WORKING WITH A FINANCIAL NAVIGATOR: BY PATRICK AND RILEY

When Riley and I began our journey with Tessa- Marie we were in dire need of help. Although neither of us was in any large debt we both had a dream of moving out and starting our lives together.

Unfortunately houses aren’t cheap and a down payment is required.

We both had bad spending habits that hindered our ability to gain any savings or any money security. If something went wrong and it was an expense we would end up in debt using a credit card to pay for whatever situation we were put in.

We started our journey with a limited budget and personally had doubted that Tessa-Marie could deliver on all of her promises.

Surprisingly we found that not only did we have money to save. We also could continue to live our lives. We could go out with friends, have an expensive dinner once in a while. Overall enjoy our weekly lives without a burden or constraint because we were saving money.

Tessa-Marie started working with us weekly. Her methods of saving money and her wise straight to the point teachings started to change our lives.

At first, it began with simply putting our money on paper and looking at our past expenditures. This forced us to look at the actual amounts of money we were spending.

This was a huge shock to both of us realizing that we were basically living pay cheque to pay cheque and spending most of our money on useless things that we no longer have.

After this, we both knew that we needed to listen to Tessa-Marie and follow her guidelines to achieve the life we both knew we wanted.

She asked us what we wanted most. We gave her a list of five things we wanted. We could see that she genuinely wanted to help us achieve these goals. Tessa-Marie then started to organize our money into different accounts each with a specific purpose to reach our goals while, still living our lives. After about a month we started to notice growth in our savings, while still having social lives. We truly began to believe in the system.

Then with a helpful nudge we realized that we could save more money and still enjoy life. So we needed to re-evaluate our spending and change our recent accounts.

After this, we had a solid plan that worked well and helped us save larger amounts.

Now it has been around 9 months and not only can we see our financial future but, we can clearly see how inflamed our bank account has come. Tessa-Marie doesn’t force you into saving, she simply helpfully guides you but, puts the responsibility on yourself or in our case us.

Truly Tessa-Marie has helped drastically change our lives for the better and we both are much happier in our lives and our future. Although she helps you reach your ultimate financial goal she does so much more than just save you money. She made us look at our lives and create goals. Figure out what we wanted out of life and overall make us realize we could do it together.

We both owe Tessa-Marie something more than you can give back because she gave us something you cannot put a price on, a happy and stress free financial future.

I hope Patrick’s and Riley’s experiences guide you to seek financial navigation to your own stress free financial future.

All the best

Tessa-Marie

The Reason I Choose To Blog Publicly

I have been blogging for over five years. During those five years, I have helped many people get out of debt; purchase homes they can afford and develop better saving habits.

The reason I choose to blog publicly because I have knowledge as a Financial Planner that I wanted to share with others. The advice I give in person or through emails is always free of charge. Blogging enables me to reach out to people all over the world.

My blogging topics will continue to be on finance. My mission is to connect with as many people as possible that needs help and advice to successfully manage their finances.

There is a big need for proper financial management many are stuck and I have the skills to guide them to find a way out.   The knowledge and training I have I enable to see opportunities, where those that are dealing with the financial crises are unable to see the other choices that are available to them.

Also I am planning to incorporate a life skill aspect to my blog because I realize that many life skill habits create poor financial choices. When proper life skills are learned and develop we are able to make better choices both in our financial and personal life.

If I am able to successfully blog throughout the next year, I hope to enlighten, educate and encourage others to successfully manage their finances and personal life.

My Journey To Financial Freedom By Lisa

I was introduced to Tessa Marie Shillingford at church; she was the speaker at one of our women’s meeting. The topic was financial management.

Boy, am I glad I was present to meet her! She not only spoke about ways to save, she also spoke about the importance of getting and staying out of debt.

After hearing her speak, I knew in my heart of hearts that I needed to approach her and ask for her assistance with financial planning.

