Gails Blog

Very often people are seen in a particular light: I’m a mother to my children, their friends, and their friends’ parents. To some I’m a nut. To the farmers around whom I live, I’m a city-girl. To those people who interact with me at school, I’m a parent or a busy-body or a Crazy Woman. You’ve seen my eyes pop out of my head on TV. Imagine what it’s like when people are messin’ with my children!

My children helped to define who I am. Before my daughter, Alex, came along, I was this sex-pot, career-focused over-achiever who thought the world revolved around me. The whole world. (Hey, don’t laugh about the sex-pot thing… you should have seen me in a bikini before babies!) After I had my children I became a much nicer person simply because I realized that I was so much more. I love motherhood. And I’m damn good at it.

One of the things that helped me be such a good mother was the realization that I couldn’t control everything. When my son was about four I found out that he has Asperger’s Syndrome - a classification of autism. Along with it came a significant language disability. And along with that information came the idea that having a child who had some challenges meant I was not in control - in fact, had never been in control — of all that goes on around me.

I have subsequently shared my story about Malcolm in many places, including a story that still lives somewhere on the internet. I received a note recently from a woman who had read my story and taken strength from something we share.

J wrote:

I love Til Debt Do Us Part and have probably watched every episode, but my question is in fact a comment that is not about personal finances (although my husband could learn a thing or two from you!).

I have just read an article you wrote about your son Malcolm and your family’s experience with his hyperlexia. I cannot thank you enough for this article. My son Stephan is 5 and seems to fit all the criteria for hyperlexia, although we are still waiting for his developmental assessment (he has finally been seen by an SLP and is slated for some therapy this summer).

Thank you for sharing your fears, frustrations, and above all your son’s success. I can relate to almost every word and it brings genuine hope to me and my family - instead of constant fear and worry about my little guy’s future.

J’s note got me thinking. Y’all know me as The Money Girl with a pretty good idea of how to put food together. But I’m also the mother of a child with Asperger’s Syndrome. And I’m the mother of a child who is Gifted. I’ve been married three times and in my first Wifely Role was abused, so I continue to work to try to get the message out that abuse is not the fault of the abused. I’m the daughter of an alcoholic, which makes me the cheapest date in town since I’ve made the conscious decision not to drink. I’m a step-mother, a grandmother, and a friend - although I’ve been left on the earth by some people whom I loved dearly and miss like mad. Sometimes I feel lonely. Most times I feel blessed. I work hard to be happy. And I work hard to make as many other people happy as I can, not doing what they want, but being there for a hug or a kiss or an ear.

We are all many people. We’re smart about some things and not-so-smart about some others. We can help people who need what we know, and learn from people who know what we need. But we have to find each other.

It’s funny the different ways the world has of putting people together. I recently watched an inspiring video called The Last Lecture by Randy Pausch, a professor at Carnegie Mellon University. Professor Pausch died of complications from pancreatic cancer this summer at the ripe young age of 47. The gist of his lecture focuses on how he achieved his childhood dreams.

This got me thinking about what my life is like relative to what I thought it would be like, and how I’ve achieved my dreams. I’m not done thinking. It’s a big question.

Too often we get caught up in what is missing from our lives, and forget to look at what we have achieved, the riches with which we are surrounded, and the beauty of every moment. Not to get too sappy, but when was the last time you thought about how WONDERFUL your life is?

Never mind that you are lonely. I’ve been lonely. You change lonely by going out and touching someone. Thanks Brownie.

Never mind that you are sad. I’ve been sad. You change sad by thinking of what you have that you can be grateful for. My beautiful children are always the first things that come to mind.

Never mind that you wish your life were different. I’ve wished my life were different, and then I’ve made it so. Not overnight. No. Big changes take both commitment and TIME. But my life has changed in remarkable ways over my 49 years, often following paths I could never have predicted.

The key, I think, is our willingness to play the hand we are dealt, but play to WIN. Randy Pausch talks about this in his lecture. It’s our willingness to look at the donut, not at the hole in the donut. And it’s in HUGE ways supported by the people with whom we choose to surround ourselves.

If you’re an alcoholic, it would be stupid to hang out with friends who always wanted to go drink their faces off. If you’re a shop-a-holic, it’s stupid to hang out with people who define themselves by their stuff. If you’re predisposed to sadness, its stupid to feed that sadness with ANYTHING – books, music, movies, people – who create sadness for you.

Randy Pausch’s lecture reminded me that I am the author of my fate, that I am responsible for making my own dreams come true, and that it’s all about attitude.

People overcome horrendous obstacles all the time. They are remarkable people. The thing is, I believe WE ARE ALL REMARKABLE PEOPLE, some of us just don’t realize it.

Today, tell someone you love just how remarkable they are. Do this every month. Find someone who is remarkable – you are surrounded by them – and TELL THEM. Find someone you can help and HELP them. Find someone who can help you and ACCEPT their help. We are nothing if we are not connected. We carry within us the spirit and experiences that would allow us to give so much to others. But like your Momma said, you have to learn to share.

What do you have to share? And who are you going to share with TODAY?

Peer pressure is something we associate with teenagers and their ability to distinguish between a sensible course of action and a dumb one. We know peer pressure leads to bad decisions and good, and that we want our kids to be able to think for themselves. But have you given any thought to how you may be affected by the peer pressure from your friends, particularly when you decide to change how you’re managing your money?

One of the hardest things to deal with once you decide to live on a budget, change how you’re using your money, and modify your life, is telling your friends. Some of them won’t mind a bit. Some will congratulate you. And some will think you’re nuts.

I run into this all the time when I’m working with my fams. They have friends who like to go out to restaurants. They have friends who want to explore all the amusement park rides in the summer. They have friends who think a budget is what losers do.

You may have to rethink who you’re hanging with.

If you’re hanging with people who are in your new head-space – folks who budget, watch their money, and are getting and staying out of debt – you’ll find it easier to stick to your plan. These Frugal Friends will know that you’re working hard to make changes and they’ll support you.

Don’t equate frugality with meanness or tightwads. Being frugal is being committed to staying on a budget and living a simpler life.

Your Careless Chums won’t consider for a minute how their own spending patterns may be difficult for you to deal with. They’ll say, “Com’on, we haven’t been out for dinner in weeks” or “We’ll just go for a couple of drinks” or “You need to spoil yourself once in a while.”

Frugal Friends are also into the sharing thang. If you have a chain saw and they have a lawnmower, they’re quite willing to share their tools with you, as long as you reciprocate from time to time. Imagine a network of Sharing Friends! I mean, how often do you use your crock-pot or your stepladder or your powerwasher? I once had sharing friends who let me use their swimming pool, which I kept clean in exchange. There’s $10,000 I didn’t have to spend! (They’ve subsequently turned their pool into a beach,  which I’m still happy to share.)

Splitting the bill evenly is not always the way to split it fairly. Frugal Friends always go with the “fair” not the “even.” If money is no object, or if y’all ate the same thing, hey, splitting equally is fine. But if you eat a $15 meal, why should you have to ante up $30 to split the bill equally? As the girl who never drinks, my share of the bill is always less than the others’ who have put away a couple of bottles of wine with dinner. My options: pony up and shut up; eat the most expensive thing on the menu; have dessert.

