Bad Habits Are Costly, So Why Do We Have Them?

Let’s be honest for a minute.  Do you have any bad habits? I am not talking about biting your finger nails or compulsively cleaning your home.  I am talking about personal habits that cost you a large amount of money every year.  I admittedly don’t drink alcohol or smoke cigarettes, but I do have a couple of very unhealthy habits.

My bad habits include eating out way too much and spending money on dessert sweets.  I could eat cupcakes and apple pie morning, noon and night and be absolutely happy.  Of course I wouldn’t be healthy, but I’d be happy.   As I get older my body and skin can’t take massive amounts of sugar so I try to avoid cupcakes and apple pie as much as possible so I am not tempted to waste my money.

Personal confession:  Reese Peanut Butter Cups are another one of my weaknesses.  I ate a whole box of Valentine’s Day Reese Peanut Butter Cups in less than 24 hours.  Now that’s unnecessary!

I eat out a lot because I hate cooking and my cooking skills are below average.  Actually below average is putting it nicely.  To be truly honest I absolutely suck in the kitchen – and I’m a vegetarian.  Sometimes I wonder if that’s why I am not married yet.  Maybe if I had dinner on the table every night at 7 p.m. and maybe if I could actually cook an edible meal my boyfriend would be my husband.  Maybe.

Personal confession:  I spend over $4000 a year on eating out.  I know what you are thinking, YIKES!

My boyfriend doesn’t even try meals I’ve cooked unless I have eaten them for two days and not gotten sick.  We had a little incident a few years ago and he just can’t get over it.  I mean seriously, you give a person food poisoning one time and they can never let it go.  My opinion is it’s in the past so we need to move on, but he still takes precautions when it comes to my cooking.

What bad habit would you like to quit this year?

I am all about spending money if it’s for a good reason, but wasting money on bad habits is just not smart.  Unhealthy habits like smoking and drinking can cost thousands of dollars a year.  I think we can all agree that this money could be better spent.

Smoking = $1600 a year.  There is nothing worse than a person who complains about not having any money then turns around and spends $14 a week on cigarettes.  I have no sympathy for people like that.

Lottery = $6280 a year.  Playing the lottery is another bad habit that I think is a waste of money.  Instead of getting your lottery tickets or betting on sports games every week people could put that money in a jar or a high interest savings account and use it for something else like an IRA contribution or a vacation.

Alcohol = $8320 a year.  Drinking alcohol at home, in restaurants and at clubs is very expensive and this doesn’t even include the cab fare to and from the bar.  Use this calculator from Rethinking Drinking to determine how much money you are wasting on alcohol every year.

Originally published on Blonde&Balanced

Photo by taxcredits  

Do you have a pretty people job?

Have you ever been somewhere and been served by someone then thought to yourself “WOW she’s pretty?”  Have you ever asked for help in a store and when the guy turned around to assist thought to yourself “WOW he should be a model?”  I know I have.

Do pretty people make more money?

So who are these people and where do they get their good genes?  I am not bad looking but I am nowhere near Victoria’s Secret or Abercrombie material.  We know from recent statistics that men make more money than women, but do pretty people also have a higher income?

If you are pretty is your life easier?

If you are considered above average looking can you negotiate a higher wage or talk your way into a job easier than someone who is not drop dead gorgeous?  In my opinion the answer is YES.

I absolutely think pretty people have an easier life than others who don’t take as much pride in their looks.  My younger sister Tara Marie has always been “the pretty one” in our family and that’s OK.  I have come to accept it, but I resented her for it for a very long time.

I am a jeans and flip flop girl whereas my sister rocks four inch stilettos like a runway model.  I feel that her life has been a lot easier than mine because she sort of just gets everything handed to her when she smiles and people want to meet her when she walks into a room.  Why is that? It’s because she’s pretty.

5 jobs that need pretty people:

Flight attendant.  I don’t know about you but every time I am in an airport or on a plane the flight attendants are always talk women with long legs or very well groomed men who look like they could be in a Hugo Boss ad.

