debt debs

Personal Debt Wrangler – Had my money head in the sand – but no more!

baseball


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Curve Balls – When You Are Hit With Unexpected Financial Events

baseballSpring is here, B-B-Q’s have been lit up and summer’s just around the corner.  Kids are starting their summer activities, whether it be swimming, soccer, football or some form of baseball.  I’ve been thinking about the latter as I review the series of financial events that delivered us to this point in our season.  There were a number of ups and downs that I consider curve balls that we needed to ‘deal’ with and not lose our drive.  So it made sense for me to use baseball terms to relay to you how my winter – spring financial season went.

The Home Team

T-ballMy husband’s income is variable, based on the demand.  He is a real estate appraiser, so swings are inevitable based on the time of year and the market.  Normally, he does receive enough bread and butter engagements to meet a minimum – moderate level of income and that is what I base our debt repayment plans on.  The idea being that it should feel like we’re playing T-ball.  The figure I use for this is $2,400 per month, which gets paid in two installments, the 15th and last day of the month.  He gets paid one month in arrears, meaning he gets paid next month for the work he did this month.  Therefore I know now, what his income will be for June, as an example.

Basically, as part of the battery, all of his income and some of mine goes to debt.  Anything he makes above that budget amount is a bonus baby which we also apply to debt to help us meet our goals even sooner than our five year plan.   Usually, we are able to stick with this as I have all foreseen expenses budgeted (including car repairs, etc.).  However, I don’t move unspent budgeted money that may be needed later into a separate cash account.  Maybe I should, because it can get messy and feels like we have a dead arm, when all of a sudden we do have a big bill, but I’ve already skimmed off the money and applied to debt.

Opening Season

good-baseball-pitcherSo looking back to the beginning of the year, January was a tough month, because he had not one engagement last December – a strikeout.  So there was no money coming from him for January.  That was our first curve ball.  Debt repayment goal could not be met, or at least not fully.  I scrimped together $1,000 from some actual and anticipated expense savings whilst declaring a bean soup and scrambled eggs on toast menu plan would get us through the lean winter months.  That $1,000 payment felt like damage control.  As the umpire, I had to watch the game closely, even if hoping the home team could steal a base to regain control of the game.

Then I got small hit on a curve ball, when he told me he could give me $2,000 he was saving in his business account which was for an upcoming annual business insurance premium of $3,100 due soon.  We decided we could put the insurance on the credit card giving us one extra month to pay and gaining cash back points, and hopefully business would pick up and we’d be in for a bit of slow pitch now that the Christmas season was over.  He never could explain what happened in December.  Normally it does slow down, but it has never come to a shutout like it did for him in 2013.   He did, however, land a large contract for the city which we could count on down the road because it wouldn’t pay out for a few months.

Regular Season Begins

baseball-player-in-the-airWell that softball turned into hardball pretty quick when we saw that January was not looking very good either.  He ended $1,100 short from our minimum goal.  With two away and two down, I was starting to get kind of panicky.  I had slowed our debt repayment, but we were committed on a low rate cash transfer credit card that needs to be fully paid by August of this year.  We had put a $24,700 lump sum against our 2.89% mortgage debt last Sept, planning to pay the 0.99% credit card off at $2,250 for 11 months.  Yes, I know this is just swapping debt for debt, but was at a lower interest rate and with no transfer fee. It seemed like a good idea since we were planning to make prepayments of more than that amount monthly.  Of course, we had no foresight of the earnings slump that was to come.

We were window shopping for strike 3 near the end of February when it looked like his income for that month to be paid in March was going to fall $700 short from our @2,400 target.  Not only that, but now we had an over $5K Visa payment due in early March (remember the $3,100 insurance above) plus $2,700 of first installment of property taxes due in March.  Normally I put $450/month in my Emergency Fund each month to build up enough to cover property taxes.  Well, with robbing Peter to pay Paul, that didn’t happen, and things were getting very precarious, indeed!

The Losing Streak

empty-baseball-fieldAt this point we are $4,200 negative on budgeted earnings plus I needed to find an additional $1,100 to make up the insurance payment for which he had only $2K for ($3,100 – $2,000).

What did I do?  Bring in a pinch hitter? I scoured the internet looking for part-time job possibilities and while I was doing that I turned into a blogger.  Overnight.  Magically.  Just like that.

I had no knowledge of the term side hustle.  I didn’t think I had the stamina to work 2 shifts per week at Shoppers Drug Mart after a brain draining workday.  I also decided early on that making money at blogging would, for me, be undoubtedly very difficult.  And yet, I was incredibly stressed and needed somewhere to unload.  So a blogger I became.

I dug-out our Emergency Fund.  I know JMoney says No Touchy! but we were dealing with a job loss of sorts (hey, where did all the fans go?).  That is what your E-fund is for.  Unforeseen events that you have no control over.  Okay, broken washing machines and vehicles kind of are too, I’ll give you that.  But hypothetically we are supposed to have a separate maintenance/stuff breaks fund to deal with that.   Some of us do not, but choose to keep our E-fund nice and high to cover that as well.   [Future post coming during the championships about how I plan to increase my Emergency Fund and why.]

Regular Season Ends

Batter-upThen we hit two home runs in a row.  The first was a due to a change-up with a family member and it was an out-of-the-park HR.  My husband is a licensed realtor and acted as agent for my sis and BIL to buy a new home and sell their existing home.  He had not intended on charging them any commission and in turn, return to them the fee he received from the purchase of their new home.  They insisted that we keep his earned commission from the purchase and in return for not taking a commission on the sale of their home they wanted to take us on a cruise (which we gratefully declined).

So that $4,000 yacker saved our home game and I started to relax a bit. Our second inside-the-park home run was that my husband’s March income exceeded our target by $1,600.  This was because of the completion of the large contract that he had been working on for a couple of months.  The regular small housing jobs were coming in, but at a rate lower than last year.  It was hard to say if business would increase to the same levels as before.  I might need to revisit my @2,400 / month projection if this continues.