I approached her with tears in my eyes and explained how overwhelmed I was with my current financial situation. She reassured me that she would be able to help. I was excited because I was ready for change.

I phoned Tessa Marie the next day and made an appointment to meet with her. Little did I know she was going to be tough on me from meeting number one, I needed help, so I didn’t mind.

She asked to see my expenses and my income. After reviewing it, we were able to make a spending plan, which is the name she uses instead of the word budget. At the end of it all I was so shocked that I had money left over. A hallelujah moment! I was on my way to financial freedom. I understood that this was going to be a lifelong change so I made sure to soak up everything she said like a sponge.

Tessa Marie works tirelessly with you to achieve your goal. She provides this service free of charge, as she believes helping others with their finances is her calling. Her only ask is that we speak to others about what we learn.

In the last two years with her help, I’ve been able to pay off debts that I never thought I would be able to pay off in such a short space of time. I’ve also been able to take two trips without using credits cards. That’s huge for an individual like me who always thought my income was less than my expenses.

Hats off to Tessa-Marie Shillingford for her dedication and helping me come to the realization that if I create a spending plan and stick to it I will have savings and absolutely debt free. Now I am.

 

Lisa

 

 

 

LIVING FRUGALLY

My friend asked me the other day, why I teach people to live frugally and to save money, when I do whatever I want, whenever I want?

When my friend asked that question it made me realized that perhaps I should better explain what frugal living is all about.

I have always been a frugal person while I believe in living frugally; I never   deprived myself of needs or of some wants. Living frugally meant I had to always have a smart plan, which I followed until I met that particular goal.

Living frugally does not mean you have to wear the same clothes over and over or lower the temperature in your home to just above freezing.  It does not mean that you have to sit in the dark and keep the lights off.  Frugal living does not mean that you never go out to dinner or to a show.

Frugal living is always working on your goals; create a plan to find out what you really want.

It is being able to have financial choices. The choices may give you a chance to find some level of happiness and contentment.  It allows you to say no or say yes with ease.

My decision to live frugally has caused me many small family frictions. I remember my brother – in – law saying “Tessa-Marie wants me to turn off the lights whenever I leave a room so she can save ten cents worth of electricity.”  Yes I did, because it was my ten cents not his, it just made no sense to me leaving the lights on when no one was in the room.  Today, Toronto hydro has all types of incentives to encourage the consumers to save on the cost of electricity.  As an example they have provided us with a chart, which explains the peak period and the non-peak period of the cost of electricity.  So as far as I am concerned I was way ahead of the curve on saving small amounts and that made me a trailblazer.

Being frugal enabled me to make a choice to publish my book “Controlling the Debt Monster”. I made the choice to have my book published and changed my career.  I am doing what I love, advancing others to financial independence.   When I discussed publishing the book, one of my co-workers told me why not continue to work for TD Canada Trust until I am 65 then publish my book.  It was tempting, but I knew I had saved and invested well so I could do something I loved while I had the energy to do so.

Being able to do what I am doing today was more tempting than continuing to work at something that had run its course.  I enjoyed my time at TD Canada Trust. I love that company and I am grateful. TD Canada Trust educated me and paid me a salary. The education I received from them I am using today to do something I love which does not feel like working. Even getting my education from TD Canada Trust to be a Financial Planner was living frugally since they paid to educate me. I did not have to pay for the training I received. Guess what, the education and training I received at TD Bank is mine to keep and use however I choose.

I know that my responsibility to serve others is to be the example they need.  I have walked in the shoes they are now wearing and I tell them my story.  Now I serve by enlightening, educating and encouraging others to follow a frugal way of life early in their career so later on they will be able to enjoy doing what they truly love.

The entire idea is to LIVE LIKE NO ONE ELSE WHILE YOU ARE YOUNG SO WHEN YOU GET OLDER YOU CAN HAVE THE OPPORTUNITY TO LIVE LIKE NO ONE ELSE.

