Celebrating Credit Union Day: Building Financial Health

Today is Credit Union Day – a day to pause and reflect on what it means to be a Credit Union and why we exist. For us, it’s to improve the financial well-being of members and communities. This year’s theme celebrates Building Financial Health for a Brighter Tomorrow. At Conexus, we believe a brighter tomorrow is the result of a well-equipped financial toolbox. Having the tools, knowledge, confidence, and resources to help guide you through difficult decisions and situations and find balance in your finances. Let’s dive a little bit deeper into what that means.


Finding balance in your finances is key to reaching your goals – but it isn’t always easy to achieve. Knowing where you should be focusing your efforts, how much you should be saving, identifying goals, the list goes on. Even Eric Dillion, Conexus CEO, and Joel Mowchenko, Conexus Board Chair struggle with financial well-being from time to time. Eric shared, “your income doesn’t matter – people experience the same emotions around money, and they aren’t always positive.”

To make it easier, we’ve defined balance using four categories: Spend, Debt, Emergency, and Save.

Spend

Understanding your spending habits is about knowing the amount of money you have coming in versus the amount of money you have going out. AND this truly is the foundation of money management – getting to a place where you spend less than you earn on a consistent basis.

What is comes down to? Awareness of where your money is going.

You’re probably sick of hearing this, but managing your spending well is about understanding your wants versus your needs. Here are a few tips:

  • When you’re thinking about making a purchase that is a want, sleep on it! If you wake up the next morning with the same desire to purchase, it’s likely a sign it’s a better purchase.
  • Try considering your “want” purchases in terms of hours you’d need to work to pay it off. Does it still appeal to you on the same level?
  • Ask yourself, what are my money thieves? Those, often small, but compounding purchases that can quickly add up over time. Understanding what these are can be a good reality check.

Here are a few blogs that help break this down even further:

  1. “Ouch, My Budget!” – Tips for Getting Your Finances Back on Track
  2. What I learned From My 90 Day Spending Freeze
  3. Kick-start your finances: tracking your spending

Debt

Debt is inevitable – but it’s often given a reputation for being bad. While not all debt is bad, regardless, it’s important to have a plan to pay it off. Here are two key things for managing your debt effectively:

  1. Avoid carrying a balance on high interest debt products

Although appealing at first, it can cause you to quickly spiral into a sea of debt. For example, carrying a large balance on your credit card from month to month. This can be very expensive and impact your potential for saving.

  1. Know how much of your income goes to paying debt (A.K.A “Debt Servicing”)

As I mentioned, debt is inevitable. It’s often needed to purchase a house, buy a vehicle, for school, etc., but having the right balance of debt-to-income is important. Its recommended to keep this percentage at or below 35%, and if you are more risk-averse, the lower the better with this number.

Looking to dive deeper? Check out these blogs:

  1. Good Debt vs. Bad Debt
  2. Top 5 Strategies to Pay Off Your Debt
  3. Credit Cards 101
  4. The Real Cost of Carrying a Balance on a Credit Card

Emergency

We’ve all had them. Those unexpected situations that disrupt any financial stability or plans we might have had. From cracking your phone screen and needing to replace it, to your water heater breaking – having an emergency fund can ensure you’re financially prepared.

When you have your spending in check and you are not carrying a balance on high interest debt, it is time to build an emergency fund. Best practice is to have between 3 and 6 months of “usual expenses” available in case of job loss, sickness, family emergency, etc.

You are likely thinking… my goodness that is a LOT of money. It is. Trying to break it down into manageable steps will help you get there. Further, keeping your emergency fund in a separate account is proven to help keep you accountable.

Where should you keep your emergency account?  A high interest savings account, redeemable term deposit or low risk investment fund are all possibilities, depending on your risk tolerance!

Check out, The importance of having an emergency fund, to learn more.

Save

Okay!  Made it.  Spending is in check.  Not carrying high-interest debt. An emergency fund is on its way. It’s time to think about short term and long-term savings goals!

For your short-term goals, be it a down payment on a house, a new bike or a trip to Europe, it’s key to plan for these expenses in advance.  Like an emergency fund, it is ideal to hold these funds in a named separate account (keeping your eye on the prize) and contribute to them on an ongoing basis.

For long-term goals, like retirement, the concept of paying yourself first remains key here.  Again, moving a certain percentage of your income towards your long-term goals on pay day is a great strategy.  Making this automated, to remove any barriers or reasons not to contribute, can help keep you on track.

Want to know more? Give these blogs a read:

  1. The Gift of Goals & How to Reach Them
  2. What Does it Really Mean to Pay Yourself First?
  3. The Key to Basic Savings
  4. When should I ACTUALLY start saving for retirement?

Joel Mowchenko shared, “financial health is how we think about money, how we relate to it, how we interact with it”, and everyone’s version is going to be different. Having a well-equipped financial toolbox; the knowledge, confidence, and resources, will ensure you’re building a healthy relationship with money, ultimately enabling the life you want to live.

At Conexus, we’re working on building a financial tool that will help members balance their spending, get control of their debt, and set up emergency and saving goals. If you’re a Conexus member and you’re interested in being a test user, sign up here to join our waitlist. We’ll contact you from there.

Good Debt vs. Bad Debt

The word “debt” is usually met with a negative connotation but what if we told you that it isn’t always such a bad thing? This blog breaks down the difference between good/bad debt while highlighting strategies for responsibly managing it. 


Good Debt vs. Bad Debt

When I was younger my mom told me that there were certain “four letter words” that I wasn’t allowed to say. Debt was not on the list, but I ended up adding it to the category myself. Partly due to horror stories I heard about people being in debt and partly from being naïve about how debt worked. Because of this, I didn’t want a credit card or a loan and I bought my first car in cash. It wasn’t until I had a conversation with a financial advisor that I began to learn that there are two types of debt: good debt and bad debt.

It wasn’t necessarily good debt vs. bad debt, but more the management of debt that was good or bad. To help illustrate this, maybe you’ve heard some of the following statements:

  1. Thanks for helping me. I owe you one.
  2. I forgot my wallet, can you spot me? I promise, I’ll pay you back.
  3. Can you work my shift this weekend? Next weekend I’ll work for you.

Each one of these scenarios is a form of debt. When we borrow something with a promise to pay it back, we are in debt until the item is paid back. There is nothing inherently good or bad about these situations. What makes them good or bad is the ability or inability to pay back the debt.

Financial Debt

Just like paying our friend back, when we borrow money from our credit union or bank, we have to determine if we are able to pay the debt back. We must be willing to ask ourselves honestly if we are in a good position to pay back the debt or not? Borrowing money can be a great tool, but if we cannot pay back the debt, it can be incredibly destructive and becomes one of those “four letter words.”

As we can see below, borrowing money can be a great tool:

  1. Student loans allow us to get a higher education before we are 40
  2. Car loans help us with transportation for work, school, and holidays
  3. Credit cards give us access to funds and help build a good credit score
  4. Mortgages allow us to buy that dream home before we retire

Once I understood that debt was not the root of all evil, I shifted my gaze to managing my debt rather than worrying about it.

