Welcome! and Welcome Back!

This morning at 7:50, my phone rang. It was a 514 area code. I panicked a bit. I don’t often get calls from back east first thing in the morning. So I assumed it was important I answered. And I’m glad that I did.

On the end of the line was a lovely reporter  writing this story for the National Post and asking about this blog. It’s been a while since I’ve checked in here. Mostly because after 365 days of debt defying acts, I was ready to move on. That was a year and a half ago. I’m delighted it still resonates with those concerned with the debt load of Canadian families. I still share that concern.

I thought it worthwhile to provide a quick update on what’s happened since December 31, 2013.

1) I still have debt – less of it – but it’s still there.
2) I feel as though I own it now rather than the other way around.
3) I earn more income. It took time to make that happen but it’s happened.
4) I have more cash flow and a healthier bank balance.
5) I still only use my credit card for work. If I can’t make money using it, I don’t use it.
6) I’m a much better cook
7) My wardrobe is more eclectic as I curate most of my outfits from thrift stores.
8) I don’t really enjoy shopping anymore. And I don’t miss it either.
9) I rarely go out for meals. I enjoy cooking at home much more.
10) In June, I’ll re-sign my mortgage for about half the rate. I’ll delight in that and all the extra money will go straight to the debt.

So if this is your first visit as a result of the piece in the Financial Post,  thanks for stopping by. Please know that you can do it. One dollar at a time. One decision at a time. One commitment at a time.

If you have too much debt, you likely don’t have enough money. Not always the case, but more or less the norm. So forget about money and remember that what you do have, what we all have, is the same amount of time. So use your time wisely. Forget about convenience foods, drive-thrus, low interest cards, buy now pay later schemes, getting ahead or keeping up with the neighbours. Just stop.

Make a budget. Learn to cook again. Do it yourself. Re-use it. Repair it. Mend it. Buy it second-hand.

Plan your escape from the busy trap. A simple life is more meaningful and much cheaper. Seek out an experience rather than an expense. Experience adds value. Most expenses do not.

In this economy, and this society, we always talk about price, profit and return. Somewhere in that important equation was lost the importance of value and equilibrium. That’s what we need to seek. That’s what debt defying taught me and I’m the better for it.

Commit a debt defying act. It might be the most valuable thing you do. Plus, it won’t cost you a dime.

If you need to chat, comment on this blog or e-mail me at louise@mediability.bc.ca – I’ve been there and I’m happy to help if I can.

Thanks

There will be good days!

If you’re on this debt journey, you’ve faced some difficult days and some big worries. I know how you feel. Really, I do.

But today I write to tell you that your hard work and soul searching will pay off. Today was a good day. One of the best in fact. I can say with some confidence (the only certainty in life is uncertainty after all), that I made it through and I’m better for it and so will you be.

It’s so true that everything happens for a reason. I was a spender. Now I’m a saver. I’ve done more with less than I knew that I was capable of and now I have more. More sanity, more balance, more certainty, more confidence and more calm and for today at least, more money in my bank account.

Ironically, it’s not even about the money. It’s about owning up to the problem, seeing the tunnel, seeing the light at the end of the tunnel, thinking it might be a freight train, but walking through all the same. Turns out, the other side is a warm spring sunny day in the Shuswap. The snow melts, the birds sing, the sun warms.

There are two sayings that have kept me going. First “If you’re going through hell, keep going” and second “Everything will be okay in the end. If it’s not okay, it’s not the end”. Please. Keep. Going.

Act 177

If you can, keep your grad out of debt

It’s Grad Day here in Salmon Arm. My facebook feed is filled with proud parents and happy young adults in fancy grown up dress.

We need to protect them from student debt. When I went away to school, we had two options. Pay for it or get an OSAP grant. Very few of us graduated with debt. Thank goodness because we graduated at the onset of an Ontario recession. Hence my life in BC – when we all went west to get away.

There were bursaries and scholarships, part time jobs that paid pretty well. We eeked out a living wage while still getting a decent education. We were lucky, as it turns out.

These days, we graduate post secondary students with record debt into a labour market with record high youth unemployment.

Education is not just a personal investment, it’s a community investment as well. An important one. More important (and affordable) than fighter jets and prisons. And that’s not a matter of opinion, as much as a matter of fact.

So protect them if you can. And give them a fighting chance. We’ll need them more than we know so let’s try and be there when they need us.

 

Act 168

Reverse engineer your debt so you can engineer your way out

It creeps up on you. If there are two wage earners in your household, and you hold an average amount of debt ($27,000 of the non-mortgage kind), and say it took you ten years to find yourself there, consider this. That’s about $15/day of over spending. $5,400 per year, or $103 per week or about $15/day of spending beyond your means. $15 a day can creep up on you.

But by the same token – think about your debt in small increments. $15 seems more manageable than $54,000, doesn’t it? Of course you’ll want to pay it back much quicker than the 10 years it took you to got it.

So what’s the point? Unless you feel you’ve lived a foolish and lavish lifestyle, try and ignore the finger waving of those who are so quick to state that if you’re in debt, you’ve lived beyond your means and your character is flawed. It’s not that simple. I really wish that it were. At least I’d have a reason to feel this lousy.