Frugal living as a young person let you choose to winter in the Caribbean for six months of the year as a senior.  Frugal living means that you do not have to work because you have to. Frugal living is choosing to work in the flower shop because you always wanted to and now you can.  It also means that you can tick off all the things on your bucket list because you can.

Frugal living does not mean that every time an item is on sale you purchase it, whether you need it or not.  Frugal living is, knowing the difference between your needs and your wants. Frugal living is shopping with a list of the things you need to purchase, it is not entering a store and purchasing whatever is on sale. Frugal living is bringing your lunch to work instead of spending $7.00 on lunch and another $4.00 on coffee and a donut everyday.

Frugal living means knowing what you want and where you want to be financially in the future. Frugal living allows you to have many choices.  Frugal living is watching your savings grow year after year; frugal living is having your house paid off and being completely free of all types of debt.

Frugal Living equals Financial Freedom.

Tessa-Marie

WHAT YOU WANT VERSUS WHAT THEY WANT YOU TO PURCHASE

I had an encounter at the mall earlier this week. I needed to get a short, white jacket to wear with my summer dresses.  I entered a store, was looking around when this young lady came to assist me in selecting my purchase, asking whether she could help me. I explained to her what I was looking for and informed her that I had already looked around and did not think they had exactly what I wanted.  She said that she would check her stock at the back and, after a few minutes, came back with several ladies’ jackets. I looked at each one and kindly explained they were not what I asked for.

The young lady began explaining to me that the shorter jackets were out of style and these are the latest fashion. They were seen on the runways of New York and Paris.  I again told her that I wanted a specific jacket.  She said the benefit of having one of these jackets is that I could go from spring into summer and then right into fall. The colours she had were spring and summer colours.  I explained again, in case she had forgotten, that I wanted a short, white jacket. She then informed me that white, as a colour for spring and summer, was out and the popular colours were bright green and bright yellow, and if I got one of those jackets I would be the envy of my friends.  The price is great, she said,it is at 50% off today and if I had a friend who is a senior I could get an additional 15% off.

As a former sales person myself, I must commend the young woman; she new the benefits of her product, she did her best to sell them to me, she informed me that I would be right in the fashion of the times since this was seen on the runways of New York and Paris for the spring, and that I would be the envy of all my friends with my new runway jackets. Then, she went for the jugular by informing me of the price and the discounts.  Who in their right, impulsive mind could let that amazing sale pass?

The sales woman did not hear my needs, she wanted to sell these jackets and her job was to convince me that I needed the jackets even if I had come to the store for something entirely different.  My needs were completely forgotten. She had an agenda and it was to sell me those jackets. I love these encounters and when I get one of them I often try to put myself in the place of the impulsive shopper.  What would an impulsive shopper do?  Would she agree with the sale person and purchase the runway jackets?  What then would she wear with those summer dresses?  Would she now have to purchase something else to wear with these new jackets, I know she could not wear the jacket without a skirt or a dress?   So the impulsive shopper would leave that store with a bag full of unintended purchases, a maxed out credit card and a belly full of regret before even getting home.

I politely told the young lady that I was not interested in the jackets and left the store.

When you go shopping, you should always be sure of what you are looking for and how much you plan on spending. Remember that the sales person’s job is to get you to buy what they have in their store. You must be aware that they are not your friend, you just met them and they are doing their job… and some can do their job very well.  Often, when we get into those stores and the sales person is helping you, they already know what has to move from the store today.  There was a sales meeting prior to opening and the manager gave them their target for the day or for the week.

When you enter a store you are swimming in unchartered waters.  Be careful as you might drown in a sea of debt before you know it. The bright, spring sunshine can push us into spending more than we plan this season… especially after the cold and snow-bound winter we just experienced.

Take your time and plan your shopping wisely. Take a friend who will tell you the truth no matter what and do not depend entirely on what the sales person has to say.

