Home Again

Hi everyone.

I come to you shame-faced and more than a little disappointed in my progress for September.

September was a busy traveling month for me. I was barely home.

The month started with a vist by two of my best friends from business school for the Labour Day weekend. That was an expensive long weekend! Probably the most expensive one in a while since my friends were foodies who wanted to try as much of the cool food/desserts in Toronto as possible. Including one of my favourite Canadian meals, also probably the most unhealthy thing one can eat.

poutinePoutine is the most delicious heart-attack-in-a-box ever!

Anyway, a few days after my friends left, I moved back home. However, within a few days of moving back, I left again. On a long weekend trip to visit a friend in Montreal. Then the weekend after that I went on a five day trip to attend my best friends wedding in the US. I saved greatly on transportation to visit these friends.

I saved money on the travel costs to visit my friends (more on that later) and, for the first trip, was actually pretty good on minizing spending once I arrived. However, for my friend’s wedding I spent more. Mainly because of gift-giving. I didn’t skip on the gift for my best friend and her husband. Also, I treated myself to a couple extra purchases there (namely the always-expensive fro-yo and a nice meal).

My Pinkberry fro-yo was great but I think my $6.57 could have been spent much better. Or not spent at all! This is my dilemma whenever I buy Starbucks coffee, coffee from independent coffee shops or little treats such as frozen yoghurt from specialty shops. I always think how I could have bought a meal for the same price as one little cup of coffee. A meal would have been much more filling and much less of a waste of money. That’s my Third World Mentality coming through. But seriously, if I never had to meet clients in coffee shops I would hardly go to coffee shops. They are a money drain!

Moving right along!

I thought August’s spending on dining out was bad but September got it beat by far.

DINING EXPENSES

July August September
$237 $371(!) $440 (!!!)

I am beginning to accept that dining is the category that benefits from my extreme frugality in other areas. I save extra hard in other areas so I can put a little more towards dining without feeling too guilty. Because I love trying new food. So I’m ok with spending a little more on dining, now that I am earning more money. However, I would like to keep my spending in the category to maximum $250 per month and ideally $150 or less.

I had only one week in the condo in September but I spent a whopping $62 on groceries. To be honest though, some of that was money I gave my Mum to buy me some things at the supermarket once I moved back home.

July August September
Dining Out $237 $371 $440
Groceries $94 $101 $62
TOTAL $331 $472 $502

All in all, minus rent, my total spending for September was $2133, which is just slightly less than August’s total. But September’s total includes only around $645 of interest payments for August, compared to the closer to $1000 figure it had been for the previous 3 months.

Also, unlike in August, in September I did not put much money toward debt. My spending total was around the same but my incoming cash flow was less in September than in previous months. So I was hesitant to throw extra money at debt.

As of the end of September, here is where things stand.

Oh, before I get to that, I decided to use the $1.1275 USD-CAD exchange rate to keep track of my progress from last year July til now. So my 2013 debt numbers will change a bit from this post onwards. Of course, now that I am using the $1.1275 rate though, looking at the currency history for this week, I am wondering if I shouldn’t just use a rate like $1.3 just to be safe…Hmmm, I will revisit this rate in 6 months.

Also, the credit card balances are not overdue. Just haven’t paid them yet but will do so in full before the balance due dates.

Ok, here is the latest:

Name July 31, 2013 September 30, 2014
Mastercard $6,123 CAD $57 CAD
Visa $8,653 CAD $167 CAD
B-school loan $96,800 USD
($109,142 CAD)
$86,650 USD
($96,698 CAD)
Ontario Student Assistance Program (OSAP) loan $20,931 CAD $18,730 CAD
Student Line of Credit (LOC) $9,678 CAD $0
TOTAL $154,527 CAD $115,652 CAD

August’s balance at the same rate was $118,011. So that means that in September I paid off $2359, which is below my monthly minimum goal of $2500 – hence the reason for the shame-faced greeting.

Sigh.

Exchange Rate Blues

Hi everyone!

I’m sorry I have been MIA this past month. I was enjoying my last month downtown. Also, I had a ton of visitors back-to-back this past month, almost right up until my last day downtown. I am back home with the ‘rents now so I have more time.

I have a post I want to do about saving money while living and having fun in the city. Before I do that though, I should do my end-of-month report for August. Here goes!

