(Steven) Financial literacy
is the understanding

of financial components and skills,

such as budgeting, investing,
borrowing, taxation,

and personal financial management.

This is the first in a series looking at
financial literacy presented by CFMWS.

Joining me is Tricia French,
Assistant Financial Counsellor,

based in Edmonton.

(Tricia) Hi Steven, thanks for having me.

(Steven) So, Tricia, how many times
have you heard this?

Budgets don't work,
they don't work for me,

and I don't care what you do,
it just doesn't work.

What do you say to people
that say that to you?

(Tricia) Oh, I hear that all the time.

Budgets can have a bad reputation.

Budget runs with diet--

and just like a diet,
it sounds like it's going to tell you

all those things you can't have,
or can't do--

it's actually the opposite.

Budgets aren't to restrict, but to allow.

Budgets don't control you,
you control the budget.

They can reduce your stress level,
they give you control and awareness

of where your money goes,

they can give you freedom,
and they can be as detailed as you like.

And making a budget
has four basic steps to it:

First, set goals.

That means know what you want.

Your goals become the motivation

to actually create
and stick with the budget.

So ask yourself what you want.

I want to pay off my credit card
in one year,

or I want to save $2500
to attend my friend's destination wedding,

or you have a bunch of goals

and they could all be something
you're chasing at once.

The second step
is you got to track your expenses.

That's called cash flow.

Looking at what money came in
and what money went out.

So, you can do it by saying:

Today, I'm going to start
writing down everything I spend,

and do that for a period of a month
to three months,

and then total up the spending
by category to get good averages.

Or you can do what I like better
which is backtracking.

It means going back and looking
at the last three to six month

of your bank statement,
line of credit statement

and pulling the categories out.

That's going to give you
accurate averages.

Interestingly, tracking your spending
has the power to change

how you spend your money forever.

Because now you can see it.

The third step is,

once you've seen the numbers,

it's now time to look
for the shock and awe.

The shock is when you see spending
that's higher than you realized it was.

We probably all have a category
that would surprise us.

The awe is... awe!

None of the things I spent my money on
were working towards my goals.

So now you have a goal to take a vacation,

and you see
you didn't put any money aside for it.

That's an awe.

And finally, the last step
is take those numbers,

the ones you're comfortable with
and the ones you've made changes to,

and that's how you build the budget.

It's more accurate, and it's going
to take into account your goals.

(Steven) What's the biggest problem
that you see with people

that face making a budget.

(Tricia) I think there's a couple,
but I think the biggest one

is just getting started.

While there can be a bit of work
going through the steps,

it's worth the investment.

The second one that kind of relates to it
is if you're in a relationship,

it might be challenging
to get your partner on board.

So it's really important
that you share with your partner the why--

why it's important
for you to create a budget,

and what you hope to gain
from doing a budget.

It's not about blame, or finding fault,
it's about getting on a financial path

that's positive for both of you.

It can really open the lines
of communication, actually.

Two people watching the budget together
is better than one.

(Steven) Now, Tricia, not everyone
can be that keen

to share their financial position
with a stranger,

or problems with someone
they don't really know.

How do you...
what do you say to those people?

How do you help them
through that dilemma?

Well, first, I completely understand.

The financial counsellors at SISIP
are very professional.

I think some people are worried
that they'll be judged

for mistakes they feel they've made
or the way spend their money,

or what they don't know
about money or money management.

That's just not the case.

Everyone has to start somewhere,

and I'm like
the other financial counsellors,

will meet you where you are
and we can work together from there.

Don't be intimidated, don't be worried,
their won't be judgement, just help.

(Steven) What types of tools are out there
to help people with their budgeting,

and help them stick to that plan?

(Tricia) Oh, It's great
these days, Steven,

there are so many tools out there.

They range from really basic
paperwork sheets, all the way to apps.

So the SISIP webpage,
so at <i>sisip.com</i>

has a downloadable budgeting worksheet.

Which you can find by clicking

on the <i>"find a form or calculator"</i> link
on the website.

This one is great, because it works well
with a mid-month military pace statement,

it has all the same categories
already in there.

There are lots of worksheets.

Find what you like or make your own.

For those who like the tech,
there are also some great tech options.

Our partner, Bank of Montreal

offers the Canadian Defense
Community Banking Program.

They have a feature called
<i>Insights</i> on their app,

that helps you to look at your spending.

You can look at your average spending,
you can compare it to different months,

you could even see
your spending by categories,

such as groceries, transportation,
and eating out.

It'll even tell you
when something has changed,

like you're eating out more often
or your subscription costs have climbed.

Besides that, there are also good apps
for your smartphone or your computer.

Mint, You Need a Budget, Wallet,
and Good Budget are all great apps.

Do a search.

There are lots out there,
they all have different features.

The secret is finding one that can like
so that you know you'll use.

It's kind of having someone alongside you
helping you manage the numbers.

It takes a little bit of the pressure
off you and your calculator.

And yet, often provides information
with kind of a graphical look.

Makes it easy to see how you're doing

and you can watch your progress
over time.

(Steven) Tricia, thank you for this.

(Tricia) Thanks, Steven, appreciate it.
Have a great day.

Tricia French is 
Assistant Financial Counsellor

based on Edmonton.

Please contact an advisor today
at <i>sisip.com</i>

to review your financial plan
and set you on a path to financial health.