Tessa-Marie

 

APRIL 2^ND 2013

FIVE POWERFUL STEPS TO FINANCIAL SUCCESS

Interesting year we are in, 2013!  Commonly, anything with the number 13 generates fear and superstition.  Many people run away from this feared number. Buildings do not have a 13^th floor as it is so feared.  Do we have a choice?  Can we ignore the year 2013 or pretend it does not exist just because it has the number 13 in the mix?  No, we can’t so we are going to include 2013 in our lives.  We are going to do something different this year.  We are actually going to embrace the number 13; we are going to embrace the entire year!  A suggestion for our theme for 2013 is NEW HOPES, NEW DREAMS AND FINANCIAL SUCCESS!

Every year we make plans and set goals, which we refer to as RESOLUTIONS.  Let us scrap that word. We are setting New Goals for a New Year with a number that will surely improve our chances.  We will begin by naming “2013” the year my life changed for the better.

My first question; what do you want to ACCUMULATE and what do you want to ELIMINATE?  Take a few minutes and write your answer down.

In the past few years were you a MISSILE WITHOUT A GUIDANCE SYSTEM?  Were you just going about your business working, paying bills, spending and reacting to life instead of life reacting to you?  It’s time to change.  Give yourself a GUIDANCE SYSTEM. Where do you want to go and when?

Now what are those five powerful steps to financial success I am talking about?  Well here they are, you might have heard some version of them previously, but not described to you in the way I am going to do so now!

1.  SPECIFICITY

Key to meeting your goals is to know your goals. Describe your goals completely and entirely until they become something you can recite like a nursery rhyme. You want to pay off your Master Card then say I want to completely pay off my Master Card.  Do not only say I want to pay off my debt.  This non-specific statement does not completely describe your goal.  The specific statement you want to make describes which debt and the amount.  Generally, when a goal is not specific it is not attained.  Ask yourself which debt, the $100.00 you owe your brother, or the $3000.00 outstanding on your Master Card?  Be Specific.

2.  KEEP SCORE

What steps are you taking to meet those goals?  In other words, keep score of your progress towards your goals.  Your statement should be as follows.  I want to pay off my Bank Master card (name the bank) and I am paying $250.00 towards the card every month.  So I Keep Score every month of the total I have paid towards my Bank Master Card debt, which shows me the headway that I have made.

3.  PUT YOUR GOAL INTO YOUR LIFESTYLE

Now that I am paying this Bank Master Card off, I should not continue to use the card.  Making payments to eliminate debt every month and simultaneously incurring more of the same debt is counter-productive.  For example, one should not make efforts to pay $250.00 a month towards a Bank Master Card debt and charge $200.00 to the card just because there is available credit.  Create habits that will enable you to bring your financial goals into your lifestyle and eliminate the habits that work against you.  Modify your behavior.

4.  PROGRAM FOR SUCCESS

Now that you know the steps you need to take in order to meet financial goals, avoid the impulses and temptations that are a hindrance to your targets.  An immediate reward can produce long-term penalties.  A drink after work every Friday is no longer one of your pastimes.  Dinner out every weekend with your friends should be scaled back. Why not cook with your friends at home and everyone contributes to the meal.  A lovely homemade Tuscan soup and some fresh buns with a bottle of wine can make a lovely winter dinner with friends at home.  Try it!  You’ll it!

5.  TIME.  WHEN DO YOU WANT TO ACCOMPLISH THIS GOAL

This is one of the most important steps in accomplishing your goal.  A friend of mine always wanted to retire to Jamaica.  I’ve heard the following statement for the last 15 years. “I am going back home to retire.”  Now that is an incomplete plan.  My friend did not complete his statement; he should have said:  “My goal is to retire in 2001 at the age of 60 in Jamaica.” Now that is a complete goal!  We have the where, the what and most importantly, the when!  My friend is still in Canada, retired and only vacations in Jamaica.  He maintains his dream of one day living in Jamaica but his goal is still incomplete.  With no when, no timeframe, this is an incomplete and unattainable goal.

