conventionally-produced food. Who cares? First, give me consistently less toxic food, then let me worry about additional nutrition by choosing food with the nutritional profile I need.

I didn’t expect CBC Newsworld to participate in this disinformation campaign. Sloppy writing; sloppy reporting. A shame.

I recently read about voicemail-to-email services and like the idea. I function better when I have fewer inboxes to monitor. I signed up at phonetag.com because they offer a seven-day free trial. They sent me instructions to start using the service the next day, which led me down a small rabbithole.

PhoneTag.com works as you might expect: you forward your unanswered calls to their service, your caller leaves voicemail with them instead of your current phone service, someone or something transcribes the voicemail to text, then they email the text to you and can send you a text message, if you like. It sounds great: no more phoning in to retrieve messages, since they can easily push those messages to me.

Unfortunately, it didn’t go as smoothly as I’d like.

I tried to forward unanswered calls to PhoneTag.com’s phone number. My phone responded with “Request not completed”. After a few attempts, I called Rogers Wireless and they forwarded all my calls for me, which allowed me to test the PhoneTag.com service. It worked. Sadly, the Rogers customer service representative told me that I had to choose between Rogers voicemail and trying out PhoneTag.com. Wait… what?!

As long as I subscribe to Rogers voicemail, I can only forward all calls or none. This means that I cannot forward only unanswered calls to PhoneTag.com unless I first remove the Rogers voicemail service from my account. I imagine eliminating Rogers voicemail will increase (!) my monthly fee, because service packages tend to work that way, and I didn’t want to deal with that possibility at that moment, so I had to abandon my PhoneTag.com experiment for the moment.

If you subscribe to Rogers Wireless and have used or still use PhoneTag.com, then please share your experience with us. I’d like to know whether you find it worthwhile.

After about 21 months, we have decided to enter the next chapter of our lives by ending the Dauphin experiment. We have purchased a house in lovely Summerside, PEI, Canada, and plan to move there next month. From today, we live only three more weeks in Dauphin, and of that, we spend a week on the road.

I declare the Dauphin experiment a rousing success! We lowered our basic cost of living to around $20k/year, which greatly increased the utility of every dollar we earned while we lived here. We bought our first house and paid only $35k for it. We hope to sell at a $5-10k profit once you include renovation expenses. On July 1, 2007, Sarah retired, and I followed on April 1, 2008. Since then, our rental properties have generated more net after-tax income than our basic cost of living. We made our first foray into business ownership with the Academy of Learning, and while that failed, we learned, although this time perhaps not cheaper than an MBA. I bowled in a league for the first time since 1996 or 1997, I can’t remember which, and while I will finish the season with an average right around 200, I’m told that Parkway Lanes in Dauphin is a tough house and that I can expect that average to rise when I bowl elsewhere. I’ll believe it when I see it. We lived through a home renovation, we survived our first break-in, we bought our first steam shower and flat-screen TV… it all worked well.

So why move?

We had three reasons to move to Dauphin: low cost of living, bowling, houses under $50k. We had to sacrifice a few things to achieve our goal of early retirement: Dauphin has no book shop, coffee shop, movie theater, pool hall, Staples or public transportation (although the taxis come close). To travel for work or pleasure we have to either spend four hours on a Greyhound bus, or $800 round trip on flights and extra nights in the hotel. We happily sacrificed those things for what we got, but we made a few assumptions: first, that we’d travel only 2-4 weeks per year because of the low cost of living and the emergence of passive income streams; second, that I’d bowl in leagues here and eventually return to provincial competition; third, that we’d be happy with a small house. Of these, the first two have fallen away. Since we retired, we’ve traveled 50% of the time, not 5%, so living 400 km from Winnipeg airport has created a number of problems. I have learned that Parkway Lanes might close in the coming few years, which, combined with my not driving, would mean I couldn’t bowl. That meant we needed to look for somewhere to live with a similar cost of living and a stable bowling culture.

Enter Summerside, Prince Edward Island.

Yes, it surprised me, too. Sarah worked her research magic and within what seemed like minutes, we were working with a real estate agent. In early February our plan was to visit Charlottetown and Summerside in the spring, perhaps buy a house, then move in late summer. Instead, Sarah found a 1500-square-foot house less than 1 km from a bowling house, pubs, markets, a pool hall and less than 100 m from water. It sounded great, so we bought it. We then realized we could move in as soon as mid-April, which meant leaving here March 25 and not looking back. It has happened that quickly.

