Getting Serious About Savings in 2014

December 16, 2013

Piggy Bank

With Christmas literally just days away, and the holiday season taking most bloggers and readers away from their computers, I decided this would be the best week to talk about some of the goals I’ve been plotting for 2014. After this week, I only have two more posts planned for the rest of the year, so now seems like the best time to tell you just how different my budget is going to look come January.

On Wednesday, I’ll share some of the new categories you’ll see next month, which forced me (for good reason) to reorganize my overall budget. Today, however, I want to share the savings goals I’m making for myself. Similar to when I was paying down my debt, I’m going to strip anything that’s unnecessary out of my budgets next year. My goals are ambitious, but I need to get serious about saving money in 2014. Here are my plans:

Emergency Fund (TFSA)
Save: $642/month = $7,704/year

A few weeks ago, I had a great chat with Gail about where I should be investing my savings. We both agreed that my Emergency Fund should be in my TFSA, which is where it’s always been, so I’m going to continue with that next year. I’m currently using ING DIRECT Canada’s TFSA, which is earning 1.40%. My goal is to have a $10,000 Emergency Fund at the end of 2014.

By the end of this year, I’ll have $2,300 saved, meaning I’ll need to save $7,700 next year to reach my goal. If you divide that by 12 months, you can see I’ll need to save $642 (rounded up) each month to make it happen. In the spring, I plan on putting my tax return (hopefully $1,000 or more) into my Emergency Fund, and then I’ll recalculate how much I need to save each month going forward.

Retirement (RRSP)
Save: $417/month = $5,004/year

The second thing Gail and I talked about was the TFSA vs. RRSP argument. Her advice: because I make more than $40,000/year but do not have a company pension plan, I should save for retirement in my RRSP (which I currently do). If I did have a company pension plan, it would make more sense for me to max out my TFSA each year and then invest in my RRSP, but that’s not the case.

One other thing I’ve been doing some reading up on is mutual funds. Yes, I invest in them. But this month I made the switch to ING DIRECT’s Streetwise Balanced Growth Portfolio, because Rob Carrick told me to. Actually, it was because I had a couple chats with friends, researched the fees (1.07%) and asset allocation, and it quickly became a portfolio I felt comfortable investing it.

Next year, I want to contribute $5,000 to my RRSP. If you divide that by 12 months, you can see I’ll need to save $417 (rounded up) to make it happen. Since I’ve been contributing $330/month for the last four months already, I feel comfortable increasing my monthly contribution to this amount. And I can’t wait until my Emergency Fund is at $10,000, so I can contribute even more!

Budget: $75/month = $900/year

This last goal has nothing to do with saving money for myself, but giving more to others. I typically donate between $300-400/year to various causes – usually ones my friends are fundraising for – but in 2014 I want to start making a monthly donation to at least three Canadian charities.

First, as a long-time volunteer dog walker, I know how much love and care is given to the animals at the Victoria BC SPCA. And even though I don’t live there anymore, I want to continue to support the work they do. So, I’ll be donating $25/month to the Victoria BC SPCA in 2014.

Second, Indigo’s Love of Reading Foundation has always been a cause after my own heart. What I really want to do is give books to Moody Elementary, in Port Moody, but I can’t do that until September 2014. In the meantime, I’ll be donating $25/month to the Love of Reading Foundation.

Finally, this year, I’ve been touched by a handful of stories about how the BC Children’s Hospital has helped my friends’ children – even saved their lives. And I know my college roommate has had multiple heart surgeries there, since she was just 2 years old. So, I’ll also be donating $25/month to the BCCH in 2014.

I’ll continue to donate money to any causes my friends are fundraising for. And I’m still always on the hunt for this non-profit that probably only exists in my dreams… you know, one that promotes financial literacy for kids/teens? If I ever find it, it can have all my money. Just take it!

In total, it looks like I’m planning on setting aside $13,608 next year; that’s nearly a third of my net income. Sounds a little scary, but I’ve lived on two-thirds of my income before and I can do it again.

Have you started to map out any savings goals for next year?

EXTRA: If anyone uses my Orange Key (38888248S1) to open an account with ING DIRECT Canada this month, we’ll each get a $50 bonus, and I’ll donate mine to one of the three charities listed above. Email me and you can choose!

Flickr: bradipo

  • Trista December 16, 2013 at 5:10 am


    1. Complete 1-2 university courses per semester and pay for books and tuition with cash. Which means I’ll have to save approximately $200-250 a month.