So there they are!  Your Five Powerful Steps to Financial Success!  Every three months take time to look at your progress towards meeting your financial goal.  If you are not on tract, then re-evaluate and make the necessary changes to get yourself back on tract.  It may not be easy, keep plugging away, do not abort the goal!

Happy New Year

Tessa-Marie

January 2 2013

FOUR MORE YEARS

On November 6^th the people of America voted President Obama for another term in office. President Obama knows he has four years to implement all the promises he made to the American people. Some of those promises date back to four years ago.  Although those promises are four years old he does not plan to give up on them.  His slogan during this election was FORWARD.  That is a powerful word, FORWARD. It makes you know that you cannot stop where you are,and that if you do you will not be able to attain your goals.  Using the word FORWARD gave you the impression that he did not plan to pack his promises aside, he intends to make them become a reality for the American people.  This time he might have to change the ways he tried the last time.  He will have to look at things from another stand point.  We all know that there are several ways to get to a certain destination and we have the choice to choose how we want to get there.   President Obama has to make some changes to his method of getting what he wants, for the American people.  He has four years and they started on the 7^th of November 12.01 am.

I have given myself a challenge and I am hoping that you too will give yourself a challenge for the next four years. If you had four years to attain some of your financial goals and the clock started ticking today, what would you do to reach those goals in four years?

Do you know what financial goals you want to achieve in four years?  Here are a few ideas of the goals you could attain in four goals.

1. Go to University or College and get an education.
2. Upgrade your credentials to get a better paying job.
3. Work with a mentor to help guide you to reach a career goal.
4. Pay off all you credit card and line of credit debts.
5. Stop using your credit cards impulsively.
6. Open a Registered Retirement Savings Plan and keep the money in the plan.
7. Create a Spending Plan that suits you.
8. Take advantage of a Tax Free Savings Account by opening one and save automatically in the account.
9. Save for your children’s education, open an Education Savings Plan.
10. Have money saved in a “God only knows what will happen account.”
11. Save to buy a home.
12. Save for a vacation.
13. Always shop with a list.
14. Avoid impulse shopping.

You might have goals not listed above which can be met in four years or less, add them to your list and share with us.  This list is just an example so create your own keeping in mind they need to be accomplished in four years.

Four years is not that long so you will have to get going immediately.  All goals cost money and I know, you might be unemployed at the moment but that should not stop you from preparing for the day when you are employed.    Your first goal could be FIND A JOB WHERE I WILL BE EMPLOYED FOR 5 OR MORE YEARS.

The first step in making your goal a reality is to write them down.  Begin by doing the following:

• Get yourself a note-book about 13 x 18 cm
• Write the date and your name on the first page.
• Write the date four years from today, when you will have achieved your goal or goals.
• Compile a list of the goals you want accomplished and when during the four years, is it in year one or two.
• Write what is your next step, what can you do now to make it a reality.
• Follow through with what you can do, stay focus.
• Write your progress down and keep tract.
• Reward yourself along the way.

I want to remind you that if your goal is to pay off your credit card, you should not be going out to dinner to reward yourself or attaining your goal by using the credit card to pay for dinner.  You should use cash you have saved to pay for dinner.

Share this blog with your friend; ask them to share it with their friends.  Start a four-year club it could be lots of fund.  My friends and I have created a Four Year Club; we are going to meet monthly to encourage each other to stay focus on reaching our goal in four years.

Tessa- Marie

WHAT DO YOU REALLY, WANT?

Whenever I facilitate a workshop on finance the very first question I ask the participants is WHAT ARE YOUR FINANCIAL WISHES?      Most of the participants are stumped by this question.

In The story of Aladdin’s Lamp the Genie once released from his imprisonment in the bottle asks Aladdin. “WHAT DO YOU WISH’   I refer to this fable to illustrate a point.  When Aladdin was confronted with this question he hesitated, and like most of us, he did not have a list of specific wishes.  He had a vague idea of what would provide the most immediate pleasure and comfort.  He did not have a working plan and he did know what he wanted.  I ask, the Genie’s question a little differently. What is it you to accomplish financially?  The common response is “You know I have never really thought of that.”