When we sell our house in Dauphin and one other property that isn’t generating any revenue for us, that will give us about 80% of the price of the new house in Summerside. We still won’t need a mortgage, although we’ll borrow on lines of credit for a few months. We will still have $30-35k/year in gross passive revenue of which 10% will go to a property manager and the rest will let us continue to retire. In a year we will recuperate our cash position, even including moving expenses and immediate repairs on the new house. We will retain our financial freedom while drastically improving our quality of life.

So, in about five weeks, we live there now.

I have just now read an article at consumerist.com that gives 15 ways to save money when shopping for groceries. We do not hold saving money as our primary concern when shopping for groceries, but the desire to save money does inform our decision-making when our other basic rules don’t do the job, so we don’t always follow all consumerist.com’s rules. Unless saving money is your top priority, I don’t think you should follow these rules blindly either. Let’s go item-by-item:

  1. Make a list and stick to it. Lists focus your shopping and are the single best way to save money.
    I strongly prefer to do this, not just to save money, but because grocery shopping is not a pleasurable task for me. I don’t hate it, but I also don’t particularly like it; I do it because it needs doing. A list is a way to know when I’ve done enough shopping. Not only that, making the list at home encourages us to think about what we are going to eat, not only to buy just enough, but also to be sure we plan to eat what we buy. I strongly dislike wasting food by letting it rot. Since we travel so often, we need to be especially careful about this in the 3-4 days before we plan to leave. The fact those who make a list tend to buy fewer impulse items, which helps them spend less is a happy side-effect.
  2. Compare unit pricing, not box size. As with good things, good prices sometimes come in small packages.
    Since we shop 2-3 times per week, we tend to buy smaller quantities at a time anyhow, which means I only reach for larger quantities of non-perishable items when the unit price of the larger package is considerably lower. Buying smaller quantities of items means buying them more often, which means storing less at home and more easily taking advantage of deep sales.
  3. If you only need a handful of items, use a basket, not a cart. Empty space cries to be filled.
    I like to do even more: we have made the ecologically-minded choice of reusable cloth shopping bags. We take 2-4 bags with us, fill them, then stop. If I can’t carry my groceries around the store, I surely won’t find it easy to carry them home. While I don’t believe that I need to fill empty space in a cart, I do know that I eat all the food in front of me, so I can’t claim to be entirely immune to this psychological phenomenon.
  4. If it’s not on your list, don’t pick it up. According to Paco Underhill in Why We Buy: “Virtually all unplanned purchases…come as a result of the shopper seeing, touching, smelling, or tasting something that promises pleasure, if not total fulfillment.”
    While I don’t follow this rule in a draconian fashion, I do strongly question everything we pick up that isn’t on the list. I know this annoys Sarah, and I understand that the question “Do we really need this?” sounds condescending, but the technique works.
  5. Shop at the edge of the store. That’s where the healthier, cheaper items hide.
    For me, this is a health-minded choice, rather than a wallet-minded choice. The only items we purchase regularly from the stacks include vegetable broth, canned tuna, turbinado sugar, spices, canned tomatoes for chili, honey, peanut butter, cleaning supplies, storage bags and paper products. We just don’t buy processed snack food or pop anymore, and I don’t miss them.
  6. Disavow brand loyalty and swear allegiance to the lowest price.
    This is one area where our desire for good products trumps our desire to save money. If we know the cheaper product is inferior and we care about that, we buy the better product, such as when we spend $15/pound on Kicking Horse Coffee. We also buy local products where we can, which represents a longer-term saving strategy, including Giguere Farms honey (Winnipeg isn’t local, but it’s more local than the US). That said, we are not loyal to brands, but rather loyal to products that give us something great beyond the price. If Kicking Horse Coffee started to suck, we would buy Folgers. If Giguere Farms moved to Montana, we’d buy something else. In all other cases, we tend to go with the lowest-priced product that we don’t know we can enjoy.
  7. Consider generics. You usually get the same quality, without the unnecessary branding.
    Since we buy mostly produce, this doesn’t concern us as much as it used to. We do like to buy bread baked in-store.
  8. Learn to love coupons. With practice, you can buy almost $150 worth of stuff for $5.
    I’m not a coupon kind of guy, because too often coupons require me to buy products I wouldn’t ordinarily buy. Rather than focusing on coupons, I like to keep my list flexible enough that I can take advantage of sale prices. If we have “berries” on the list, and blackberries are on sale, I might buy more blackberries than raspberries. Perhaps we are missing out on coupons, but given the items we tend to buy, I don’t think the potential savings are anywhere near 97%.
  9. Make one big shop, rather than several small ones. You’ll save on gas while inoculating against wasteful spending.
    We save on gas the old-fashioned way: we walk. This means we buy less, get a little more exercise, and think more about what we buy.
  10. Buy from bulk bins. Why pay for packaging and marketing when you can reach right in and scoop out exactly what you need?
    We don’t buy much of the stuff you find in bulk bins, but when we want nuts and seeds, we head to the bulk bins.
  11. Check your receipt. Don’t let an errant scan ruin your hard work.
    We shop at Safeway, who have a “club card” program, which essentially gives lower prices to anyone willing to fill out an application form for a card. Occasionally the point-of-sale system registers the regular price, rather than the club price. I try to pay attention. Given that we shop more often and buy less stuff, I find it relatively easy to remember the low Club prices and notice when the point-of-sale system has the wrong price. It’s harder to do that when you buy $250 worth of groceries at once. We buy less, we spend less on errant prices.
  12. Shop alone. Science shows that we spend more when we’re with company.
    Sarah and I go to the store together, but shop separately: I take half the list, and she takes the other half. I find we spend less time in the store that way.
  13. Track your spending so you can see what’s eating your money. Committed receipt hawks can spot price cycles to help guide their shopping.
    We have tracked all our spending at points in the past, per the recommendation of the classic Your Money or Your Life. We haven’t done this recently, mostly because we have kept our spending well under control the past year. We might benefit from doing this again, especially since we travel so much and we might find it easy to spend “in vacation mode” while on the road, even though when I work, we don’t exacly find ourselves on vacation!
  14. Eat a meal before shopping. Shopping on a full stomach tamps down impulse spending and keeps you focused on your list.
    I have never been concerned about this. If anything, when I’m hungry, I want to buy exactly those things I want to eat right now, then leave the store. This helps me buy less, not more.
  15. Shop without a car. Nothing limits spending like knowing you’ll have to carry your goods home.
    I find it sad that they have this tip last. I would put it first. Nothing limits spending in general like not having tens cubic meters of space to put all the crap you might buy, groceries or otherwise.