    2. Finish saving for my vacation with my mom and step dad. $350 a month until September then I will add $150 per month towards my emergency fund and $200 will stay in vacation savings for my next trip.

    3. Start my emergency fund with my $1000 bonus at work and then use the majority of the money I make at my second job to hopefully reach $5000 ($333.33 per month) by the end of 2014. $5000 is a 3 month emergency fund for me. My ultimate goal is to have $10,000 in emergency savings but unlike you I need to start with a smaller more manageable goal.

    4. Investigate saving for retirement. I have a provincial government pension so I’m still not sure about the whole RRSP thing.

    I should look in to giving to charity more regularly. I think I’ll start looking in to some charities.

    I don’t have my 2014 budget completely figured out yet as I’m still waiting for my first normal cheque after my raise. I won’t get that until January 1st.

    • Cait Flanders December 16, 2013 at 7:23 pm

      These all sound like great goals! I bet you’re excited to see what your new paycheque will look like. :)

  • Bridget December 16, 2013 at 5:26 am

    Saving over $1,000/mo? You go girl!

    I’m going to keep contributing to my emergency fund and brokerage account but I think I’m going to stop contributing to my RRSPs for 2014. Since my income will be low next year because I’ll be a student for 8 months of 2014, it doesn’t make sense tax wise. Thankfully there’s enough in there that it will still grow a bit through interest and dividends.

    • Cait Flanders December 16, 2013 at 7:26 pm

      You know it!

      And I think that makes sense. Stocks are something I want to understand better by the end of next year, as well. Don’t be surprised if I start lurking some old blog posts.

  • Heather December 16, 2013 at 6:05 am

    1. Pay off my debt in May!!!!
    2. Build up my emergency fund to 10, 000. This simply means diverting the amount I was paying on debt to my TFSA. That will be accomplished by December.

    Throughout this year, I also want to research better options for retirement saving. This year and next I’ll only be contributing $100/month.

    • Cait Flanders December 16, 2013 at 7:27 pm

      Woo hoo! Those sound like two amazing goals. :)

  • Lynsey December 16, 2013 at 6:19 am

    I’ve been giving a lot of thought to our goals for 2014 over the past couple of weeks:

    1. We’ve saved up a house deposit & some money towards moving expenses but I’d really like to save £5,000 for an emergency fund before we commit to buying a home..
    2. In the same vein, we live in a furnished flat (apartment) at the moment, so will need to save another £1,000 or so towards a bed & a sofa – we could get them cheaper but it’s a bit of a false economy if we’d be looking to replace them as soon as we could afford to. Might as well wait a bit longer & get something that we love & will last.
    3. Start a pension! I’ve just resigned from my job to finish off writing up my thesis, but the first thing I’ll be doing once I get something new is setting up a pension plan & contributing approx. 20 % of my salary towards it.
    4. Finally, I’d like to save up towards a short holiday – my husband & I didn’t go on honeymoon when we got married in the summer. So I’m hopeful we can save enough for a few days in the sunshine before the end of the year. I’ve got my fingers crossed we can get a cheap flight to Barcelona.

    Your goals sound great Cait – having $10,000 in an emergency account will be a fantastic achievement & charitable giving is so important too. We give £25 a month to charity, but once I’m working again I think we should probably increase this total.

    Hope you have a great Christmas & New Year! x

    • Cait Flanders December 16, 2013 at 7:36 pm

      Sounds like you have given a lot of thought to your goals, Lynsey! Your first goal is basically my Emergency Fund goal but backwards. I want to think about buying one day, but not until I have an E Fund ready to help me if anything comes up as a new homeowner. So, I’m going to save that first and THEN start saving for a down payment. (It’s also just to see if I have what it takes to save a decent chunk of change or not, since I’ve always sucked at that.)

      Anyway, good luck finishing up your thesis! And Merry Christmas to you, as well :)

  • Rob December 16, 2013 at 6:36 am

    Great goals to strive for in 2014, Cait.