At the beginning of a workshop on finance I get those same reactions. So let’s see if I can help guide you to achieve your financial goals

It is Tuesday night and you are watching reality television wishing you were one of those rich people or one of those getting rich doing their show.  You wished so hard that the Genie appears,   “Give me a list of the ten things you want now and they all will be yours in five years.  You will receive the first one in January and the second one in June and every year after this for the next five years.  There is only one catch; you must name these ten things in 120 seconds.”

How many of you are able to do this now?  Stop reading and get your, I phone, I Pad, purple, yellow or blackberries and begin writing taking only 120 seconds to complete the list.  How was that for you, did you complete your list in 120 seconds or were you mystified, dumfounded, and exhausted, well you are not alone you are just like 90% of the population over the age of 20.

Kids know what they want; we have all seen or experienced with a child who wants a particular toy, they know the name of the toy, they know where it is sold, what colour it is, how much it cost and they also know you will move heaven and earth to get it for them.

The Genie feels sorry for you and decided to give you another chance.   He tells you “I will be back in seven days and if you have those ten things listed they will be yours.”

What are you going to do, are you going to turn off the television, and get your note-book or one of those berries and begin writing or are you going to do it after this particular show is over?  It is all your choice, remember. The decisions you make today determines the life you live tomorrow.

You decided you are starting now.  The first list you created you set aside, NO! You say out loud as you jump out of your chair, this is not what I really, want.   You start again.  This time you date and time the second page and begin, using the previous list as a reference, you look at the list again and will see the things you know you need, also what you don’t want.

Here are  some things you might have on that first list.

1. Be happy,
2.  Have good health
3. Travel
4.  Have a fancy car
5. Eat at superfine restaurants
6. Have a big House
7. Buy designer clothes and shoes
8. Want to be comfortable
9. Get married
10.  Have a family

Now here is a list of the things you need and want to accomplish.

1. Stop borrowing money to buy things
2. Bring my current debt up-to-date
3. Pay off all my debt Buy a Home
4. Create a small only God knows fund
5. Create a Big emergency fund
6. Buy a house
7. Open a  Registered Retirement Savings Plan
8. Save my children’s education
9. Have an annual vacation
10. Pay off the house

A very different list from the previous one.  Are these better choices?

Try creating your own list using the above as a reference.

When you have these things in place, peace of mind, happiness and contentment will follow, and your Financial Advisor aka Genie will have guided you to reach your financial goals.

It requires some practice and it will definitely take much more than 120 seconds to get it right but it is worth doing.

Let me know how you felt before and after the exercise.

Tessa-Marie

CONSTANCE

CONSTANCE

I was out shopping the other day and when I got to the cash register the sales clerk took my purchases and then asked me the following three questions.

• Would you like to purchase these lovely gloves they are on sale?
• Would that be on your store credit card?
• Would you like to purchase a shopping bag?

To all three questions my answer was NO, after saying NO I felt someone tugging at my coat.  I looked back into the smiling face of a lady who said,

“Good for you, I can never say no”.  I smiled back and said, “I have trained myself to only purchase what I plan to purchase that day”. She replied, “I wish I could be like you”.  

I was just about to say bye to her when she said, “You are just the person I want to talk too”. She decided to forego her shopping and walked out of the department store with me.   She said, “I hope I’m not taking up too much of your time”.  I replied, “No” and thought to myself you are using NO an awful lot today.   

She introduced herself as Constance and told me she needs the help of someone who can advise her where to get an installment loan.  I explained that her best choices would be her local bank, trust company or a credit union. 

Constance then said, “I have such bad credit, I can’t get a loan from any one of these places, you see I have a payday loan and it is just killing me inside out”.   I paused looked at her with all the empathy I could muster and said, “NO” to that she said, “Yes my dear what can I do?”  I replied, “In order to help you, I would like to know more about your finances is that okay with you?”  “Let’s find somewhere to sit” I said, and then she began her story.