As I mentioned up above, August was a busy month. It also felt like an expensive month, spending-wise. With all the visitors I had who wanted to enjoy the food of downtown Toronto about which I’d been boasting, I didn’t really cook as I do when I am normally on my own. In fact, I barely cooked. Consequently, my dining expenses for the month were more than double what they were in June and 57% more than what they were in July.

Behold the difference in spending on dining out (this includes coffee shops, which is where I have many work meetings).

DINING EXPENSES

June July August
$177 $237 $371 (!!!)

So far, not good.

However, if I also look at grocery spending and compare the totals of dining out and grocery shopping per month, it looks like this:

June July August
Dining Out $177 $237 $371
Groceries $242 $94 $101
TOTAL $419 $331 $472

June and July’s spending on food are no longer far apart. Both are still hella high though!

Another big expense was a new laptop, which I finally bought after working with an old, slow one for way longer than I should have. Especially considering that on my laptop is where I do 90% of my work. More details about my laptop expense in a future post on saving in the city.

Besides those two aforementioned things though, almost all my other expenses were down or almost the same from the previous month. Here is a comparison of my biggest ones, minus loan interest payments:

June July August
Dentist & Health $150 $869 $263
Entertainment $93 $404 $68
Clothes $210 $84 $6

In total, minus that laptop purchase and rent, I spent about $2157 in August. Compare this with June’s $2426 and July’s $2838. Keep in mind that these totals look high because they include close to $1000 of monthly loan interest payments and an average of $430 per month of dental expenses.

Although July’s total included tickets bought for future weekend trips, it is pretty surprising to me that my spending total for August is less than those of the previous two months. But I’m not going to complain!

Yay me for kind of spending less this month!

I also made a big effort to put more money towards my debt this month, more specifically toward my business school loan. I actually put money toward the debt before I received pay from my clients this month. I’m happy to report that my efforts again paid off this month. However, they came at the expense of my monthly saving goal. Since my main client was again late with their payments, I didn’t get much income for August until September. And I actually had to dip into my savings a little until I received the payments. Thankfully, I had built up a buffer of savings from the past year so I could survive just fine until I got paid.

Speaking of buffers, since I started paying off the principal balance on my MBA student loan in July my payment due date has been going further and further into the future. My next due date is now June 2015! My goal is to push it out at least one year ahead, in case I, for whatever reason, no longer have work and it takes me a year to find a paying gig. Would love to have the burden of paying my loan off my shoulders while unemployed.

Anyway, without further ado, here is where things stand as at the end of August:

Name July 31, 2013 August 31, 2014
Mastercard $6,123 CAD $0
Visa $8,653 CAD $605 CAD
B-school loan $96,800 USD ($105,503 CAD) $87,382 USD ($95,238 CAD)
Ontario Student Assistance Program (OSAP) loan $20,931 CAD $18,883 CAD
Student Line of Credit (LOC) $9,678 CAD $0
TOTAL $150,888 CAD $114,726 CAD

It would seem that my debt has fallen below $115K! At the end of July, it stood at $119,428. By my calculations up above, the balance at the end of August is $114,726. Meaning, I paid off a whopping $4702. That seems fantastic! However…however…and here is where I become the bearer of bad news again…

Today, I remembered (after making a transfer of funds from a Canadian bank account to my US bank account) that my bank charges me higher than the actual exchange rate whenever I make a transfer. Worse is that I certainly noticed the downward trend of the Canadian dollar against the US dollar the first 6 months after I started tracking my debt reduction. And I most especially noticed a downward trend again in July this year. I finally went and checked the historical values today.

The two charts below are exchange rates from July 1, 2013 to September 9, 2014 (the date I am writing this post).

Here is a chart of the value of the Canadian dollar to one US dollar.

CAD to USD Exchange Rate - Historical

You can see that the Canadian dollar dropped from over $0.96 of a US dollar to under $0.92. As I mentioned in my first post, it sucks that almost the entire time I was in the US during grad school and afterwards when I was unemployed….In other words, when I had no income whatsoever, the Canadian dollar was at par or greater than the US dollar. I arrived in Canada and I swear it felt like the Canadian dollar literally began falling that very same day. The chart above, which begins a few months after I moved back, kinda proves my feelings correct. Do you see that depressing downward trajectory going to around February 2014? This year’s July and August were also looking dim. For the past few months, the Canadian dollar has been nowhere near where it was last year July. *sigh*

Here is another view of the same information. This second chart shows the US dollar expressed as one Canadian dollar.