Having a fun night out doesn’t have to cost a fortune. Your Careless Chums may want to blow $100 on baseball tickets, but your Frugal Friends will be quite happy with a night of scrabble and a pot luck dinner. Yes, you’d have a great time at the baseball game. And your Careless Chums may even offer to spring for your ticket ‘cos they love you.  Then you feel you have to go, spending gobs for parking, food at the stadium, treating them to drinks after as a ‘thank you’ and paying a babysitter

Frugal Friends will be willing to point you in the direction of the best deal, ways to cut costs, and having fun for free. While Careless Chums will brag about their latest acquisitions, leaving you feeling pooooor, your Frugal Friends will demonstrate just how rich a life can be without constant consumption.

I’m not suggesting that you tell all your Careless Chums to go to hell and go get yourself a whole new set of friends, I’m just trying to point out how peer pressure can mess up even the best laid plans. If you’re committed to changing how you deal with your money, you’re gonna have some ‘splaining to do if you want those Careless Chums to understand your new headspace. 

I’ve been swamped with questions recently, and many of them are far more sophisticated than I’ve been seeing up until now. Before I get to some answers, let me reiterate: If I’ve answered a question similar to the one you’re asking before, I won’t answer it again. You’ll have to search my site for the answer. See the How to Use This Site on the home page.  

Here we go:

Hi Gail, our mortgage will soon be up for renewal and we would really appreciate your advice: would you go for a plain simple mortgage (we’re considering President’s Choice PC points plus for a 5 or 10yr fixed term) or would you consider a ‘home equity diversification plan’ (through Investor’s Group) that replaces a mortgage with a home equity line of credit that consists of 2 sub-accounts, one for the mortgage and the other for investment lending to make regular investments into a non-registered portfolio of mutual funds that ’should be’ tax deductible according to the brochure we have. I do our own taxes and this one sounds kind of confusing to me but I would appreciate your advice. Also my 2nd question is do you recommend registered or non-registered investments? Thank you so much for your time in reading my email and we will wait for your response.

Okay, J, here’s the long answer. The product you’re being offered is one that allows you to use the equity in your home to secure a loan for investment purposes. Each time you build up some equity, the loan would eliminate the equity and the money would be used to buy investments. The upside is the interest on the loan for investing is tax deductible. The downside is if there’s a reversal in the value of your investments – if the value goes down – you’ll still be on the hook for the loan. And since you’re not building any equity in your  home, you have to “safety net” there. If it were me, I would go with the vanilla-flavoured plain old mortgage.

Now here’s the short answer: If you don’t understand an investment, or you’re not sure you should do something, THEN DON’T DO IT!

As for your second question: registered or non-registered. That depends on how close you are to retirement (the further away you are the more the RRSP works for you), and what type of investments you’re buying (interest-bearing investments are tax sheltered in an RRSP).

My husband and I are in a tricky financial situation–my husband is in a position where he has to change careers, which would necessitate us buying a house in a location where prices are EXTREMELY high. We are looking at having to spend approximately $350,000 for a moderately priced home that will suit our family. Our problem is this: we have extremely high credit card and line of credit debt, dating back to my being laid off from my job and going back to school. We foolishly kept living the same lifestyle on credit, thinking that my earning power once I graduated was going to be much better than it actually was, at least initially. Poor choice, I know!! Anyway, we are concerned because every mortgage calculation site we have visited has indicated that despite the fact that we have a combined monthly income of approx. $6500, our debt load is too high. We are working toward paying down our debt and have scaled back considerably in all areas (We watch your show, so w e knew just how to do it!). However, we may need to purchase a home in the very near future (renting here can be more costly than a mortgage, so it seems the better choice). Would we be able to get a consolidation loan, or put some of our debt on our mortgage even though it is unsecured debt? Please help!

S: The big problem with living life like tomorrow will be better is that life has a way of biting you on the ass! Carrying debt is one of the best ways to LIMIT YOUR OPTIONS. I’m sorry that you’re feeling squeezed and that your options are limited by your current debt load. Unfortunately, a consolidation loan doesn’t reduce your debt load, it just moves it – hopefully to a lower interest rate option. If you do consolidate, and end up paying less in interest, more of your payment will go toward paying down your principal. That’s a good thing. However, unless you find stuff to sell or find a way to make more money so you can get that debt paid down, in all likelihood, you won’t qualify for the size mortgage you’re looking act. Sorry to be a bummer.

Thank you so much for your show. I have learned so much. I find it hard to apply many of the ideas you present. I am a full-time law student. I work part-time during school and am working full-time right now. I get the maximum amount of student loans. Tuition is so expensive, as is my rent, that I still need to make up the shortfall with a personal line of credit. Before going to school I had no debt and fairly decent savings. I still have the savings, which I intend to use for a downpayment on a house in a couple years. But this living with debt over my head is a very unpleasant feeling. I know I am going to get a decent job once I graduate. I have some rather large expenses for things I would really like to have now. For example, I would love to get orthodontic work done while I’m in school. I could live without a car but really really don’t want to…and my current car is falling apart on me. Is it an absolutely horrible idea to bank on future income? The line of credit is at a decent interest rate. The student loan will take some time paying off, but once I start working it really won’t be a problem. Should I wait?

A: See my previous response and the mess S got herself into thinking that it’s okay to spend money you haven’t yet earned.

My husband & I have never used credit cards much, and we have raised our sons to be frugal, or at least thoughtful in their money habits. Now our oldest is 19 and has run his finances well for several years. He is eligible for a credit card and we are eager to see him begin to build a strong credit rating. Does a credit card have to be used to develop this rating, or is it enough to hold one unused — either in a safe deposit box or perhaps frozen in a block of ice as I have seen on a terrific TV show we all enjoy?

Kerry: the only way a credit card works to build a credit rating is if you use it and pay it off religiously. So, yes, he has to use it. And it is THAT experience – using it and paying it off on time and in full every month – that is the real lesson.

Love your show! My fiance and I are engaged and have been together for 6 years (living together for 5 of them). We have always had separate accounts/money except for our mortgage. We split the bills. We both have student loans and car loans. I feel it would be easier to have our finances become one (and maybe just reassuring to me to know exactly whats going on). I have goals to buy a home and have a family soon, but want to be sure we are financially ready. Am I being to controlling? What is the norm out there? It seems my friends who have joint accounts communicate better about finances.

T, there is no norm. But being able to communicate about money is a key part of being able to stay married for a long time. Go read the stuff under Getting Married on my blog. Then TALK!

I have been working on a plan in place to pay off all of my consumer debt (2 years remaining). All of my hard work is about to be thrown into chaos: my work has given me more responsibility on a lower pay scale, which has also changed my union. I am now making less gross ($3k/annum), paying double the union fees and this new union of mine is planning on striking in two months. I already had the financial struggle that my daughter is about to lose her job (in a month) and may be unable to continue to contribute temporarily.  How do you prepare for a financial disaster on such short notice? My emergency fund isn’t large enough to accommodate this many disasters at once.  

Karen: there’s no way to prepare on such short notice for so many changes at one time if you don’t already have an emergency fund in place. You’re going to have to buckle down and find a way to cut your expenses. Can you take in a renter? Can you (and your daughter) find part-time jobs? Can you sell something that will bring in some income?