Constance’s’ story went this way:

“I am 70 years old and live on a fixed income of $1,133.00 monthly, my source of income is from Canada Pension, Old Age Pension and a Guaranty Income supplement.  For the past thirty years I have never held a job past probation, therefore, I do not have a company pension”.  So I said to Constance, “Can you tell me what your expenses are?”

Here are the numbers Constance gave me:

1. Rent                                                                                  $ 413.00
2. Telephone and cable        ABOUT                              160.00
3. Bay Card                                                                               50.00
4. Bus Fare                                ABOUT                              100.00
5. Grocery                                 ABOUT                              200.00

                                                               TOTAL                               923.00

I realized quickly that is was $923.00 in monthly expenses.  Although whenever someone tells me an amount of an expenditure or income prefaced with words such as, “PRETTY CLOSE, NEARLY, ABOUT, LET ME SEE and I BELIEVE”, I know right there and then that person is not managing their money properly; which means they are usually in debt, and don’t know how much they owe and how they spend their money.

I asked Constance if that was all her expenses, and if it was she still had $210.00 left.  I wanted to know what she spent the remaining on.  

Constance replies, “Oh I forgot, I’m paying a Credit Proposal of $150.00 for the next five years”. 

“Well that still leaves you with $60.00 I said, where does that go?”

“You know” she replied, some of those prefaces again I thought.  

“You mentioned a payday loan, how and when are you supposed to pay this?” I asked. 

She replied, “That’s the problem” as she held on to her head.  “You see, I borrowed $500 and I have to pay back $600.  When I pay back the $600, I do not have sufficient money left to pay my expenses and so the cycle continues, I take another payday loan for the next month and so on and so on.   If I had an installment loan, I would be able to pay a small amount every month until it is paid off”. 

I asked her “When you received the credit proposal, were you advised not to incur anymore debt?” 

To that she said “Yes but I did not have any money and started using my credit cards again”. 

 Do you have any family or friends that could lend you the $600 to pay the payday loan off and then pay that family member $55 a month over one year that would give them a small amount of interest?” 

She replied “No I can’t.  I’ve received help from both my son and my sister and right now they are unable to help me.”  Constance continued with sadness, it was my carelessness and lack of knowledge over the past thirty years which paved this road I am on.  I never thought it was necessary to save for old age; no one told me that I shouldn’t retire with credit card debt.  I believed that my Canada Pension and Old Age Pension would be enough to pay all of my expenses and I would have some left.  Do you know until I became eligible to receive my pensions I thought the amount was in the thousands?  I moved from the Maritimes to Ontario at the age of forty for a better life, now I’m not able to purchase a train ticket home to visit my family.    

The situation that Constance is in is not uncommon, I am meeting more and more people who are finding themselves in this position.   We are planning to meet again to see if together we could come up with a solution to solve her problem.

It always comes back to those five simple words:  proper preparation prevents poor performance.

It is never too early to begin to plan for your retirement, better to start sooner than later. Everyone should pay off all debt in full before retirement; retirement income is MUCH, MUCH lower than employment income.

Tessa- Marie Shillingford is the author of Controlling the Debt Monster. She is Personal Financial Planner, with a designation from the Institute of Canadian Bankers, and a Financial Counselor certified by the institute of Canadian Banker. She is presently a Program Facilitator of Financial Literacy at JVS Toronto. Tessa- Marie was employed by TD Canada Trust for twenty years in the retail section of the bank. During her tenure at TD Canada Trust she held various positions interacting with customers of the bank. As a Financial Advisor and Manager of Financial Services she led a group of Financial Advisors in helping customers of TD Canada Trust successfully manage their finances. Details of her book… Controlling the Debt Monster, can be found at http://www.controldebtmonster.com

ALEX AND SOFIA

Alex and Sofia

Alex and his wife Sofia are clients I have been working with for a number of years on their financial plans. When I came home today I had a voice message from Alex asking me whether I had read the article in the Toronto Star by Sunny Freeman of the Canadian Press: 

 CANADIANS ADDING DEBT FASTER THAN AMERICANS

I had read the article but I wanted to find out why that particular article had propelled Alex into making the call asking me if I had read it.  My first thought was, I hope these guys are not back in a financial mess. We are due to meet in four months for their annual financial check up.