I still kept blogging, as I soon realized I still had a lot to learn and I also had a story to tell as part of the Hot Stove League.   Maybe, just maybe, I could help others and maybe, just maybe, I could develop my blog into a retirement side hustle of my own.

Post Season

slide-into-baseAs we enter the seventh-inning stretch I see that I need to examine my slugging averages more closely because although the actual income has finally caught up with planned income, my Emergency fund is still $2,100 lower than it should be.  I can account for $1,100 of that being the passed ball shortfall in the insurance premium that I had not budgeted for plus $450 of missing tax savings that I did not fund one month when I was doing a suicide squeeze.

If I can continue to play ball, the plan is to pay $2K per month to the low rate credit card to have it knocked out of the park before the interest rate goes up ($6K – 3 more payments to go).  I’m not sure if I will deploy this strategy again, as it certainly has been a nail-biter.  I may just decide to become a patient hitter and just pay any excess towards debt as it comes so I don’t stress myself out so much.

Now I’ve got some good news about breaking balls and some bad news bears to share as we head into the wild-card playoff.  What d’ya want first?  Okay, the bad news it is – as in a grouch Uncle Charlie of My Three Sons curve ball when I received something in the mail yesterday.  I saw the word Justice on the envelope thinking it was a call to Jury Duty as I quickly tore it open only to find a RED LIGHT CAMERA SYSTEM OFFENCE NOTICE for my car which I was not driving on a particular day in a certain area to the tune of $325.  Ya, sucks the big ball$.

So that somebody, who shall remain nameless, worked his a$$ off this month (as luck would have it) and will bring in ticket sales of $3,200 next month which is $800 greater than minimum plan.  So two things we learned here folks – housing market is moving again in Canada and don’t run red lights when you’re debt wrangling or playing a perfect inning.

To mop up this post, I must confess that I knew little about baseball.  Just like me, you can learn how to manage your finances better too!  You just need to get in the game, define your level playing field and don’t stop short when things don’t go your way and you’re down and outHome plate will still be there, even if you need to round the bases a few times.  It’s practice and green lights that will get you the Commissioner’s Trophy and make you a champion of the series in your world.
Home-Game-Baseball

Images courtesy of flickr.com
Baseball glove / Andrei Niemimäki
T-ball / Chris Harrison
Baseball pitcher / Ralph Arveson
First base / Jonathon Assink
Baseball field / JACoxwell
Baseball batter / Eric Ward
Slide into base / Sherri Abendroth
Home field / Sherri B

blogger-identity-brand-perception


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Two Key Blogging Tips to Help Your Brand and Exposure

blogger-identity-brand-perception

Your BRAND deserves R-E-S-P-E-C-T

Hey there everyone ~ I’ve been blogging for a little over two months now and constantly learning the hard way.  But the cool thing about being a newbie is that when you don’t know anything, you can ask the ‘dumb’ questions and get away with it.  😀

However, in my trials and tribulations, I’ve come across 2 things that I think every beginner blogger should know.  Wait there’s more – in fact these are two things that even seasoned bloggers could benefit from.

They’re BASIC, they’re bold and they all revolve around your brand.  I mean your brand is the figurehead of your blog and therefore a key recognizable identity to you as a writer.  Once people get to know and appreciate your writing style and featured content in your posts, it helps to remind your readership who you are and keeps them coming back.  This, in turn, is a stepping stone to be able to further interact with the blogging community, get inspired, write more great posts, grow your readership and retire early have a jolly good time.

#1 Who Tweets Your Stuff

The Process

I like to tweet out people’s posts that I have read or particularly like.  I don’t always comment* (see more on this subject in BONUS section below), if I have nothing to add to the conversation, but if I like the post, I try to remember to tweet it.  When you select the Tweet button below the post a nice summary is formulated that you can add to or tweet as is.  Here’s a sample of what I mean for a twitter share generated from my blog:
Tweet-format-from-WordPress

The Problem

However, in many cases (I estimate 40- 50% of bloggers) your own twitter handle is not added to the tweet.  Note above that the @DEBtDEBs was added automatically by the WordPress application software, but you have to configure it.

Note to self:  Wait a minute, Debt Debs.  You can just throw that figure of 40%-50% out there like that without any substantiation.

Right, fair enough, but I tweet out enough posts that I have a fairly good feel for it.  When the twitter id is not coming up automatically, I go to Twitter, search for the twitter name, copy it, and then paste it in the Tweet.  It’s a lot of hassle.  Sometimes, by the time I’ve done that, I forget to add my usual witty commentary at the intro.  #vain  Then I’m kinda miffed because what’s the point of just tweeting out a robotic tweet without some snarky comment added colour at the front of it – totally endorsing your post and showing that I actually read it.

The Evidence

Right, ahem.  So in fairness, in case I tend to exaggerate, while reading some blogs Monday night (Happy Belated Memorial Day to y’all BTW – you wrote some awesome tributes!), I decided to do a scientific and terrific test of the actual number of occurrences of this phenomenon.  (WoW, I’m getting all fancy wordy now that I’m a lowly application tester).

So within a one hour period from 8 p.m. – 9 p.m. EDT, I read a total of 7 posts (OK, maybe I’m a slow reader) and then tweeted them all (they were wonderful!) and here are the results:

Twitter-Wordpress-Button-Test

3 out of 7 tweets had their Twitter ID – 4 did not 😦

So my 40%-50% estimate is pretty accurate or understated, because out of the 7 tweets I sent, for 4 (57%) of them I needed to look-up of your twitter ID’s and manually add to the tweet before I sent them.  Like I said, I thought I had a pretty good feel for it.

Now maybe you don’t want to know who tweets your posts out, but if you’re a new blogger like me, trying to build your traffic and brand, it’s awesome to know when someone tweets your stuff!  Usually you like to thank them, although it is not necessary if you are a high traffic blog, in my humble opinion.

