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Managing your money: How to DIY your personal finances

You can DIY almost anything, it seems. What about your personal finances?

It’s important to have a financial plan in place, to maintain a healthy financial life and reach our financial goals. Many in Bow Island worry that this isn’t something we can possibly do on our own; we need to pay for financial advice and leave the decision-making to the professionals.

But there is an abundance of online personal finance resources now, so that’s no longer true. You can absolutely gain control of your finances yourself these days; there is no need to pay fees to get outside help.

With this approach, you can customize all of your decisions. You create your own goals, select your own investments and go at a pace you feel comfortable with. Your plan can be 100 per cent personalized. The best part? The sense of accomplishment that comes with designing your own financial roadmap.

Financial literacy as the basis for personal finance

Financial literacy is a necessary foundation. In order to make better financial decisions in all three areas of personal finance—saving, spending and borrowing—you need to understand how your finances work.

“There are countless free online resources available to Canadians looking to improve their personal finances,” explains Caitlin Wood, Chief Content Officer for Loans Canada and Rate Genie. “Consumers should check out the Government of Canada’s website as it covers many money and finance topics. With both Loans Canada and Rate Genie, we are always publishing content to empower Canadians to improve their financial knowledge.”

A free online financial literacy course is available through McGill University. It takes a few hours to complete, is open to all and is taught by professors from the school’s Desautels Faculty of Management. After you finish all of the course modules, you’ll receive a McGill Personal Finance Essentials attestation of completion.

As Wood recommends, another tool to help you learn how to manage your money is the Government of Canada website. It’s comprehensive and explains making a budget, banking, credit reports and credit scores, insurance, retirement and estate planning.

Canada’s largest personal loan comparison website, LoansCanada.ca, can also help you make good financial decisions. The site provides quotes from an array of different lenders. It can choose the best one for you, saving you time and money.

Steps to improve your financial health

Everyone should learn how to create a budget for themselves. Budgeting allows you to track and control spending; it is key to helping you reach your financial goals. With a budget in place, you can create an emergency fund, which, as we all learned from the COVID-19 pandemic, is essential.

If you’re not sure where to start, try Mint, a free online budget tracker and planner, or YNAB (You Need A Budget) , personal budgeting software based on The Four Rules principle. Both can help you gain control of your money and make smarter financial decisions.

Now it’s time to start investing. Investing may sound a little intimidating, especially when you’re just starting to manage your finances, but it’s a necessary component of financial planning. It will help you grow your wealth and reach your financial goals comfortably, especially long-term ones like retirement or saving for your children’s education.

If you haven’t already, open a tax-free savings account (TFSA) either online or in-person at your local bank. You may also want to use a robo advisor; online investment management services like Wealthsimple or WealthBar are both simple to use.

The next step is debt management . Begin paying down your debts and only take on new debt you can handle. Remember that good debt can actually increase your credit score.

If you still feel you need help, seek the services of a credit counsellor. They can assist you with basic budgeting, credit health, credit improvement and creating debt repayment plans. Should you require a more drastic option such as debt consolidation, debt relief, consumer proposal or bankruptcy, they can advise you.

You can manage your financial future. If you have questions, help is available. Begin with the resources listed above and reach out if needed.

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