Did you get "the Money Talk"?

Am I alone? Am I the only reserve kid who never got sat down by her mom and dad to get the big talk about money?

I love my mom and dad. Nay I idolize them because they did amazing things in their lifetimes respectively. My mom raised 10 kids and still is one of the strongest participants and volunteers at our community church. My dad worked seasonally for YEARS. In fact, at 74, my dad shows no sign of slowing down. He still works at the provincial park office for the Ministry of Natural Resources and he still goes out into the bush to go trapping, net fishing and hunting. They are formidable people each in their own right. I respect them because they showed me unconditional love, were tough with me when the situation called for it, and helped me grow into the person I am today by offering me guidance when I asked for it.

However, I am writing today because I’ve had to sit myself down and give myself a talk about my spending habits. They’re bad. I have five, count them, five credit cards, a line of credit, a mortgage and a car loan. I’m drowning in debt. I have a toddler and am a single mom and should have a plan in place if, God forbid, anything should happen to me and I am no longer around for Riley (my aforementioned son). I do have life insurance and he’s my beneficiary so he’s covered.

However, I never did get “that” talk. No one told me about managing personal debt. In fact, when I got my first credit card I got it by the stupidest means possible: I was a newly minted student heading off to campus at college and then BAM! There were credit card companies with welcoming booths waiting for my (and many others’) arrival. These companies like to offer free swag -- like a thermal coffee mug, T-shirt, or even a gift card -- in exchange for your signature on a shiny new credit card application. I totally fell for this trick. I was also irresponsible with that “shiny new credit card.” I recall having an emergency involving these very awesome leather boots at Aldo and I HAD to buy them. Oh the woe I caused myself.

It took me a while to catch on (not that long), but I now pay all my bills on time and I try to be as shrewd as I can about my spending habits. I regularly find that I ask myself “is it a want or a need?” before I buy anything, which believe me is a huge improvement compared to that girl who was walking through those college doors for the first time several years ago.

Anyway, back to my conundrum. I now want to be completely debt free, so I went to the repository of all human knowledge: the internet.

Here’s what I learned: The most efficient way to pay your credit card(s) off (lean closer for this cause it’s good) is to pay at least 10 per cent of your balance on each payment.

“Yes it’s going to hurt to begin with but it really works and it works quickly,” promised the blog where I gleaned this tidbit of wisdom. “You will find that within a year you’re out of debt or very close to it. Every time you pay at least 10 per cent, within a few months the payment is quite small and so is your balance. I.E. balance $7500, payment should be $750 that month and so on and so on. If you can’t afford that try 5 per cent to begin with.”

I’m going to take on this challenge. It’s going to be a “bare bones” year, but that’s OK. We have food, a roof over our heads and each other. (that and Riley will be too young to remember so it’ll be easier to weather this out while he’s small).

BTW: If you need a credit card when heading off to college, plan ahead by shopping for better rates!