Since I appreciate this and knowing that my twitter handle comes up automatically, I went to investigate why this does not occur with all blogs.  I’m on a WordPress.com hosted site, so I wasn’t sure that if I would be able to troubleshoot on my own for those who use self-hosted WordPress.org themes.  So I enlisted the help of three bloggers, whom I’ve come to know in this world of Personal Finance blogs, to help me:

@Shoeaholicnomor from shoeaholicnomore.com – ‘Shoe’ has just recently moved her blog over from Blogger to self-hosted WordPress and I was trying to help her with these logistics.

@SavvyJames from retirementsavvy.net – James and I have conversed on-line a number of times and his blog is already on a self-hosted WordPress site.

@SaverSpender from www.savespendsplurge.com – helped Shoe and me out when we had a question and James was not available.

The Solution

WordPress.com blogs

My blog is hosted by WordPress.com and uses the WordPress application software.

In order to have my Twitter handle @debtdebs show up whenever someone re-tweets one of my posts, I had to configure the following two steps:

1. Go to Dashboard > Settings > Sharing

Sharing-Settings-for-Twitter

WordPress-Twitter-Linking

2. Scroll down on that same page and fill out this section

Sharing-Settings-for-Twitter-WordPress.com
This will yield the above tweet result when someone opts to tweet your post like this:

Twitter-share-buttonOnce the new window is opened with your tweet, you can modify before you send.

WordPress.org blogs – self hosted blogs

Many blogs are self-hosted as this allows them flexibility in terms of advertising options that they use on their site.  This involves hiring a server hosting company (e.g. Host Gator, Blue Host) to manage their site’s data as well as a company that licenses their domain name on an annual basis (e.g. Go Daddy).   A majority seem to use WordPress application software, utilizing either a free or paid for theme, or a specifically developed theme for their site from a WordPress developer.

To link your twitter account to your blog and set your Twitter handle like above, the steps are similar but it looks a bit different.

Step 1 – actually this step looks identical from what I can see

Twitter-Settings-WordPress.orgStep 2 – similar but the description field is slightly different.  It may depend on the template used for the blog site.

Twitter-handle-settingPrevious to making the Step 2 change for Shoeaholicnomor’s blog, this is what the Tweets looked like.  Note the addition of @jetpack at the end of the tweet:

@JetPack-in-TweetAfter the step 2 was completed, here is the result.  @jetpack is replaced by @shoeaholicnomor:

Twitter-handle-now-showing

Here is further information from the support forum question and answer for WordPress.org that shows you how to modify your script so that your twitter handle shows on your tweeted posts, if the above options are not available in your blog.

#2 Your unique Avatar showing on browser tab

The Process

Okay, call me a nerd or call me a word that rhymes with banal but drop the ‘b’, but I like to see the your little avatar showing on the tabs across the top of my browser.

Actually, it’s pretty practical to be able to quickly scan your tabs and find the one your are looking for by zoning in on the picture.  I don’t know about you, but I often have 20 – 40 tabs open (more than what will fit on my screen).  So if I’m trying to find one, it’s nice when it stands out easily by the special picture you have selected to go with your blog brand.

Here’s a picture to illustrate exactly what I mean:

Browser-tabs-showing-avatar

The Problem

Well what I discovered was that the avatar showing for Shoeaholic’s blog was the Host Gator (blog hosting provider) picture.

With @Saverspender’s help, we identified that Shoe was looking for something called a favicon in her blog settings:

Favicon

The Solution

Shoe found the spot and uploaded her .png (or .jpg) file as follows:

How-to-configure-favicon-in-WordPressViolà, we have Shoe’s pretty little shoes showing up on the tab (even if small, you still ‘get the picture’):

favicon-avatar-tabsBonus Point on Commenting

*Note:  I would be remiss in telling you that Joshua @ CNA Finance had a great post last week on commenting on other blogs.  Contrary to what I said above about only commenting where I think I add value to the thread, Josh maintains you should comment on every ‘authority’ blog in your niche.  Here’s what he has to say on this:

Step #1: Find Authorities In Your Niche – Authorities in any niche get a ton of comments. You should be leaving one on every article as well! There are also benefits to knowing who the authorities in your niche are when it comes to running a successful blog commenting campaign. One of the biggest is the fact that chances are, there are tons of other influential bloggers commenting in the same place. So, you’ll never fall short of articles to read and comment on.

So what I interpret what Josh is saying is, although it may be difficult to comment on every blog post in your niche that you read, you should make a specific point to always comment on every blog post from a Personal Finance (PF) Authority Blog. 

Now we all have our favourites and ones who we see are the authorities in PF blogging (Josh mentions a few of my personal favourite authorities in his post), but the list of authorities in PF blogging is getting pretty long as well.  So try to comment when you can, but especially on sites that you see as the authorities in your domain, whether it be Personal Finance or something else.

The most important thing when leaving a comment is that it is sincere and shows you’ve read the post, which Josh also mentions in his write-up.  I’ve had very few comments that did not seem sincere and maybe once or twice the comment looked a bit like the person might have skimmed the post only.

Josh has other good tips in his post and future planned posts on blogging topics so be sure to go read the whole thing through the link above and add his site to your feedly or bloglovin. **

** Incidentally, it looks like feedly has fixed the problem I was having with my site showing up in Android readers so I’ve amended the above linked post.

The Wrap

Now I’m not a technical expert, but as a blog reader and user, I am thankful to have figured out how to offer the above tips as a way to finesse your social networking  and blog branding strategy.  In the article, The Tweeting Dead: 5 Ways Brands Can Avoid Being Muted the importance of keeping your social networking content unique and utilizing automated social media strategies are discussed.  Doing it right and finding the right balance are key to ensuring you writing is not passed over as being overly flouted or too self-serving.

If you have other technical suggestions or aspects I have not covered above, please feel free to respond in the comments.  Of course any other best practice suggestions regarding use of Twitter, Avatars/Favicons and Comments are most welcome too.

I’d like to sincerely thank @Shoeaholicnomor, @SavvyJames and @SaverSpender for their support and information provided to trouble-shoot the ‘mystery’ settings to make the above two features function properly.