I’m sorry I can’t be of more help. There are no magic strategies for this situation. You just have to get creative and find ways of cutting back or back-filling your budget. Good luck.

Hi Gail, I have been using your interactive budget since February and love it!!!  All but 2 categories make perfect sense to me: I understand the fixed expense category ‘Maintenance/improv/condo’ to cover expenses for the building/property you live in, such as paint, repairs, upgrades etc.  However, what category covers things like necessary home furnishings?  We recently needed to replace lamps and I’m not sure what category these fall under.  Also, would you elaborate on what the ‘Family/gifts’ category would include beyond gifts?  Thank-you so much for sharing your wisdom.  

S: furniture and other big-ticket stuff you want to buy comes under Capital Expenditures. As for Family/Gifts, that would cover presents for b/days and other holidays, and if you’re helping to support a family member, that’d go in here too.

My question is this, what are your thoughts on shopping at Costco? I like to shop at Costco because they have such good prices on food and I have tried making a budget for groceries, but it is hard to come out of Costco without spending under a $100 dollars. Do you recommend to people on Til’ debt us do part that stay away from Costco?  

M: I don’t tell people to stay away from Costco. I like the store. A lot. Their prices can be fabulous. I always go in with a list. I only buy what’s on the list. I never spend more than I plan to. That’s my advice.

When should you consider consolidation? I’ve been thinking it’s the best option for us but I often see you have folks try to reduce interest rates on credit cards instead. Is there a preferred method or does it vary? What questions should we be asking to help us understand what the next steps are? By the way, your show is very helpful and I try to watch it often. Our debt ratio is .2998, but we don’t’= have the best credit out there. No bankruptcy, or past dues (although we have occasionally been late on payments), but we have a lot of credit and are cosigners on both of our son’s student loans. I have not checked our credit score in over a year but it was not great then.

M: I recommend people consolidate to a) reduce their interest cost, b) get one single monthly payment and c) limit the amount of time it takes to repay their debt. If you don’t have a good credit history, in all likelihood you won’t get a good (low) interest rate, since your history is part of what goes into setting your interest rate. So you should be working at negotiating with creditors to reduce your interest rates on the individual cards.

Hi Gail, I love your show and would love to be on it unfortunately it is for couples only. My question is: At present I have approximately $8ooo of student debt remaining. I am interested in buying a condo or a townhouse and am wondering if it is the right time seeing as I have only recently begun saving more. Should I wait until I have at least 10000- 15ooo$ before I consider buying or it is feasible to do so at this point? Any input is very much appreciated.

Monique: I can’t tell you if it’s the right time to buy. That depends on whether you qualify for a mortgage, and how much, and whether you can manage the responsibility of home ownership. I have a number of articles on the site about this, so go read them.

I’ve read your articles about kids and money, and think they are great, but we are having trouble with the idea of $1 per year of life with our 9 year old. Currently, all he uses his $3 pocket money for is candy, we make his lunches (there’s no cafeteria at school). Could you expand a bit on what things you think a 9 year-old could and should be paying for?

Hi Andrea. I define an allowance as, “The money you would normally spend on your child, put in your child’s hands so he/she can learn to manage it.” If you son likes to watch rented movies, he could use his allowance for that. Or for buying software for his computer/gaming device. Or to buy books. Whatever you find yourself laying out money for, he should be buying (not the necessities of life). Over time, as he needs more money to meet his needs, you can increase his allowance, or give him the opportunity to work for more money.

My other half is very reluctant to take any financial risks as a result of seeing his parents make some very costly errors for which we are now picking up the pieces. This becomes most noticeable when we discuss buying a home. He has a number of reasons against this: 1/ it’s too expensive compared to rent, 2/ if something ever happens (such when his father got cancer or if one of us were to lose our job) we could move according to our new requirements much more easily. On the other side I’m afraid of still having to pay a mortgage when we retire. I understand that there may be an argument for renting over buying a home but I think it requires a very disciplined saving strategy. How can we get on the same page on this? Should I accept that buying isn’t for everyone? It seems it may come down to emotions rather than finance as no matter how much we talk his fears remain the same. Thanks so much for taking the time,

L: you and your husband are going to have to sit down and hash this out. There’s no right or wrong answer on the own versus rent question, it’s a matter of what suits you. But your differing objectives could be a point of resentment later if one or the other is forced to do something that goes against the grain. So you’re going to have to work it out. Maybe if you went to see an advisor who could show you the black and white of it (or use some of the tools on line), that would help you come to a consensus.

My husband came to Canada in 1998, the first 7 months we lived with my parents. We saved up money towards a downpayment on a condo. I got pregnant and that’s when our debt started building up. Now, I happy to say that we moved house and debt free (excluding fixed mortgage). Several years have passed and managed to save some money. My question is that the money saved is just sitting in the bank. How can I convince my husband to start thinking about our family’s future and make the money work for us? I believe that he still feels scared that we will go from black to red. Please reply back with some suggestions. Thank you

A: Same as above. There’s no right or wrong way to invest. But you have to come to some kind of agreement.

My husband will be living on his own in another province for a new job. My son and I will be joining him in a couple of months. How do I set up a budget to keep track of both households?

Deena, the same way as you would if you were living in the same place… you’ll just have much higher expenses

I have a department store card, which I rarely use. I always maintain a zero balance as well. Recently when I went to use the card I was informed that the department store cancelled the old card and replaced it with a new card (new number) since it had not been used in over a year. How will this affect my credit report? If this does negatively impact my credit history what steps must I take to rectify the situation? Thank you for your kind assistance.

C: you need to check with the credit bureau to see if it had an impact. Perhaps not. I’d be more concerned about the company issuing me credit I hadn’t signed up for.

I am carrying a balance of $18,000 on my line of credit with an interest rate of prime plus 1.75%. I currently earn $58,000 a year and have not savings. I am 40 years old. Between paying mortgage, condo fee, living expenses (food, gas, etc), and paying towards debt repayment. I find that I don’t have any extra cash for savings or needed extras (like clothes for work). These expenses go onto my credit again. Since I’ve bought my condo, the value has increased about $30,000. I’ve been thinking about adding my credit line balance into my mortgage, — re-financing my mortgage, to add in my line of credit balance. This will leave me without “consumer” debt and I would have cash flow every month for savings and buying things with cash. Is this a good idea?

M, this is only a good idea if you save the difference and BUY NOTHING until the $18,000 is paid off

We are now faced with a decision: we declare bankruptcy or go with a proposal offered by BDO Dunwoody Ltd. Are they promoting themselves or is this really in our best interest? Very desperately yours

AM & M: I doubt that the company is “promoting” itself, but if you’re in doubt, get a second (and third) opinion. I have worked with several people who have been given bad advice when it comes to declaring bankruptcy or using a consumer proposal. I don’t know your circumstances, so I can’t comment. You could read up on the bankruptcy rules to see if that would be better for you. (Go to bankruptcycanada.com).