Bartender.  I worked as a bartender for a year while studying in college and it’s not secret the prettier you are the more money you make.  On a good week I would make more in tips working two nights at the bar than I did in my weekly wage at the bank.  The downside is it really depends on how you look and how friendly you want to be, if you are having a bad night you could end up with very little tips.

Makeup artist.  No one wants an unattractive person trying to make them pretty.  If you are in any type of beauty business you are probably very attractive.  No one wants a hairdresser with a bad hair-do and no one wants to get their makeup done by someone who doesn’t look good themselves.

Real estate agent.  I don’t know why, but real estate agents are usually very attractive people.  Maybe it’s because they are selling a lifestyle.   They also usually drive really nice cars, I guess that’s a sign of success.

Restaurant hostess.  A hostess is the restaurants first impression and these girls are usually very pretty.  My sister worked as a restaurant hostess for two years.  Every night when she came home from work she said her cheeks hurt from smiling so much at everyone who walked in the door.

Originally published on Blonde&Balanced

Photo by kaybee

Do you need a second mortgage?

As a financial planner clients come and see me for a variety of reasons from investment advice to debt consolidations. On a good day clients can bring me a big lump sum of money to invest and on a bad day clients can be in my office with tears in their eyes because they can no longer provide for their families due to the fact that they have accumulated thousands of dollars in debt that they can’t afford to pay off.

A second mortgage gives you access to cash

There are many reasons why people accumulate debt from over spending and poor budgeting to experiencing a job loss or making a bad investment.  When clients are experiencing financial difficulties or need a large amount of money they often turn to their home as a way to free up some extra money because their home is most likely their most valuable asset.

A second mortgage is a new loan in second position on your property title.  In simple terms it means that you will have two mortgage loans on one property.  If you can no longer afford to make your monthly mortgage payments, the second lender will be paid in second priority if your home is forced into default and needs to be sold at auction. Second mortgages are offered by trust and finance companies, they are not offered by big banks.

The first position bank would be (i.e. your original mortgage loan) would be paid first and if there is money left over after your home is sold your second position lender (i.e. your second mortgage loan) would be paid afterwards.  Depending on how much money is leftover from the sale of the home, the second mortgage lender may not be repaid in full. Therefore in exchange for their added risk trust and finance companies charge higher interest rates on second mortgages than first position banks charge on first position mortgage loans.

Consider your options with a second mortgage

According to Cait Flanders of RateHub.ca, a mortgage rate comparison website that aims to help Canadians access the best mortgage rates in the country, second mortgages are most often used as a solution to help clients consolidate high interest debt; but she says that a second mortgage should be a second option for homeowners.  “Most of the big banks (initially offer) homeowners a home equity line of credit (HELOC) for debt consolidation.”  A HELOC is more advantageous than a second mortgage loan because the interest rates are usually lower and the product offers more flexibility, but if your credit is less than ideal a second mortgage may be your only option.  Flanders confirms that “someone with a lower credit score may not be approved for a HELOC and could then consider a second mortgage loan.”

My best advice to clients considering a second mortgage is to make sure you fully understand the financial implications involved when taking out a second lien on your home because that’s exactly what a second mortgage is.  It’s a completely different mortgage contract than the original loan, with a new mortgage term, a new interest rate and a new amortization.  A second mortgage loan also means a second monthly mortgage payment.

Shop for the best interest rate on your second mortgage

How do you find the best interest rate available? By shopping around and comparing rates between trust and finance companies. Consumers should visit RateHub.ca to find a local mortgage broker in your area who can help compare second mortgage interest rates.

Rate comparison websites such as RateHub.ca exist – to provide Canadians with unbiased mortgage information and financial calculators so they can make informed decisions when it comes to their homes and financial lives.  Flanders hopes that with the help of their website “more Canadians will feel comfortable with the decisions they make regarding their mortgages.”

Photo by camknows

Originally published in MoneyMagazine