Did you know about these settings?  Are you going to make changes to your blog configuration now?

 

Image courtesy of Stuart Miles / FreeDigitalPhotos.net


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Found money

LOST-FOUNDDo you ever find money where you weren’t expecting to find it?

Whether it be on an inside pocket a small clutch purse from your last fancy gala, a $20 bill tucked in your sock drawer or glove compartment or some birthday money tucked in a card that you could have sworn you already spent.

Those small amounts are not windfalls, but enough for you to say, ‘Hey, cool’, and then get on with your day.  Unless you decide to fret about how you almost threw out said birthday card and that $30 would have been gone and you never would have even known about it.

Anyways, it’s nice when that happens, right?

What’s that you say?  It rarely happens to you anymore because you’ve got your money sewn up so tight that you know where every dollar is designated in your so-called debt life.

Ya, it doesn’t happen to me anymore either.

Until yesterday.

There were two of these in the mail.

Found-Money

2 x 100 dollas!  {insert Gail Vaz-Oxlade voice here}  One made out to yours truly and one made out to the Irishman.

How.sweet.that.was.  … of Prince$$ Cruise Line to send back the deposits we left for our next cruise when we were on our last one in 2010 and obviously giddy with the sea air.

I’ve thought about this money.  But I never even considered asking for the money back.  I thought it was lost money.

So what’s the lesson learned here folks?

Ask for your money back.  Or don’t, and maybe you will get a nice surprise in the mail one day.

That’s going right on our big fat debt, baby.  How.sweet.it.is.

In other news, I was featured on Brian at Debt Discipline’s blog this week.  You can see the Debt Debs interview here.  Be sure to let Brian know if you’d like to divulge all your embarrassing secrets share your story too.

A big thank you to A Disease Called Debt, Frugal Rules , Debt Discipline and Financially Blonde for linking to my post Worth it Wednesday – Can a Marriage Survive a Debt Crisis?  I think they know how much it took me to write this and other posts I’ve done recently, and I sincerely appreciate their support as I continue to dig deep.  I’ll be back to some funny and quasi-techy stuff soon.  I’m beginning to feel these writing jags go in cycles.  I can only be deep for a short period of time and then I need to come up for air and be my usual quirky, snarky and crazy self.

Thanks to The Pursuit of Riches for mentioning my interview, but you should check her out cause she’s got the best new news since I’ve been following her blog (which is basically from the beginning).

So I need to get crackin’ and help The Irishman clean out the garage.  I am inspired to do this from Holly at Club Thrifty.  Get a look at how clean her garage is!  This is something we’ve been putting off.   I hear him out there throwing things around now.  I better run out and get a before picture….

…. but first, since I love hearing this woman’s voice and her no-nonsense talk, I leave you with a little dialogue with Canada’s version of Dave Ramsey, Gail Vaz-Oxlade:

*To view this video on YouTube Click here

Lost/Found sign Image courtesy of Stuart Miles / FreeDigitalPhotos.net

spitting-llama


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Worth It Wednesday – Can a Marriage Survive a Debt Crisis?

We’re more than two years into our debt journey now.  It hasn’t always been pretty.  Last month, when Melanie @ Dear Debt wrote on Financial Fidelity it resurrected some feelings I had squashed down.   Coincidentally, Hayley @ A Disease Called Debt wrote that same week “How to make a relationship work if you’re in debt” on her own personal marriage struggles with debt and I said “Oh, boy!  I’ve got to do a post on this too … when I’m ready”.

I’m ready.

The Early Days of a Relationship Debt Crisis

I don’t remember now what particular purchase I tried to make with my credit card that was declined.  All I remember is the date in early March 2012.   I remember how my stomach sank and that awful dread feeling washed over me.   It was quickly followed by a fluttering of butterflies in my chest, as anxiousness and fear temporarily paralyzed me.  It wasn’t the first time.  It hadn’t happened for years though.  I didn’t see it coming.

I thought we were doing better.  I remember there being an issue in 2004 when I tried paying for a rental car overseas.  Then again in 2005, I poked my nose in and didn’t like what I saw.  I started trying to conserve money in a half-hearted attempt.  I remember not wanting to drive anywhere, as if saving on gas was going to be the answer to all of our financial problems.

Shortly thereafter, my Mum passed away, which set off a few years of YOLO with depression.  I never looked at the bank and credit card statements during this time.

We started planning a cruise with some friends and family.  I figured we would have time to save.  All of a sudden it’s 2009 but our cruise is postponed due to the financial situation of one of the couples.  It didn’t even dawn on me to look at our own financial situation then.  I just blindly trusted my partner that we had the money. There always seemed to be a few thousand in the bank whenever I went to take cash out of the ATM.  I was none-the-wiser.  I had been looking forward to the trip and felt I needed a break.  We went on a short one week cruise on our own anyways.  The following year we took the other cruise as planned.

Fast forward to 2012 and the declined credit card.  I decided that this was enough and I was sick of being put in these positions.  I asked to see the line of credit statement.  Maxed out.  $35K Why? Because of the trip, car repairs, Christmas presents, that thing we bought for the house.  The list was endless.  I guess my husband was moving money around from card to card while trying to make minimum payments.  Wait there’s more.  There’s a home equity LoC maxed out as well at $100K.  I thought we paid that.  No we didn’t because we were aggressively paying down the mortgage.  Why would we bother try to pay down the mortgage when there was still this huge HELOC sitting there?  “For psychological reasons, to have the mortgage gone”, I am told.  “Stupid psychological reasons” I mutter under my breath.   Wouldn’t Dave Ramsey be proud?

Then la pièce de résistance, $100K in low rate credit card balance transfers!!  I.was.in.complete.shock.

The Emotions of a Relationship Debt Crisis

I wanted to flee.  I wanted to run.  I wanted to get in the car and drive and never come back.  I could not fathom the extent of our debt nor could I see a way clear of it.  Divorce was the only way out of my misery.