HI Gail! I have a question that has been on my mind for quite some time: we are a one income family with young kids, our yearly income is about 55k. We’re still renting, but planning to buy a house very soon. We will have about $30.000 for the down payment (in-laws are giving a “pre-inheritance”). We have 2 credit cards with zero balance, and a LOC with about $4.000 on it. Our credit score is very good. My question is, should we call the banks and ask them to lower our limits (one is at $12.000 and the other $ 9.000)? I think those amounts are just ridiculous, but will lowering the limits affect our mortgage at all? If we should ask them to lower them, what amount do you suggest? Should we cancel the other card altogether, and just have one credit card? Thank you in advance, you’re my hero!!

M, great question. Yes, the amount of credit to which you have access does affect your ability to qualify for more credit. Go get those limits lowered!

Hi Gail, My girlfriend of 2.5 years recently told me that she has $40,000.00 worth of credit card/line of credit debt. This year I was planning to propose to her, but with this debt and the fact that I am just learning about it despite several attempts on my part to ask her about her money situation, everything is in doubt. I want to help her with this, but can’t help but feel angry that she lied to me (or withheld the truth…same thing in my books). Any advice on how to navigate this situation?

D: I think you both need to come clean on your finances. And you need to tell her how you feel about her “secret.” She may have simply been embarrassed. But people who love each other don’t need to worry about embarrassment, right. They just need to worry about honesty. So sit down over a nice dinner, with all your paperwork in hand, and tell each other the truth.

I loveeeee your show and practical saving methods. My husband and I just bought a vehicle and purchased it through our line of credit. The dealership wanted to charge us 9.5% interest because it wasn’t a new vehicle. I harassed them asking what happened to 0% financing, but they wouldn’t budge and told me good luck on getting a better rate. Anyhow, we purchased the vehicle and used our line of credit. Because we were able to increase what we could borrow from our line of credit, we lowered our interest rate from prime plus 3 to prime plus .5. I thought it was an ok deal, but obviously the bank is still making their 2 cents worth and then some. My question is, currently we’re paying 5.75% with 41,000.00 owing and 5.2% on our mortgage, which we’ve only had for 1.5 years now. When we have extra money, what makes more sense, to pay the mortgage because we owe more or the line of credit to get it out of the way? We pay on our line of credit every 2 weeks and will be increasing the payment close to 100.00+ extra due to my husbands promotion. I just want to pay where it will count!!

D, pay off the line first. It’s the debt with the highest interest rate.

Hi Gail, I got married about 6 months ago & the only debt my husband & I have is his car loan. We pay $482 a month & have about 37 months left. We are currently renting my mom’s basement apartment & would like to purchase a home in 3-5 years. Would it be beneficial to pay off the loan from our savings & start from scratch? Thanks for your help……

J, if paying off the car loan will save you a bag of interest, yes. Then you can put the money you were using to pay the car loan towards your home downpayment savings. Make sure you set up an automatic savings program so that you aren’t tempted to skip the savings.

My husband and I bought a timeshare in the states and we live in Canada. Its a loan. At the time we thought it was a good idea to get it but now really thinking about it, not really. Now we just added more debt to what we already had. We would like to sell it but not sure how to do it. What would you recommend?

K, sorry, I don’t know squat about timeshares. Anybody else know anything?

How do you get out of debt when students loans are out of control? My husbands student loans are extremely high, he can’t get a loan for anything and when we bought our house 6 mos ago it had to go in my name only because the interest rate would have been higher if his name was on the house?? Just so lost and financially whipped that there is nothing to save?? Don’t know how to pay of his loans and we have collection agency calling about him almost everyday now. Should I consult a financial advisor to help us out and put us on a budget?? Any advice would be appreciated watch you show when I can am a big fan of yours.

T, there’s no magic to getting out of debt. You have to find a way to get the money to pay down the debt.  You can cut expenses. You can make more money. You can sell something. Them’s your options.

 

I’ve been getting quite a few letters of late from people who are desperate because they have a Spending Spouse. It doesn’t matter how hard these partners work to get their fams out of the red, they Spending Spouses dig ‘em another hole. It’s frustrating. They’re angry.

I’ve talked about this before recommending that the Spouse on the Spot take drastic steps like handing the money over to the Spending Spouse to manage so they get a taste of reality. But that doesn’t always work, as demonstrated when DM gave her BoyMan a little responsibility:

My boyfriend and I have been living together for almost 2 years and he has no part in the bills. I pay and look after everything. I did, at the end of last year give him the responsibility of paying our $40.00 a month insurance bill. It was canceled twice and we were very lucky they let us keep our rate and just pay up front for year. How do I get him more involved but not giving him full responsibility of anything? I don’t trust him to take full responsibility. We are really far in debt, like $40,000.00. For a young couple that’s a lot. Its got me really worried. Maybe I am doing something wrong because we just don’t seem to be getting any where.  Thank you so much for everything. I was your show when I can and your advice has helped a lot and I hope someday we will get the chance to meet you. You have to come to Nova Scotia!

I also suggested that you get naked and paint what you owe all over your body to get his attention. But not everyone has the courage to do this. And not everyone wants to dump their Spending Spouse, as L makes clear in her letter:

Gail, I am at a loss. I just received my husband’s credit card statement to find out that on top of his $16 monthly amount for playing his online game, he also just spent $60 on ‘gold’ for use in his game. The credit card is also raising his APR from 18% to 25.9%… probably due to the fact his account is over limit every month since Christmas. We have already filed for bankruptcy 6 years ago and have been working towards a better credit report but I feel like I am living with a baby with a credit card. I was just speaking with him and his first words out of his mouth were ‘So I guess I am coming home for a fight, eh?’ I am not interested in leaving but how do I deal with him, he will not a. budget or b. deal with the budget that I try and lay out. I work very part time and raise my family and keep house full time. He is happy that I am home to do everything that needs to be done, yet every time a money issue arises he wants me to go to work… if only he would work towards budgeting with me, I could afford to stay home and work the way I do. How on earth does a person deal with a spouse who thinks they need their toys and games? We were doing just fine with less money until he went out and maxed out 2 credit cards.

Lots has been written about the need for spouses to trust each other, to talk about the money, to work together on their goals. There’s very little on how to steer a Spending Spouse back in line or what to do when your BoyMan is unwilling to face adult responsibilities. And while all the usual advice is very civilized - respect each other, be willing to accept his objectives are different from yours, keep a cool head - none of this advice really works with a Dope. It’s all very well for an “expert” to say that you and your partner should spend a month tracking your expenses, but if he won’t, what’s a girl to do?

I know some people have resorted to the “allowance” system, taking all means of purchase away from their Spending Spouses and replacing it with a set allowance their partners can use, but not abuse. This feels motherly to me, and I can’t imagine anyone taking well to the idea of an allowance, particularly when they’re bringing home the bacon. If you are both on an allowance, that can ease the humiliation, but if your Spending Spouse is determined to circumvent your plan, he’ll just go out and apply for a credit card you know nothing about. Better the debt you know.

I do believe that getting your partner involved in the money management will help. No matter how much she resists, make her sit down and go over the budget with you. Very often spouses who don’t handle the money have no concept of how much it takes to keep the boat afloat. Making them acknowledge this by sitting through a weekly budget meeting may help.