Managing Debt

When it comes to managing debt, every situation is different. Rather than focusing on how to manage debt, here are some things I do every time I’m looking at borrowing money to ensure I’m able to pay back the money I borrow.

1. Talk to an Advisor: If you only take one thing away from this entire blog, this is it. Always talk to a financial advisor before you borrow money. When you do talk to your financial advisor, listen to their advice.

Anytime I’ve ever had to borrow money, or take on more debt, I’ve booked time to talk through my finances with my financial advisor. This includes before getting a new credit card, increasing my credit card limit, buying a new car or boat, adding overdraft protection. If you don’t have a financial advisor, I would recommend seeking one out like a family physician. Find someone who can stick with you and give you sound advice. My financial advisor knows everything about my finances. She knows how much money I make, how much I spend, my passions, my goals, what I’m saving for, what things stress me out and more. Because my advisor knows me, she is able to advise me.

2. Can You Afford the Debt?: Before you take on debt, either for the first time or you’re taking on more debt, ask yourself (or your advisor) if you’re able to manage the debt. Could you manage the debt if you lost your job or if an unexpected expense came in?

There are options to help manage unexpected debt such as debt consolidation to have a lower interest rate. This is another great reason to talk with an advisor. Financial advisors are experts and may know products and services to help you that you may be unaware of.

3. Paying Off Your Debt

The biggest difference from paying your friend back for a meal and paying your loan or credit card is interest. Interest is the cost of borrowing money. If you are unable to pay back your debts, the interest can quickly add up so it is very important to ensure you are in a good place to manage debt before taking it on. One of the best tips I can give you when it comes to managing debt is to always pay your monthly bill, and if possible, pay off your debt as quickly as possible. Especially credit card debt as the higher interest rates can do a lot of harm if you aren’t careful.

Good debt management means being able to pay off the money you borrow consistently, and if possible, as quickly as you can. Paying of debt quickly helps save you money by lowering the amount of money you will end up paying towards interest.

4. Are You Borrowing for a Need or a Want?

Like we talked about earlier, borrowing is neither good nor bad, but sometimes we can take on unnecessary debt that can put us in a bad position. If we already have a credit card that is almost at the $10,000 limit, then taking on a new debt for a boat might not be the wisest decision. The decision to wait and save some money or wait and pay the credit card off might be the better choice.

Talking with your financial advisor about managing current debt or taking on future debt is absolutely critical. They are the experts. My financial advisor has dealt with loans, credit cards, and debt management for well over 10 years. She has likely seen and heard of almost every situation regarding debt and I rely on her expertise, opinions and advice.

Final Thoughts

Debt is a tool and comes in different shapes and sizes. It can help us with unexpected expenses or help us take our dream vacation. However, when debt isn’t managed properly it can lead to stress, anxiety, broken homes, damaged relationships and so much more.

Everyone’s financial situation and lifestyle is complex and unique. Before taking on debt, you should always talk with your financial advisor who can help you develop a clear plan to manage and pay off the debt so you can take on debt confidently.

Happy borrowing!

A Grad Student’s Guide to Going Back to School

Contemplating heading back to university for grad school? This blog breaks down the obvious and hidden costs while providing tips to manage the change.


Here I go again!

Just when I thought I was done with being a student, I’m heading back to university, but this time as a business grad student at the University of Calgary.

Back in June 2020, I made the decision I wanted to go back to school to complete my Master’s Degree in Business Administration. This decision is one I didn’t make lightly as it comes with some big costs, sacrifices, and a lot of life changes. From the moment I made the decision to accept my spot into grad school, I spent many hours thinking about why I wanted to do this, what I wanted to get out of it, researching various schools, studying for the entrance exam, preparing my applications, and doing interviews.

After being out of school for so long you forget about how much time and money it takes to even just apply.

3 things to know before applying to grad school

This new adventure hasn’t come without some big changes. I’m living in a new city, balancing work and my studies, and managing the pressures of increased financial demands. Depending on your situation, you might find yourself in a similar situation. But if it’s the right path for you and something you are determined to do, then in the end, its worth it.

Here are three questions that helped me determine that this was the right path, complete my applications, and prepare for all the changes that were about to come:

  1. What are the financial demands?

To put this simply – graduate programs are expensive! However, every program and school are different and there are many options available to lessen the financial load. It’s important that you understand what to expect for tuition, student fees, books, etc. so that you know what supports you might need and how much you’ll need to save.

  1. What’s my why?

On top of the financial demands of a graduate program, they are also quite intensive and require a lot of time in and out of class. Knowing your “why” will ensure going back to school is the right decision for you, assist in choosing what classes you want to take and help give you that push to study when your motivation is running low.

  1. What program is right for me?

There are endless options when choosing a program. Once you choose a discipline, you’ll also have to map out your specialization or focuses, executive programs, accelerated programs, part-time/full-time course load, etc. Make sure to do your research and tailor this experience to you.

Costs to consider

When I was thinking of going back to school, I immediately considered all the obvious costs like tuition, books, and student fees. What I didn’t expect were all the expenses that would come before I even got in. According to Stats Canada, on average a Master’s in Business Administration costs roughly $27,000 and that only includes tuition. In the table below, I break down my expenses from applications to tuition.

 

Note: My program is accelerated meaning it has fewer classes. If I was applying for a typical MBA at this school, the total costs would be approximately $7,000 more.

On top of the costs that come with school, I also had to consider the costs that would come with this big life change. Including:

  1. Moving to a new city
  2. Lost income

Not being from Calgary meant I would be moving. These costs include rent or the purchase of a new house, moving costs to rent a U-Haul, packing boxes, and all the fees that come with it. For some, it will also mean lost income. For full-time programs, you are typically required to take three classes at a time and they tend to be during the day, making it much more difficult to work.

Tips on managing the costs

While all the expenses outlined above can seem overwhelming, there are lots of resources available to support students:

  1. Look into scholarships and grants – do this early and do your research!
  2. Employer education programs – talk with your employer to see if they offer any supports to employees looking to further their education.
  3. Student financing options – such as student loans or student lines of credit.
  4. Personal savings – if you can, start putting money away each month into a savings account.
  5. Look into part-time programs or executive programs – both are designed to allow students to work while completing the program.
  6. Ask yourself, where can I start cutting costs now to save more? Consider your wants versus needs.

In the long run, depending on your career goals, going back to school is worth it. But it doesn’t come without an adjustment period. Just remember, make sure you understand the financial demands, know your why, and do your research to find the right program for you.

Managing Money as a New Canadian

Moving to a new country and becoming a new Canadian is incredibly intimidating. Not only do you have to know a whole new currency, you have to learn to manage it as well. This blog features a story from a new Canadian from India who breaks down what they learned by establishing their financial well-being in their brand new home. 


Humble Beginnings

On January 22, 2018, I landed in Regina as a new Canadian on a cold night with my husband and my 10-year old daughter. In 2019 alone, approximately 85,000 immigrants landed in Canada from India making it one of the main source countries for new immigrants to Canada. I am so excited to be one of them.

