Margot Bai

To read the article in it's entirety, visit the Vancouver Sun's website for Friday January 5, 2007, page D4.
The Vancouver Sun
An Excerpt from the article by Fiona Anderson in the VANCOUVER SUN
Friday, January 05, 2007

Don't sweat the small stuff: Big items provide big savings

Mortgages and investments are keys to increasing wealth

Greg Izzard, with his wife Cindy and son Kyle at their home in Langley. They're looking for ways to save money.

Greg Izzard, with his wife Cindy and son Kyle at their
home in Langley. They're looking for ways to save
money. (Photograph by: Steve Bosch, Vancouver Sun)

With a young family, one of Greg Izzard's New Year's resolutions is to save more money.

He hopes to telecommute more -- since he lives in Langley and works in Burnaby -- so he can cut back on both gas and lunch money.

He's hoping to pay down a chunk of principal on his mortgage and he makes accelerated payments because "it saves a lot of money on interest [and] shaves years off," the mortgage, he said. He already has a variable mortgage rate and because he thinks interest rates will be going down, not up, he'll keep it that way.

Izzard's friend, Margot Bai, has written a book about saving money: Spend Smarter, Save Bigger which is available through

There is a lot of talk of cutting back on things like cafe lattes, like somehow this is going to pay for our retirement, Bai said in an interview. But most people eventually buy big-ticket items like a car or a house.

"And anytime we are spending big money there is the opportunity for big savings," Bai said.

Bai believes saving money can be easy if you do two things: Know what you are getting into and do the math.

"We tend to rely on the advice of the person sitting on the other side of the desk but that person isn't there to help us get the best deal," Bai said. "Usually they are a commission-based salesperson and their job is to secure the biggest contract possible."

Her top three tips are:

"It's pretty stock advice that everyone should be working with a financial advisor," Bai said. "But when you look closely you realize this advice is coming from financial advisors. They're not going to tell you you don't need them because they'd be shooting themselves in the foot."

But there are alternatives to using a financial adviser, and Bai invests her money through low-fee mutual fund companies, which she lists in her book.

The average management expense ratio, the fee mutual funds charge to manage the fund, is about 2.8 per cent, she said. But it's possible to find funds with MERs as low as one per cent.

If you take a difference of 1.8 per cent for a $1,000-investment that doesn't make much of a difference, she said. But for a $100,000-investment that's $1,800 a year in savings and over 10 years that's $18,000.

"If you've got a life time of investing where you're contributing regularly, the difference of 1.8 per cent can end up being $200,000," Bai said.

Do the math for every big purchase, Bai said. She even provides worksheets in her book, but makes readers do the math for themselves.

"Did you do the calculations?" Bai asks in her book. "Please do before you read on," she admonishes.
© The Vancouver Sun 2007