One of the things that I’ve had success with working with my fams is simply showing them how much it’s going to cost in interest over the long term. You have to spend some time on a debt repayment calculator to come up with the numbers, but why not take your Spending Spouse on a tour of one, plugging in his real numbers, so he can see how much of his money he’s wasting on dumb interest.

Desperate times call for desperate measures, and if you just can get your Spending Spouse to STOP, you might have to resort to SHOCK. Pick a month and blow your brains out on your credit cards. (Buy stuff you can take back or that you actually need but never buy because you’re always covering your Spending Spouse’s butt).  Drain your bank account. Present your Spending Spouse with the bills and say, “Here honey, there’s plenty more of this to come.” I know it’ll damage your credit history in the short term, but it might save your marriage in the long term. Only you can decide how far you’re prepared to go to get your message across.

And maybe YOU can’t get the message across. Maybe you need to seek outside intervention, professional help to get your partner to open his eyes. Don’t assume that because you can’t reach him, no one can. He may be so inured to your nagging that you’re just a mosquito buzz in his ear. Another person may make great inroads with the most quiet and reasonable of voices.

To all you boys and girls dealing with a Spending Spouse, you have my sympathy. I wish you the best of luck. This is not an easy road to walk, but there’s a lesson in it for both you and your partner. Learn the lesson and you’ll be able to stop banging your head against the wall.

Okay, I’ve done it. A Woman of Independent Means has been updated, edited, uploaded…

and now it’s ready to be purchased. You asked for it, so BUY IT!

 

When I started this website a half-year ago, I promised I’d answer one of your questions every week. I’ve been inundated with questions, and have been responding to two a week. But there are times when I’ve got so many great questions that need to be answered, that I just take a couple of hours and fire-through them. Here’s what I have for you today.

rinkrat_hockeymom wrote:

One of my employers is not taking enough tax from my paycheck. I have been having an extra $50 a pay taken out to cover this since the beginning of the year. I was telling a friend about this, and he suggested it would be more beneficial to take that $50 and put it into an RRSP and I would get thed same result, plus be able to save my own money instead of lending it to the government for a year. Is he correct?

Not quite. While every dollar you put in your RRSP is not taxable, you’d have to put the entire income you’re earning from your second employer into an RRSP to achieve the result your friend is suggesting. I’m all for that… but I don’t think that’s what you’re trying to achieve. So you’re doing the right thing.

If you want to calculate your tax exactly, you can go to Taxtips for a really thorough calculator. If that one makes your head spin, here’s a simpler one that will give you a basic of idea of how much tax you should pay.

 

L from B.C. wrote:

I have just come into to some money — $35,000.00 — and I am wondering what I should do with this money. I currently don’t own my place (renting) and just finished paying off my line of credit ($25,000.00) at the bank as well as my credit card ($25,000.00). I have been working as a cashier for six months at $10.00 an hour. I am looking for a better paying job right now. Can you give me any advice for this $35,000.00. Should I invest this money or maybe put the money into an ING Direct account at 4.5%? I don’t think I am eligible for a mortgage just yet…?

I get a lot of notes like this with people asking for advice on what they should do with a lump of money that’s just fallen into their laps. I like to tell people to:

1. Take care of past mistakes,

2. Have some fun in the present, and

3. Plan for the future.

So, L, on the Take Care of Past Mistakes front, congrats on getting all that debt paid off! Wow! You’re one determined young woman. You’re in a much better place now and you should be very proud of your accomplishment.

On the Plan for the Future front, you’re right when you say you aren’t ready for a mortgage yet, particularly in your neck of the woods.  But you are ready to set up an emergency fund, start an RRSP, even with just a couple of thousand bucks, and begin building your downpayment. As for where to invest the money for your downpayment to grow, you’ll need a financial guide for that. Ask friends/family for a referral to their GREAT financial advisor. Don’t settle for anything less than GREAT!

Using a high-interest account is smart. Making sure you know what you want to accomplish with the money is smart too. So ask yourself what’s important to you and by when you’d like to achieve that goal. Plan from there.

As for my number 2 point: have some fun in the present, don’t go nuts, but take some of your money and treat yourself and someone you love to a Nicey: Dinner out, a fun weekend of movies, a new piece of furniture you’ve been wanting, or a lovely new dress. Or you could decide to set up a Mad Money Account, putting $500 or $600 aside that you can spend on anything you want whenever you want, just for the hell of it.  Have a ball.

 

On a similar theme, K wrote:

I have an inheritance if 60,000 and wondered if I should double up on my mortgage payments each week (that is the maximum allowed) or wait put the money in a high interest account until the mortgage is up for renewal this December 2008 to bay off a chunk of the 120,000 principle?

The faster you put the money to work against the mortgage, the more you’ll save in interest. And any interest you earn is taxable, but the interest you save is not. So double-up and then use whatever is left to make the principal pre-payment at the end.

 

Carman wrote:

What is your opinion for a person to use RRSP savings to pay down debt? We have enough RRSP savings to pay off our debt (excluding Mortgage). Thanks for all you teach on your show, I think everyone could learn something.

I’ve answered this one before, but I’m going to answer it one last time since I get this question every week. Really.

The answer is: DON’T DO IT! I know there are some people who say this is a good idea, but it’s a terrible idea. A really terrible idea. First, there’s the tax you’ll end up paying on the withdrawal from the RRSP, and then there’s the tax you’ll owe because the amount withheld won’t have been enough.

If you’re determined to get rid of your debt, then you’re going to have to bite the bullet, tighten your belt and put your shoulder to the grindstone. If that’s not enough metaphors for you, I have plenty more!

 

T wrote:

hi gail i watch your show all the time and i was just wondering i am 17 and still going to school and planning to go to university soon i am extremely good with money and saving and i have about 7000.00 in my bank account right now. would u recommand when i turn 18 to get a credit card and always pay it off in order to get my credit rating started. i would never spend more than what i have or even come close to spending all i got so i dont think it wud be a problem but just asking for ur advice.

T, if you swear on your Mom’s head that you’ll never spend more money than you have, then I say getting a credit card to build a credit history is a good idea. I’ve seen a lot of kids (and elders) start out with the best intentions and then fall into the carrying-a-balance trap. But if you promise not to be one of the dopes, then I’d say go for the card, Bud, and build yourself a fabulous financial history.

 

Sarah wrote:

My husband and I love your show - yes I said both of us - you’ve got us talking about our finances - YAY! Our question is in regards to student loan debt. I’m in the process of finishing my PhD and my husband and I each have 3 degrees. Our combined students debt is $62,000 (not bad considering) and we have a new mortgage of $120,000. So many of our friends have just followed the plan offered by the bank/government - but 12 years to pay it off??  We gross $76K a year but we’re going to be starting a family soon and our plan right now was to add $200/month as a prepayment to our mortgage. What do you suggest - balance pre-payments and extra student loan payments? Should we make one a priority over the other (student loan interest is prime +1, mortgage 6.3 locked for 10 years)?  We would really appreciate your advice - the bank always says “follow the plan, then you have more disposable income” - yes and they make more money in interest! love your show and your kick-butt attitude.

Ah, yes, there are those Pesky Bankers again, telling you to keep more disposable income so they can rake in more interest. Hmmm. Is it any wonder Canadian’s don’t trust their advisors?