    One observation please:
    As I’ve commented previously, I also follow Garth Turner’s blog. He makes a good point about TFSA accounts (which I fully agree with) – they are sadly misnamed. They need not be only considered as “savings” accounts but really should be considered as “investment” accounts, especially due to their favourable tax treatment. This means that a TFSA can hold all kinds of investment vehicles within them, not just cash / money market / CD type stuff (which currently earns very little). Like Garth, I like to see my TFSA money working hard for me in their earnings. There may be a little more risk involved but, being as young as you are, it’s surely quite manageable. After inflation (even if it’s currently minimal), results in your current ING TFSA earning probably just over 1% annually. I’m sure that since you plan to invest a significant amount next year in your TFSA that you can set up some additional investment(s) in it that can earn double (or triple or even more) of what you currently expect to earn. I’m sure if you discuss this point more with Gail that she would agree. My suggestion – spread out your investments in your TFSA – not just for guaranteed savings but also for growth. It’s all part of passive investing strategy. Just a suggestion, for what it’s worth.

    Btw, you would not want to be here in TO today – man is it cold out there !!! :-)

    • Cait Flanders December 16, 2013 at 6:56 am

      I did actually open a self-directed TFSA as well, but only have $100 in there right now. Next year, depending on my savings progress (you know I’ve always been a crappy saver), I’m going to add a little to that account to see how it performs!

  • Alicia @ Financial Diffraction December 16, 2013 at 6:36 am

    I have an entire tab on my website going through my goals for the upcoming year.

    Basically it comes down to putting between $1200 – 1350 per month towards debt. The variability comes into whether I can top up one of my payments or not. 21k of my debt should be cleared off by December 2014 (after a beefy tax return), with the remaining $9,500 for 2015.

    I am also working to have my emergency fund up to $6,000, but that will only be through found money and interest. No contributions, but it’s only $600 away. My planned spending will be growing a bit over time as well because my car is getting a bit older and needs to be regularly-, and well-maintained.

    Assuming I get on with my new employer, I will be saving for retirement at around $300/month in an RRSP, with a pension contribution from them at $450. That will boost my savings pretty well.

    • Cait Flanders December 16, 2013 at 7:39 pm

      How amazing would it feel to wipe out 21K next year? Think about what it would feel like to write that blog post, and use it as motivation all year. :)

  • Catherine December 16, 2013 at 6:44 am

    Once your ER fund is maxed at 10k what do you plan on doing with the $600ish dollars per month? Increase cash flow or redirect to retirement?

    • Cait Flanders December 16, 2013 at 6:59 am

      Start saving for a down payment. :)

  • Nadia December 16, 2013 at 7:39 am

    You go Cait!

    My goal is to get a job and get my student loans knocked out.

    • Cait Flanders December 16, 2013 at 7:40 pm

      Nice! I hope you can make both of those things happen, Nadia. :)

  • Well Heeled Blog December 16, 2013 at 7:39 am

    Great goals. And I love how you can discuss your goals with one of the top PF experts because you guys are friends/colleagues! :-)

    • Cait Flanders December 16, 2013 at 7:43 pm

      Thanks! And I feel extremely fortunate to have a good relationship w/ Gail.

  • Kali @ CommonSenseMillennial December 16, 2013 at 7:49 am

    These are some really awesome goals! I love that you are going to make such an effort to make donations to charities that could really use the help. You are a wonderful person and I wish you the best of luck with ALL your 2014 goals.

    As for me, we have started looking at what we want to financially accomplish in the new year – basically, it boils down to SAVE MORE! :)

    • Cait Flanders December 16, 2013 at 7:46 pm

      Thanks, Kali! I think I’m just trying to become more well-rounded w/ my finances. Like if I can afford to save X amount, I can also afford to start giving X amount. Make sense?

      And it sounds like 2014 will be the year of savings for many!

  • Rebecca @ Stapler Confessions December 16, 2013 at 7:58 am

    I have started to think about my 2014 goals, but it feels like life and finances are so up in the air that it’s hard to envision what some realistic goals will be. First and foremost, however, I’m pretty sure that we will start the year with a January Spending Freeze. I hadn’t done a lot of shopping from August (when I was laid off) until November, but once mid-November hit, I started holiday shopping and had a hard time putting the credit card away. :(

    • Cait Flanders December 16, 2013 at 7:48 pm

      That’s not a bad idea, then. Honestly, I’ll be doing the same. My entertainment next month will have to come from books, Netflix and really good home-cooked meals, haha. Good luck :)

  • Jordann December 16, 2013 at 8:09 am

    Girl, we have almost identical savings goals!

    I’m also planning on saving $10,000 in my TFSA for emergencies, and I just started investing in ING’s Streetwise Balanced Growth fund last month. I plan on putting $6,600 in there in 2014 to match my measly $500 contributed in 2013.