When I returned the call Sofia answered and she told me they were just talking about the article and that they both wanted to talk to me about it.

 Alex and Sofia wanted to ask me to write this blog hoping that it might help others.

The article states that, “Household debt is now rising faster in Canada than in the United States and will continue to grow as low-interest rates encourage consumers to spend beyond their means.”

These are frightening, ominous words. They spell a time when rates will climb and what will happen to consumers with huge balances on Home Equity Lines of Credit and Credit Cards or unsecured lines of credit.

As consumers, we fail to learn from others. We are affected by our employers decisions to cut back when the market for their goods and services are not in high demand.  They lay us off. They ask us to take early retirement. They stop hiring and in some cases the businesses might shut down entirely.

We, the consumers, pay no heed to all this action happening to us or to friends and family.

Our economy is not growing as expected. July to September it grew by 1.6 per cent which is down from 2 per cent in the second quarter and it’s a far cry from the growth of 5.8 per cent gained in the first quarter.

The message to us the consumer is to tighten our belts and not buy on credit.  Although interest rates are low and it is very tempting to buy and buy on credit it is time that we go back to the old ways and only buy what we can afford with the cash we have available to us instead of using the almighty plastic.

Someone told me that if we don’t spend the economy will come to grinding halt.  No, it won’t come to a halt and certainly not grinding. We can spend and yes we should spend, but purchasing endlessly on credit is not wise spending. Furthermore, even if rates are low the rates on the credit cards do not change they are still at 18 to 29 or even 32 per cent and they never go down, unless the financial institution wants you as a new customer. They will then offer you an introductory rate for a short time. Then watch the rates go up to the same old rate. But by that time, you are hooked and their hands are deeper in your pockets. How can you move? Where do you go from there, to another introductory offer? Before you know it you have four to six cards that were all introductory offers.

My recommendation to you is to learn from the large companies out there. Look at General Motors; they were in deep trouble, they closed plants, laid their people off and now they are showing a profit.

As a consumer make some changes in your management of your finances. Cut back on going out to dinner every week. Just because it is in this season that does not mean you and your family needs to have it.  Think of things you can do as a family. Take a look at that gym membership. When did you last go to the gym?  Having it is costing you money. Run your family finances like a business when it is slow. Stop and take a look at your bottom line. Will you be able to meet the financial goals you set if you continue to spend and buy on credit as you are presently doing.

 Make some changes today. Pay a little more on your mortgages increase, your payment on your credit cards, cut the cards up or freeze them like my sister did.

How would you feel when rates are high again and everyone is complaining while you are sitting back enjoying your planned success?

Make some changes now!

LIVE LIKE NO ONE ELSE TODAY SO YOU CAN LIVE LIKE NO ONE ELSE TOMORROW. 

Tessa- Marie Shillingford is the author of Controlling the Debt Monster. She is Personal Financial Planner, with a designation from the Institute of Canadian Bankers, and a Financial Counselor certified by the institute of Canadian Banker. She is presently a Program Facilitator of Financial Literacy at JVS Toronto. Tessa- Marie was employed by TD Canada Trust for twenty years in the retail section of the bank. During her tenure at TD Canada Trust she held various positions interacting with customers of the bank. As a Financial Advisor and Manager of Financial Services she led a group of Financial Advisors in helping customers of TD Canada Trust successfully manage their finances. Details of her book… Controlling the Debt Monster, can be found at http://www.controldebtmonster.com