A Money Coach in Canada

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One of my clients gave permission to seek opinions on her debt options. She is up to her eyeballs, and, 3 big cheers to her, is taking charge of the situation. She has a solid income and has a lot of equity in her home. She doesn’t want to go the bankruptcy route – in fact, was told she couldn’t – so is considering using a debt consolidation firm. It would result in an R7 on her credit report.

Her mortgage is up for renewal in a year.

I’m a money coach – helping on the day-to-day money stuff like controlling spending, setting savings objectives, learning how to interpret your mutual fund statements etc – and this particular question is slightly out of my domain and expertise.

Any informed opinions out there?

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Upon our Loonie flying to par with the USD, witty comments on metafilter:

  1. Man, you guys are screwed. Now who’s going to buy your maple syrup?
  2. I think this is all part of a massive worldwide conspiracy to keep Americans home
  3. You owe me 96¢, Haughey!
  4. See? I knew keeping that bag of Canadian change from ’02 around was a good idea! I’ve made, like, four dollars (Canadian) just by having it sit there!
  5. sucks to be me. i live in canada and get paid in US dollars.
    it’s like a >$10k pay cut and i didn’t even get demoted 🙁
  6. Turns out those people threatening to move north when Bush was elected weren’t raving hippies- they were canny financial geniuses!
  7. So does this mean that the strippers at the Sundowner aren’t going to be as frisky when I pull out my roll of greenbacks next time?You should see what they do for Canadian Tire money!
  8. O Canada!Loonie
    Ill-omened rate is panned!
    Blew eighteen thou to visit Newfoundland.With groaning hearts we see fees rise,
    The new North conquered me!Sums par decried!
    O Canada, remand dinar to me!

    God lend your hand to penurious bourgeoisie!
    O Canada, remand dinar to me!

    O Canada, remand dinar to me!

  9. The dollars last met each other as equals a week after Darryl Sittler scored ten points against the Boston Bruins. Going by that, I’m hoping the Leafs will have a good season this year.
  10. The last time this happened was ’76, anyone remember what has happening then?
    I was born, so basically, my life is at net zero, in at least one measure.

cdn-penny.jpgWith our dollar at par, many Canadians can’t help but notice how much less expensive it would be to purchase a car in the US these days. And with NAFTA an all that, this would be an option of us, you’ think. Here’s Judy’s experience:

So you’re a Canadian and want to buy a Toyota? Excellent choice. Great car.

But oops! The price. About $10K more than the identical vehicle in the United States

Well, how ’bout buying one in the US and having a bit of a vacation during the three days it takes to get a US export permit?

Canada Customs is very helpful, providing a pamphlet called, “How to import a car from the U.S.” And all they will ding you for is the gst. No duty.

Then comes the brick wall. Whammo! That friendly American salesperson you were negotiating with sadly informs you that he is not allowed to sell to you.

“What? Who, me? Am I such a pariah?” Yes, you are. Because you’re Canadian, that’s why.

Canadian Toyotas are still priced as though the Canadian dollar were still around 63¢ US. That accounts for the 30% difference. Somebody in Toyota must be getting very rich selling in Canada.

An irritation, though, is that stream of Canadians going to buy Toyotas in the US – what a hew and cry from Canadian dealers! The remedy? Forbid US Toyota dealers to sell to us Canucks. Disregard the discrimination. Disregard the Canada – US Free Trade Agreement. Protect the obscene profits made by Toyota in Canada.

Editors note to Judy: you’re not alone in your disgust! CBC did 2 features – one on the general question: when will consumer goods start being evenly priced in Canada? And another specifically on the car issue – apparently a class action lawsuit alleging conspiracy is being taken against four car companies and the canadian auto association.

Readers: what are you thoughts on this? Are the higher prices in Canada justified, or is it a complete rip-off?

If ever you wanted fine art, now is the time: Revival Art in gastown is having a moving sale. The art is going for up to 85% off. These are genuinely incredible deals.

Store hours: Thur, Fri, Sat 9am – 9pm

Location: 359 Water Street.

And! A really fun one – LUSH salutes single parents with this special offer:
SPLL Survival Kit

And for something completely different, these men’s boots, great condition, $50 cdn care of 10 on Wednesday.dscn0022-6-1.JPG

Ask an Accountant is provided by Your Money by Design’s stellar accountant, the inimitable Mindy Abramowitz. We’re happy to have her here each Wednesday! Have a question? Want more info on the post? Leave a comment!

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Maybe you are applying for a credit card, a loan or a mortgage, or maybe you are just trying to get a handle on your personal finances. Where does your car belong in the financial picture?

Although it costs you money, and occasionally grief, your car itself is an asset. Anything you own that can be sold for cash counts as an asset. Even a beater can be sold for parts; and, whether it seems like it or not, it contributes to your net worth.

It’s all the other stuff car ownership entails that leads to confusion. Fuel, repairs, insurance and lease payments are all expenses – that is, costs of owning a car. A car loan is a liability, or debt. Loan interest is another expense. And let’s not forget depreciation – a car loses value from the moment you drive it off the lot. The longer you own a car, the more you will have to budget for future repairs (also a liability!) and the lower its potential selling price.

So a car may be an asset, but it’s one that incurs expenses and gives rise to liabilities over time.

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