In my house cooking has never been a chore; it’s an activity. It’s something we do together. Even if was the one stirring the pot, the kids were there chatting their heads off, doing homework, or skylarkin’ with each other, and the whole thing was fun. And I’ve been to several pot-lucks of late where everyone brings something to the table. I particularly like the yabber-jabber that goes on as people talk about what they made, how they were inspired and how much they love food.

My friend Annie had an “origins” dinner. We each had to bring something that was representative of our cultural heritage. I made oxtail soup (tomorrow’s recipe) and mango upside down cake. And I was introduced to some new folks and some very interesting foods. It was a blast.

Let’s face it folks, if you can read a cookbook, you can make a meal. It’s not rocket science, particularly with the great instructions we now get in recipes. Anyone else remember when measurements were “a pinch” of this and “a dash” of that. Once you get good, you can start improvising, and then the fun really begins. To this day, I don’t measure. And whenever my kids say, “This is great Mom” I respond with, “Enjoy it!” meaning it isn’t likely to happen just the same way again.

Ever wondered how jerk seasoning would taste mixed in with basil pesto? (It’s fabulous.) I mix world-class cuisines to entertain my friends, and I spend only a quarter of what I would if we went to a restaurant and paid premium dollars for food, drink, taxes, and tip.

The trick to making cooking at home interesting is to experiment. The trick to making it a money-saving strategy is to use whatever is on special to inspire you to create something new. When my local supermarket had fruity salsa on sale for $1.29 off, I immediately thought how lovely that would be combined with some jerk seasoning (yah, I’m a jerk-freak) over chicken. Slice it up and top a fresh salad of spinach, dried cranberries and ‘shrooms and not only will your friends think you’re a genius, you’ll save money too!

People often can’t wrap their heads around the idea of getting a pile of money together as an emergency. The concept of having six months’ worth of expenses covered is just too overwhelming. Well, here’s an idea that’ll make it easy peasy to get your emergency fund together.

List each category of expense you would have to keep covered if you hit an emergency. That may include rent or mortgage payments, food, medical costs, insurance, child-care, car payments, gas. These are your essential expenses: the stuff you must pay to keep the wolves from the door.

Go back over your list and cut out anything you’ve kept that’s not essential to keeping body and soul together. If you’ve just gone from two incomes to one, you can give up your cable, telephone, entertainment and everything else you wouldn’t die without, at least in the short term. Your Emergency Fund is designed to cover the essentials of life.

Now write in the average monthly amount for each of your essential emergency expenses. Then put six check boxes beside the amount.

Pick the first expense you want to have covered. Most people pick either the roof over their heads or the food in their bellies. Let’s go with shelter for our example, and say you need $1,200 to cover your rent or mortgage payment.

How much can you save every month? Ten dollars? $25? $100. Whatever it is, open up a savings account where they’ll pay you a decent rate of interest and ask that the amount you’ve designated be deducted from your regular account to this account every month. For our example, we’ll say you can save $100 a month.

Now you’re going to save your first month’s worth of rent/mortgage expenses. So when you’ve got your first $1200 in your Emergency Fund Savings Account, you’re going to put a check-mark in one of your boxes. There. You’ve done it. One month’s worth of shelter money at the ready, just in case.

One of the decisions you’ll have to make is whether you’ll save all six months’ worth of shelter money before you start on your food category, or if you’ll check the first box for each category and then start back at the beginning. That’s your choice. My choice would be to put a check-mark in the first box of each category, and then move on to save my second month’s worth of essential expenses.

Now you have a plan to build your Emergency Fund. All that’s left is for you to stop planning and start doing.  Go ahead, pick up a pencil and a piece of paper and start making a list of your essential expenses. NOW!

People are always setting goals for themselves and then beating themselves up when they miss by a mile. Then there are the folks who are so tired of missing the mark, they’ve just stopped setting goals completely. From the school of “I can’t miss if I don’t throw the dart,” they’ve given up trying.

But if you don’t know what you want, if you don’t lay a plan for getting from one point in your life to another, you’re just wondering in the woods blindfolded. You’re probably going to tumble down a steep slope, trip over some roots, or fall in a hole.  You will get hurt. And then you’ll be angry, frustrated, sad. Wouldn’t it just be easier to take off the blindfold?