Spitting-CobraHow could someone who supposedly cares for me so much, have done this to me?  Was I not working hard enough to provide for the family?  I wasn’t gambling, or rampantly spending to keep up with the Joneses.  I was just doing what any ‘normal’ family does.  I deserve a holiday when I work so hard all year!  The platitudes just kept coming and coming.

I was so furious and beside myself with grief that I didn’t know what I was going to do.    I literally said to him “I spit on you!”.  The venom was real.  How could I love a man whom I was so seething at, …. again?

He slept on the couch that night.  And the next night.  And the night after that.  By the fourth night, I guess since I was still in the house, he decided to come into our bed.  I asked him why he was sleeping on the couch.  He said because he didn’t want to get spit on.

The Getting-On-With-It of a Relationship Debt Crisis

The financial aspects we dealt with together at the bank, adding onto our mortgage.  I went to work figuring out our budget and cash flow.  He started renegotiating phone plans, satellite TV, internet etc.

But that’s not the point of this post.  It’s about how does a couple come back together and repair the lost trust, respect and the “cared for” feeling once a relationship experiences a debt crisis.

It’s not easy but it can be done.

Take Responsibility

It was so easy to blame him for everything.  But that would not help our marriage.  I had to dig deep and acknowledge the role that I played in our debt position.  I also have to ensure he is accountable for his part in our debt journey.

  • It Takes Two – I had left him to manage it, never checking, never discussing, just assuming.  We both have to be involved.  Whether one takes one role, and the other takes another, we still have to share the load and be sure we are reading from the same book, let alone be on the same page!
  • Communicate, Communicate, Communicate – He was overwhelmed but did not discuss it with me.  Other than the odd comment about a purchase, there were no other indications that he thought or knew we were spending beyond our means.  We now discuss our purchases, our progress against goals, our concerns and worries.
  • Record. Review, Revise – We never tracked our spending to know how much we should allow ourselves to spend in different areas and to ensure we were staying on plan.  I track everything now and review progress with him when we discuss.  Usually Saturday mornings in bed with coffee.  Romantic ay?
  • Plan Ahead – Although not a big spender, my husband is “penny wise and pound foolish”.  He will drive around to get sales on groceries, spending more in gas.  He will not buy something that we need because it’s more expensive than he thinks it should be (consequently resulting in a second trip later), but will buy something that don’t even need, just because it’s on sale.    Since I am doing all the ‘bookkeeping’ of our finances, this is his responsibility to think ahead and plan accordingly using lists and consulting the flyers for sales items.
  • Bring Home the Bacon – He was not bringing home enough income.   His job paid him like crap.  I said he needed to get a second job to increase his earnings.  He opted to speak to his boss about getting more assigned work.  This (except for lower season) has worked out for the most part.  He has increased his income dramatically from before, even if it is still quite low (in my opinion), but it is also variable.  He works very hard, too freakin’ hard as far as I can see for what they pay him and what he upgraded his skills for during the last 10 years.
  • Leave the Past There – There’s no point in resurrecting past mistakes and failures.  What’s done is done.  We’re either in this together or we’re against each other.    Okay, sometimes we laugh now, about how he didn’t want to sleep in the same bed in case I spit on him.
  • Be Informed – I let him research options about equipment / technology / home maintenance to ensure we are doing the best thing with our money.   For instance, we switched our home internet provider to Tek Savvy from Primus and our home phone from Primus to Ooma.  We save about $42/mth on our monthly fees (although there was some initial equipment investment doing this of about $300).  I do the research on tools and templates for managing our financial decisions.  We each do what we are more suited for and that (now) suits me fine!
  • Keep Each Other Honest But Keep it Fun – If we find we are slipping into bad habits we remind each other and make a joke about it (You don’t want me spitting on you do you?).

We can choose to be miserable about our debt crisis but we do not.  We both played a part in it and it will take both of us working together and working hard to reach our goals.  We have more than two years behind us and four more to go to be debt free.  That is longer than what is recommended (normally a three year rule of thumb is a good guideline in order to not experience debt fatigue, which I can attest to).

The only other way to get there sooner is to sell our home.  I’m partially in favour of that but my husband is not.  We’ve agreed to review each year and see if we’ve changed our minds.

After that, my husband can retire (he’s seven years older than me) and I will keep working until we have some money saved for house renovations and maybe some more for retirement.  It will depend a lot on how I feel, our health etc.

If you are facing a similar situation, you need to consider whether there is gambling, alcoholism, gaming or other addictive spending habits involved to know if repairing a relationship after a severe debt crisis is feasible or not. There is no easy answer and every situation is different.

Do not let fear keep you in an unhealthy relationship.  If both parties act (not say, talk is cheap) like they are committed to resolving the financial situation, repaying the debt, rebuilding trust and nurturing the relationship, then it is worth giving it a sincere effort.

We’re not there yet, but we are a work in progress!  Now instead of a spitting cobra when he looks at me he just sees this.

spitting-llama

Enough said?  Okay, but first I suggest you check out this inspiring post on this topic from Big Guy Money – Improve Your Marriage – I Dare You

Javan Spitting Cobra (Naja Sputatrix) via flickr Michael Ransburg                                                    Llama via flickr Valerie
Oh, one last thing.  I joined the Yakezie Challenge.  For anyone who isn’t familiar with it, its about improving your blog over a six month period in order to be eligible to join this community  of personal finance and lifestyle bloggers.   There is a forum where you can work with other bloggers to get support while you are doing the challenge.  One of the criteria for measurement is your Alexa rating of traffic to your blog.  You also write a submission post at the end of the induction period.  You can see the button showing I’m doing the Yakezie challenge in my right side bar.
So on that note, I just want to say that I appreciate all who come and read what I have to say here, whether you comment or not, it’s all good and the more the merrier.  The post above is one of the reasons why I blogIf you like any posts you see or know of someone else who would like to laugh at me  benefit from it, please share via the buttons below.  You have the choice of Twitter ~ Facebook ~ Google+ ~ Pinterest ~ email.   Thank you kindly for reading and for your support!
 
