At Brooklyn’s 99th precinct, Jake Peralta is known as a perpetually broke man-child. Advisor to Client asked two experts to explain how Peralta can grow up financially.
Subject: Jake Peralta, Brooklyn Nine-Nine
Problems: Debt, budgeting
Part two: Adulting
When it comes to his personal finances, Jake Peralta needs an attitude change if he wants a stable financial future, says Toronto-based financial planner and founder of Caring for Clients, Rona Birenbaum.
“What’s missing for him is something to motivate him to actually care about this,” she says, noting that Jake and his partner, Amy Santiago, are now dating. “If he wants to have a future with her, he’s going to need to get his act together because she won’t likely want to be long-term with somebody who’s that irresponsible about their personal finances.”
Once Jake finds the motivation to change his money habits, Ottawa-based financial planner and money coach Janet Gray says he needs to do an inventory of his current financial situation.
“It’s a self-report of what all your financial obligations are. That’s your rent, food, car payment, loans, what does that amount to and is it more than you’re making,” she says. Once Jake sees the impossibility of reaching his goals while continuing with his current behaviour, he can find places to change.
The easiest way to cut back on expenses, Gray says, is to find unnecessary spending. “Going out for dinner is optional, going to Cuba is optional, buying spiffy clothes is optional. There are a lot of things when you look at your discretionary expenses where you can cut back and find a couple hundred dollars a month you can apply to make your your necessaries affordable.”
To help him along the way, Gray suggests finding a personal finance mentor. “If he could find someone he admires and is good with money, that would be a good start. Maybe there’s even people in Jake’s office who could help with that, who look at him and go, ‘You’re a train wreck.’” Captain Holt, perhaps?
Next, Jake should look at his bank fees and credit cards. Birenbaum says to avoid debt, Jake could get rid of his credit card altogether. “If he doesn’t want to carry around cash, use debit not credit. If he isn’t using a free chequing account, he should.”
In addition to automating his debt payments as discussed in Part 1, once Jake eliminates excess spending and frees up money in his budget, he should automate savings to prepare for the future. “I get paid on Thursday, $20 is going into my TFSA right away,” suggests Gray.
Savings are also helpful when it comes to unexpected costs, says Birenbaum, like when Jake had to move to Florida as part of witness protection in the third season. “When you live paycheque to paycheque, you’re fine if everything goes tickety-boo. But if there’s an unexpected expense, you end up having to use debt in order to deal with that emergency. And I would suggest that most ‘emergencies’ could be planned for.”
But creating an automated savings account might be a stretch for immature Jake. If none of his colleagues are able to help him restructure his finances, there are many online resources he could rely on to rectify his “crushing debt.”
Mint.com and You Need a Budget were mentioned by both Gray and Birenbaum. In addition, Jake could contact his family for help, or call a credit counsellor. Since Jake and Amy decided to move in together in a recent episode, it’s more important than ever that he gets his personal finances in order.