Debt Buster: How to avoid personal finance mistakes

Who you gonna trust to help you with your money?

Financial journalists?

"Journalists are always looking for the new hook," said Gail Vaz-Oxlade, whose face is familiar on books, newspapers and TV.


"Your bank offered you the Kool-Aid and you drank it," Vaz-Oxlade retorted.

The TV personality and financial author, who is coming to Kamloops Feb. 10, (2 p.m., Coast Kamloops Hotel & Convention Centre), has nothing against reporters or bankers, but she believes neither is the consumer's best advocate.

Journalism is too caught up with the new, she said, giving as an example tax-free savings accounts (TFSAs) brought in by the Conservative government.

When they were first announced, the financial press breathlessly pushed them as an alternative to vanilla registered savings plans.

Then the financial press swung back to RSPs. Next, when the $5,000 limit was recently raised by $500 a year for TFSAs, she argues financial writers began focusing on them again as the preferred retirement vehicle - all in search of the newest angle.

As for financial instutions, Vaz-Oxlade said banks are out to maximize profit for shareholders, not act in the best interests of Canadians.

She said overdraft protection offered by banks is less a protection for clients than an easy source of profit, credit offered at jacked up rates.

So if you can't trust the financial press or banks, who's left?


Vaz-Oxlade wants Canadians to become their own financial advocates, starting at the basis of all spending.

"Most people have money to save . . . The first thing they do is make a budget. That shouldn't be the first thing."

Instead, Vaz-Oxlade said families must decide how much they want to save - and for what. From there springs a budget.

Vaz-Oxlade's website outlines her "jars" system, whereby budgeted amounts are placed in a jar each week. When the jar is empty, that's all there is.

"When you're down to your last $20 and the choice is between dinner out and eating next week, it's not that hard. With plastic, people don't know how much they're spending."

She calls the mindset "creating the illusion of scarcity."

She's also not a fan of the 10-per-cent rule advocated by fellow financial writer David Chilton in his popular Wealthy Barber book.

She argues the percentage needed is less for young people and higher for those nearing retirement.
Vaz-Oxlade will speak in Kamloops about "The 10 biggest mistakes people make with personal finances."

In addition to advice about everything from insurance to budgets and wills, Vaz-Oxlade said she tries to focus on shifting mindsets in a society that focuses on signs of material wealth - signs that can still be achieved with easy credit.

"We need to shift our mindset from judging ourselves and each other by stuff. Those things don't tell you anything about a person. You can do it all with credit. It can be a show."

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WHAT:Gail Vaz-Oxlade speaks about "The 10 biggest mistakes people make with personal finances"

WHEN:Sunday,Feb. 10, 2 p.m.

WHERE:Coast Kamloops Hotel & Convention Centre

TICKETS:$29.95 for Daily News subscribers available at The Daily News and Kamloops Live Box office.
Non-subscribers tickets are $39.95 and available through Kamloops Live Box Office

MAJOR SPONSORS:The Daily News and Epp Cates Oien Barristers & Solicitors

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