How-does-your-family-treat-debt


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Family Matters – How Does Your Family Treat Money and Debt?

How Do Your Family Membes Treat Money and DebtI wrote recently about some key contributors to our debt journey, acknowledging that my worst fear was the impact it was having on the ability of my adult children to manage their finances responsibly and proactively.

The Early Days after Debt Acknowledgement

My oldest is the most frugal of all of them, and has been quite capable of managing her finances well, (mostly) without my help.  In fact when we first acknowledged our debt crisis, I was quite overwhelmed and anxious.  I found it anxiety provoking to even log into our bank accounts or credit card statements on line!  Can you believe that?  She gave me some sage advice suggesting that I just start with one of them, and log in every day, until the anxiousness subsided.

Later I added logging in to see my credit card balances to my routine, and soon I was creating budgets on excel and living and breathing our financial numbers until I was bleary-eyed.   The new found financial good habits, for me, had begun.

More than a year later, after that initial shock, I had built up routines and coping strategies and I began to talk more openly about our finances with all of our children.

Good Personal Finance Habits

Even though I knew my oldest was probably in the best position, I still wanted to satisfy my curiosity urgent need to know exactly how they were managing things.  Were there any things they were not doing or neglecting that, after twelve months of debt wrangling, I might be able to offer advice on.

She assured me that they had all of the following in place:

  • An emergency fund of cash equal to about 3 months of expenses.  We discussed the merits of having up to six months of expenses.
  • Fully topped up TFSA’s (Tax Free Savings Accounts), for both her and her husband.  This equated to about 40K at the time, more than enough to be considered the additional component of their emergency fund.
  • Regular contributions to their RRSP’s to obtain the maximum company match.

I also knew that she had good frugal habits in place such as:

  • Managing household expenses by minimizing hydro use (her husband always jokes that he walks around in the dark half the time).
  • Selling unwanted stuff on Kijiji to make a few extra dollars from household clutter.

More recently, they just moved into a new home, and I helped them do a few different sensitivity analyses for the mortgage repayment.  I use the following Canadian Mortgage Calculator (from Vertex42 – can also be used for US, see note below (*).  We created the following worksheets by making copies of the master and tweaking the variables:

  • To illustrate the impact on total interest paid and final payment date of switching to accelerated bi-weekly payments from monthly mortgage payments.  With accelerated bi-weekly, you pay half of your budgeted monthly mortgage amount exactly every two weeks on the same day of the week, thereby fitting in 26 payments a year,  instead of 24 if you just paid it twice per month, or 12 if only once per month.  Your payments are less if you pay biweekly, but the biggest savings comes from taking your monthly payment and dividing by 2 and paying that every two weeks having the equivalent of 13 months of payments (26/2) instead of 12.
  • We also wanted to see the impact of making prepayments, both annual of $3,000 plus an extra bi-weekly payment of $50.  These prepayments come right off the principal.  (Note:  You need to check the terms of your mortgage with respect to prepayments.  There is often maximum annual amounts.  Some can be made at any time and as often as you want throughoutt the year, some can only be done once per year at or near anniversary date).

canadian-mortgage-calculator_options

* The compound period for a Canadian mortgage is semi-annual, but this calculator can also be used for US mortgage calculations by changing the compound period to monthly – the main difference between a US and Canadian mortgage.

  • They are planning to following the final option in the chart.  If they can save make an extra $50 payment every two weeks and save to make a $3K payment every year, they will reduce their mortgage term to just over 16 years.

My son lives farther away and seems to be pretty savvy.  I’m pretty sure he’s paying off his credit cards each month.  I think his student debt is fully paid.  I believe he is also saving for a down payment for a house.  Other than that, I don’t know much else.

I offered him help to prepare any budget spreadsheets answer any questions he may have in order to ensure his financial house is in order.  He hasn’t taken me up on it yet, probably because when we see him we don’t really have time to spend on this.  But he knows I’m ready any time, even if we do it on a web session.   I can always send him the spreadsheets to fill out, but something tells me that it’s easier more valuable if Mum is there to ask the savvy questions and keep it interactive!

  • One of the drawbacks though, is that if Mum does all the work, they may be less likely to keep it up or track their spending going forward etc.

I wrote on Worth-it-Wednesday, how about how my #3 surprised me about paying off her student loans.  She was on my list to work with next, because I really wasn’t sure how she was doing, what with a recent humanitarian trip to Haiti which she paid for herself (she’s a nurse).   I think maturity is helping here because I see her being more frugal like her older sister and brother.  I think she now has a sense of how good it feels to be debt free (well, since last weekend   😉  ) and she seemed pretty, pretty happy about it!  Bazinga!

Bad Personal Finance Habits

I’m not really sure where to start with #4 so I’ll just dive in.  She doesn’t have a lot of income because she is on disability due to here severe OCD (Obsessive Compulsive Disorder) and social anxiety.   Her OCD is the germaphobic / cleanliness type so she’s always buying new products to keep her body and her bathroom clean.  She also discards (or gives to me or my husband digs it out of the garbage) shampoo or makeup that she feels has sat around too long and has become contaminated.  She goes through toilet paper and paper towels like there’s no tomorrow (note to self:  buy shares in Scott paper).  Plus, I think she tends to try to soothe herself and her symptoms by shopping on-line.  The UPS truck is often stopping at our house and makes me feel annoyed.

She used to pay us $300 / month for room and board, which was okay because it covered her expenses.  Lately she renegotiated her payment because she felt she was paying too much and said she wanted to save her money.  I wasn’t too keen but it was becoming a bit of a bone of contention and I gave up the battle out of resignation, I guess.  She had calculated how much she consumes in hydro, paper products, water etc. and thought that $190 was sufficient.  Only I have yet to see any of that money for two months now.

Am I frustrated?  Damn right I am.  Is she taking advantage of us?  Maybe.  Am I going to do something about it?  I will, I’m just too tired to fight with her about it right now.  We’ve been going through this for seven years.  Her symptoms became visible to us at age 14, but really severe at 17 and she’s 24 now.  She acknowledges that she had OCD symptoms since about 5 years of age (touching compulsions, scrupulosity, bad thoughts).

