Black Friday, Cyber Monday and Holiday Spending

680 CJOB, Winnipeg’s news talk radio, Hal Anderson recently invited Creditaid’s, Brian Denysuik to join him on air to help get people through the holiday spending season. Brian provides advice on how not to overspend including a few tips on how to create a “Save to Spend” holiday plan to help alleviate stress and avoid going into debt this holiday season.

Listen to the discussion below.

Help Your Debt, Help Your Health

As more studies are done on the correlation between physical and financial health, one thing has become crystal clear: the more affluent you are, the better your physical health is likely to be. According to the Public Health Agency of Canada, social and economic status “seem to be the most important determinants of health”.

Help-your-debt-and-healthThere are a number of reasons for this. The obvious is that people with higher incomes are likely to be better educated about their health, and have better access to nutrition and medical services.

There’s also the emotional toll that a debt load can bring to an individual and a family. No matter what your level of income, if you’re carrying significant debt, it will weigh on you. When that debt load gets out of hand, the collection calls from creditors and the “balancing act” of weighting credit card and loan payments against the necessities of life can produce high levels of stress, which will have an impact on your health. Credit card debt is the most significant detractor, because it’s the most available and carries the highest interest cost.

For Manitobans struggling with debt, the first steps to recovery are the most difficult. You must analyze your budget, and take a detailed look at your obligations and their accompanying interest rates. From there, you need to create a realistic payment schedule, one that allows you to take care of your family’s needs while reducing the amount you owe.

At Creditaid, we understand the physical and emotional toll that spiraling debt can have. When you contact us, we’ll do our best to help you by offering counselling regarding your debt situation, management of your debt, and look at a consolidation strategy when appropriate.

Contact us anytime online or by telephone at (204) 987-6890. We can help you take those important first steps toward a healthier, debt free life.

Changes Are-a-Comin’

‘I’ve always wanted something really cool like this to happen!’ That’s what I excitedly exclaimed to my ‘twenty something’ buddy as we prepared for an emergency landing into the Toronto Airport. We were thrilled to be along for the ride. We were young.

We landed without incident, but what youthful carelessness to actually revel in a dangerous moment.

Proverb says: ‘Be careful what you wish for.’ A lot of folks wish for some kind of change – in their marriage, in their jobs, where they live. When separating, or thinking of separating or negotiating the terms of your separation, be careful. Things can change. And this can apply to the parenting plan you and your ex and the negotiator put together.

Try to stay flexible about the future to enable you to address possible changes in circumstances. Two biggies are changing jobs and moving out of province. For example, a couple might have a legal agreement with a Parenting Plan that states he gets the kids each July at the old family cottage, while she gets them all of August in the city. They live in Brandon, Manitoba and he has just been laid off but accepted a new job at lower pay in Estevan, Saskatchewan, three hours away. His new employer won’t give him that same vacation time he enjoyed before so he doesn’t have the freedom of a month at the cottage with the kids next summer. But she has already made plans for that July, having committed to her own kayaking holiday off Vancouver Island. To further complicate things, the Parenting Plan was based on the expectation of a certain level of spousal and child support. She feels undermined by his change of circumstances – she has already pre-paid for the kayaking holiday and part of her ability to afford it was dependent on the spousal support payments. On the other hand, he didn’t willingly lose his job and hoped to replace it with something even better with even more pay.

People can change their minds and their agreement but it does require consensus. A big ‘but’ is ‘But what if one side insists on the existing agreement? What if she pushes for compensation for her outlay of cash for her holiday? And what about the kids and those two summer months? What happens there?’ I don’t have the answer, but an overly rigid plan can be suffocating. The reality is, they need to compromise. It is likely his spousal support and even child support payments will be adjusted downwards to reflect his lower income. Perhaps he can make some contribution to the pre-paid holiday, which she now can’t afford nor has that time free to go. As to what to do about the summer, not sure I’d want to be in the same room when they discuss it, but one way or the other they will figure it out. [I am letting him off the hook too easily, I know; surely he could have discussed this with her and the kids before committing to the new, not so great job out of province. But maybe he was desperate, maybe he had no choice].

Life is full of changes: some too hot, some too cold, some just right. The Goldilocks zone of being just right is where you want to be, but more often than not, like picking your parents, hard to accomplish. Plans emanating from separation and divorce should not be handcuffs, albeit, many feel the obligations for payments, which are just that, financial payments. If they are ‘court ordered’, well, you’re outside the Goldilocks zone, and unfortunately traditional divorce attracts court orders. A mediated divorce can be more flexible while still leaving the party in greatest need with a leveraging stick if need be. I am not advocating delinquency, but if you both start with a cooperative approach you can better handle inevitable changes in circumstance. And often times it’s the one in greatest financial need that requires the flexibility.