Becoming debt free, buying a home, having and raising children, building a safety net, creating a retirement account with enough money to live when you stop working… these are all goals. The fact that you may not have thought of them as such means you’re walking around with the blindfold on. When you take it off, when you clearly delineate what it is you want, you’ll stop missing by a mile and driving yourself into apathy.

The first step is to know exactly what you want. Since I work for myself, and there’s nobody around to tell me what to do, it’s easy to spend a whole day at my desk and accomplish nothing of value. If I don’t want this to happen, I have to be really clear about what I’m going to accomplish. So I make my goals for the day very specific. And I write them in my List Book.

My list today looks like this:

1. Invoice for article
2. Pay credit card bill
3. Groceries
4. Wrap M’s presents
5. Cook chicken & rice
6. Write blog 1
7. Write blog 2
8. Write blog 3
9. Write blog 4
10. Conference call

Notice the “Write Blog” things on my list? See how I separated the four blogs I plan to write. If I just wrote Write 4 blogs, I wouldn’t be able to scratch anything off my list once the first blog was written, leaving me feeling like I was only ¼ way to the goal. And if I only managed to get through three of the four, having them separate means I only carry one forward to my next day’s list – much more manageable and realistic, dontcha think? Making the goals you’re trying to achieve specific, realistic and manageable goes a long way towards creating a sense of completion and success.

Your goals should be so obviously clear that any Tom, Dick or Harriette could look at what you’re trying to achieve and be able to measure your success. After all, if you don’t know exactly where it is you’re going, how will you know when you get there?

Now it’s your turn. Grab a pen and a piece of paper and write down a list of what you want to accomplish today. Eventually you’ll learn to set goals with longer timeframes, but starting short helps keep you focused.

Often when people meet me out and about, they want to talk about the people I work with on Til Debt Do Us Part. Very often I hear, “How’d they get themselves in such a mess?”

Here’s how:

#1 No Money Management Skills. Money management is a skill too many people are missing it. Folks fly by the seat of their pants, hoping that things will turn out okay. Some days they do. Many days they don’t and people then run around fire-fighting to stay afloat. If you don’t know how much money you make, how will you know how much money you can spend? If you merrily charge whatever you’re buying on your credit card, but you don’t know how much you have to spend, how will you pay off that credit card when the bill comes in? A lack of money management skills is, perhaps, the biggest predictor of financial failure. All the credit counseling, all the bankruptcies, all the income in the world isn’t going to save your butt if you don’t take the time to figure out how to use what you’ve got to your advantage. There are rules to follow, work to put in, and self-control to be applied. It’s much easier to simply whine, “I can’t” and go happily on shooting yourself in the foot.

#2 Underemployment. Some people are just born lazy. I’ve worked with more than a few people who think that earning $14 an hour for 37.5 hours a week is all they have to do. Bringing home just over $400 a week is fine, if you’re prepared to live on $400 a week. But most people aren’t. They want to buy beer, watch movies, have cell phones and premium cable and everything else their pals have. Sometimes when I tell these people to go Make More Money, they complain that it’ll take away from their Mommy or Daddy jobs. Ya know what? That’s an excuse for not wanting to work harder since many of those same people spend hours a day doing stuff that doesn’t involve their kids. THOSE are the hours you should be spending Making More Money.

#3 Income Goes Down, Spending Doesn’t. People get laid off from work, get sick or stay home to raise their children. Their incomes go down, but their spending doesn’t. They use their credit cards, lines of credit and overdraft protection to fill the gap and then say they are surprised to find they are buried in debt.

#4 No Savings. We seem to have developed an aversion to saving. We use the excuse that we can’t get much return on our money right now, so what’s the point. Ha! Talk about JUSTIFICATION! Wow! We’ve watched the savings rate plummet over the past three decades, hitting the negatives. How can that ever be a good thing? Of course, if we were willing to live on a little less now so that we’d have a cushion set aside in case we lost our jobs, we wouldn’t be pushed into Debt Hell quite so quickly. And if, knowing we were going to take time away from work to raise kids or go back to school, we set aside some money to see us through our future plans, we wouldn’t dig ourselves a tunnel to Debt Hell.  And with three to six months’ worth of Essential Emergency Expenses in the bank, getting sick wouldn’t also make up financially ill.

