Mrs. Hutch’s Home Economics: Using IUDs as Birth Control For Fun and Profit

A few years ago, for personal reasons, I decided to switch up my method of birth control. I had been on the same pill since I was sixteen years old and needed a change. Mr. Hutch and I were in a committed, monogamous relationship and we didn’t intend on starting our family for a few more years. After weighing my options I decided to take an IUD out for a spin.

Now, an IUD is a pretty big commitment. Saying I took one “out for a spin” is pretty flippant. It’s not something that you can easily get rid of if you decide that it isn’t for you. Ideally, you want to keep that sucker in there for at least 5 years, maybe even 7. So I talked to my doctor and did a fair bit of reading before deciding to go ahead. My doctor didn’t “do” IUD insertions, so I had to have that bit done at my local sexual health clinic (for all you old-timers, we used to call it Planned Parenthood). Being the sexual-health police that they are, the clinic imposed a mandatory “counselling” session. It was kind of annoying but I just told them my deal and really, it was fine.

There are two kinds of IUDs: ones made of copper that release no hormones and ones made of plastic that release the same hormone(s) as in birth control pills, but at a much smaller dose. I chose the hormone-releasing type and that, my friends, is where the “for fun and profit” part began. I don’t remember my reasons for choosing the hormone-releasing IUD. I’d imagine it may have seemed more bullet-proof as the hormones inhibit ovulation while the copper IUDs do not. I admit this is an entirely invalid point on which to base one’s decision because both types are equally effective at preventing pregnancy. Whatever the reasons, my decision to go with the hormone-releasing IUD was about to unleash a whole lot of unintended awesome on my life.

The happiest side effect of the hormonal IUD (aside from not getting pregnant) is that I have NEVER had a period while using it. Granted, I had the thing removed after about two years when Mr. Hutch and I decided to start trying for Hutchlings - a bit sooner than we originally planned - so I had a couple of periods before getting pregnant. But as soon as I got the all-clear from my doctor following their birth I had a new one rigged up. Again, I haven’t had a period since. Two periods in the last four years. Life changing.

Ladies, consider for a moment how different life would be if you never got your period. No mood swings, no bloat, no cramps, no headaches, no blood leaking out of your vagina for the better part of a week that needs to be continually mopped up! I’m telling you: AWESOME. Every day is just as carefree as the last, and I’m as emotionally balanced as one could expect a mother of 18 month-old twins to be. This must be what being a man feels like (in a good way). I’m not kidding, this is what I call fun. I’m guessing Mr. Hutch would agree.

Now for the profit:  IUDs run around $300 but like I said, they are intended to last for a minimum of 5 years. My extended health plan covers all forms of birth control so the upfront cost, while significant, doesn’t factor for me. $300 over five years works out to only five bucks a month, less than any birth control pills I know of. Stretch your IUD for 7 years, which my doctor says is perfectly fine to do, and you’ve saved even more. Now add in the fact that you are no longer buying tampons, pads, diva cups or any other method of clean-up. No more Advil or Tylenol for cramps. Your drugstore budget just went through the floor!

Disclaimer: Obviously, I’m a fan but I’m no doctor. Don’t take my advice when choosing your method of birth control. Explore your options with a qualified medical professional.

What Should We Do With All That Rental Income?

Progress continues on our two-bedroom rental suite. We’ve turned the corner on demolition and repair and are on to construction. As I type, walls are being erected. It’s exciting. One of my favorite pastimes lately is deciding what to do with the extra cash flow once the suite is rented. It involves lists, charts, spreadsheets and calculators. I love it.

We expect to get somewhere in the neighborhood of $1200-$1400 a month in rent from the suite. We’ll also be able to claim some tax deductions (which of course we’ll include in our T1213 form every year) which I’d estimate will add maybe another $200 per month. So we’ll effectively add another $1400-$1600 to our income every month. I can’t wait.

Now for the downside. Here’s all of our debt:

1. Car loan: balance is about $9000, interest rate fixed at 6.89%

2.  Line of Credit: currently no balance, but there will definitely be one by the time the rental suite is finished. I think we’ll be lucky if we end up with a balance of less than $25,000. Interest is variable at Prime + 2.75%, or 5.75% today

3.  Income Tax Arrears: I owe about $4000 to the government in income tax. This is a one-off situation and is related to my recent maternity leave. I have worked out a payment plan that will have it paid off in seven months. Interest rate is fixed at 5%

4.  Mortgage: we just refinanced in June 2012 in order to fund this renovation. We owe $410,000 at a fixed rate of 3.29% and if we follow our current schedule, it will be paid in about 26 years.