Our family of three came to Canada carrying around $30,000 CAD (~1.7M INR) of survival funds. We knew that if we weren’t careful, we could spend all of it in the first six months – especially if we did not secure a job so it was important to be cautious with our spending until we got our legs under us in our new country. We educated ourselves about spending money in Canada by not shying away from asking questions to colleagues, neighbours and fellow immigrants.

Little did we know, that $30,000 could quickly dwindle on things you didn’t even expect to purchase when adjusting to a different environment. For instance, the three of us had never purchased winter jackets before but it was an essential buy as we had moved midway through winter in Canada. We had a choice to make between thrifting or buying. “Frigid” would be an understatement when it comes to Saskatchewan winters so buying new jackets to last us for years was a reasonable choice.

We leased a condo apartment in the first week of us having landed in Canada. Putting cash down on a used van to ensure we were mobile and independent was also important to us. We shopped for kitchen supplies from the dollar store and our furniture shopping ended after buying a box spring and a few mattresses. We were ready to take on the world and build our new nest each day, piece by piece!

Budgeting

Finding a job as a new Canadian is hard. It took us five months to get stable jobs that covered our monthly expenses and allowed us to begin our savings again.

Being salaried employees in our previous jobs, my husband and I were well-versed in the principles of budgeting and saving for retirements and emergencies. Having a conversation about budgeting and setting strict spending rules was a great place to start. Our google spreadsheet had titles like groceries, gas, utilities and even alcohol & salon expenses. Every little detail mattered and was essential for us to plan better. We now use the Conexus Budget Calculator. This is a wonderful tool that allows you to get a clear picture of monthly expenses in percentages.

A perception survey conducted by Insightrix in 2020 stated that 62% of Saskatchewanians say money causes stress and 61% say their top financial concern is not having enough savings for emergencies. Being disciplined in saving money may seem like a hassle at the time, but it quickly transforms into hope, security and confidence as you know you are covered for emergencies and you can take comfort in the fact that you are actively contributing to your future (ie: down payment on a future home).  We have learnt over time that categorizing savings in different accounts and naming them after our goals/purposes (ie: “vacation”, “home expenses”, “miscellaneous”, “emergency”) is helpful for staying on track. Here’s a helpful tip: you can save emergency savings in a TFSA account as well as the interest earned on that account will not be taxed.

Building Our Credit

As a new Canadian, it’s important to start building your credit score as soon as possible. In most cases, the credit history you’ve built in your home country does not transfer into Canada and unless there is enough cash to pay up front for all purchases, a family will need to work towards building a decent credit score.

To get credit, you need history and to build history, you needs to get credit. This is a vicious circle!

We were lucky to get approved for basic credit cards with no annual fees under the newcomers’ program.  In cases when a financial institution does not have a program like this, you can opt for a secured credit card.

When building our credit score, doing these things helped build it up faster:

  • We ensured that we paid out the card fully every month before the due date
  • Avoided cash transactions
  • Used no more than 30% of our credit limits
  • Avoided unnecessary credit applications

Our First New Car

As we were taking baby steps towards settling here, we were yearning to buy a new car. Being avid road-trippers, getting rid of the van and buying an SUV was at the top of our list.

We thought a six-month credit history was enough and started car shopping around summer. However, we soon found out that six months was not going to cut it. After trying four different dealerships, 11 hits on our credit report and waiting for an additional three months, we managed to get a loan from Ford Credit after we accumulated nine months of credit history. We did manage to hit the road before fall with our first camping trip to Moose Mountain in our brand new black Lincoln MKX Reserve.

My experience of working in a credit union helped me understand the importance of saving and having a good credit score. However, a few things should be left to the experts. For instance, I wish we had met with an advisor for the car loan before venturing out on our own. The 11 hits on our credit report knocked our score down further and that cost us time to rebuild the credit.

Buying Our Home in Regina

Coming into a new country – you are faced with the decision: “Should I buy or rent?” Our decision depended solely on the fact that we needed stability, preferred paying a mortgage versus renting, and having a place we could call “our home”. A mortgage seemed like a better option and a better use of our savings. We used money saved from our survival funds and extra savings from our jobs for a down payment. Researching the importance of having a Registered Retirement Savings Plan (RRSP) was also crucial for us. We opened our RRSP account as soon as we started working and set up direct debit contributions into the RRSP account. RRSPs can help you save for retirement, save taxes and you can withdraw from an RRSP account for a down payment under the first time Home Buyer’s Plan. This withdrawal helped us with extra wriggle room for buying new furniture and paying lawyer fees. A first-time home buyer can withdraw up to $25,000 from their RRSP account without worrying about taxes as long as they pay back the withdrawn amount within 12 years. We managed to get keys to our new home in July 2019!

We Are Still Unfinished

Financial literacy is a critical life skill. I was lucky enough to learn a lot by working for a credit union and could pass it down to my husband. We often wonder how things would have shaped up differently if my career path took me to a different profession. We try to financially educate every new Canadian we come across and try to make the transition easy for them. Our friends believe we have a story with a happy ending. We believe that we are still learning the fine skills of being financially healthy and staying on track while continuing to do what we love – traveling, camping, and living each day as it comes!

If you are a new Canadian and are on your own journey, I wish you the best of luck. If you have any questions – don’t hesitate to reach out to a Conexus financial advisor who are here to help you out, every step of the way.

Playing the Stock Market & Things to Know

Investing directly in the stock market is becoming more accessible to people and while this has its advantages – it also comes with a lot of risk. This blog breaks down what factors to keep in mind when building your investment strategy while also preparing yourself emotionally.


There are lots of reason why you may have a desire to start investing directly in the stock markets:

  • You, like many others, have thought to yourself, “If only I had bought Apple stocks in 2003” or “I wish I would have bought into Tesla or Amazon before they took off”.
  • You have heard that it’s a way to get rich quick.
  • You know of a company you believe is about to “go big” and want in on the action.
  • You know of a company that you really believe in as far as what they are building and how they are run.

Whatever the reason is, it’s important that you stop to reflect on your own reason why you want to start investing in the stock market because your motivation will often determine your strategy, and your strategy can impact not only finances, but also the emotions that come along with investing.

Are Your Emotions Prepared to Invest?

This is a good place to start because whether we like it or not, investing in the stock market can be like riding an emotional rollercoaster. Too many people start this journey without any thought or care to the emotional side of investing.

Investing on your own is not for the faint of heart, and having a good  “emotional strategy” will be just as important as having a clear “investment strategy”.