Sarah, leave your mortgage payments as they are, and use all your extra money to pay off your student loans, which is your more expensive debt. Once that is paid off, you can balance mortgage prepayment with long-term saving. As for starting a fam soon, have a great time with that. And while you’re preggers, live on the one income you’ll have during your mat leave so that you

a) get used to having a smaller income, and

b) have a nice pool of savings set aside for when baby gets here.

 

Kerry wrote:

I am a 21 year old full time worker. I graduated with a 2-year diploma in Bus Adm (major accounting) and have taking Intro to Financial Planning as well. After graduating from college with WAY MORE DEBT than I ever imagined from 2 years of school, I have got myself back on track by my own means and would like to offer a credit/debt counseling service outside of my full time job (which I love). I want to educate people before they make the same mistakes I did, and/or repair the mistakes already made. Only problem I have found in my plan is, how do you charge a fee when your clients are already living paycheque to paycheque? PS your show and outstanding way of making the obvious PAINFULLY obvious has changed my life and influenced my (hopefully!) future career path immensely!

Hey, Kerry, that’s a darned good question. Some people who work in debt management affiliate themselves with a company that will allow them to do debt-counseling. Credit counselors, for example, are often not-for-profit organizations that help clients consolidate their debt and set-up repayment plans. And I do know of at least one private company that builds their fee into the “consolidation” loan. You might want to look at that as an option.

So, all you debtors out there, what would you be willing to pay to have someone dig you out of a hole, and how would you come up with the moolah?

 

Mercedes wrote:

I am a 24 year old university student living on my own and paying all of my bills yet have still managed to save about 15000.00 in the past 2 years. I have no debts and am wondering what to do with this money to make it grow for the future. I feel as though it’s just sitting there. How much should I set aside for a rainy day/emergency fund? Thanks!

Okay, all you student debtors who tell me you can’t possibly save any money while going to school, heads up to this.

Mercedes, you are a shining light. Congrats!

As to what to do with the money, set side at least $5,000 in a high interest account for emergencies. Ultimately, you want to have 3-6 months’ worth of living expenses covered. As for the rest, it’s time to learn to invest. Read about investing. Choose a couple you think might work for you and watch them for a while to develop a comfort level. When you think you’re ready, take the plunge. Don’t be too aggressive too quickly. And never invest in anything you can pronounce or don’t understand.

 

Carrie wrote:

I am currently on mat leave with 2nd baby. We figured out if I return to work I will be contributing 2/3 of my take home pay to working expenses and only contributing 1/3 of my take home pay to the household. Does this make it worthwhile for me to return to work? Or is the smart thing to try to find a part time job to make up the money we are short? Or, with only about 6 years left on our mortgage, should we reduce our mortgage payments in order to live, until I can return full time in about 5 years?

You seem like a clear-thinking girl. You’ve certainly outlined your options well. Here are my answers

Does this make it worthwhile for me to return to work? Yes, if you need the 1/3 to make ends meet.

Or is the smart thing to try to find a part time job to make up the money we are short? Really? This is a question? Work less to make the same? Where’s the question?

Or, with only about 6 years left on our mortgage, should we reduce our mortgage payments in order to live, until I can return full time in about 5 years? This, too, is an option, if you’re prepared for the extra interest cost over the life of the mortgage. You don’t say how old you are, but how old could you be with a second baby just here? So you have lots of time to get this mortgage paid off.

Now, the question is, what do YOU think you should do?

 

S wrote:

I work part time as a nurse, so I actually bring home more money per hour with my liue of benefits. Is it better for me to work full time and “bring home” less money, but have job security, sick time and vacation? I am 41 married with two school age children. Thanks and I love your show-your sense of humour really makes it!

It’s hard to answer this question when I don’t know how much less you’d be bringing home, or how that would impact your cash flow. Assuming you don’t NEED the extra for essentials, then the security of full-time with benefits would be a huge blessing, particularly with young kids. However, if the extra money you’re bringing in is essential to your budget, then maybe not. What do you think?

 

Erin wrote

On your show, you give your clients an “office in a box” with all kinds of file folders and coloured tabs. I tried making my own and it doesn’t look as nearly detailed or full as yours. What categories do you have in your box?

Go read 12 Steps to Getting Financially Organized and the blog Paper Chase.

 

For Lynn who wrote:

How long should you keep your paperwork, such as bill statements, payments and income tax forms

Ditto

 

A wrote:

If I have a defined benefit pension plan with my employer, do I really need to contribute to an RRSP? Also, how do I figure out my “tax bracket” as I am planning to withdraw $10,000 from my RRSP to pay down debt - if the withholding tax is 30% then how do I estimate the additional tax I will pay next April - my gross income is about $60,000…

A, you likely don’t need an RRSP if you have a defined benefit plan. I’d be very surprised if you have much contribution room at all. If you do, then I would use it up, but not break your neck to do so. As for writhdrawing money from your RRSP to pay off debt: DON’T DO IT!

 

Tammy wrote:

I have 2 children: a son who is 20 and has finished 3 years of university and a daughter 19 who has finished 1 year of college. We have paid for the tuition and book for the 3 years for my son and paid the 1st year of college for my daughter and have enough to pay for her 2nd year, her course is 2 years long. I do not want my kids to finish school and owe money but my husband and I find that most of our money goes to the kids and there is none left over for us. We have been putting a lot of things for them on our line of credit and it just keeps going up, I know I need to stop but I don’t want to see them acquire any debt but I just feel that my husband and I are sinking further and further into debt and we have been arguing over the money spend on the kids. If you any suggestions on how we can work this out I would really appreciate it.

It’s nice that you don’t want your kids to graduate with debt, but you’re accumulating debt and that’s no good either. I hope your kids are contributing to their own education. If they are not, that’s the first place to start. There is no such thing as a free ride in life, and 19 and 20 are plenty old enough to start dealing with life’s realities. Help your kids. That’ great. Don’t do yourself damage in the process. That’s dumb!

 

Victoria wrote:

Hello. Congratulations with the show. I have been watching it daily for some time now. I have put my husband on a $200 a month budget. This money includes his gas and extra spending. We have been using the jars for three weeks now. So far so good. I am currently on maternity leave and working one day a week that I am allowed. I am making $430 every two weeks. I am trying to save this for our vacation at Christmas. Do you think it would be better to put this money onto the line of credit and then take it back out when we need it? Also, we just did a balance transfer on our one credit card. We have an interest rate of 1.9% until November. Should we penny pinch and put every last cent on it so it is paid off by then? Thanks so much and keep up the great work.

First the credit card question: Absolutely pinch every penny so the card is paid off before your great rate expires in November.

Now the line of credit question: Yes you should put it to the line first, and then take it back off when you need to, to minimize your interest costs. But I don’t think a fam on mat leave with a balance outstanding on their line of credit should be prioritizing a holiday over debt repayment. Once you return to work full time, I can see saving the money for a holiday. But while you’re living on a reduced income, and have debt, your focus should be on getting out of the red.

Are you sorry you asked?

 

M wrote:

My husband says that it’s not smart to start a RRSP because I owe $50,000 in student loans, which I am paying the minimum right now. I work part time as a RN and I have 2 kids. I’m 38 years old and I feel that I have to get started. What should I do?

