Money & Career

Ask Caroline: How to get free money for your kids' education, and getting a job when you've been fired

Those questions and more (how much to save before moving out, advice on financial planning) answered by financial expert, Caroline Cakebread

financial advice, money, savings

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Dear Caroline, How much money should a new grad save up before they even consider moving out of their parent’s house?

A: Getting ready to move out of your folks’ house will cost a lot more than just first and last month’s rent – you’ll be taking on monthly bills like phone, cable/internet and food. You’ll also need setup money for things like furniture, towels, pots and pans. Put together a realistic list of costs for setting up house along with any monthly costs you anticipate having to pay. Don’t be shy about asking your parents or other friends and family if they have any household items they don’t need that they could donate to your new place (old couch, dining table etc?).

Multiply your monthly costs by three or four to give yourself a small cushion in case you lose your job or can’t work – that should give you a realistic estimate of what you’ll need.

Lastly, if you and your parents can live with your current arrangement, why not stay home for as long as you can and save your money? By saving and investing now when you’re young, you can buy yourself a lot more financial freedom down the road….

Dear Caroline, I’m 30 and want to know how well I’m doing with my money. Do you have benchmarks for what I should have achieved? How much money should I have saved, etc.?

A: You’re on the right track with this question – what’s missing are your savings goals. What are you saving for? Setting financial goals is one of the most important steps in financial planning. So if you’re saving for retirement, for example, then when do you plan to retire and how much do you want to live on every year?

How you reach those goals depends on things like your net worth right now (the value of all your assets minus your debts) and how much you see yourself earning in the coming years.

I think you might benefit from a bit of financial advice. I recently wrote this blog post with some tips for choosing a financial advisor. It might help you along the way.

Dear Caroline, Someone told me the government would give me money for my kids’ education. Is that true and if so how do I apply?

A: It’s true. The Federal government will give you free money to start saving for your child’s post-secondary education. All you have to do is open up a Registered Education Savings Plan (RESP). It’s a special savings account that lets your savings grow tax-free. But the best thing about an RESP is that it makes you eligible for the Canada Education Savings Grant (CESG) – the free money part. The CESG matches 20 percent of your RESP contributions on an annual basis to a maximum lifetime grant of $7,200 per child. So, if you put in $500 in the first year, the government will give you an additional $100 in grant money. It’s a big leg up in helping your child save for university or college.

Dear Caroline, I got fired the other day and I’m scared I won’t be able to get a new job because I was fired. What should I do?

A: Getting fired is awful, but it’s not the end of the world. And it doesn’t mean you won’t find a new job. You need to get back in the saddle and brush up your resume. Rally all of your good references and, when you start going to interviews for a new job, try and be as honest as possible when answering questions about your last employer. Make sure you give your response some thought – think about the reasons why you were fired and what you might do differently today. One big tip: Never bad-talk your last employer, no matter how tempting it might be. Do your best to be positive and honest at the same time. Good luck – I hope you find something you enjoy!

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