Obviously, paying down any and all of these debts is an option. I have other ideas for the money too though. Mr. Hutch and I currently put away $400 every two weeks into our RRSPs. Right now we’re buying mutual funds but I want to change that. Hopefully that will be the subject of a new post in the near future. We also put aside $100 into an RESP every month for the Hutchlings. I want to increase our contributions to both the RRSP and RESP. We’d also like to save for a new vehicle for Mr. Hutch, and maybe the odd family vacation (nothing extravagant).

I think we’ll do a combination of the following:

1.  Pay off the car loan. It’s pretty obvious to me that this has to go as a top priority. It’s essentially like getting a guaranteed 6.89% return and that is hard to beat. Once we’re no longer making payments, we’ll also have an additional $338 per month to direct towards our other goals.

2.  Increase our RESP contributions. The government matches contributions 20% up to a maximum of $500 per year, per child. That is one sweet deal. We could contribute $416 per month for both Hutchlings before we max out the government contributions. I’d like to get close to that.

3. Pay down the line of credit. Again, we’re not going to find anything close to a guaranteed 5.75% return anywhere else these days. Depending on how much our balance is once the renovation is complete, I’d even like to pay off the car loan with the line of credit and then focus on paying down the line of credit. I’d only consider that though if we can roll in the car loan and still have a good cushion left.

4. Increase our RRSP contributions. From what I understand, I can be fairly confident in assuming an average return of around 6-8% for our investments, but of course this carries a degree of risk. It could be more, it could be less. Of course, the more we contribute to our RRSPs, the bigger the tax return. Or tax “keep”, I should call it.

5. Increase our mortgage payments. I’m going to resist the urge to be too aggressive on this. A guaranteed 3.29% return is okay, but our money is probably going to work harder for us elsewhere (like our RRSPs). I’d like to pay it down only to the extent that it is gone by the time we want to retire (much earlier than 65 if all goes according to plan).

6. Save for a new truck, some family vacations and other rainy day-type stuff. Because this is short-term, this will probably go into a high-interest savings account TFSA that earns 1.2%.

So there you have it, the start of a plan. I’ll let you know how it all goes down once that rental income starts rolling in.

How Mrs. Hutch Sticks it to the Taxman

Any parent will tell you that raising children is the hardest job in the world. Any parent who isn’t medicated, anyway. And it’s true, you put up with a lot.  Sure you get to enjoy the world’s sweetest slobbery kisses, but those kisses only go so far. That smear of shit on the wall still isn’t going to clean itself, you know what I mean?

But there is one big fat juicy reward that goes with parenting: tax breaks. Mr. Hutch and I pay an honest-to-god saint to take care of the Hutchlings so that we can work at apparently more important jobs. We gladly hand them over to her with $65 every weekday (we get a $5 break per day because there are two of them – totally makes carrying two babies at once worth it).  $65 a day, 5 days a week, 48 weeks of the year, plus a $200 deposit for the remaining four weeks, works out to nearly $16,000. Ouch. But, because of some previous government’s infinite wisdom, those 16 Gs are tax deductible in Canada. Assuming a marginal tax rate of 29.7%, we’d get $4752 back on our tax return. That is, if we were stupid.

You see, I’d rather not give the government my money in the first place only to have them return it to me, interest-free, next April. I have better things to do with it right now. Luckily, there is a way to do just that. The Canada Revenue Agency will allow you to not have the income tax withheld from your paycheque on the amount of your tax-deductions. In the Hutch family, this means RRSP contributions as well as child care expenses (we just stick with these two and don’t factor in other minor deductions like tools for Mr. Hutch or charitable contributions). If you or your employer contribute to a pension plan, they essentially do this already.

It’s called the T1213 Request to Reduce Tax Deductions at Source for Year(s) ____. Print it from the CRA’s website and mail it in. If you can’t print for some reason they’ll even mail you a few copies if you ask. Once your request is approved, you’ll get a letter instructing your employer to stop withholding income tax on whatever amount is warranted in your situation. 

Since we started doing this my bi-weekly paycheques increased by a couple hundred bucks. Pretty sweet, if you ask me. And it makes that monthly cheque to the daycare a bit easier to swallow knowing that my "refund" is already in the bank. And it's not going anywhere until I say so.

Mrs. Hutch’s Home Economics: Breastfeeding for $9.38 per month*

Just this morning, I found myself in an interesting position.  It’s one that I don’t have a lot of experience with, but that has certainly been more frequent since I had children: being on the receiving end of judgement.