You should get started, you’re right. But your husband is right too. Since you’re only working part time, your marginal tax rate isn’t high, and paying only the minimum on a $50K student loan is stupid. You’ll pay way too much in interest. So:

1. Up your student loan repayment amount to an amount that’ll have you debt free in five years or less, and

2. Start contributing $200 a month to an RRSP.

If you don’t have enough to do both, you’re going to have to find a way to make more money.

 

S wrote:

I would like to know if there is a way to save money on a disability pension.

I’m surprised by how often I get this (or a similar) question. There are a lot of people out there trying to make do on disability income, which should be a heads-up for all the people who don’t yet have disability insurance. As for this question, the answer is quite simple: If you have extra money after all your basic needs are met, you can save some. If you don’t, you can’t.

I’m sorry that there seem to be so many people living a marginal life on less income than they need. It’s a tough haul and you have my admiration for making a go of it.

 

Another M wrote:

My wife and I are a one-income family and even with a very tight budget our expenses are always more than our costs every month. I have mentioned taking some of the equity from our home (either re-mortgaging or a straight loan) to ease some of the expenses until my wife gets back to work. So, I was wondering, is it ever a good idea to take a home equity loan?

You don’t say why your wife is off work, or how long it may be until she’s fully employed again, and that affects the answer. If this is a short-term thing, then I’d say do the refinance and un-strap your budget. If it’s a long-term thing, you may have to sell your home to make it through. Good luck.

 

Karen wrote:

My relationship with my boyfriend of 8 years is strained to say the least because of this debt and not knowing how to budget. We have thought of calling it quits. I think the icing on the cake was when I was offered a job but would have to take a 14k cut in pay for 2 years from what I am making now, but then would make over 100k a year after that. I had to turn it down because each month I am going further and further into debt AND with a 14k a year cut in that!??! How would I make ends meet? Help! Please point me in the right direction.

I don’t often say this, but are you sure you’re in the right relationship? After all, is this the way you want to spend the rest of your life: giving up your hopes and dreams because your partner can’t get outside himself long enough to stop going into debt for crap? If you’re determined to stay in the relationship, then I’d separate the money - yes, you heard me say “separate the money” - and make the Boy Man responsible for himself. If he can’t do it, then either reconcile yourself to a life of misery with him, or get the hell out!

 

RC wrote:

What is the best way to invest money that I am intending to use toward the purchase of a home/condo, in one years’ time. I would be a first time buyer.

Since your time horizon is very short, you need to stick with something that has no volatility at all. Go with a term deposit, GIC, high-interest savings account… wherever you can get the best rate for one year.

 

Carol wrote:

I am 55 years old and will retire at age 64 with a good Omers Hydro pension. I was a single mother raising 3 children for most of their lives, so savings and retirement planning were not a priority. However, as my children are now grown I have more disposable income. Is it too late to start RSP’s or should I concentrate on paying off my mortgage?

Since you’re over 50 and have a good pension, I’d focus on paying off that mortgage so you’re retiring mortgage free. If you still have money left over, you can take me out for dinner.

 

Cynthia wrote:

I watch your show all the time and I noticed that you always talk in terms of household income and don’t discuss the differences in the amount each person makes. My boyfriend and I recently purchased a home, but we still have totally seperate finances, we live like roommates, simply splitting the common expenses in half and then we each pay our own credit cards etc. I would like us to be a more equal partnership, but he still thinks in terms of “your money” and “my money.” Is there a proper way to start combining finances?

Girl, you and your honey need to get on the same page. Go and read To Consolidate or Not to Consolidate and So You’re Getting Married even if you’re not.

 

Brett wrote:

My wife and I have recently realized that our parents are in rough financial shape, planning on relying solely on a single pension in retirement (no RRSPS). How can we approach them to talk about it and get them doing something about it? We feel as if we will be burdened by our parents within the next 15 years, and need help to get this situation under control!

Sorry Brett, it might already be too late if they have not been planning and are pretty close to retirement, with not enough money. Do they have assets they can liquidate to provide an income? Can they move to a less expensive community to cut costs? In terms of just approaching them about the issue, read Aging Parents: Talking about the Money. 

 

Okay, that’s it. My brain is mush and my fingers are cold from the breeze created as they’re flying across the keyboard! Ha! 

 

BTW: I’m planning to put up a series of articles on home buying. Are there any special topics y’all want me to cover? Speak now.

I’ve received a lot of questions from people who just can’t seem to get their partners on board when it comes to managing the money. It’s not unusual for people to have different approaches to money. One likes to save, the other likes to spend. One thinks credit is evil, the other thinks credit is there to be used to full advantage. Differences that are even smaller that these diametrically opposed positions can cause friction: witness the couple who both agree they want to buy a house, both agree they’re going to save, and then disagree on where they should keep their savings.

I’m not sure why money has so much emotion attached to it. After all, it’s only meant as a convenience so you don’t have to carry the goat over your shoulder from stall to stall hacking off limbs as you buy your vegis, pay your fuel bill or pick out a snappy new slingshot for Hunter Boy. So why does it matter so much how much we make, what kind of wagon we drive or whether our plough-horse is the latest in breed?

Perhaps it’s because we’ve lost sight of what’s really important. Now we measure ourselves less by our ability to help others through tough times and more by how snappy we look when we head off to church. I think we should have to wear little tags on our stuff that shows what we still owe so that people get the right idea about what we’re willing to sacrifice (peace of mind, hard earned money in interest, our family’s security) just to make an impression.

Well, if money is such a big, hairy deal, then why are some people so willing to ignore it, to their own (and their partner’s) detriment? Why do they throw up their arms and stomp out of the room, yelling over their shoulder, “I don’t care. You do it.”

I’ll tell you why. They’re scared. Yup. They’re petrified. And the very idea of facing up to what’s what with their money makes them just want to toss their cookies. They have no hope. It’s a lost cause. The whole thing isn’t even worth talking about.

So, if you’re the guy trying to get them to pay attention, what do you do?

Some people would tell you to just separate your money and be done with them. Let them sort out their own mess. Me, I think that’s foolhardy. Since their negative behaviour - sticking their heads in the sand and never making a payment - can have serious repercussions for the rest of the family, I’d find another way.

You have to do something to get your partner’s attention. And it has to be something big, or you won’t make an impression. Since humour is the one thing that consistently overcomes fear, then you should also make it something funny.

So image this: you’ve been trying to get your husband to sit down and talk to you about the bills and how you’re going to pay them. He won’t. Your husband arrives home, yelling your name as he comes trumping into the house. You’re sitting in the living room buck-naked. On your right breast is printed “overdraft — $372.34″, on your left breast is printed “credit card payment: $238.” Do you think he’ll laugh? Will he pay attention?

Guys, use your imagination. You can see where I’m going with this. So if it’s the missus that’s been acting like an ostrich, you can just go ahead and write on yourself wherever you think she’ll pay most attention.

You may have to take your prodding public. This is hard, because people are so secretive about their money. But it may be what you need to do to get your partner to heads-up to your frustration, your anger, your sense of desperation.