I hope you have found this useful. Take care, and I wish you efficient shopping!

…it’s not the reason you might think. Certainly, if I could avoid paying taxes, I would do so; however, this is not the primary reason I would rather live someplace tax-free. My primary reason has to do with the unnecessary and stunning complexity of the tax rules. Today I encountered a particularly delightful example.

An ordinary-looking receiptConsider an ordinary-looking receipt. I have to process this for my corporate income taxes. I use QuickBooks Pro to do my books, although I imagine this problem exists in all major book-keeping software. I have to enter a tax code for this transaction in order to get the input tax credit (ITC) related to the GST I paid which, I should mention, comes to $2.49. Look at how hard I have to work for my $2.49.

First, I happily choose tax code “S” for standard tax rate (6% GST at the time, 8% GST in Ontario, where this meal was purchased), then happily enter the net amount of $46.30 into QuickBooks. I see that the total is not the $52.10 I expect, but rather $52.78. Whence the extra 68 cents? Not too bad yet, since this pretty common: some items are only taxed at GST, others not at all, and usually it’s clear what’s what. I fiddle for 10 minutes or so before recalling algebra and solving the following system of equations. (Yep!)

Let x be the amount of the bill attracting only GST, and let y be the amount attracting GST and PST.

x + y = 46.30; 0.06x + 0.14y = 5.80

I solve this, but get the ugly y = $37.775, and that can’t be. Perhaps part of the bill attracts no tax at all. Well, 5.80 / 0.14 = $41.43, roughly speaking. That means $4.87 is not subject to tax at all. But what the hell comes to $4.87 on the cheque?!

Oh wait, there’s a .29, another .29 and a third .29, which I know add to .87. Aha! I can’t believe it: the tomato, jalapeño and asparagus do not attract tax because they are fresh produce!

I’m sorry folks, but this is insane. There is no way Eggspectation is doing this correctly. If that were the case, Pizza receipts would require a mathematics degree to figure out, since they use fresh produce (one hopes) in their food, too. Could you imagine if a restaurant itemized your salad and charged you taxes only on the (processed) dressing?!

Whether Eggspectation is computing their taxes correctly or not, shame on Canada for having sales tax rules with the potential to create this situation at all. It’s ridiculous. It wastes time for vendors, book-keepers, tax collectors… sure, it fuels the bureaucracy and gives civil servants jobs, but that’s not why I pay taxes, and I certainly didn’t want to pay for an absurd system like this!

So that’s why I long to live in Andorra, where at least there is almost no income tax. I don’t know about their sales taxes, though… that bears another look. To the point, though, it’s the complexity of the tax system I want to avoid. If we paid a flat sales tax on everything and a flat income tax, then I would be much happier. Happy enough perhaps not to need to leave Canada.