USD to CAD Exchange Rate - Historical

*double sigh*

As you can see from the second chart, one US dollar is now equal to $1.0885 Canadian. My Canadian bank, however, charged me the rate of $1.1273 to do the wire transfer to my US account. At first glance, $0.0388 does not seem like a big difference. However, to my five-figure US dollars loan amount owing, that $0.0388 is a $3,390 CAD difference. Not an insignificant amount of money!

This, by the way, is one of the many reasons I have been focusing on paying off the business school loan first. I don’t want to continue losing money because of crappy exchange rates! And, while the Canadian dollar may yet rise again to equal the US, I think that the quicker I pay things off the less I will lose.

To be more accurate in the debt amount I have to pay off, I have decided to stop using the exchange rate of $1.0899 which I’d been using since July and instead start using a rate closer to the rate I am charged. I also want to use a higher rate because I am conservative when doing my financial planning.

Besides checking when I go do my transfers, I have not really been following the currency markets and have precisely zero idea whether or not the Canadian dollar is expected to rise or fall in the next year or so. Earlier I chose $1.0899 for my rate, although it was probably around $1.0589 on average, because I wanted to account for that increase bank rate. Now that the Canadian dollar has fallen even more (and the USD/CAD rate has risen) I think I should adjust my numbers. And yes, I recognize that the Canadian dollar seems to be on a little upward trend the past 3 weeks. However, as a financial pessimist, I am going to assume that it will fall soon, at least getting back to today’s level within the next 3 months.

So from now on, I will use an exchange rate of $1.1275 for my amount owing in US dollars (and pray that the rate falls in the future or does not go much higher, on average, than where it is today).

When I use the rate of $1.1275 for August, my new table looks like this:

Name July 31, 2013 August 31, 2014
Mastercard $6,123 CAD $0
Visa $8,653 CAD $605 CAD
B-school loan $96,800 USD ($105,503 CAD) $87,382 USD ($98,523 CAD)
Ontario Student Assistance Program (OSAP) loan $20,931 CAD $18,883 CAD
Student Line of Credit (LOC) $9,678 CAD $0
TOTAL $150,888 CAD $118,011 CAD

That, my dear readers, is a $3,285 difference in amount owing. And, it makes the amount paid off in August only a measly $1,417.

Sad faces upon sad faces.

If I want to feel better I should think about how my total paid off in the 13 months is $32,877 or an average of $2,529 per month. To pay off $150,888 in 5 years, I need to pay off $2515 per month on average. At $2,529 paid off per month, I just hit that monthly goal.

If I want to feel A LOT better about things though I could also use that $1.1275 rate for last year’s July amount too to get a better idea of the progress I have made in comparative terms. My new-new table would then look like this:

Name July 31, 2013 August 31, 2014
Mastercard $6,123 CAD $0
Visa $8,653 CAD $605 CAD
B-school loan $96,800 USD ($109,142 CAD) $87,382 USD ($98,523 CAD)
Ontario Student Assistance Program (OSAP) loan $20,931 CAD $18,883 CAD
Student Line of Credit (LOC) $9,678 CAD $0
TOTAL $154,527 CAD $118,011 CAD

Making my total paid off so far equal to $36,516 or an average of $2,808 per month. To pay off $154,527 in 5 years I need to pay off an average of $2,575 per month. Paying off an average of $2,808 would make me a few hundred dollars ahead per month, which is good!

I’m not sure which table to use. Should I use the same exchange rate for my entire payoff period (beginning July 2013) or should I adjust the exchange rate periodically, perhaps every 6 months? I am leaning toward going with the former because if I do the latter it makes my true progress harder to track as the amount paid off will fluctuate a lot when I make adjustments to the rate.

If any of you reading have an answer or any suggestions for how to handle currency fluctuations in my debt reduction tracking, please let me know in the comments!

I Believe I Can Fly

Hello all :). I hope those of you in Ontario are having a great long weekend. I know I am! There were so many free events this weekend in Toronto that it was hard to choose where to go. Long weekends are especially fun in the city because there are usually more events than normal. And normally summer weekends in Toronto are already packed with events.

I love Toronto

This month I continued to spend a lot. Sad face. However, I should note that while it is a lot compared to the spending I did when I was at home it is not that much considering that I am on my own and am going out a helluva lot! Also, after last month’s total and utter failure I made a big effort to put way more towards my debt, although I once again was dealing with some late payments.