To help you understand how your emotions can play a roll, I want you to ask yourself how you might feel at the end of each scenario below:

SCENARIO #1

You open up your investment account and decide to add $1,000 to start off. You then invest your $1,000 in a company your friend told you all about that was sure to go big this year. Within a few weeks of investing you look at the market value of your account to see your money has grown to $1,800. Let’s pause there. Ask yourself, “How do you feel?” I’m assuming the answer is, “I feel pretty good,” or you’re saying to yourself, “my friend’s a genius”. Let’s continue…

SCENARIO #2

After your delight of seeing your account rise, you decide your friend’s advice was a sure win. Around the same time, you are just about to head on a two week camping trip up north. You’ve had no cell service and no way to check your account while you’re away. Upon your return home, you’re looking forward to checking in on your new investment only to find that the market value has decreased to $600. How do you feel?

In the first scenario, people usually have a feeling of euphoria, excitement and general enthusiasm. In the second scenario people share common feelings of despair and buyer’s regret. Buyer’s regret is when you say things like, “I should have sold when my stock was at $1,800” or “Why did I listen to my friend?”

These types of scenarios take place daily, weekly, monthly and yearly whether you’re investing yourself or by other means, the biggest difference is you see it happening more closely. Unfortunately, most people have not prepared for the emotions that come along with investing. Because of this, they begin to make poor investment decisions based on their emotions. Let’s look at one more scenario of emotion-based decisions.

SCENARIO #3

After seeing your stock go down to $600, you decide to wait it out, only to see it drop down to $500 the next week. You figure your friend’s advice wasn’t so great after all and decide to get out while you still can and take the $500 loss from your original investment. You sell your stock and decide to take a break for a few weeks. About three weeks later you open up your account and just out of curiosity, you look at the stock you sold to see it has risen back above your original $1000. The frenzy of emotions that come after seeing this are hard to describe as most people begin reflecting back on all of their decision up to this point.

In this final scenario, buyer’s regret creeps back along with some other emotions. It’s at this point we hope people begin to realize that perhaps making investment decision based on their emotions may not be the best strategy.

Before you start “playing the stock market” I would encourage you to not think about this as “playing the stock market” and start thinking about what your investment strategy will be. Really dive into how you will build a clear investment plan with a clear emotional strategy to go along with it.

Building an Investment Strategy

In this section I will not be outlining any specific strategy to use while investing because every person’s goals are different. What I will talk about are some things to consider as you begin to invest.

#1 Investing vs. Gambling

As mentioned above, the first thing you’ll need to change is your mindset if you’ve been thinking of “playing the stock market”.

The stock market is not a slot machine that you put money into and pull the trigger to see if everything lines up. These are real companies with employees, customers and business strategies. These companies have actual costs with real decisions on how they spend and manage their money. When you invest money into a company, you are investing in every decision they make, every dollar they earn or lose; every employee, every leader.

Unlike a VLT machine, the results are not shown instantaneously but happen over time. Apple, Amazon, Facebook and Tesla were not built over night but over years and years of hard work. Some companies see returns in a few years, some over a few decades.

So the first principle to building your strategy is to ensure the right understanding of what investing means. Ensuring you understand that you are investing in a company not playing the stock market.

#2 Don’t Put All Your Eggs in One Basket

If all of your eggs are in one basket and you trip and fall, the likelihood of all of your eggs breaking at the same time is very high. Putting all of your money in one stock “basket” is risky business. If the stock falls, you may lose a significant amount of money. Now you may say, “but if the stock rises, I could get a high return on my investment.” This is very true, and only you can make the choice, but make sure that whatever choice you make, your emotional strategy is up to the task.

The best advice you’ll hear from almost every financial advisor is to “diversify”. This basically means, “don’t put all of your eggs in one basket”. One of the best strategies for investing in the stock market is to find multiple options/companies to invest in. Some people even look at different types of investments such as technologies vs gaming or health care vs. oil. Another way to diversify is to continue to invest in other ways such as RRSPs and TFSAs.

No matter how you diversify, it’s important to remember principle #1, you are investing in a company. Because you are investing in a company it’s up to you to do your research and set a clear timeline for how long you want to invest.

#3 Research & Timeliness

This is the less glamorous side of investing yourself. When you invest through mutual funds, there are portfolio managers who are trained to do research on companies. Portfolio managers are investment professionals who manage the companies/funds that your money is being invested into and builds diverse portfolios. When you decide to invest by yourself, you become the portfolio manager. It’s now up to you to do research into the companies your investing in. Who is their CEO? What is their business plan? How long have they been a company? What is their five-year strategy? Do they have former success? There are many things to consider and research when choosing a company to invest in so that you can ensure you are aligning your investment strategy to their business strategy.

Once you’ve done your research and feel confident in your decision, it’s a great idea to decide how long you want to invest in the company of choice. One year, five years, twenty years? What business goal(s) are you hoping to see the company achieve during your investment time or what dollar amount are you hoping to see on your return in the future? This time management decision making will help you not lose focus on your goals. It will also help with the emotions that come along with investing. When you’ve put a stake in the sand for five years, you’re more likely to ride through the highs and lows with less anxiety. This will also help you with your decision-making process to be thoughtful versus emotional.

Final Considerations: Platforms, Fees, Advice & Taxes

When I started this blog, I mentioned that investing in companies yourself is becoming more accessible and that is because of the platforms that are available. You may have heard of things like Wealth Simple and Questrade as common names in the world of investing. I would like to make you aware of one more company: Qtrade Direct InvestingTM (Qtrade).

Qtrade is not only the #1 online trading platform in Canada, but it is also a credit union company! Qtrade has a simple way to open an account and allows you to even link your account to your bank for easy processing of fund transfers. Whatever you choose, one thing you should consider are the fees associated with trading (buying and selling) as well as any recurring monthly fees that may exist. Hint: some platforms such as Qtrade offer ways to waive fees.

Once you’ve chosen a platform you may be asking yourself where you could get some advice. It’s a great question and while there is some advice out there, it usually pertains to the platform itself (how to make a trade) and less on strategy (what’s a good company to invest in). Qtrade also offers portfolio analytic tools to help clients make informed investment decisions.

Investing on your own is very much a DIY (do it yourself or learn it yourself) model but sometimes you can pay a fee for added advice. In some cases, you may want to invest in more complicated options and it may be more beneficial to talk to your financial advisor about where you should invest your money. Investing in the stock market isn’t for everybody. At Conexus, we are able to help people with other investment solutions such as mutual funds offered through Credential Asset Management Inc. or even refer people to our wealth management company “Thrive Wealth Management” who are experts in investment advice and solutions. You can also reach out to Thrive directly using the contact us form on their website.

Finally, when you make money, lose money, or break even, you should be aware that there are tax implications that go along with investing. If you make money, you will need to claim it as earnings. Side note: “making money” means selling a stock. If the market value rises but you don’t sell, you’ve made nothing because all that has changed is the market value of your stock. You only make or lose money when you sell your stocks. A basic understanding of investment terms such as “market value”, “buying”, “selling” should be on your priority list to learn if you do not already understand this type of terminology.

If you end up losing money, there may be some tax breaks. In either case, you should be aware that there are tax implications. I would encourage to do your research during tax season to ensure you are filing taxes correctly. There are several tax articles from Qtrade for those who are self-employed, parents, homeowners, investors, seniors, retirees, etc. You can find these articles on their education pages.