#5 Getting Sick. Some people believe they will never get sick. It’s why people don’t bother to get critical illness insurance, disability insurance, or life insurance. In my mid-40’s I had to deal with the death of my best friend from cancer. She was in her 40s. And before Cookie died, she had years of dealing first with MS and then with breast cancer and finally brain cancer. It was horrible. If she hadn’t had insurance, she would have been totally screwed. As it was, every month was a challenge financially. And believe me, she didn’t need any more aggravation. Of course, you may not be the one to get sick. It may be your partner, at which point you better have some money to help pay for the things (s)he used to do. Or it may be a child or an elderly relatively that causes you to lose time off work.

Debt is like quicksand: easy to get into and terribly hard to get out of. Know what you have to do to avoid stepping into the quagmire so you can skirt the problems debt brings.

I recently received a letter from a woman who had to live through the angst of nursing her dying mother while raising six-year-old twins. It got me thinking about how families have changed. It used to be Mom was completely healthy and independent well past the time when Junior was heading off to university or his first job. Nowadays, late stage marriages and remarriages mean that the old family portrait looks quite different from today’s snapshot. And what was supposed an empty nest is bursting at the seams as aging parents, young children, divorcing children with their own young ‘uns, and kids home from university all fighting for space and attention.

Boomers are the sandwich generation, squished from both sides and spewing out the edges. In helping to launch our children into happy and responsible adulthood, we are expected to help them assume financial responsibility for themselves, to learning the value of a dollar, and to know when to defer gratification for the sake of the bigger picture. Even as we unbridle our yearlings we may be called upon to pick up the reins for our aging parents. And all this while we wonder about our own careers, expectations that have remained unfulfilled, and retirement.

When it comes to the kids, you may be in one of two positions: they may not yet have left home, or they may be boomeranging back – alone, or with spouse and/or children in tow.

Probably the most important part of the boomerang-kids phenomenon is dealing with the emotional side of the change. If children are forced to move home because of a job loss, divorce or disability, you’ll have to help them deal with the impact on their self-esteem. Don’t think yourself immune to heated moments as you redefine your roles within the new family structure. Your children may at once love you for being there to help and hate you for their need for your help. Or you may experience both compassion for your children and resentment at being put back on duty as caregiver, financial supporter, grown-up.

Lots of families have to pull together to get through tough times. As the glue that binds the sandwich, you’ve got to stay healthy, maintain your own goals, and come first, at least some of the time, if you want to hold the family together.

One of the downsides of being the filling in the sandwich generation is the complete lack of control that comes with being tugged at from too many different sides. It’s frustrating. It’s emotionally draining. And it’s expensive. Prioritizing becomes an essential skill in maintaining some sense of balance in both our lives and our finances.

Of course, the ones in the middle aren’t the only ones who feel stress. Elder parents often experience high levels of stress. As they age and their children assume more responsibility for them, they lose a sense of having any power over their environment and decisions. It’s a Catch-22, for if control seems to be external, then they may lose their desire to make their own decisions.

One of the most damaging myths surrounding aging is that getting old automatically means a decline in mental facilities. At 40 I forget things, as I will at 50 and 60. Women blame it on the brain cells we lost during pregnancy and we laugh. Both sexes blame it on the fact that we must hold seventeen thoughts at once and we laugh. It’s easy, when we’re young, to dismiss it as just having too much on our minds. But when we’re old and forget things, we automatically blame age. Unfortunately, when we project a limiting myth onto our aging parent, it becomes self-perpetuating

If your parent is not yet fully dependent on you but you’re worried about the little things falling through the cracks, there are small steps you can take to ease your mind. Arrange for the automatic payment of important, recurring bills. This prevents hassles and interruptions in service if required payments aren’t made. Arrange to be notified if a non-automatic payment is missed. And arrange for the direct deposit of pension and benefit checks into bank and brokerage accounts. Consider setting up a joint account with telephone banking privileges so you can do a quick check to make sure everything in the account is going smoothly (no overdrafts!) several times a month.

Reuniting households sometimes works like a charm — or not — depending upon the temperament, flexibility, and tolerance of the parties involved. It is important for all members of the family to deal with conflicts and communication issues before they become problems. Mutual respect will bring you closer to a functioning multi-generation family that can forge a workable and healthy living environment.