In July, I made a bunch of extra payments towards my b-school loan. In so doing, I finally paid off the accumulated interest part of the loan and now some of my monthly payments are being applied to the principal balance. This is great news. It is great to see the principal going down now, after well over a year of seeing every payment I made only being applied to interest. THAT was depressing because it felt like my principal balance owing was never gonna go down.

I had a big credit card bill of over $1500 at the end of the month. Over $600 of it was towards my dentist fees. I forgot to pay off the credit card balance before the month’s end. Otherwise, my debt reduction progress for July would have been much better! Don’t worry though, I didn’t carry the credit card balance past the due date. I actually just paid it off, before the due date, so I’m good.

 

Name July 31, 2013 July 31, 2014
Mastercard $6,123 CAD $0
Visa $8,653 CAD $1167 CAD
B-school loan $96,800 USD ($105,503 CAD) $91,038 USD ($99,222 CAD)
Ontario Student Assistance Program (OSAP) loan $20,931 CAD $19,039 CAD
Student Line of Credit (LOC) $9,678 CAD $0
TOTAL $150,888 CAD $119,428 CAD

At the end of June my debt total was $122,675. So that means that in July I paid off $3247, thereby meeting both my minimum monthly goal of $2500 and paying off more than my desired goal of $3000 per month! I still have some catching up to do though since June’s progress was so dismal. I need at least a couple more months of paying off more than the desired goal to be fine again.

In great news though, I met my goal of paying off $30,000 in one year! I paid off $31,460 of debt from July 2013 to July 2014! So I am on track, actually a little ahead, of my goal to be debt-free five years from July 31, 2013!

I am extremely grateful that I was afforded the ability to be able to pay down so much in one year, while still living my life in a way that worked well and was enjoyable for me. I love this feeling of having met a goal. Believing that I can fly does get me places! I pray and hope that next year I will be in a similarly joyful position when it comes to my debt reduction progress!

Phone Savings

A month ago, for the first time ever, a phone I owned crapped out on me. Of course, as is my luck, it was a phone I had bought outright, not on a plan. I spent total $450 for it. It was a Samsung Galaxy S3, a great phone, that is before it started giving problems. And it conveniently died just a a week after the warranty ended so repairs are not covered.

phone dies days after warranty ends

Joking aside, you are probably asking why I spent so much on a phone. Why not buy a cheap phone? Or better yet, why not get one for free on a plan?

One major concern at the time was that I was not sure I was going to be staying in Canada/Toronto long-term and I did not want to lock myself into the typical 3-year plan the major Canadian carriers had at the time (most Canadian plans are city-specific or region-specific with roaming fees charged once you leave a coverage zone). By buying a phone outright I could either sell it if I left Toronto within a few months and get back most of my money OR bring it with me unlocked and, rather than buy a new phone in my new location, use it instead.

I got the phone on sale at a great price too, $200 less than it cost elsewhere. As a testament to how much of a sale I got, new phones of the same model and make as my phone are currently selling for the same price I paid for it a year ago. So, if needed, I could have easily sold back the phone a few months after I bought it and got back basically all my money. Another reason I had at the time was that, during b-school, I got used to using a smartphone like a mini-tablet. So when I came back and had to get a Canadian number I was looking for a fast phone with features that were excellent for business and personal use when on-the-go. The Galaxy S3 fit the bill!

It sucks that my phone died and while I am way more pissed at Samsung than at my carrier, Mobilicity, I am still a little angry with my carrier’s non-helpful response that they are not responsible for helping me with my phone problem, especially considering I bought the phone from them. However, I’m not gonna switch from low-cost Mobilicity to try to get a phone for much cheaper on a 2-yr plan with one of the bigger carriers. Here’s why.

If I got a phone and plan with one of the three major cellphone providers here in Canada I would have paid something like $299+tax for the same phone, instead of the $399+tax I paid. That is $100 less than what I paid. However, as previously mentioned, if I had signed up with one of the major carriers I would also have been locked in to a minimum 2-year plan at a much higher monthly rate than my current one. As it was though, I got unlimited talk, data and text PLUS free calling and texting to the US at a discount rate from Mobilicity ($29+tax, instead of $45+tax) and I was NOT tied to a plan. Furthermore, my all-inclusive bill from Mobilicity has been $39.55 for 14 months now, taxes and fees included. The average for any of the big three phone companies for a similar plan is $95 and that’s only for 2GB of data. This means that I have saved at least $45/mth for the past 14 months, or $630. I paid just over $450 all in for my phone. So although my phone has now died I am still $180 ahead. And I can once again do the same thing of buying a phone outright and continuing on Mobilicity’s unlimited plan because I’ll still be saving money compared to if I was on a plan with one of the major carriers.

