Canadian Personal Finance Blog

This is a day to celebrate all Father’s and their contributions to our lives, and I am very lucky to have had a Father who taught me many things, and continues to teach me even now.

In honour of this day, I will post (yet again) the greatest piece of financial advice ever given to me and it was (by surprise) given to me by my Father:

There once was a court jester who enjoyed a good joke, usually at the expense of the King, which got the Jester into deep trouble. One day the Jester was having a particularly “devilish” day and insulted the Queen in a large public forum. The King was OUTRAGED by this and ordered the Jester executed for his insolence and the guards dragged the Jester off to the dungeons.

Hours passed and the Jester (who was a quick thinking man) thought how can I get myself out of this mess? Finally the door to his dungeon opened and the guards dragged him back to the King. The King said, “I have enjoyed your buffooneries over the years, so I will give you one wish before I put you to death for your crimes.”.

The Jester thought what could he wish? Then he came up with a plan, he knew that the King adored his horses so he came up with the following, “Sire, all I ask is that you give me a year’s reprieve, and during that time, I will teach your horses to Sing! This will make you the envy of all other monarchs. If at the end of this year I am unable to get your horses to Sing you can execute me in any gruesome fashion you wish.”. The King looked perplexed and then confused, but finally he thought that he had nothing to lose, he would either be the envy of Europe or the Jester would be executed, either way was fine by him.

The guards then took the Jester towards the Royal stable, when one of the Guards asked the Jester, “Why would you make such an obviously impossible deal, surely you know no one can get a horse to sing?”

The Jester smiled and whispered to the guard, “Many things can transpire in a year my friend, I could die and thus I have cheated the executioner… the King could die and I might get a reprieve… or the horses could sing!”

My Dad told me this story after we discussed payments schemes for money he was loaning me to buy my first house. What was he telling me? I’ll leave that to you gentle reader, as usual with a story from my Dad, you get from it, what you think, not necessarily what he thinks you should.

I was telling my daughter that comment and she looked at me like I had five heads. I tried to explain that building up debt rarely happens overnight, just like building up your body mass is not done overnight, and I think it is very true.

When I had my weight gain it happened over about a 14 year period, and it was slow, but by the time I finally did something about it, it was significant. It was a compounding of eating the wrong things, in the wrong quantities at the wrong time, and a complete lack of physical exertion, luckily I have taken the weight off and am keeping it off (mostly).

Debt build up is the same way, usually (unless you make some gruesome investments, an incredible blunder or you are a victim of a fraud), slowly without you noticing you are doing it. Buying your lunch every day isn’t going to put you into debt, neither is leasing your car, vacationing in Las Vegas, or buying lottery tickets either, however, start adding these together with spending more than you make and suddenly you are building up debt, instead of equity.  Keep doing this over a long period of time, and suddenly you have a debt load that you cannot afford and you are just not sure how the heck you did it. It was done one small step at a time.

Unfortunately, or fortunately, debt reduction is accomplished in the same way. Unless it rains money, getting out of debt is done slowly and one month at a time, using a plan and self-control and a wililngness to change your lifestyle (because losing weight and debt reduction are BOTH lifestyle changes, not just a quick fix that allows you to go back to your old habits).

Losing the financial bad habits is the key to debt reduction, keep that in mind.

Carnivals

My posting about Jesus is Watching You! was mentioned at the Personal Power and Self-Help Carnival.

Random Thoughts

It is Friday again, and it has been yet another interesting week financially in this world.

• There is now serious talk of Gasoline going for $200 a barrel, which would mean it’s price in Ottawa would be around $2.20 a liter, which may well cause folks to seriously look at alternate transportation methods.
• I reviewed my Family’s Personal Spending for April and found some interesting spending oddities of my own.
• Ellen Roseman asked a good question about Who Speaks for Investors, and she was part of a group who tried to, and was even asked to, however, not much seems to have come out of her work.
• Stats Canada talked about how Family Incomes haven’t really changed too much in the past few years, certainly doesn’t look like it keeps up with inflation.
• The Canadian Capitalist asked us if We are Comfortable With our Portfolio, I think my answer is, it’s doing ok, but it would be nice if it doubled tomorrow.
• The Government has an Auditor General to make sure spending doesn’t get out of control, shouldn’t we all have our own Personal Auditor General?
• Any way to control your spending is by creating Artificial Scarcity in your own money supply according to Michael James.
• My mail bag does have some very interesting things in it, as well.
• The Quest for Four Pillars states boldly Zero Down Payment On a House is Just Fine, which on the surface sounds wacky to me, but the article isn’t espousing buying houses you can’t afford, simply not waiting until you have some magic number for a down payment. Interesting concept, not sure I completely buy it, but interesting.
• Finally the Globe and Mail is having a poll about picking the Top 5 Financial Bloggers in Canada , I note I am conspicuous by my absence, but I am not bitter, where did I leave my copy of the Ottawa Sun? I’d vote for the Canadian Capitalist myself (but I would have also included Michael James on Money on that list as well).

Flash: De-Crapification Set Back

Never go to a Gar(b)age sale if you are trying to get rid of your crap. Our Church is running one, and I came home with something, I have however removed something from my bedroom (which is where the new item will go), however, I am ashamed of myself. I did get a trouser press for $10 however, which I think is still kind of cool, and I could bring a lot of crap back to my Church’s gar(b)age sale tomorrow, so maybe this will work out.

Sometimes good habits start happening and you don’t notice that you are doing them. What do I mean?

• When I stopped biting my finger nails, I started over a Christmas vacation and when I got back to work, I noticed I hadn’t indulged my obsessive habit, so I just kept doing it.
• I haven’t bought any coffee at work this year so far. Yes, I have not been at work, but that doesn’t mean this good habit should be dismissed, changes are done, one day at a time.

Interesting, I hadn’t even noticed until I started driving in to work (in the fog) this morning. Keep this in mind, have you started a good habit and you don’t even know it yet?

Starting the Year

Remember the year is starting, so starting planning the year. When are you going to have Christmas paid off? When that happens what are you going to start paying off after that debt is clear?

Under Construction

For those of you who haven’t noticed, there is a new version of this site being set up and should be up and ready very soon. Canadian Financial Opinions new site is over here, my RSS feed already points there.