Another big change can be re-marriage or ‘re-partnering’ as I have heard it described. One of the divorcing couples entering a new relationship can send ripples, even waves, across what were reasonably calm waters. The kids too can find themselves rising and falling with the waves. One of the things we caution couples in the midst of the process, is to avoid new relationships and if they are already in one, to keep it more or less to themselves. But once the dust has settled, hearts expand and that leads to dancing and …well you get the picture. And why not? Love makes us happy. In fact, when I have a couple going through the process, I can usually tell which of two have someone else already in their life – they usually smile more – and I know that at least one of these folks is, if not really happy, at least sort of happy, and will therefore be a little more focused on getting the work done. I do feel sorry for the lonely one though – dejected, perhaps feeling still in love with their departing spouse, wondering if the pain will ever go away. There really isn’t a plan that can address re-partnering unless it’s tied to spousal support. For example, they might agree that spousal support ends if the recipient remarries but that’s more to do with financial issues than Parenting. One couple agreed not to introduce a new partner to the kids for at least a year, but outside of that, when your ex finds someone, and especially if it involves your kids in any way, you’ll have to adjust your thinking. The wise one on the mountain says you need to be happy for him/her. That little broken hearted egomaniac on your shoulder will suggest other actions.

The main take-home message about divorce related plans, be they Parenting or otherwise, is: it can cut both ways. An old professional mediator in the investment business told me that he thought a good deal was when neither side was thrilled with the terms. Maybe a bit too dreary but something to keep in mind when dealing with family.

Originally published by Fairway Divorce Solutions.

Divorce is a painful process and the traditional adversarial system can make a painful process even worse. Fairway Divorce Solutions® is changing the way divorce happens by providing families with a safe and comforting environment where they can make well-informed decisions. People leave The Fairway Process™ with A Clear Road to a New Life®. Our job is to bring you and your spouse to resolution. The traditional process of divorce is daunting, expensive and stressful. At Fairway we work with you every step of the way to avoid uncertainty, unnecessary conflict and expensive litigation. Working with both amicable and conflicted couples, Fairway has brought thousands of couples to resolution, helping them move on in a positive and productive way. Reduce cost, reduce stress, preserve assets and protect the kids — contact us today by calling (204) 414-9181 or visit us online at FairwayDivorce.com

Scared to Pick Up the Phone?

Do you panic every time the phone rings? At Creditaid, we help people take back control of their lives. Many of the people we have helped have been where you are today – too scared to answer the phone or check the mail when it is delivered, missing out on spending time with family or friends for fear of spending money that you don’t have. Life is too short to live in constant fear – it is time to take control, and start living your life again. Call to speak to one of our qualified counsellors who will walk you through each step of the way to becoming debt free – whenever you’re ready, just give us a call at 204-987-6890.

Do you worry when the phone rings?

Do you toss and turn at night, worry every time the phone rings or hesitate to check the mail for fear of seeing more bills? It’s time you start living your life again. Call us today.

Visit Us Today

The New Year is fast approaching – and it’s a great opportunity to take some time to think about what you would like to accomplish in 2014. If getting your finances back on track is on your list for the year, take this opportunity to drop by and see one of our counsellors.

We are available today and tomorrow –

Monday December 30th  9:00 am – 5:00 pm
Tuesday December 31st 8:00 am – 3:00 pm

Have a wonderful holiday season!

Credit Card Debt Weighing You Down?

Are you afraid to check the mail for fear of seeing your credit card bills? Especially during this time of the year, we understand how credit card balances can be overwhelming. Give us a call and we will help you, every step of the way to becoming debt free.

Peg City Car Co-op. Fantastic Vehicle Alternative

Photo Credits: Peg City Co-Op

Do you wish you had access to a vehicle anytime you wanted but didn’t have to pay the monthly loan payment, insurance payment, gas and repairs? Imagine being able to drive a car anytime you needed one but also saving thousands a year on car costs? Peg City Car Co-op is here for you. This organization has 9 cars located in and around the downtown area waiting for you to pick and use anytime you need one. You pay a low hourly (plus kilometer) rate with no further charges- not even gas! They have 2 programs available for you to choose from depending on your expected car usage. One of these programs is accessible without a credit card. It’s perfect for anyone in a credit counseling program or someone without access to credit.

To learn more call 204-793-3912 or visit their website at www.pegcitycarcoop.ca.

Student Loans: Your Saving Grace or Debt Trap?

You are 18 and all your friends are going to university so you follow the pack and sign up for some courses too. You intend to work part time so you only borrow $8000 in provincial and federal government student loans for the first year to help pay for your expenses.

In September you move out and put a deposit on an apartment. But now you need furniture so you buy some. You dip into your student loan money for both. You reason that since that you have a roommate- you can afford it.

After going to Mexico for spring break, your money runs out in late February. But you still need to get through two months of school! You increase the number of hours you work but then your marks suffer. You don’t finish your first year with straight A’s like you imagined.

