Save Vs. Spend

We seem to be bombarded these days with mixed messages on our financial responsibilities.  On the one hand, we’re being urged to spend money to help the struggling economy.  The government is looking at reducing income taxes so people will have more disposable income to spend on non-essential items.  Buying a new car or T.V. is almost viewed as a patriotic duty.

Then they turn around and create the Tax Free Savings Account, which seems designed to encourage more savings – a worthy goal at a time when our savings rate is hovering around 0%.

One article I read the other day said we should do the following in 2009:

1.  Max out our RRSP contributions.

2. Start a TFSA with an initial contribution of $5,000, plus another $5,000 for my spouse.

3.  Maximize our contributions to the boys’ RESP.

4.  Reduce the mortgage and other debt by making additional payments. 

5.  Build a financial reserve equal to six months of salary, and if possible, increase this to nine or twelve months to ride out unexpected job losses.

Well, that should be easy enough.  I was wondering what to do with all that cash we have lying around each month after covering the mortgage payment, municipal taxes, hydro, water and sewer, cable, phone, gas, K’s daycare, A’s daycare, car payment, auto insurance, home insurance, life insurance, critical illness insurance, parking, gas, groceries, and charitable contributions.

In order cover all my bases, I’m looking at unloading some assets.  For example, I have two perfectly good kidneys, and I’m pretty sure I can get by with one.  So, if I can find a buyer, I should be able to sell the left one and use the proceeds to build our nest egg and go on a little shopping spree.  As an added benefit, I’ll probably lose a few pounds during the post-op recovery period.  

Just don’t tell anybody about my plan – too many kidneys on the organ market will drive the price down.

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