It has been really bad.  Think worst case.  Ya, it happened.  Every parents nightmare.   Well I guess worse case would be if she wasn’t here anymore.  She tried twice.  So I always have to remind myself that as bad as it is, it could always be worse.

Anyways, I just wanna OCD break right now, so I choose not to deal with it.  Probably a bad move on my part.  I think dealing with her OCD has also played a factor in our debt load.   Many trips to hospital, parking, eating out, buying things she needed, shopping to try to feel better, taking trips to get away from it all.  When it gets really bad, your spending becomes an afterthought.

We still have bottles of bug killer in our hall closet that my husband bought last summer when she insisted there were bugs in her room, even though we couldn’t find any evidence of them.   (Ya, I’m frustrated too because he never took them back after she didn’t use them and used something else instead to kill the invisible bugs so now $30 – $40 of chemical bug killer still sitting in my front hall closet).

I’m not looking for sympathy.  But there you have it.  Another excerpt on my personal debt story.  I count my blessings …  still.

I was going to also talk about my sister and how they are treating their debt and spending but this post is entirely too long so I’ll keep that for another time.

Plus this post is getting to be a bit of a downer and I don’t like being a Debbie Downer (even though Debbie Down was my nickname as a kid), so let me end on a positive note and with a joke.

Positive note:

I was initially inspired to write this post by John at Frugal Rules when he wrote Why Financial Literacy is so Important to Me.   He says it’s his responsibility to teach them to be wise about their financial decision making and I couldn’t agree more!

This pair of ducks were coming to our pool in spring for about 10 years - this year they didn't return

This pair of ducks were coming to our pool in spring for about 10 years – this year they didn’t return

An oldie but goodie:

A duck walks into a bar and asks, “Got any gwapes?”

The bartender, confused, tells the duck no. The duck thanks him and leaves.

The next day, the duck returns and asks, “Got any gwapes?”

Again, the bartender tells him, “No — the bar does not serve grapes, has never served grapes and, furthermore, will never serve grapes.” The duck thanks him and leaves.

The next day, the duck returns, but before he can say anything, the bartender yells, “Listen, duck! This is a bar! We do not serve grapes! If you ask for grapes again, I will nail your stupid duck beak to the bar!”

2 bunches of grapes by Grant CochraneThe duck is silent for a moment, and then asks, “Got any nails?”

Confused, the bartender says no.

“Good!” says the duck. “Got any gwapes?”

 

“2 Bunches Of Grapes” by Grant Cochrane from http://www.freedigitalphotos.net


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Worth it Wednesday ~ Dear Debt Letter

debt debs ransom-note-

Debt sent me a ransom note … I’m so ignoring him

Worth-it-Wednesday is here a little early because Melanie at deardebt.com enticed me to write my debt breakup letter.  It is such a great idea but as I started to write, I found Debt was sitting on my shoulder watching every word I typed.  In usual fashion he decided to chime in.  Go on over and check out what I and he had to say.  He’s a gnarly little fellow.  So here is me, writing my taking back my life letter, and this is how it went … Dear Debt …

In other news….Nutcracker by artur84 from FreeDigitalPhotos.net

DD#3_targetsMy #3 daughter gave me the best Mum’s day present on Sunday when she told me her student debt from her Masters degree was all paid off!   About a year ago we sat down and did a Gail Vaz-Oxlade analysis on her expenses to see if it fit into Gail’s guidelines for Housing – Transportation – Life – Debt – Savings of 35% – 15% – 25% – 15% – 10%.    Now, she did have more than could be paid off in a year but she received a very sizable income tax refund so was able to completely extinguish it this weekend.  I was so happy!! 

I didn’t know how serious she was taking it from when we last talked about it and I don’t like to nag.  Well, more honestly, I was probably afraid of being disappointed, so in usual fashion I buried my head in the sand.  (Hey, it’s her debt, not mine!  … even though I did feel partly responsible for not setting a better example on how to handle money.)  She used to be a bit spendy and she likes to travel.  Plus, her once famous quote “I’ll always be in debt” used to make me cringe, so I figured she was going to be a hard nut to crack.

Look the nut is cracked open into a heart shape ... ahhhh!

Look the nut is cracked open into a heart shape … ahhhh!

But I guess Mum’s persuasion and some new found frugalness on her part was just what was needed to crack that nut open.  She thanked me because she said I helped her to see it was possible to eliminate her debt.   🙂   I guess I can really move on from my guilt trip now.  Heeee …

Image Credits from FreeDigitalPhotos.net:
Nutcracker by artur84
Walnuts In Love by Aleksa D

 


32 Comments

Mother Money Moments

I always become a bit melancholy around Mother’s Day.  There’s a lot of strong emotion around mothers, whether you have one (or not), whether you are one (or not) and basically just all of the personal experiences we have related to the phenomenon of motherhood.

Interestingly enough, I can relate a number of my stories surrounding motherhood to personal finance.  Revealing these facets helps to explain, in part, why I am where I am today in my debt journey.

Excuse me, while I go and grab a box of kleenex.

My Second Mum

Hip Auntie - I'm Blondie on the far right

Hip Auntie – I’m Blondie on the far right

She wasn’t really my second Mum, but it sure felt like it.  You see, I was blessed with not only my own mother, but a wonderful relationship with my aunt.   She was a only a couple of years younger than my Mum, but she acted like our hip Auntie and spoiled us like a generous grandmother.  As she never married or had children of her own, we received all the benefit and love that her mothering instincts desired, and then some.

I paid my way through university, as I had the benefit of coop work terms every four months throughout my 5 year degree.  However, usually near the end of the school term, cash was getting low for me and my aunt would always seek out in our weekly phone calls the state of my bank account.  She was very generous to send a cheque for several hundred dollars to tide me over until I started my next coop work term.  No repayment was expected.  I was always very thankful for this cash relief as I was trying to finish up my exams and did not want to be distracted by my growling tummy.

