We are the stupidest people alive….

I truly believe that there are signs in the universe that if you take the time to pay attention and listen to them, they will let you know when things are going off the rails or when you are heading down the right path. I don’t think I am the only one who has beliefs that support the idea that you can manifest the good or the bad in your life based on the messages that you are sending out.

Just to give you an idea of what that might look like, believer or not, here is how we spent one month listening, cringing, paying attention and then heading down the right path.

Jeff Foxworthy uses the phrase, “You might be a redneck if….” as a starter to his many jokes, to help you identify the signs that you are indeed a redneck.  Here are my signs that, “You may be in trouble financially if….”

You max out your borrowing account to cover your Mastercard payment. If you are playing what I refer to as the money game each month, with a revolving door of money going around in circles from high interest credit cards, to low interest borrowing accounts to zero percent interest credit cards for six months only, and then back again….you may be in financial trouble.

You paid the Mastercard bill by mistake twice in one month. How often do you and your spouse have conversations regarding the accounts, bill payments, savings and retirement? More importantly, how often do you have this conversation uninterrupted by bigger priorities like work, sleep, appointments, events and fighting kids?

There is a horrible gap between the proportion of time that we set aside to discuss our financial planning with each other compared to the relative importance of what we need to discuss.

The result of our lack of devoting the necessary time means that I have left the retirement planning entirely up to my husband. He has left the bill paying mostly up to me, but not always.

If he were to die tomorrow, I would have little to no knowledge of what we have saved and where to access the money we have in anything from RRSPS, to investment accounts to life insurance to his own company’s benefit plan.

If we were to both die simultaneously, I recently found out that our children would end up in foster care until the courts decide who best to raise them and our estate would be up the air in until the government gets paid and our funeral costs get covered.  Even then, there is no guarantee without a will that our children would receive anything that we own or be placed with a family member.  Kinda important?! No kidding, yet we dawdle like many others in getting a will in place because we never seem to have the money for it. It’s outrageous!

The signs of this lack of communication in our relationship shows up in small and big ways in our current financial well-being. We both paid the Mastercard this month….someone, not naming any names, neglected to write the payment down on the statement. (It wasn’t me….but someone….) The result left a credit balance on our Mastercard and our line of credit extended to its limit when it wasn't even necessary.

The cheques you gave your sister for your nieces birthday's bounces and you are charged $90 for overdraft on your line of credit.  I can’t believe I am sharing this, because it is SO stupid, it’s beyond embarrassing and I haven’t even had a conversation with my sister yet. So the cheques I wrote in August, she cashed in October…right at the same time that we double paid the Mastercard and maxxed out our borrowing account to cover it.  The shame I feel is worse than the extra charges we need to fit into our budget for next month to make up for it.

I mean the timing couldn’t have been worse….this is like the perfect storm of stupid on so many levels….I don’t know where to begin. Maybe I should have started with…..If you are writing birthday cheques to pay for gifts on your borrowing account, you may be in financial trouble. Or how about…If you are not checking to see that the cheques you write are cashed on your account before you write more cheques…... or best of all is,..... if your finances are shaming yourself with other family members, you are definitely in financial trouble…..

A lousy financial strategy leads you to put money into a high interest saving account while you are paying fees on your chequing account due to overdrafts.  Imagine my surprise when my husband and I sat down to sort out this mess to find out that he had money being deducted off his paycheck each month to go into a high interest savings account.  Yet he couldn’t keep his chequing account from going into overdraft each month because of the deduction of income. It’s so crazy, I can barely believe it!

We also realized that the other reason the chequing account was overdrawn was because the money being put towards the kids RESP was going into the wrong account and has been for 10 months! It’s ridiculous, but so easily solvable once we made the time to discuss it and fix it. There was also a windfall waiting for us in the other account since the money was just sitting there, not being applied to anything. Nuts!!

What came out of this giant anvil on the head from the universe was that we seriously needed to start talking more about where we are at financially and not once a month….but rather, we decided, once a week. While it sounds like a big commitment from two people who would be lucky to have had a yearly conversation in the past, we both felt that by talking weekly, it gives us time to make the adjustments we need before an entire month or better yet, ten months, is financially wrecked by stupid decision making.

There are good signs as well....this is how you can tell that you are on the right track financially after going down the wrong path.....

You may be on the right track financially when cheques from your health insurance provider start landing on your doorstep. Remember that HSA spending account I discovered through taking the time to understand my company benefits? We received five pay checks in the month of November that covered spending for my entire family and topped up the benefits my husband’s company provides. It’s like winning the Set for Life of Lottery at our house! I can’t believe how much lost income we were missing out on because I didn’t want to take the time to understand my policy….which I am paying for, by the way.

You review your bill statements and find a windfall. We just received our fuel oil statement this month and because I was paying attention, not just filing it and forgetting it, I uncovered another double bill payment back in July of almost $500. We must be the most vigilant bill payers on the planet….that or we are the worst investors ever. Say, honey…if we overpay Bluewave and Mastercard….do you think they will send us profit sharing? Yikes, it’s painful. The silver lining was a windfall in our bank account when we contacted our fuel supplier and politely asked for the money back.

You increase your disposable income by finding more affordable services or using less of what you have. By switching our Cable provider, looking at our home heating costs, reducing our electricity consumption, making tough choices about our childcare needs and getting smart about using the resources we already had, we spent substantially less then every month previous.  Hard to believe it can be that easy to slow down the bleeding when it comes to money, but it is. There are always ways to spend less and in a way that makes sense for your family.

Finally, you finish the month, and there is still money in your bank account and the bills are paid. Who knew we could stick to our budget one month into the new plan?! But we have!  We finished the month of October with our first payments of 15% made to decreasing our debt, paying all of our bills without credit and having 5% of our income saved and in the bank. We also got the buffer back on our borrowing account by not having to pay anything on our Mastercard this month and by using our financial windfall.

Our Austerity Measures pantry and freezer cooking month paid off too. We saved our entire grocery budget by eating only from our existing kitchen inventory. We had some interesting meals (Pasta Surprise with three kinds of noodles was a hit with the kids) and also some excellent ones (forgot about some T-Bone steaks in the freezer that were a hit with the parents).

The greatest thing out of the austerity measures pantry experiment was a turnover of the product in our fridge and freezer, an immediate reduction in the food being thrown out, an increase in our kitchen pantry space and our kids seemed more open to whatever was on the table since we included them in the changes we needed to make along the way. 

Our son who is six asked in the beginning of our Austerity Measures discussion, “So does that mean we are poor now?”, which gave us a great laugh since we may have little money in the bank right now, but if you look around our home, there is no poverty….all the money is around us.

We still have a long way to go, but when I look at how many signs we have had that, “things might be better financially if…”, I can’t help but feel empowered by the changes we are making. No shopping spree for things we don't really need or impulse purchases on treats we think we deserve could make me feel this good.

We are your average Canadian family and we make stupid financial decisions, sometimes without even thinking about it………..