In Canada the big three cellphone carriers have an oligopoly on the system.

Canadian Cellphone Companies Market Share
Source: Seeking Alpha

Most people are with one of the major carriers (Bell, Rogers and Telus) and make no attempt to leave. People usually mention quality of reception as a reason for not switching to a cheaper carrier. So far, my reception quality with Mobilicity has been pretty great.

Another reason people used to give was the inconvenience of having to change numbers every time you switch carriers. Now that Canada has phone number portability, if you want to save money, the least you can do is try out one of the new, also cheaper, carriers. If you find out you don’t have good coverage in your area then by all means switch back to your original provider. However, you may discover that coverage is good to great and if this occurs you will be well-pleased to know how much money you can save on an annual basis by switching. If you are in the US or elsewhere in the world, it goes without saying that you too can do the same price comparison and calculations before going with the company that every one else uses.

At the same time, it still stings when I consider that I either have to spend a considerable amount of money to fix my phone or buy a new phone!

Two Steps Back

Hiya!

I hope my fellow Canadians had a great Canada Day and that my American readers had a happy Fourth of July!

Social life wise, June was a splendid month for me! Savings and debt reduction wise, not so much :/.

I am too lazy to keep hiding my city so I will just let you know what city I live in:

Toronto skyline
Toronto

Toronto is awesome, especially in the summer! There are numerous events, including many free events, all summer long and I partook in many this past month. I also went to many more meetups. And I went out a lot, eating out and partying, seemingly trying to reclaim the party life I had during b-school. I didn’t reach my b-school heights of partying and I kept my drinking to a minimum but I certainly had almost as much fun!

Excluding rent and the amount I gave to my Mum, here were my biggest expenses for June:

  • Clothes – $210
  • Groceries – $245
  • Dining out – $180
  • Dentist – $150
  • Miscellaneous – $150
  • Gifts – $100
  • Entertainment (clubbing/drinking/movies/recreation/etc) – $85

Looking at my total spending for dining out and partying ($265), I actually did not do that badly for someone who ate out and partied at a club/pub an average of three times a week. It was also less spending in this category than the previous month, my birthday month ($495). The dentist was unavoidable (*siiigh*). However, for groceries, I was hoping to spend $200 per month so I’m quite a ways over my goal. In addition, there were a few expenses that drove up my spending for the month and had they not been present my spending would have been lower than last month’s. My best friend is getting married at the end of summer. I had to buy a bridesmaid dress that cost $200. I also spent about $100 getting sheets, a comforter set and pillows for the bed in my apartment since I had nothing at home that would work and I did not want to have a mismatched, tacky-looking bed. Those were included in the Miscellaneous category. Then a friend told me last-minute about his small wedding. So of course I had to get a gift.

As a consequence of all this fun, extra spending and, this is the main reason, the fact that a client is once again late with a couple payments, I didn’t put too much towards my debt.

As of now, here is a summary of my debt situation.

Name July 31, 2013 June 30, 2014
Mastercard $6,123 CAD $0
Visa $8,653 CAD $0
B-school loan $96,800 USD ($105,503 CAD) $94,944 USD ($103,479 CAD)
Ontario Student Assistance Program (OSAP) loan $20,931 CAD $19,196 CAD
Student Line of Credit (LOC) $9,678 CAD $0
TOTAL $150,888 CAD $122,675 CAD

At the end of May my debt was $123,771.  That means that this month I only paid off $1,096.

TOTAL FAIL! :(

That’s the lowest I have ever paid off in a month and well below my $2500 minimum and desired $3000. :(

I’m guessing that July will be very similar with the spending. However, I will make an extra push to put more money towards debt. On the brighter side, I have now paid off $28,213 of my debt and as long as I do that extra push I can still make my goal of paying off $30,000 by the end of July, to mark one year from when I started my debt squashing journey.

A Lesson In Appreciation and Delayed Gratification

Hello again,

I hope your week started off well. Before the week was the weekend. And last weekend was good for me.

I finally made good on my goal to start volunteering this year. Because I think it is great to give back and it is important to me that I volunteer. I made some sandwiches to give out to the homeless and went around with a group to one of the parks the homeless in my city frequent. We handed out sandwiches, clothes and shoes. It is pretty much the ideal volunteer activity I’ve been wanting to do for a while now.