Year 2- You still want to go to school but are not sure what field you want to go into. You decide to take more general arts or science course. You don’t want to run out of money again so you borrow $12,000 in student loans this time.

Year 3- Because your marks aren’t high enough to be accepted into law school, you decide to stay in university and declare history as your major and psychology as your minor. Or you dream of being a doctor and continue with your general science courses. You borrow another $12,000 in student loans.

Year 4- Ditto, and another $12,000 borrowed.

At the end of four years did you get into medical school? Or law school? Or another high paid profession?

If not, you could be in serious financial trouble. Even if you graduate with a B.A. or B.Sc., where are you going to find a job paying you enough money to be able to pay rent, your living expenses, make a car payment, PLUS your student loan re-payments. You now owe $44,000. The interest has been calculating since your last day of school and your payments are set at $444 per month. You are likely to have this payment for approximately 10 years. Unless you now have a high paying career as a result of your 4 years of education, you may struggle to pay your rent, car payment, and other living expenses for the next 15 years! What about being able to buy a house or starting a family?

Here are some tips to avoid the above scenario:

By all means choose a career that you think you will enjoy as you will be spending up to 1/3 of your life working at it. But be realistic. Ask yourself these questions:

1) Am I smart enough and do I have what it takes to successfully finish the schooling for this?
2) How much does this career pay? Some careers pay a higher salary in relation to others that required the same amount of education: 4 year Bachelor of Nursing degree, Pharmacy or Engineering degree vs. 4 year general arts or sciences degrees. If you graduate as a nurse, pharmacist or engineer your salary would likely be over $70,000 per year. With a general arts or science degree you might be lucky to find a job paying $35,000.
3) What are the job prospects in the province I want to live in? If you want to become a marine biologist but continue to live in Manitoba, find out what the job prospects truly are. In order to find work, maybe you need to become an aquatic biologist instead.
4) Choose a career where you are actually trained for a career that is in demand. Don’t study arts or science courses unless you intend to go into education or graduate with a master’s degree in that field of study.
5) Consider alternatives to university or college. You could join the military (Department of Defence). Because they require all sorts of professionals such as dentists, doctors, pharmacists, nurses, lawyers, etc., you may qualify for a program in which they pay for your schooling.
6) Reduce your expectations. If you had your heart set on becoming a doctor but your marks are not high enough, consider another medical related career such as a cardiology technician, sonographer or respiratory therapist. Or if you want to become a lawyer but your LSAT mark is too low, consider alternative career choices as a parole officer, government policy analyst or a career in human resources which deals with employment law.
7) HERE IS THE MOST IMPORTANT TIP: Don’t make the mistake of overlooking a career as a tradesperson. It has been estimated that by the year 2020, Canada will have 1,000,000 vacant positions. The apprenticeship system usually involves six months of schooling followed by six months of practical paid work (for a four year period) which can drastically reduce the need for student loans. There are many trades that pay six figure incomes. Don’t make the mistake of thinking that a university education will pay you more as this is simply not true.

Here are some general tips to avoid the student loan trap:

1) Buy everything USED. Second hand school books, clothing, furniture, equipment (including refurbished phones and computers) can save you thousands of dollars during your school years.
2) Make a monthly budget and keep track of your expenses. Be disciplined. If you struggle, instead of telling yourself ‘No’ and feeling sorry for yourself, tell yourself you can buy it once you are working full time.
3) Do not USE your student loan money to buy a car or go on a spring break trip. It should only be used for tuition and books. Do everything in your power to reduce your expenses while you are in school.
4) You are finally an adult and want to be on your own but it is in your best interest to live at home until you are finished school and working. Even if you have to pay ‘rent’ at home, it will likely be far less than if you move out. Then you’ll be paying rent, utilities, groceries, tenant insurance, cable and internet expenses, etc.
5) Do not ask (or let your parents) co-sign your student loans. As an adult you need to be
responsible for your own debt. Someday, if you are not able to repay your student loan
payments your parents will be forced to. If they are not able to make your payments their credit rating could be affected. It is also possible that their wages could be garnished.
6) If you move- always update the student loans departments with your new address. Don’t make the mistake of thinking ‘If the government can’t find me, they can’t make me pay’. If you do, two things will happen. The first is that your wages will be garnished. (They can track you through your social insurance number). You will lose up to 1/3 of your pay cheque until the debt is paid in full. The second is- you will now have a negative rating on your credit report. You may not be able to purchase a house or a car because of this. In order to rebuild your credit you will have to repay the entire student loan debt, plus the accumulated interest. It could take many years to rebuild your credit so that you qualify to buy a house or car. Don’t make the mistake of thinking that you can outrun your student loan debt no matter how many years have gone by.

Written by Creditaid Credit Counsellor, Laurie Boudreau.  Whether you’re a current student dealing with student loans or a recent graduate trying to make ends meet, speak to one of our counsellors today.  We have many tips to help you manage your debt.