Developing your financial green-thumb

A little patience is all you need to let your money grow
Sarah Twomey | Desjardins Group

The first long-weekend of the summer season signals the start of an annual ritual for most Canadian green-thumbs: planting season. 

For months now, they've been itching to get their hands dirty in the garden with their favourite perennials, veggies and perhaps a shrub or two. Some garden projects start with a few tiny seeds, planted at random. While others are created using intricate landscaping plans. Both methods require patience and care. In the end, it all pays off and bears a lot of fruit, provided the gardener is persistent. 

The same can be said about your finances - with a little simple planning and persistence, you can grow a nice money tree. 

Reduce your debt: Making a commitment to paying down your debt will help free up additional cash that you can set aside for emergencies, retirement or education savings, and investments. Having circular debt also affects your credit rating. Paying it off will bring you into a higher rating which helps you in the long-term.

Control your cash flow: Do you know what's coming in and what's going out? If you can't answer these questions immediately, you likely aren't budgeting. To make a simple budget, make a list of your income sources and your monthly expenditures, including your investments and savings. You can track it on paper, a spreadsheet or by using personal finance software. 

Increase your savings: Set up a pre-authorised payment plan to contribute to your registered accounts year-round and have fun watching your nest egg grow. You'll end up increasing your cash flow and reducing your end-of-year tax, perhaps even down to zero. Also consider taking advantage of savings programs that are provided through your employer.

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