It’s not just the homeless who benefited from our volunteering effort though. I think we, the volunteers, benefited even more. Having long conversations with some of the homeless, finding out their life stories, made us realize how lucky we are. Made me better appreciate how lucky I am.

For one, I am not suffering from any mental illness or destructive addictions. And the other thing is that I have a very strong support system. I think that sometimes a big part of what prevents us non-homeless people from becoming homeless is that we actually have friends or family members we can count on for emotional support and often-times other support such as temporary shelter.

Emotional Support - Hugs

I am definitely planning to volunteer again with the group! It was an especially nice activity to do the day before Father’s Day here in Canada.

For Father’s Day my family came to hang out with me for the day. We walked around downtown for a bit but mostly it was all eight of us in my one bedroom condo. Wouldn’t have had it any other way though. It was an excellent day!

Speaking of fathers…I previously mentioned how much my spending habits have been influenced by my parents. And how a big reason for my desire to pay off my debt as quickly as possible is to help out my parents and my family. I know that in North American culture in particular it is a bit unusual to be planning my life around ensuring my parents’ future well-being. Because in this culture it sometimes seems like every man or woman for him/herself. So I know people are wondering why I want to financially help my parents in retirement and why I am not thinking about saving for only my retirement, like most North Americans.

Firstly, when compared to other cultures, my slightly more wide-reaching plan is just a fraction of what people in other cultures do. Secondly, I mentioned in an earlier post that my family immigrated to Canada eleven years ago. This means that I didn’t actually grow up in North America. So I have that excuse for my different way of thinking. However, truth be told, what is perhaps most influential to my way of thinking is my parents’ history, especially my father’s. My father’s life has been the ultimate example of putting one’s family first and delaying gratification. Delaying gratification is one of the key tenets I think to living a frugal lifestyle, something that’s necessary if you are me and are trying to pay off $151K of debt as quickly as possible.

Delaying Gratification - Now Later

My father was the third child and most book-smart one of six kids in his family. The younger of two boys in the family. He was the only one of his siblings to pass his grade six achievement test and gain acceptance to a traditional high school in his home country, the country I also grew up in.

My home country’s school system is based off the British system. When you are 10 or 11 years old you have to take an exam to get into high school. If you fail to get a grade that wins you a spot in one of the traditional high schools you get to re-sit the exam the next year. If you are lucky and were born in the last three months of the year you get a third try. If you fail the test after your last allotted try you get sent to a technical high school which basically prepares you for a career in trades. When I was in high school, I remember an English exchange student once telling me that everyone in England is eventually placed in a traditional high school. In my home country the number of spots available at a traditional high school is far below the number of students who get decent grades in the exam. So only the cream of the crop get in. Needless to say, it is a very competitive process just to get into high school! And, essentially, your life path is determined when you are eleven years old.

As we all know (well, unless you live in Finland), getting in to high school is not the end of exam stress though. An easy way to understand the high school system in my home country is to think of the Harry Potter books (hopefully you know at least a little about them) and the various school exams Harry had to take. Here is a quick summary:

In grade 6, you take an exam to enter high school. High school goes from grades 7 to grade 11 (or 1st year to 5th year). After grade 11 you take another exam (the equivalent of the OWLs in the Harry Potter books). Your scores in the OWLs determine what kind of jobs you can get. You officially graduate high shool at the end of grade 11, as long as you pass a minimum number of subjects. However, if you want to attend university you must continue on to grades 12 and 13, also known as lower 6th and upper 6th. Once again, spots are limited. It is more competitive than the process of getting into high school. If you get in, thank the Gods. But then prepare again because in grade 13 you have to take the equivalent of the NEWTs in the HP books. Your scores for those exams determine whether or not you get into university and into the programs you want. If you do not do grades 12 and 13, university life is off the table and your only option is to enter the job force.

Back to my father…

His father got sick a couple years before he started high school. Shortly after my Dad started high school his father died. Before my grandfather got sick, the family was doing pretty well because my grandfather owned a successful small business. However, when my grandfather died that immediately made my grandmother a single mother of 6 kids. And life got rough after that point. Actually, life had started getting rough from before he died, since he had a lengthy illness before his death. My grandmother had had to sell the business from pretty early on. It might even have been before my grandfather died. And she was not educated beyond elementary school level so the multiple jobs she got to support the family were all low-paying.