In Closing

I hope this has helped you understand a few things regarding investing in the stock markets and has given you a bit of an outline of things to be aware of, and a few things to help you plan before you take the plunge.

If you’re ready to take the next step, I would recommend opening a Qtrade account. Even if you’re not a credit union member, it’s still a great platform which I use daily. Once you open it up, do some research on the fees, add some money, and then begin to look for the companies you wish to invest in.


Mutual funds are offered through Credential Asset Management Inc. Online brokerage services are offered through Qtrade Direct Investing. Mutual funds and other securities are offered through Credential Securities. Qtrade Direct Investing and Credential Securities are divisions of Credential Qtrade Securities Inc. Credential Securities is a registered mark owned by Aviso Wealth Inc. Qtrade and Qtrade Direct Investing are trade names and trademarks of Aviso Wealth.

 

Basement Renovations: The Expected/Unexpected Costs

If you’ve been watching a lot of HGTV during the pandemic and have been mapping out your home renovation, this blog will go through the expected and unexpected costs of getting the job done so you can start hammering down your renovations budget. 


When we moved into our house, like many people, there was an unfinished basement. And like many people, we had a plan to eventually finish it but instead it became a bit of a dumping ground for everything that didn’t fit anywhere else. We’d talk about how great it would be for everything to have a place but we just didn’t have the time to commit to it.

Fast forward a couple of years and we decided it was time. My husband had a break in work which meant he was home and we were in a pandemic so time wasn’t an excuse anymore. Also, with the new Home Renovation Tax Credit announced by the Saskatchewan Government, we would be able to save money. We had talked about hiring someone to come in, but we didn’t think it was too big of a job and we were up for the challenge! Plus, I’d seen lots of friends posting their reno pics and I was inspired to take on my own home project.

We decided on a floor plan, bought the lumber, purchased tools (that I still maintain we don’t need), grabbed the insulation and got to work!

The Physical Costs

What about the permit?

You may be asking yourself, “Didn’t you forget a step? Don’t you need a permit for a renovation like that?” Yes, you are correct, we did need a permit and more importantly, it was the first thing we did after deciding on our floor plan. As part of the permit application, we had to submit the floor plan to make sure that it passed building code and there wasn’t anything we had done wrong. I know this is one of those topics that a lot of people have an opinion on and I’m not going to judge people for whether or not they choose to get a permit, however, if you don’t get one and an inspector drives past your house and notices renos are happening without a permit, you can be fined. Plus, if you ever want to sell your house, you’re going to want to make sure you have gotten all the necessary permits to prevent any issues. If you are looking to do renos at all, including building a deck, check in with your city or rural municipality office, most can be found online like for Regina.

Don’t forget that there is a cost to the permit that is based on the square footage of the space and there will be a slight increase to your property taxes. However, there is also an increase to your property value!

Amateur vs Professional

Although we decided to finish the basement ourselves to save money, there are some things that had to be done by a professional. Because we are in an attached townhouse and share a wall with our neighbours, we had to have an electrician come in and do all of the electrical work and pull that part of the permit. This was a cost we hadn’t budgeted for and cost over $3,000 (thank goodness for tax returns). To be honest, I definitely feel more comfortable having a professional do the electrical work because there is history in my family of amateur electrical work that ended in a bathroom fan switch turning on a closet light in another room.

Materials

One thing I learned is that there are some materials that are necessary to the project and you just can’t get away from and there are other materials that are “necessary” to your husband. Lumber, insulation, drywall, nails, screws, mud, tape, sand paper, primer, paint, paint supplies, flooring, lights – all things that are absolutely necessary. A new drill, an air nailer, a new TV and some other tools I don’t even remember the names of – nice to haves that you may have to convince your building partner out of. Right now, lumber prices are higher than normal and that’s not something you can get away from. For us, the following tips helped us to stay within budget:

  1. Research what materials cost with a quick trip to your local hardware store.
  2. Talk to the professionals working at the hardware store. I was on a first name basis with quite a few people at Lowe’s. They can help advise how much product you will actually need.
  3. Build your budget once you know how much the materials cost. Remember to add in a bit of extra room for when you inevitably break pieces of drywall or dump an entire bucket of mud.
  4. Borrow tools from friends or family rather than buying for one project.
  5. Buy things in bulk and on sale when possible.

The Mental Costs

It will take time

Unlike what I was led to believe from home reno shows on HGTV, it does not take a week or two to finish an entire basement – well not without an entire team of professionals anyway. I knew it would take time, but didn’t expect to be sitting here almost a year later and just be painting. At first we had talked about it being done for Christmas 2020, and now our goal is fall 2021. My one bit of advice on this is to be realistic in your timelines, especially when working full-time. It can feel a bit disappointing to not have it done, but it’s so important to celebrate the wins from each stage!

There will be dust

One of the things I didn’t realize, was how much dust is involved in renovating. Between the sawdust from framing, the drywall dust, and the sanding there was dust everywhere. I was sweeping, vacuuming and washing the basement floor often at first, but it became an exercise in futility as there was so much dust in the air that would fall over night that it was so overwhelming. I accepted that it was a construction zone and I’d do what I could and do a big clean at the end.

Almost done

Within the next week we should have all the painting and flooring done so I can move things downstairs and get the basement set up and I absolutely can’t wait. While the physical costs, money and body aches, were more than I expected, it was the mental costs of living in a construction zone I was completely taken surprise by. But nothing will compare to being able to go downstairs and feel so much pride that we did it ourselves.

Will I do it again? Maybe on a much smaller scale like a painting a wall, but doubtful we’ll tackle an entire floor of a house. I don’t have much experience with DIYing and I want to give so much credit and kudos to people who do it often – it’s exhausting!

Retirement Homes: When, Where & How Much

Beginning the conversation with a loved one about transitioning to a retirement home can be emotional, intimidating and overwhelming. This MONEYTALK Blog breaks down tips on how to have the conversation, retirement home options, and factors to keep in mind when making your decision to make the process as easy for you and your loved ones as possible.


Ready Or Not?

Over the past couple of years, my mom has been dealing with some health issues. She just celebrated her 84th birthday and is still living in her own home. For the most part, she is capable of taking care of herself but my siblings and I are starting to wonder if her living situation is safe and healthy. We’ve been gathering information on retirement homes and have learned a lot along the way. Here are some helpful tips and things to consider so you or your loved one are best equipped for a seamless transition to an assisted living facility.

Time to Talk

There are so many options available for retirement living. Seniors are no longer resigning themselves to the retirement homes of old. They are choosing a lifestyle, a new freedom to focus on, and a place that brings them happiness with reduced chores and responsibilities. They are living their best retirement taking advantage of safe, social and active living opportunities. Sounds like a dream, right? But not everyone, including my mom, is ready for such a big change. Now what do we do?