Debt is structurally integral to how our economy works. More so now than ever. It wasn’t always this way. The challenge is to resist the consumer culture we live in and mimic the times when these levels of debt were not an issue because these debts products were not options.

There. Rant done. Back to regularly scheduled programming.

Act 100

The best things in life are free (but I still need money)

100 days in to 2013. Where does the time go?

100 debt defying acts. What have I learned?

I’ve learned you can do as much with less. I’ve spent less money and managed to restore healthy cash flow. I’ve learned to shop smarter and to cut out the extras.

I’ve learned that I can’t do much about my banking situation. I can’t change my mortgage (at 5.16 with my credit union) or get access to more cost effective credit for my business because my business is very small. Business banking really only kicks in if you’re in a million dollar range. Anything below that has to be financed by personal credit. I’ve checked (my credit union said no to that too).

I’ve learned that I need to think about savings even while I’m in debt. Time is my friend and I shouldn’t waste it.

So I know what I know now and I move forward. I know it’s working. I know I’m grateful and I know I’m in charge. And you can’t put a price on that.

Act 95

Pay a little more, a little sooner.

It’s all about momentum. Once you start seeing results, start paying a little more a little sooner on your debt. It adds up. And use whatever windfall you come across (even a very small rebate from your credit union or a tax refund) to put towards it to and focus on one goal at a time. If you see progress, you’ll want more of it.

Act 78

When you’re done asking why, start asking how.

I’ve spent alot of time asking why. Why am I in debt? Why is this happening? Why did I do that? Why did they do that? Why me?

I am innately curious. It is both my best quality and my worst fault all rolled into one. My curiousity has taken me on great adventures and great misadventures.

But there comes a point, at least for me, where you have to let go of why and focus instead on how. How do I do this? How do I deal with that? How do I solve this problem? How do I avoid that one?

It’s going to be a how kind of week for me, at least I hope so – one that’s so full of hows that the whys will be left for another time.

Act 36

Ask questions.

And keep asking them. Every time I hear about record bank profits, my spider sense starts to tingle. And every time I hear about record personal debt levels for Canadians, I have to wonder why we aren’t drawing a cause and effect relationship between the two.

I thought this was an interesting perspective about money supply, income distribution, the real economy and the financial sector.

http://www.positivemoney.org/consequences/poverty-inequality/

I also read what the people at Canadian Community Reinvestment Coalition have to offer

http://www.cancrc.org/english/ccrc10q.html

Specifically, their question 3 of 10 questions to ask about bank profits “Do Canada’s big banks serve people and businesses trying to create jobs well?” 

We do know that of the banks’ total lending to business of about $600 billion, only 3% is small business lending (loans under $100,000), while 77% goes to big business in loans over $5 million. The small and medium-sized business sector has created 90% of the jobs in Canada since 1983, and employs half of all working Canadians. If banks do not meet small businesses’ demand for capital, they prevent jobs from being created.

And, I would add, keep those Canadians in debt, helping banks earn bigger profits. 

Everyone wants in on the debate. Recently TD released a report stating that the income inequality gap is not growing which has been valiantly debunked by Armine Yalnizyan in a letter to the National Post. Not to be outdone, the Canadian Banking Association is happy to share that profitable banks are good for Canadians.Question is, which ones.

I’ll keep asking.

Act 19

Go with the flow.

I know it’s a cliche but sometimes, you just have to go with it.

While I may be on an all consuming mission, it doesn’t mean everyone around me is too. And it certainly doesn’t mean my family needs to be sentenced to weekends full of chores, errands and duties.

So today, I went with it. We skied. We visited. We had fun. And now, we’ll chill out. Tomorrow, it’s back to work.

Act 15

Laches Pas!

That’s French for “Don’t give up”. Somehow it has more authority in French. As if Yoda himself appeared and ordered you to give up not.

This is of particular interest to those of you, who like me, are self-employed. There are tough days. Today was one of them. Actually the 15th and 30th of any month are tough when you have payroll to meet and/or remittances to submit.

At the same time, I watch in despair as the business media discuss the merits of our Government setting aside 400 million dollars for the venture capital industry to help them and the new starts up for whom they want to raise funds, through a “difficult” period.

Existing small business represents 98% of the Canadian economy. And very little is “set aside” by our Government to assist the real economic engine of this country stay alight.

So, back to me for a moment. I had a situation to address today. An overdue expense resulted in my firm being in danger of losing a job that would have gone a long way in addressing overdue expenses.

But fear not, a quick phone call and calculation later, the situation will be resolved and the opportunity will put me back on track. Silver lining, if you will

A year ago, this scenario would have gutted me. The sheer shame of the situation would have persuaded me to pack it in. But I’m past that now. I can’t afford the drama. I have work to do.

So if you face a seemingly impossible situation, get out your calculator and get on the phone. It can be fixed.

Most honest creditors will tell you that what they really want is to keep in touch and work towards a solution. The money itself is not the issue. So get in touch and work towards a solution.

Then get it done and move on. Don’t give up. Ever. There are too many people counting on small business to walk away now.