By the time my father sat the equivalent of the OWL exams in grade 11, things were bleak financially. My father’s two older siblings had long since dropped out of school to help their mother by doing odd jobs. Pretty sure they didn’t make it past grade nine even. He had no one in his family who had ever finished high school, much less college. He wanted to attend university but didn’t realize he needed to sit the equivalent to Harry Potter’s NEWT exams. In any case, he also did not have the money to apply for the entrance fees for university, knew he could never afford tuition anyways and after getting decent grades in his OWLs had a job offer from a family friend offering him a job that paid decent wages. He decided to accept the job offer to make money to help out his family.

My father was sixteen when he graduated high school and started that job. He worked and moved up the ranks slightly, doing little certifications here and there to get better positions. He used his earnings to help his mother, his siblings and then later on his siblings’ first children. It was only when he was certain that his mother and his siblings were taken care of and his sisters had worked their way up to decent-paying jobs that he felt okay enough to leave his family to attend university in the UK. But it took many many years for that point to be reached. So many years that my father did not end up attending university until he was 28. He graduated with his Bachelor’s degree when he was 31. My exact age now. Many people would have given up on their dream to attend university. My father didn’t. And by doing so he showed me that whatever I put my mind to I also can accomplish!

I will never be as selfless in my actions for my family as my father was. However, I would like to at least somewhat take my family into consideration when I think of the future. In addition, whenever I think of all the things that I want for myself and realize sometimes how self-centred and/or selfish I am being I only have to think about what my father did for me to realize how good I have it in this world. If he could wait TWELVE YEARS to accomplish his goal of attending university then I can certainly wait a few years to start enjoying life more and can most definitely get by holding out for a few months to have whatever rare material thing it is that I desire.

If any of you reading this are fathers or serve as fathers, I hope you had a wonderful Father’s Day :).

Next post will be the monthly update on my debt reduction progress!

Material World

Hi all. I apologize for not posting the last two weeks. Things got busy with main client the first weekend and then this past weekend was spent preparing for and then moving downtown. I also didn’t have internet at the new place for a few days. So it took me longer to download my bank account transactions to my personal finance software, run my reports and do my usual monthly analyses of spending, expenses, etc. One day I will write a post about the process and tools I use to keep track of my money. Today, however, I will give an update on my debt reduction progress as of the end of last month and my life in the new digs.

Since I last posted, I paid off the last of the student line of credit (LOC)! Yay!
LOC paid

So that’s one more debt erased! Or rather squashed – haha. Next step is to focus on the b-school loan since it has the higher interest rate!

By the way, I realize that I have been zigzagging between the avalanche method of debt repayment (where you pay off the debts with the highest interest rates first, in descending order of interest rates) and the snowball payoff strategy (where you pay off the smallest debts first in ascending order of debt size, to get emotional wins). To be honest, I wasn’t really consciously following either one. I made sure to pay off my credit cards first because they had the highest interest rates AND they were the smaller amounts. Then I needed the emotional win of paying off my student line of credit (it’s been 11 years since I’ve had it!). And now I am back to focusing on the debt with the highest interest rate because the saved interest payments on my massive b-school loan will be a lot of money.

Alright, back to my progress…I didn’t get to throw money at much else besides the LOC because I didn’t have as much money coming in this past month. A couple payments I was to get in May have been late. And I didn’t want to put too much money towards the debt without for sure knowing I had a certain amount in my savings (planning for uncertainty remember?). In addition, besides the extra expenses of rent and living expenses, I am planning to spend a few thousand towards much-needed dental work before the summer is out. I will write about them later but my teeth issues are depressing :( . The point though is that, thanks to those mentioned things, I was more conservative this month in the money I threw at debt.

As for my life and last month’s spending…

If you remember from my last post, I told you all that I planned to temporarily move from a rent-free situation with the ‘rents to downtown living for the summer. That time arrived last weekend! Last Saturday, I moved into a condo for the three full months of summer!

It is a pretty nice, centrally-located condo with lots of amenities. The complete opposite of my living environment at home. And it is in a totally different type of neighbourhood from where my family lives. I got a really good deal on this nicely furnished luxury condo. It was listed at a price I could not afford so I emailed the owner and asked for a greatly reduced price, with the offer to pay all 3 months upfront. He initially said no. But then he emailed later saying that though he had others willing to pay more he liked me (he probably checked the links I gave him and googled me to make sure I was legit). After some back and forth we agreed on a price. I met him, saw the place and it worked out!

