Mortgage Watch

Step 2: Fixed expenses

Fixed expenses are recurring expenses. You must pay these amounts each month, no matter your income level or your mood.


Step 3: Variable costs

Variables expenses can vary from month to month as they are not necessarily recurrent. When due, you must pay these amounts, whether you expect to or not.

Estimate the costs as fairly as possible and try not to forget any. Some of these expenses are not payable on a monthly basis (taxes, registration, driver's license, etc...) while others are unpredictable (car repairs, illness, etc...).

Be as accurate as possible, based on your past years’ experience. Also, as it is better to save more than not enough, you'll appreciate having a cash surplus.

For those who really want the best way to assess monthly expenses, keep a financial journal for a few weeks. By registering everyday expenses, you might be surprised! These lattes purchased every morning at $3.45 costs $900 at the end of the year!

These small purchases add up! In addition, you will realize quickly that there are many expenses that you failed to include simply because you did not think of them when making a budget. You'll be surprised to see how fast these small amounts can accumulate, forming large amounts that can affect the balance of your budget.

You’ll have to decide what matters most in your life: a trip or a coffee every morning?

Step 4: The results

You have carefully compiled a list of your income and expenditure and, by completing the table, you now realize what your current situation is. Of course, you’ll make adjustments along the way to reflect your salary increases or add an expense account that you had forgotten.

Your budget completed, you have on hand an important tool to help you spend or save.

Once completed, you should print your budget and check it often during the first few months. Annotate it; this way, you’ll gain experience and make a better budget next month.

Remember, the primary purpose of a budget is to see where your money goes. This tool allows you to make adjustments in your financial behaviour and achieve goals you will set.

Generally, it is suggested to get rid of one’s debts as quickly as possible by first paying off the debt with the higher interest rate. A good trick is to tackle the debt with the smallest balance first and moving on to the next and so on, eliminating debts one by one.

In some cases, it is preferable to consolidate debts. This would achieve multiple objectives, reduce the monthly financial burden, reduce the cost of credit and reduce stress.

Do not hesitate to contact your Mortgage Financing Consultant at any time; he or she will be glad to guide you towards the best solutions.