First and foremost, we had to accept that this is her life decision, not ours. She needs to be ready to make the move when the time is right for her. Although we have good intentions and want only what’s best, we also have to adhere to her wishes. My advice to you, if you are nearing the same situations with your parent(s) – plan ahead. Start planting the seed for them to think about what their plans are for the future so that they don’t feel defensive or offended when they are older. Be proactive while they are in good health to start exploring their options without the sudden urgency to decide for them.

Retirement Living Options

Here are some info and tips on the different options available based on needs and affordability we learnt:

Independent Living

Mom, like many seniors, is determined to live in her home as long as she can. Many communities have home care services and emergency life-line communications systems available to assist those wanting to maintain their independence. You can also make a few changes to their home like lifts, handrails, or step in tubs so that your loved ones are able to continue living safely and comfortably. To assess if this was still a possibility for my mom, we considered:

  • Could she manage her day to day care (ie: cooking, cleaning, shopping)?
  • Was additional care available in her community if needed? Home care costs vary depending on the type and level of care.
  • Does she have friends and a social life? My mom is a social butterfly so we knew this is really important for her mental health.
  • What is the actual cost of staying in her home?

Together we made a detailed list of all of the expenses incurred on a monthly and yearly basis. The mortgage may be paid for, but there are other costs including:

  • Vehicle: gas, maintenance, insurance, license plates
  • Medical: prescriptions, lifeline medical alert, ambulance
  • Home: upkeep, appliance replacement, insurance, taxes, yard care
  • Groceries/personal items or meals on wheels
  • Utilities: phone, cellular service, power, gas, cable, internet,
  • Entertainment/Gifts
  • Home care
  • House keeping
  • Miscellaneous expenses

Retirement Residence

Retirement residences are not just a home, but a community. They are privately run but provincially regulated. This presented an option where she could kick back and enjoy a worry-free lifestyle in her own self-contained suite and where her daily needs (meals, housekeeping, laundry) would be met. A place where she was free to socialize and take advantage of all the active living opportunities and amenities available. How to choose which is the best facility really comes down to personal choice. It’s good to have choices but too many can be overwhelming. So, we started to do our homework:

  • First, we needed to determine what general area or community she wants to live in – close to her current home or closer to her kids and grandkids.
  • We asked friends whose parents are in homes for their advice and feedback.
  • We started searching online. Most residences have a website you can poke around to see what they offer. Does it look clean and well kept? Does it meet her needs and have some nice to haves?
  • We created a list of questions
    • What are the size options and any extra costs in the personal unit (ie: internet, cable and telephone service)?
    • Is there transportation available for personal appointments?
    • What amenities are included (ie: housekeeping, laundry)?
    • Are pets welcome?
    • What is a typical weekly menu?
    • What are the recreational activities included?
    • Are there outdoor areas to enjoy?
    • Are guest stays available?
    • And the big question: “What does it cost per month? What are considered “extra care costs”?
  • Next, we started booking tours. Take advantage of staying overnight or for the weekend. It will give you the option to try out the food and talk to the residences and staff in order to get a feel for the place. Ultimately you should be able to envision yourself staying there long-term.

Everything comes with a price and there can be a big difference between facilities. We found monthly costs ranged from $2,500 to upwards of $10,000. In some communities, low income housing options are available. Keep in mind that the cost is like choosing and paying for an all-inclusive vacation. You truly get what you pay for. Remember: it’s your loved one’s choice. Don’t push your preferences on them. Let them weigh the pros and cons of each place.

Other Options Down the Road

When the time comes, we know we may have to consider other living arrangements when Mom needs more hands-on care:

Assisted Living

These can be government or privately run for people with some limitations in physical or cognitive health. They provide 24-hour care with assistance with grooming and personal care, mobility, medications or anything related to your disease care. There is usually a base cost and then additional charges based on care required. It’s important to find out the level of care. Some offer level 1-4 care so you won’t have to move multiple times.

Long Term Care

With these type of facilities, you need to be assessed and referred by your family doctor. The cost of long-term care is actually shared by the government. They pay for everything to do with care and you pay for the space. They do provide basic furnishings including a bed, nightstand and chair. It’s up to you to make it as homey as possible given the limited space. Cost is based on your income.

This is just the tip of the iceberg. For every place we have been in contact with so far, the staff have been wonderful and very helpful. They have dealt with many individuals and families who are struggling to make one of the biggest life changing decisions they have ever made. Their patience and empathy were welcomed and they provided us packages of information and checklists to help in our decision making.

Like with retirement savings, you’re never too young to start planning and educating yourself. I’ve already started asking my spouse where he sees us in the next 10 – 20 years.

The Decision

In closing, remember whose decision this is and that as long as your loved one is happy, safe and cared for, there will be less worry all around. Hey, if things don’t work out, they can always come live with you. I’ll save that blog for another day.

Celebrating 100 MONEYTALK Blogs: Top 10 Blogs

Can you believe it!? We’ve made it to MONEYTALK Blog #100! For our 100th blog, we are going to look back at ten of our most viewed and relevant blogs that provides relatable financial literacy advice for a variety of different topics, events and life stages. 


Money is stressful and everyone is experiencing their own unique life stages and financial situations. There is no one-size-fits-all model when it comes to providing financial advice.

In November 2017, we launched the Conexus #MONEYTALK Blog with a purpose to share expert advice, practical help and real-life experiences for relatable topics and life stages. Time flies when you are exploring financial literacy from a different lens because it’s hard to believe that three and a half years later – we are celebrating our 100th Blog! From blogs on money saving hacks at Rider games to renewing your mortgage during a global pandemic, our authors have explored topical and relevant events and have provided advice to ensure you are best equipped to navigate your financial well-being through whatever life throws at you.

To celebrate this milestone, blog #100 is looking back at ten of our most popular and still relevant blogs that have been published over the past three and a half years. These ten blogs approach financial literacy from a number of different perspectives so it is no surprise that eight of our authors are featured in this list. Enjoy our walk down memory lane and here’s to the next 100 blogs!

What I Learned From My 90 Day Spending Freeze

We’ve all heard of “cleanses” or “detoxes”. Although traditionally meant for weight loss or breaks from social media, spending freezes are gaining popularity as a means to cut spending and flush out bad money habits. Here’s a personal story where one of our writers was forced to check herself before debting herself and what she learned from a 90-day spending freeze. (Author: Melissa Fiacco, November 2020)

LINK: READ THE BLOG HERE

More COVID-19 Scams to Monitor

During this pandemic, it’s not just your physical health at risk, your financial health may be as well. Throughout times of uncertainty we are seeing fraudsters launch sophisticated scams, exploiting public fears for targeted attacks – and we’re definitely in uncertain times.  In addition to the scams we went over earlier, here are five more of the most prevalent COVID-19 scams we’re seeing used to attack people’s financial health and how you can protect yourself from being a victim. (Author: Rachel Langen, April 2020)

LINK: READ THE BLOG HERE

3 Key Money Tips for High Schoolers

No matter how old you are – you likely aren’t satisfied with the amount of money you have and you want more. When you are in high school, you want to be able to buy the things you want, go out with your friends, and maybe even save for your future education. So, if you are a high schooler – here are a few things you can do with your money to make it work best for you!  (Author: Kailyn Carter, January 2020) 

