People sometimes forget that saving a dollar is as good as making a dollar (plus income tax). By managing your spending habits, budget and planning/negotiating your purchases you can increase the rate at which you accumulate wealth.


– Know Your Expenses: What are your necessary expenses and your extra expenses?  Necessary expenses are things like rent, food, transportation to work. Then minimize your those expenses that are not necessary. Ask yourself if you really need that new toy you want to buy or if you really need to eat out at that fancy restaurant this week.

– Monitor Your Expenses: Know how much you’re spending and where you stand on your budget from day to day. You can do this by automating some payments, standardizing payments into set monthly amounts and giving yourself a cash allowance so you can actually see in your pocket book how much money  you have left.

– Consider Alternatives: Look at your biggest expenses and see what other ways you can find of fufilling those needs at a lower cost. For example, rent versus owning your home. Sometimes, such as in early 2011 in Toronto it is about 25% cheaper to rent your home than it is to own it.  A specific example is a Toronto waterfront 2-bedroom apartment that costs $3,000 per month to own (interest, principal, maintenance, taxes, insurance) and yet you can rent the same apartment for $1,800 per month.  In this case it is a difference of 40%. How would you like to save an extra $14,400 per year?

– Negotiate: So you’ve decided that you need or want something, now you can negotiate the price.  Aside from the big corporations like Bell and Shell Oil, and government offices like the tax department, you’ll be surprised just how much you can negotiate on a product or service, especially in this economy.

– Loyalty Programs: Despite how many gifts you can buy with points from these programs they actually increase the cost of your purchases. When you do an analysis on these programs you’ll realize that rarely, if ever, are they a bargain. Consider the limitations these programs offer, how they reduce and often eliminate your ability to negotiate, how they require you to pay taxes on top of points (which you bought with after tax dollars). In cases of catalogue selection, the products are usually outdated and overpriced.  In cases of airline points, they often have black out periods which co-incide with the days you’re most likely to want to travel.