Fast forward well past graduation, past my first apartment which I furnished after living at home for a year and saving, on to buying my first home.  For some reason the elderly couple I bought from wanted to leave the microwave, which I didn’t need, but took anyways – it was a little bigger than the one I had in my apartment.  I offered the one from my apartment to my aunt, and to this day I do not understand why or what got into me to suggest what I said next.

I said that she could pay me $50 (or some such amount) for the microwave, as she didn’t have one and wanted to get one.  Well this did not sit well with her, and she became rather withdrawn.  Initially, I did not clue into my faux pas.  I thought it was actually a pretty good deal (in those days) – it was still fairly new and nice and compact for her condo.  Well her sullenness lasted for days until we had a heart-to-heart and she explained how hurt she was after all she did for me when I was in university.  Many years had passed since that time, and I had let my busy, selfish, determined self get in the way of seeing the big picture.  She had always been so generous and kind to us, and I let that blind me so that it never entered my purview when I made that stupid, ridiculous request.  I cried a lot and told her how sorry I was.  Of course, we made up instantly, but I have always harboured great guilt over that incident.  I loved her dearly, and still miss her like crazy, even though she’s been gone for 15 years.

Suddenly, I’m a Mother

WeddingIn my late twenties, after a series of some quite long and some shorter relationships, I met a man through a mutual friend.  It was a blind date, which I openly confess I only went on because I suspected he might have some single friends.  He was a widower with three young children, and I felt assured that he would not meet my criteria, which included having my own children.  Well, you know what they say, you find love in all the unsuspected places.

The great part about our relationship, from the beginning, was that he was looking for a wife, not a mother for his kids.  They had been managing on their own as a family for 3 years.  I was able to slide in with no expectations put on me, which, in all honestly, made me want to assume my new role as Mum, which I did.

Within a year, we had a fourth child.  Life was busy but fun.  We worked hard and played hard. I loved buying things for my kids, taking them to movies or out for a meal.  We had holidays in Florida 3 summers in a row! Life was grand and I loved it and my family!!

Christmas was so exciting – I learned all the tricks of the trade from my aunt.  I would plan out our Christmas purchases of toys and clothes, often buying one more thing right up to Christmas eve.  Of course, then I had to buy 3 more things,  always making sure the appearance and spending was balanced amongst all four kids.  I wouldn’t change a thing about those early years!

Life Takes a Turn -> Impact on the Maternal Breadwinner

In the mid-nineties my husband was laid off from his job after a series of Corporate restructurings.  Even though we had some indication the cuts were continuing, it still comes as a bit of a shock.  Even, when employed, my salary was always higher than his, but it did not mean anything to me.  I always felt we fed from the communal trough.

He decided to pursue a different career path, working for himself instead of seeking another full-time position.  I won’t go into the details and ups and downs of this avenue, but I know it has had a significant effect on my psyche, having been the primary breadwinner of the family for the last 20 years.

I was always a high achiever, high performer, but with the added stress to keep my position, salary and benefits for the sake of the family,  I felt an overwhelming burden.  I was no longer a loving wife and a fun mother.  I was providing for my family, and I had better not screw anything up.  I would work long hours, to ensure my position was always secure.

The stress and pressure could always be relieved by “I deserve” purchases while out shopping, holidays with the family or get-a-ways on our own.  Since I was bearing, what felt to me, this great burden, I left The Irishman to manage things more on the homefront, including managing the finances.  I worked with a computer and numbers all day, why would I want and why should I do this in my badly needed decompression time?

Mum Goes on a Trip with Nana but Ignores the $igns

Life goes on.  The children start to become teenagers and we try to roll with the punches.  My dear aunt passes away from cancer at age 64.  YOLO ensues.  Money is used as a de-stressor.   We have enough on our plate.

I decide to take my youngest on a trip to Ireland with my Mum, for her 14 birthday.  Exciting times!  We are so looking forward to seeing family and I’m ecstatic to show her around the Ireland I’ve come to know and love.   I go to pick up the rental car at the airport and my credit card is declined.  I manage to contact my husband who calls the bank, something about a lost payment or other.

Mum Misses Nana and Auntie, so YOLO Continues

Youngest daughter develops severe OCD.  Life continues to be stressful.  We don’t spend willy nilly, but we don’t hold back either.

Mum ~ Taken in Ireland What a glorious time we had

Mum ~ Taken in Ireland
What a glorious time we had

Mum passes away suddenly almost a year from when we left on our trip to Ireland.  Life becomes almost unbearable.  So thankful that we did that trip together.  Wonderful memories.  YOLO continues.

Mum Quits Making Excuses and Gets on the Bandwagon

I wouldn’t have done it, if I didn’t have to, but after a series of ‘signs’ that I chose to ignore, I finally got the big sign that I could no longer hide from.  I can’t even remember what it was, probably another credit card decline.  It’s not important now.  Mum has to either face the music and commit to supporting her husband and family to get out of this mess or have herself committed.  I chose door #1.

Mum is Now a Grandma

Nama is the New Black

Nama = Na + Ma from Nana (my Mum) and Grandma (my MIL)

So after two years of frugal living and debt repayment, I’ve learned a lot.

About myself.

Most importantly, I want to help my children be good money managers.  I feel I’ve let them down in this regard.  But it’s been said before that guilt is a wasted emotion.  One of my favourite PF blogs has given me the fortitude to face it.

If you are at all touched by this post, you should go check this out too ~ Mea Culpa @ The Pursuit of Riches.

I have forgiven my husband.  Now it’s time to forgive myself.

Happy Mother’s Day to all Mothers, Aunties, Mother-in-laws, Soon-to-be-Mums, Wanna-be-Mums and Chrysanthemums!

Sure hope I didn’t leave any one out! 😀

Don’t forget #FinSavSat blog hop party.  I’m co-hosting this week.  Just slide on down to previous post and add your link!

debt debs

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