Basically, I negotiated the rent price (protip to saving money taught to me by my parents: negotiate on everything!).

funny negotiation

Nonetheless, I will also confess that, in securing this sweet pad, I went over my monthly rent budget quite a bit. However, by renting for only 3 months instead of the 4 months I had been thinking I’d do, I will end up spending the same amount of planned money on rent. A shorter stay in uber-convenient, swankier digs was a price I was willing to pay. Best believe that I will be using as many of the amenities as possible. And, since I have no flatmates, I achieved my goal of having a place where I can finally host visiting friends, without worrying about flatmates. Also, I figured that since I will be able to walk to many places I will be able save on transportation costs.

In other news, last weekend was also my birthday!
happy dog birthday

And as I feared, downtown living, with fun and temptation within easy grasp, started out proving to be rough on the wallet. As part of my birthday celebrations, I went proper clubbing for the first time in many years. And was simply reminded why I don’t really like the clubbing experience. It is time-consuming and expensive!

Club night was the day of my move but I unexpectedly had to help my parents with something so I spent all day driving them around. This had me moving in and getting ready two hours later than I intended. I was going to a nice club with a dress code (clearly not my choice) and my company was to include at least one girl I knew was going to go all out with dressing up. She is one of my new friends. We had gone out the night before to a stylish event and she had come dressed to turn heads, while I basically just flung on whatever clothes I could grab. I didn’t want to disappoint her again Saturday night. She hadn’t said anything Friday night but I definitely felt imagined her disappointment.

Most of the time, I try to avoid comparing myself to other women. But sometimes I can’t help it. Like when I know I am going to a club where most of the women will be dressed to kill. So I spent a lot of time on Saturday getting ready – deciding on a nice outfit, doing my hair and doing my makeup. Then because I started getting ready late, by the time I was ready to leave the apartment, it was after the time I should already have been at dinner with my friends (dinner was to be our first stop before the club). I had been planning to take public transportation to the restaurant, 15 minutes away. But I was late and in super high heels and a cab would take 7 minutes and only cost me $10 versus the $3 bus ride, i.e. $7 more. So I took a cab.

After dinner we briefly went into a pub and then went to the club. By the time the night was done I had spent $70, including dinner! I know that’s a small amount for clubgoers and high rollers (of which I count many of my former b-school classmates) but it was a big amount for me, especially since I had also gone out the previous two nights and had spent $40 each of those nights. That was a $150 weekend just for entertainment alone! I justify it a little though, because last year when I became 30 life was pretty depressing for me. So I tell myself that that big spending on just food and drinks was ok because it was my birthday, I didn’t do anything for my 30th last year and I don’t spend on myself like that often.

The cab spending is what I will have to watch out for…I live near enough to everything that it shouldn’t cost me more than $10 to take a cab anywhere, which is pretty cheap. However, public transportation is cheaper and runs 24/7 near enough to me that I can take it late at night. As long as I am not in heels. This is why I will try to avoid clubs/dressy lounges this summer and if I take a cab I will try to have at least one friend with me so we can split the cost.

On the bright side, this week I have already saved on a few round-trip transportation costs, because I walked to events/meetings. So cheers to that!

I will continue to keep you posted of my spending. As of now, here is a summary of my debt situation.

Name July 31, 2013 May 31, 2014
Mastercard $6,123 CAD $0
Visa $8,653 CAD $0
B-school loan $96,800 USD ($105,503 CAD) $95,807 USD ($104,420 CAD)
Ontario Student Assistance Program (OSAP) loan $20,931 CAD $19,351 CAD
Student Line of Credit (LOC) $9,678 CAD $0
TOTAL $150,888 CAD $123,771 CAD

That means that so far I have paid off $27,117 of my debt, which is not bad and still keeps me on track to my $30K payoff goal by July. However, I also have a goal to put at least $2500 per month towards debt, preferably $3000.

At the end of April my debt was $126,370. With May’s end of month debt balance being $123,771, this means that last month I put $2599 towards debt. That’s a little short of my $3000 per month goal. But I’m actually surprised. In a good way! With all the spending I’d been doing and few payments towards debt, I thought I only paid off $2000 at most (low expectations all the way).

This month of June I will again be spending extra on living expenses AND also have to put aside money for future dental treatment so I don’t know that I will be able to put $3000 towards debt. Hopefully, I will! Please check back in a week or two to get an update from me!