Whatever outrageous step you take to get your partner’s attention, he might get mad or she might throw a hissy-fit. So you have to warn them ahead of time that if they don’t start bringing some positive attitude to the table, you’re going to get desperate and do something crazy.

Once you do sit down to talk, it’s important to not only talk about what’s important, but why it is important. If your partner wants to take a vacation away from home every year, it may be the travel bug, or it may be a desire to get you away from other distractions. Or he may simply want you all to himself for a while. Is there a less expensive way of achieving his goal?

Pick your discussion time carefully; don’t try to talk when you’re mad. If you’re angry about your buddy’s most recent financial misstep, you’re ripe for a fight. Hold off until you’re calm.

Keep in mind that arguments about money often mask more deep-rooted problems, such as your partner’s sense of value or power within the relationship. There are times when the way in which we do things sends a message our partners may resent. They might be miffed if we:

• seem to spend more money on ourselves or our family/friends than on them
• complain about how much money they spend on themselves
• fail to check to see if they’ve got plans for the bank balance before we spend the spare cash
• question them on every penny they spend.

If one of you thinks the other has an unfair advantage - perhaps one person makes considerably more, or constantly buys expensive presents that make the other feel they have to keep up - resentments can build.

As you discuss your money and start working together on your financial future, agree that money management is a joint responsibility. No one person should have to bear all the responsibility. And the other guy shouldn’t be in the dark about what’s happening with the family coffers. Agree to talk. Talk. Talk. Talk. Talk. Talk. There’s no better way to work it out. And if your partner doesn’t hear you the first time you say something, say it again. Write it on the bathroom mirror in toothpaste. Write it on your stomach in chocolate sauce.

Remember that life and relationships are all about negotiation. Learn to give so you can get. And make sure you get when you give.

 

 

February 7, 2008, marks the Chinese New Year and Year of the Earth Rat. The Rat is the first sign of the Chinese zodiac and signifies new beginnings, so this may be just the right time to embrace new ways of doing things. Experiment and put plans into action since you’ll have lots of  opportunities to achieve success. Things started now are likely to have long term consequences, so choose wisely to enrich your life.

 

While you might be quite willing to turn over a new leaf and do things a whole new way, what do you do if you’re partnered with a dope who just won’t change? Or someone who has bought into a stereo-type and just won’t get with the 21st century? Or someone who just won’t pull his or her weight?

 

I’ve known couples where there was no equality, couples in which one person bore an unfair amount of the responsibility. Whether it was a she who worked and also did every stitch of housework because that stuff’s “woman’s work”, or a he who was saddled with all the family financial responsibility, despite the fact that she worked and brought home a fair to fabulous income. Whazzup with that?

Some people refuse to deal with the money at all, leaving all the responsibility on the shoulders of the other partner. Some want all of the control - and this isn’t just men keeping women “in their places” - so they can make all the decisions. Whazzup with that?

I can’t believe in this day and age, after all the progress we’ve supposedly made in terms of moving away from traditional relationships and embracing a new reality, we’re still holding on to old stereotypes:

• house-work is for women, as is raising babies,
• men should be the major breadwinners in a family
• men should bear all the responsibility for financial decisions
• women should be able to stay home with the babies for as long as they want
• women aren’t good at math, so they can’t manage the money
• women care more about shopping than investing
• men shop online less often than women, and spend less money when they do

 

Okay, all those things aren’t true. They’re stereotypes. And if you found yourself nodding at any of them, give your head a shake

Since stereotypes are always going to be with us, what do you do if you’re the unlucky sap who has found himself doing all the housework while holding down a full-time job? Or what if you’re the sucker who is paying all the bills while your significant other is blowing his money on whatever he feels like

Well… first you have to decide how important it is that the situation change. If you’ve been the patsy for a while, it may take some time to make the changes you want. And you’re going to have to be consistent in the message you send and in the way you follow through. If you’re just feeling a little put-upon and whiney, give it a couple of days. If this has been bugging the crap out of you and you’re ready to pack you bags, it’s time to take some action

Step 1: Have a discussion with your significant other. Explain how you’re feeling. Ask your partner what they think about what you’ve said. Ask them if they are willing to help change things so you don’t feel so resentful, so angry, so taken-advantage-of.

Step 2: Your partner responds in one of three ways:

• She agrees she’s been a heal and promises to change, and does.
• He disagrees he’s being a jerk and refuses to change a thing.
• She agrees to change, and then blythly goes ahead and does what she’s always been doing.

Step 3: Then you have to decide what you’re going to do.

If you see change, reinforce it, no matter how small the change my be. If you see slips, don’t panic and get angry, just use a gentle reminder to get your joint approach to solving the problem back on track.

If your partner refuses to change, I’m really sorry you married such a vacuous nit. Now you have to decide if you’ve had enough and you’re prepared to pack. If you can’t imagine splitting up over this issue, you’ll just suck it up. Or you could go on strike and refuse to do any of the things you’ve been doing and let the chips fall where they may. Only after your partner does one thing, will you do one thing. Then when he does a second, so do you.

How about if this applies to managing the finances, paying the bills, ponying up with the moolah every month. Suggest that you’re tired of doing it all, that you’re going to open up a joint account and put half the monthly expenses in it from your resources, and if she chooses not to contribute the other half, then bills will go unpaid, cheques will bounce, collectors will call, and that’s the life you’ll have together.

The hardest to deal with, I think, is the partner who promises to change and then just doesn’t. “Sorry honey, I won’t do that any more. Ooops, shucks, I did it again, sorry.”

Boy, don’t you just want to pull your hair out. Resist the urge to throw a hissy-fit. It won’t make a scrap of difference. Ask him to do a specific thing you want him to do, NOW. “Bob, can you please come rinse these dishes and put them in the dishwasher for me, I’m just up to my eye-balls.” Then when he does, give him some positive reinforcement. “Thanks babe, I didn’t think I was ever going to get out of the kitchen. Want to play cards?” Don’t go overboard and be careful not to be sarcastic in your delivery.

Keep it up, asking for small changes, immediately, and then reinforcing them. After a while, ask for something that doesn’t have to be done immediately. When she does it, reinforce it. If she doesn’t, then ask her to do it immediately and reinforce it.

Does this sound a little like training a puppy? Same idea. To bring about change takes positive reinforcement and the patience of Job.

We often can’t help whom we fall in love with. Then we find ourselves in living arrangements and wonder, “How the hell did I end up here?”

You are the only one that can decide how best to deal with your partner. I wish you all the luck in the world. 

 

Casting Call:

Til Debt Do Us Part  is now casting it’s final 26 families. If you want to participate in the show, or you know someone who does, now is the time to apply. 

Does your partner constantly borrow money from you?  Does splitting household expenses really mean you pay for it all?  Are money fights ruling the house?  Is your partner’s drowning debt affecting your life?   

I can help!

Til Debt Do Us Part is shot in the greater Toronto area. Families receive a financial makeover and a chance to earn up to $5000 to pay down debt. 

Click here to apply on-line.  

We’re especially interested in: 

*Roommates

*Same-sex couples

*Blended families

*Single parents

*Stay-At-Home Dads

*Siblings who are financially entwined or dealing with eldercare issues

*Parents with adult children living at home

*Couples who get to the end of the money before they get to the end of the month!