Last week we talked about some steps to take in this after-Christmas time of bills and today we’ll look at three more steps

What are some other steps we can take to turn our finances around in these economic times?

Take your credit cards out of your wallet. You don’t need them heading for work on a daily basis. That way the temptation is gone and what you charge is a whole lot less. Take a $20 or $50 bill and hide it in your wallet or purse for emergency money. If it’s really for an emergency you’ll still have it in there in six months. With credit cards we spend about 18% more than paying by debit card or cash. We just don’t connect real money with our cards the same way casinos give us chips and don’t want us using $20 bills!

Set up your Tax Free Savings Account. These came out January 1st. Set one up, even if it’s only for $100. It’s a start and you’re well on the way. Putting the money in is not tax-deductible like an RRSP, but all the share increases or interest you earn is tax free. But you have to be really careful. Many institutions are ready to rip you off with a ton of fees. If you’re not careful, more than half the people will pay more in fees than they’ll make in interest off a GIC or term deposit. Your first question needs to be the full list of fees: What’s the opening fee, annual maintenance fee AND if there are any costs for contributions or for withdrawals. Here’s a really great calculator for it from the Government of Canada web site: http://www.budget.gc.ca/2008/mm/calc_e.html

Keep your car for another year. If you believe a cool car is a status symbol and a must-have, you’re doomed to be in debt for decades to come. Not to mention that almost 50% of people trade their vehicle and STILL owe more than it’s worth. The goal should be to drive a reliable vehicle that doesn’t have payments with it which are killing your chances to save or get ahead financially.

And for 2009, I wish you:

Three months of emergency savings

A debit card in your wallet and a credit card that stays at home for emergencies

A zero balance line of credit

A mortgage renewal where you’ve shopped around and shortened the term

And payroll deduction for some savings or RRSPs where you now pay yourself first