A Money Coach in Canada

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Photo  credit: TheTruthAbout

I bet you receive irresistible visa balance transfer offers from time to time.

They go something like this:

BIG PRINT:   BALANCE TRANSFERS 2.9%

Medium Print:  for the first 6 months, then….

Fine Print:  I’ll get to that, but first,

 

These can be a good deal, but you do need to read the fine print. Be savvy.  You could stand to win, or to lose.

Watch for the following in the fine print:

  1. Balance transfer fee.  Sometimes you will pay a percentage right up front on whatever you transfer.  Factor that in – is it still a good deal?
  2.  Dramatic rate increase if you’re late on a payment.  One of my friends transferred a large balance, was a bit disorganized and missed a payment, and suddenly the low balance deal was canceled and the new rate was over 20%.
  3. Payments applied to low-interest portion first.  This is fair, but watch that it doesn’t bite you.  Here’s how it can.  Let’s say you transfer $5000 to the new card.   Then you go out for dinner/drinks and put the $100 tab on your visa.  That $100 is at the high interest rate, since it’s a new charge, and you can’t pay it off til the entire low-interest $5000 portion is paid off first. Do that a few times (go out to dinner, buy books, purchase plane tickets) and you could end up with $2 or $3K or whatever at the high interest, and again, it’s impossible to pay off until the original $5K is all paid off.

Again, transferring balances can work in your favour;  just keep your wits about you and read the fine print.

Readers:  Any fine-print that I missed?   Or any stories to share on the topic?

What to do when you get screwed, financially?  Stories I’ve heard:

One senior’s  husband secretly maxed out their joint $10K line of credit, for his own purposes, knowing full well that he did not and would not have the wherewithal to pay it back.   She was stuck with the debt,  and the lost dreams of her own.   This was years ago.   She’s paid off the debt,  but the resentment remains.

A middle aged man had worked very hard as the sole breadwinner in his marriage, only to lose the home and be driven to bankruptcy after the divorce.   Now, anytime he begins to long for romance again, he backs off because there’s no way he’s trusting another woman with his money again.

And then there was the young woman who moved across the country for a job offer, only to find herself in a crazy-making work environment, with far less earning potential than she’d been led to believe.   She eventually moved on, but figures she lost about two years of her career plus the loss of income plus the moving expenses.

And without disclosing the painful details, I’ve personally experienced what can only be described as a serious rip-off, and I bet you may have, too.

These experiences leave their scars:   Raw spots that still have the capacity to elicit expletives or angry, wet eyes.

How do we recover?

There is no “how to” or technical answer- as is  often the case, with money issues.  It’s a matter of life experience, maturity and our ability to absorb injustice without becoming a victim, or feeling diminished.

We can start by validating that indeed we suffered an injustice.  We took a hit.

We must also accept the painful truth that a lot – (!) – of injustice is perpetrated not just in tyrant-ruled countries “somewhere else” but right in our midst.

But our experience is not the end of our story, nor its defining moment.  It’s just one piece of the ups-and-downs of our financial lives.   A wide angle lens of our life, set in the context of this whole world of ours, serves us well.   We can learn to forgive, we can regain lost financial ground, and we can get on with our lives in relative ease compared to the people around the world facing systemic injustice the likes of which we’ll never face.  And besides, imho, while we may have lost some money, the perpetrators lost some of their soul.

From time to time I have clients who just.can’t.do it.   They can’t pull their head out of the sand.  Or sometimes they do, for the briefest while, and then dive right back into the comfort zone of Not Knowing.

One of my roles is to help clients reduce their anxiety about managing their money.   There are myriad ostensible reasons people prefer to avoid taking a good look at their money, but the underlying reason is usually a fear of inadequacy.

The fear could be …

  • inadequate income for their spending levels (I knew it!  I knew it! Now what??)
  • inadequate time/organizing skills to keep up with money management (I won’t be able to do it for the long haul anyway, so why bother trying now?)
  • inadequate confidence to see themselves as effective money managers (I’ve never been good with money)

Resolving these tensions takes time, and sometimes a few starts, stops and re-starts, before they fade.  In all cases, the most effective method to overcome the fears is by diving in and starting the practice of managing money.   With rare exception, clients discover that things are not as bad as they may have feared, but even more important is the sense of dignity, that’s right, dignity, of putting themselves in the driver’s seat.

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Will you be wanting fries with that?