LINK: READ THE BLOG HERE

How Take Out Almost Took Out My Budget

With so many options for ordering meals via delivery, it’s becoming increasingly hard to resist the convenience of take-out and maintaining the discipline to stick to your meal prepping schedule. Let’s look at a real-life example of how creating and sticking to a budget can save your bank account from landing in the trash with your leftover to-go containers. (Author: Mason Gardiner, November 2019)

LINK: READ THE BLOG HERE

The Cost of Being Single

Single and ready to mingle? Well, if you didn’t need another reason to despise Valentine’s Day,  I’m about to give you one more – independence is expensive. Whether you are choosing to live the single life or you just haven’t met the right catch yet, you’ve probably experienced some of the nuisances that come with taking on the world on your own. (Author: Mason Gardiner, June 2019)

LINK: READ THE BLOG HERE

The Real Cost of Carrying a Balance on a Credit Card

Do you know what it actually costs when you carry a balance on your credit card? We’ve broken it down and even have a tool to figure out how long it might take you to pay off your balance. (Author: Kailyn Carter, May 2019)

LINK: READ THE BLOG HERE

5 Activities for Young Kids: Introduction to Money

Introducing your kids to money early on can create a foundation for financial knowledge and positively impact how they manage money later. (Author: Laura McKnight; June 2018)

LINK: READ THE BLOG HERE

Tips for First-Time Home Buyers

Purchasing your first home is a big life decision. Our Mobile Mortgage Specialists share advice for first-time homebuyers on what to know and consider when purchasing your first home. (Author: Nicole Haynes-Siminoff, March 2018)

LINK: READ THE BLOG HERE 

The Importance of Having an Emergency Fund

Life happens and sometimes an unexpected curveball is thrown our way, threatening our financial well-being and causing stress. Having an emergency savings fund helps us be prepared for these unexpected life events. (Author: Courtney Rink, March 2018)

LINK: READ THE BLOG HERE

Credit Unions vs Banks: What’s the Difference?

When it comes to managing your finances and choosing where to bank, there are many things to consider including whether you should choose a credit union or a bank. (Author: Francis Dixon, December 2017)

LINK: READ THE BLOG HERE

Conquering the Resale Market & Building a VarageSale Empire

Ready to make a little extra money and declutter your space and mind through a resale empire? You don’t need to have a history of garage saling on your resume to take advantage of this and rule Facebook Marketplace, VarageSale or Kijiji. In this blog, I’ll share the benefits of reselling your items in order to turn the unused and unwanted into vacation funds or a new wardrobe.


The Day the Empire was Born

As a kid, one of my favourite things to do in the summer was to go garage saling with my mom and sister. Although Spice Girls merchandise (don’t act like you didn’t collect the stickers from the bubble gum) or rare Pokemon cards to bring home to my brother were on the top of the list, we also kept our eye out for hidden gems or brand new items to snag for a fraction of the price.

As a trio we weren’t just treasure hunters, we had garage sales of our own. Every year we’d play the game of “keep or sell” with our toys in order to decide which ones we’d be willing to part with. The decision was a bit easier to make knowing that we’d get to keep the money we made to put towards something else we had our eye on – another Ty beanie baby, a fresh Skip-It, or save up to buy Mario Party for Nintendo 64.

Back then I had my first taste of what it was like to resell my items and use that money to buy something new or save up for a bigger ticket item. Fast forward to 2015 when I discovered an app called VarageSale. For those of you who don’t know, VarageSale is essentially an online garage sale where you can buy and sell locally. After a quick review, I HAD to share with my mom and she was quickly on board to try this out with me – this will forever be the day the empire was born.

Started from the Bottom Now We’re Here

App downloaded, check. Profile created, check. Items to sell (we can thank many years of low-key hoarding for this one) – check! If the rush of selling our first items wasn’t enough, it was seeing items we no longer use or wear turn into money. On top of that, the amount of space cleared after the decluttering and the quality time my mom and I spent together bonding and reminiscing over years of possessions were so valuable.

What started as a mother and daughter cleaning spree turned into a mini side hustle. We were not only selling our own stuff but we started to sell for my sister, brother, and a couple aunts. Even my dad was getting into it! I know you must be thinking, doesn’t this take time and effort? The answer is: yes it does, but I would also say it is worth it. According to this article, 82% of Canadians participate in second-hand transactions and this has grown steadily over the last several years. If you’re willing to put in a bit of effort you will see a big return! Let’s talk about some of the benefits of reselling your items.

Benefits of Reselling

Money Maker

This is probably the most rewarding benefit – you make money! Depending on the quantity, size and quality of items you’re selling, you could be bringing in an additional income ranging from $20 a week to a couple hundred dollars a month or more. According to that same article, Canadians have earned an average of $961 and saved an average of $723 each year through buying and selling second-hand items. This is tax free money in your pocket – and if you think about it, you’re getting paid to declutter your home!

It wouldn’t be a #MONEYTALK blog if I didn’t talk about what you could do with this extra money. For me, I’ve graduated from those Ty beanie babies and N64 games to putting this money aside to feed my travel bug. When it is safe to fly again, these savings will go directly to a flight to Hawaii and a couple cocktails on the beach.

This is a short-term savings goal I have my eyes set on. Your short-term savings goals can range from purchasing a few new pieces for your wardrobe, to buying a treadmill for your home gym, to adding dollars to your kitchen renovation fund. It’s also important to consider topping up your emergency savings fund as this comes in handy when your furnace needs repairing. Living in Saskatchewan, we all know how important that is!

Another option is to put this collection into something long-term like an RRSP for your future self or an RESP for the future of your little one. If you’re looking to set a savings goal, this “Kick-start your finances: goal setting” blog will help get you started!

Reduces Clutter in Your Space and Mind

If you’ve ever gone through the process of decluttering and reorganizing, you understand the both calming and energizing feeling that comes from the result.

I’m sure everyone has their own method to their madness but if you’re looking for a tip, I’d suggest starting the decluttering and organization process with one section or category of the house at a time. For instance, starting with your closet first and working your way to each room of the house. It is a little less overwhelming and makes you feel like you are finding success as you are accomplishing smaller, attainable goals rather than one big one.

I find it helpful to put items in each room into piles of keep, sell, donate or toss. If you get stuck, just think to yourself “what would Marie Kondo do?” If you haven’t been introduced to Marie Kondo, now is the time you become familiar– you’ll thank me later!

Ballin’ on a Budget

As I mentioned, VarageSale is a way to buy and sell. As a budget conscious person, using this app provides access to buying used items that are almost brand new for half the price. After all, you’ve worked hard for this extra money and here you’ll get more bang for your buck.