    Looking forward to reading about your accomplishment of these goals. :)

    • Cait Flanders December 16, 2013 at 8:16 am

      Don’t forget that whatever you contribute in January and February counts as your 2013 contributions!

      • Jordann December 16, 2013 at 11:04 am

        See I didn’t know that because this is the first year I’ve ever contributed to an RRSP, thanks for the heads up, that’ll help pad my tax return a little.

        • Cait Flanders December 16, 2013 at 12:04 pm

          No prob! Lately, I’ve been obsessed w/ reading through the CRA’s site about this kind of stuff:

          • Trista December 17, 2013 at 5:02 am

            Cait, I’m not sure if you know the answer to this question…

            Where I work two jobs people often tell me I should be getting extra taxes taken out of my cheque because the second job does not take enough out and I get stuck with an income tax bill in April. But what if I took some money and put it in an rrsp instead would that be close to the same thing? I’ve shared with you before that I don’t have an rrsp because of my government pension.

  • Anne @ Unique Gifter December 16, 2013 at 9:07 am

    I love hearing about your plans to donate to a variety of charities! It sounds like you have an awesome savings plan laid out for 2014, too. It will be amazing to reflect back at the end of 2014 and compare it to 2012!

    • Cait Flanders December 16, 2013 at 7:50 pm

      Oh my gosh, I can’t even imagine what the end of 2014 will look like. Well, I can… but it doesn’t seem possible – in a good way. Does that make sense?

  • Debt and the Girl December 16, 2013 at 9:14 am

    You have some great goals. I hope you are able to accomplish them. Good luck in the new year!

    • Cait Flanders December 16, 2013 at 7:51 pm

      Thanks, lady!

  • dojo December 16, 2013 at 9:25 am

    Good plans, keeping fingers crossed for you.
    In our case it’s save as much as possible, since it will be a ‘costly’ year.

    • Cait Flanders December 16, 2013 at 7:52 pm

      Sounds like it’ll be a year of savings for many!

  • Eva @ Girl Counting Pennies December 16, 2013 at 12:35 pm

    Great savings goals, Cait, and I am sure you will succeed! :P

    My plan is to save no more than £3k next year, this is mostly money I get in commission and side income (like selling things). Since my main priority is to pay off debt, I’m happy with my savings goal for now.

    • Cait Flanders December 16, 2013 at 7:55 pm

      I sure hope so!

      And that sounds like a very reasonable savings goal, since you also want to pay off your debt next year. I can’t wait to read the post about you making your final payment :)

  • Liquid December 16, 2013 at 12:45 pm

    SMART goals :) Hopefully 2014 will be another great year for stocks so you’ll get some capital appreciation along with your new investments. I aim to save about $1K a month for 2014 myself so we have similar targets.

    • Cait Flanders December 16, 2013 at 8:07 pm

      Nice! And thanks. I hope so. :)

  • L December 16, 2013 at 1:25 pm

    Awesome goals! I’m working on the $10,0000 EF myself. Do you think you will start setting money aside for a down payment in the near future? Happy Holidays!!

    • Cait Flanders December 16, 2013 at 8:17 pm

      That’ll be my goal for 2015. :)

  • Travis @debtchronicles December 17, 2013 at 5:17 am

    I’m glad to see you’re putting your Efund into something that has a chance to grow, instead of your average run-of-the-mill savings account. The interest rates on those are stupid low (like less than 1%??) and actually make you LOSE money compared to inflation. Great goals, Cait, looking forward to following along as you achieve ALL of them! :)

    • Cait Flanders December 17, 2013 at 7:39 am

      Yea, I’m happy with 1.40%, but have been told there are other lenders that offer a little more. The trouble is, most of those better rates are for promotional periods, and I just can’t be bothered to constantly shift money around to wherever the best rates are. At least not when I only have a little bit of money in there, barely earning anything, haha. And thanks, Travis! Here’s hoping :)

  • Rob December 17, 2013 at 6:19 am

    Just another word about RRSP contributions, Cait (for those out there unaware of these facts) – according to the Canadian Feds:

    Your allowable RRSP contribution for the current year is the lower of:
    18% of your earned income from the previous year, or
    The maximum annual contribution limit for the taxation year (which is $23,820 for 2013), or
    The remaining limit after any company sponsored pension plan contributions.

    So be careful to not over contribute into your RRSP (based on your 18% limit) if you also are currently contributing into a pension plan – both contributions taken together must not exceed your 18% of previous year earned income.