This particular judgement was of the fact that I still breastfeed the Hutchlings at 18 months old.  It’s generally only once a day, after their bath in the evening, unless they are sick or on an airplane or in some equally traumatizing place. N, in particular, is a boob-monster. I’m pretty sure he would like nothing better than to sleep all night, every night, while nursing.  We never did the family-bed thing, mostly for the logistical factors that come with twins, so it’s not like he ever had the opportunity.

Curiously, I have found that this particular judgment has only ever come from people who are a generation older than me. It has even come from within my own family. The person who said this to me today did so, I believe, with the best of intentions. She is of the mind that weaning the Hutchlings will make them more independent. I agree that independence can and should be encouraged at this age, but I’m not convinced that denying them the breast will accomplish it.

We all know that breastfeeding saves money over formula feeding. When the Hutchlings first came home from the NICU, my nurse and lactation consultant told my husband that at the end of their first year, he was to take me on a week-long holiday to a very expensive resort on the coast. She claimed I would have saved us about $6000 by breastfeeding twins that long. I have no idea if that figure is accurate. I will say though that I ate so much more in those early days when I was a milk-machine that I may have eroded a good portion of those savings with a higher grocery bill.  Who knows?

We also all know that many women who formula feed don’t do so by choice. I want to be clear that I was very lucky in that I had professional help in the form of a lactation consultant, and with that help I was able to produce enough milk for both the Hutchlings, and then some. Learning to breastfeed two premature infants was not easy though. Many people in those early days expressed surprise that I was doing it. I’m not sure if it was because I was physiologically able to, or that I was choosing to. I guess I could have given up but honestly, the thought never crossed my mind. In some ways it may have been easier, but in many ways it wouldn’t have. The thought of washing all those bottles alone would have made it out of the question for me.

So, in answer to the comment from this morning: I’m not going to stop breastfeeding. I can’t see any good reason to. Heck, if it replaced one cup of cow’s milk, I saved $0.31 today.

*Where we live, 4 litres of cow’s milk is $5. 250ml per day is $0.3125, or $9.375 per month.

What does Mrs. Hutch do for cash?

What don’t I do for cash? I think I’ll explain that statement in a future post. For now, I work for our provincial government in a job that is “good enough”. It allows me a good degree of flexibility and autonomy (worth a lot, in my book), and decent enough pay for what I do. It generally isn’t taxing, physically or mentally. Though not my dream job in any sense, I feel it’s an okay choice for now and offers some stability while Mr. Hutch pursues his self-employment dream.  I don’t see myself in this job forever, and I’m even beginning to think I may not spend the balance of my career in government. That’s new.

Lately, I’ve been secretly wondering if there will be a place for me beside Mr. Hutch one day, helping him to run his empire.

What does Mr. Hutch do for cash?

I married a man with many redeeming qualities. Not the least of which is his handiness. Mr. Hutch is a tradesman. Here’s a hot tip for everyone out there: you can do much, much worse than marrying someone in the trades. I love Mr. Hutch for many reasons. But when we had one two-month old Hutchling still in the NICU and one two-month old Hutchling at home and our roof started to leak, I loved him just a little bit more for not being a pencil-pusher.

As I mentioned, we are (well, he is) building a secondary rental suite in our basement. Mr. Hutch is currently on hiatus from being a journeyman worker-bee and is working on our renovation. We figure it makes more sense for him to do it than is does to pay someone else.

Once the renovation is complete and all buttoned-up with paying tenants, Mr. Hutch hopes to go into business for himself. This is very exciting to me, and I imagine it will provide a wealth of blog material in the future.

Who are the 4 Hutches?

Mr. Hutch and I are just a couple of kids living the dream.  Wait! One of us turned 40 this year (read: not me). I guess we’re not really kids anymore.  Heck, can you still be kids when you’ve got two of them yourselves?  That’s right, the Hutchlings, N and V, arrived just a little over 9 months after our wedding.  Apparently we’re very efficient at reproducing.

We’ve lived in our 1906 Victorian for four years and in that time Mr. Hutch has renovated almost every square inch of that sucker.  I mean literally top (a new roof last year) to bottom (just poured new foundation footings last week).  We are currently immersed in a full-on basement renovation in which we are building a secondary rental suite.  I mentioned we live in one of Canada’s most expensive cities, right?  Hutchlings that come by the pair aren’t cheap.

I tend to geek our over our family’s finances. I have a lot of dreams for us. I have spreadsheets, plans and more spreadsheets and plans. I’m always thinking of how to get ahead in this expensive city, and at this expensive stage of our lives. Hence this blog: I figured I might as well get it out so that it isn’t rattling around so much in my head. Yeah, we’ll see.