Ready, Set, Sell – Tips for Resell Success

Now that you’ve identified the items that you are wanting to sell, let’s get you set up to best position your products and connect you to buyers on apps and websites such as Varagesale, Facebook Marketplace, eBay and Kijiji. Here are some tips when reselling your items to set you up for success:

Good Quality

To be a reputable seller, you want to make sure the items you are selling are in good shape. Avoid selling items that are broken, torn or missing pieces – these should end up in your “toss” pile. By misleading buyers on the quality of the items you are selling, you are setting yourself up for a bad review and a horrible reputation which will deter buyers from trusting you. You will not find long-term success as a reseller without positive seller scores and reviews.

Clear Description and Photos

Be transparent! Include a clear description of what the item is, color, size, condition, and for everyone’s sake, hold the phone still when you’re taking photos. Nothing is worse than a blurry photo of the floor titled “brand new t-shirt”. To set yourself up for a smooth transaction, it also wouldn’t hurt to include the area of the community you are living in and how you prefer transactions to take place. For example, a mailbox transaction with an e-Transfer as payment is a popular choice. These are all questions that will be asked when the buyer negotiates with you so you can save yourself some hassle by listing it up-front.

Price Fairly – Have Some Wiggle Room

Ultimately you get to decide what price you are willing to part with your items. If you price a bit lower, it may get rid of the items quicker. I recommend pricing a little higher than your goal for each item. Part of the fun of garage saling is bargaining and by allowing the seller to negotiate the price down a bit, they will feel better about the purchase.

Answer Quickly and Friendly

You’re more likely to make a sale if you respond promptly and friendly to potential buyers. I find this makes the transaction a lot smoother and more enjoyable.

Leveling Up

As I mentioned earlier, my Mom and I started selling for my sister, brother and aunts and as much as we love the time spent together – it’s still a lot of effort. We charge a 50% commission rate to manage the resell of their items. When an item sells, we keep 50% of the total sale price and 50% goes to them. If you’re looking to level up your reselling game, reach out to friends and family and watch that side hustle grow!

Remember to have fun when building your empire. After the novelty wears off, it can feel like a lot of tedious work so keep track of your progress, celebrate the victories and enjoy connecting with buyers from across your community. Good luck!

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How Debt Can Impact Your Relationship

Over half of Saskatchewan people say that they would have no issue pursuing a relationship with someone if they had a high level of debt. Debt may be low on your list of deal breakers, but it can severely impact the health of your relationship if it isn’t talked about or there isn’t a plan in place to pay it off. This blog recounts how debt struggles negatively impacted the author’s relationship with their partner and the small but impactful steps they took to fix it.


Let’s talk about debt baby

How much debt would be too much to prevent you from exploring a relationship with someone? According to 52% of Saskatchewanians, no amount of debt would stop them from dating or marrying a partner.

Though debt may not impact you from choosing a partner, it could have an impact on your relationship. According to Canadian divorce statistics, Canada’s divorce rate has increased by 44.15% over the last 20 years, and it’s estimated one out of every 309 adults are divorced in Canada. As to the reason for the divorce – many say money!

While you may not chat about money on your first date, finances should be a topic that is talked about as your relationship becomes more serious. From the assets you possess to the amount of debt you have, it’s important to be open and honest with your significant other to ensure both parties know what they may be getting into. It’s important to continually have this conversation with your partner in order to reduce any stress or tension that may negatively impact your relationship.

This advice is something I wish I knew and started talking about sooner. This is my experience.

How it started

I met my husband when I was 15, and though we didn’t start dating until a few years later, money was not even a topic of mind. I mean, is it for anyone at that age?

Skip forward 21 years to where we are today and money is something we talk about regularly. However, this wasn’t always the case, and up until about 5 years ago, money was not part of our conversation. Looking back, I realize how not talking about money with one another was putting a lot of stress on us and taking a heavy toll on our relationship.

Five years ago, we were in debt and struggling to get a hold of our finances. We each had our own bank accounts, individual vehicle payments, different credit cards and line of credits – everything was separate. Because of this, we didn’t have a full grasp on our finances as a whole. We continually tried to pay our debt down, but no matter what we did it seemed to continually go up. There was tension. There were fights. Our relationship was rocky. We knew we needed to do something before our debt and our relationship got worse.

With our mortgage up for renewal, we decided it’s now or never to make a change. We sat down with our financial advisor and looked at what options we had.

Consolidating our debt

After talking with our financial advisor, we decided to consolidate our debt. What this means is that you take all of the debt you have – loans, credit cards, vehicle payments, mortgage, etc. – and roll it into one monthly payment. Consolidating your debt doesn’t make it go away, however, it can help you gain control of your finances a bit easier.

Now that we had all of our debt in one spot, we needed to be able to manage all of our money from one channel, so we decided to join our bank accounts and have a joint credit card. While joint accounts may not be for everyone, it was the best option for us and showed us how each of us was spending individually. This wasn’t something we hid from one another when we had individual accounts but it also wasn’t something we talked about. With time, we started to get a grasp on our spending habits and were able to hold each other more accountable.

Tip: The one downside with having a joint account is that each of you can see all the transactions in the account and it can ruin the surprise if you buy a gift for your loved one. We recommend using cash for any gifts in order to keep the element of surprise.

To see change, you must make change

We had gotten ourselves into debt before because of our spending habits and behaviours, and if we didn’t change, we’d most likely wind up in a similar situation. To see difference, we needed to change how we talked about money and how we spent money.

The first order of business was introducing the word “money” into our conversations. It was UNCOMFORTABLE, to say the least, and didn’t begin well. We started with financial goals and quickly realized we were on two separate pages: one of us wanted to save for trips and a new vehicle and the other wanted to think retirement. It was frustrating and we wanted to give up immediately.

Once we figured out our financial goals, we started to create a plan on how to change our spending habits. This included building a budget and actively tracking our transactions each month.

Creating the budget was the easy part. The challenging part was changing our behaviours and the first few months were tough. Over time it got easier and after making some significant changes in our spending behaviours, openly talking about our money, and ensuring each other knew where we were at in our budget, we started to see some positive changes. This included starting to actively put money into our savings and seeing it grow – something we hadn’t really done until this point.

Tip: Build your budget together and be realistic. The first few months will be tough, but if you do it together, you’re able to support one another and hold each other accountable where needed. This allows you to celebrate and succeed together.

How it’s going

It’s unbelievable how much of a positive impact a few simple conversations about money and behaviour changes have had on our household.

We continue to set a monthly budget and compare our spending to these amounts which keeps us on track to reach the goals we set. Though we still have our consolidated debt, in five years we have not gotten ourselves into any new debt and are even actively working to pay our mortgage and debt down faster!

What used to cause us stress and a lot of tension has turned into an ongoing positive conversation and even celebrations when we hit our goals. Where we were previously embarrassed to talk about our situation with friends and family, we now openly talk money and do so together (my husband’s even sitting beside me now and helping me write this blog as we speak). And the best part of all, our relationship has never been better.

Looking back, we wish we would have started the conversation a lot earlier. All we can do is share our story to help others learn from it. Money is something that needs to be talked about. No matter how uncomfortable or awkward it may be, it’s important to talk about your financial goals and spending habits– trust me, you’ll thank yourself and your relationship for it later.