    If in doubt google about RRSP contribution limits.
    Here’s one link:

  • Sara Hamil @ They Call it Gumption December 17, 2013 at 6:22 am

    As always, your savings goals are a lot more specific than mine! All I really know is that I want to make savings and debt repayment a priority in 2014. Guess it’s time to sit down and really plan it out!

    I like that you added donations to this list. You’re such a champ :)

    • Cait Flanders December 17, 2013 at 7:42 am

      Do it! And thanks, lady. Just trying to be a little more well-rounded w/ it all.

  • Laura @ Richmond Savers December 17, 2013 at 9:12 am

    Awesome goals! 2014 is going to be a great year for your savings for sure :) I wish you all the best in the new year as you work towards those goals and I think it’s lovely that you’ve included donations.

    • Cait Flanders December 18, 2013 at 8:17 am

      Thanks, Laura! Happy New Year :)

  • Michelle's Finance Journal December 17, 2013 at 10:10 am

    These are great goals and you didn’t forget to spread the love and blessing~
    It’s good that you’re specific with your goals. You’ll do great~

    • Cait Flanders December 18, 2013 at 8:18 am

      Thanks, Michelle. :)

  • Kevin @ goodfinancialdecision December 17, 2013 at 8:57 pm

    Hey Cait, love the post, great goals! I wish you all the best in achieving them! I’m just finishing up my goals for next year, here are some of my top ones (the more I share, the more likely I am to achieve them!):

    1. Contribute 10% of my pre-tax income from each pay-cheque to my RSP through direct deposits into my RSP account.

    2. Contribute $500/month to my house down payment fund. This is to continue to build to my medium term goal of having a 20% down-payment saved up by the end of 2015. I am currently about 80% there!

    3. Determine how I can make a career transition into the personal finance industry by October 1, 2014 while maintaining a minimum salary of at least $60,000. As someone with no direct work experience in that industry, this will probably be the most challenging.

    4. Begin earning income from my blogging through the sale of ebooks or financial coaching services by March 31, 2014, even if it is only $50 in the first month!

    • Cait Flanders December 18, 2013 at 8:21 am

      Looks like a great list of goals, Kevin! They’re very specific, which will make them that much more achievable. Good luck!

  • Chelsea December 19, 2013 at 10:57 pm

    Great post! A couple of questions- and I apologize if you’ve addressed these in previous posts but I’ve been super busy with work the past few weeks and am just catching up on blog reading.

    1. Why $10,000 in a emergency fund? Is this typically what people save or is it a random number you’ve come to decide on?
    2. Can you write a post explaining TFSA or direct me to a good source?
    3. Did you talk to THE Gail? Like, Gail Vaz-Oxlade? Because if so, ohmygosh!

  • Mo' Money Mo' Houses December 21, 2013 at 8:10 am

    Awesome goals. I still need to figure out what mine are. Since I’m making more now than in my previous job I’m excited to look at everything and see how much more I can save this year compared to last year.

    • Cait Flanders December 30, 2013 at 2:49 pm

      You should also save for a trip… maybe to NYC!? You must go, while you’re living over there! #enabler

  • Val @ Balancing Val December 21, 2013 at 4:19 pm

    I used a chunk of downtime to map out my entire debt-free plan. I found out that if I keep the same income and not have any large expenses then I could potentially be debt-free in 5 years.

    I currently am close to $30k in debt when all is said and done.

    The plan for my debt snowball is going to start out as a snowflake in 2014 ;)

    – put away 25% of my income for taxes – the company i work for pays my business directly

    – figure out EXACTLY how much i have to spend on debt repayment after all expenses are covered and discretionary spending is calculated

    – put most 80% of debt repayment money on the highest interest debt each month and 20% going to the next highest

    – use the 52 weeks of saving printable (on my blog) to have a little chunk of money at the end of the year when things get the tightest

    – continue to eat more meals at home and make conscious decisions on the items i buy throughout the year while still feeling like i am not depriving myself of life :)

    – teach my future husband better spending habits and get him comfortable with them before we combine our incomes and tackle his debts too

    A pretentious goal is to try and be completely out of debt in 3 years before I leave Hawaii. With the income I have now it seems less possible, but I hope to one day make an income with blogging and also finally launch my healthy foods t-shirt line!

    Happy holidays, Cait <3

    • Cait Flanders December 30, 2013 at 2:55 pm

      Way to go, Val! These are amazing goals – so specific, which I love. I hope you’re enjoying the final days of the year. Happy New Year!