Imagine the freedom of never having to worry about money. Some dopes think that means having so much of the green stuff that you could never spend it all. But bad money management has put many a Richy Rich in the poor house. I’m talking about the kind of freedom that comes from being in control of your dough. I’m talking about a budget.

I know budgets aren’t romantic. And for all those people who feel they are entitled to buy whatever they want, whenever they want it, a budget can seem like kryptonite.  You can choose to continue to see a budget  as a major pain in the butt or you can choose to see it as a useful tool that helps you spend your money on the things that are most important to you.

Once upon a time to try and get away from the stigma the word “budget” carried, I took to calling them “spending plans.” But you know what? It wasn’t the word people hated, it was the discipline, the work, the focus required to pre-determine how much you were going to spend, and then spend no more.

Regardless of whether you call it a spending plan or a budget, the point of the exercise is to decide how you will spend your money. Having a plan gives you the freedom to enjoy yourself because you don’t have to worry about how you’ll pay the bill when it comes in. You’ll know, right from the start, whether you can afford the purchase you’re contemplating or not. And if you really, really want it, you can decide what you’re prepared to give up to get it, whatever it may be.

Have you ever made a large cash withdrawal from a banking machine only to wonder a few days later where all the money went? Think for a moment; where did the last $100 you spent go? Stop for a minute and write it down. Chances are you can account for most of it, but there may be five, ten or twenty dollars missing from your list.

What does it cost you to live each month? Some people under-estimate their expenses because they forget the things that don’t occur every month. Did you include your gym costs even though you pay them once a year? How about your house or car insurance? Did you include the cost of your haircuts, your contact lenses, or your vacation? Do you pay someone to shovel your snow, clean your windows and carpets or do your taxes? What about your vet bills, the flowers for your garden or patio, your best-friend’s birthday present?

Some people under-estimate their expenses because they actually don’t know how much they’re spending on things like take-out, clothes, and coffee. Over and over when I show folks how much money they’re spending on the non-essentials of life, they are gob-smacked. Well, the only way to make a budget that will work is to know what you have been spending so you get some sense of what you’re going to have to change.

One of the best ways to gain a perspective on your spending habits is to keep a log of everything you spend, each time you do a transaction. The idea is to figure out where you’re spending all those dimes that seem to go missing each month. It’s also about learning more about yourself and where your place your priorities. This isn’t about shame, blame or deprivation. You don’t have to change anything you don’t want to change. But you should at least know. With a transaction log, you’ll have a clear picture of what you’re getting for your money.

When you do all your money management in your head, it’s very easy to forget things — sometimes important things — that will have an impact on your overall financial life. You’re always guessing how much you have left. And you shouldn’t really be surprised when your account is overdrawn. After all, if you don’t know how much you have, how can you know how much you can spend?

If you don’t believe you can find the time to maintain your budget: collecting receipts, entering details onto your budget, adding it all up and balancing it out, think about the time you have to spend solving the problems that arise from not taking care of the details. And think about all the money you waste on overdraft fees, interest costs and ATM transactions. You’ll have to decide whether you’d rather live life peacefully, or continue waking to the specter of financial worry rattling his chains at the foot of your bed.

People are always talking about money: what they paid for their latest toy, how much they saved on their last shopping expedition, how expensive life is. And while the money chatter really ratchets up as couples plan for their weddings, the focus tends to be on The Big Day and not on what comes next.

While the wedding itself is exciting and challenging, it doesn’t hold a candle to what it’s going to be like sharing a life. If you haven’t had the money heart-to-heart, you’re begging for a fight down the road. When questions about financial goals, money values and debt start cropping up, so can the conflict. Better to get it all out in the open so you know what you’re getting into.

In setting up for the big money chat:

• Choose a non-stressful time to talk.
• Listen to each other with patience and respect.
• Be honest.
• Share concerns without judging your partner.
• Make your partner feel safe.
• Take a break if emotions start to run high… but
• Set up the time for the next money talk before you’re done.

You’ll want to talk about who will pay for what. You might think that splitting the bills 50/50 is the fair thing to do. He might think you should just pool all your money in one account and pay for everything together. So what’s it going to be? If you don’t iron out how you will manage your cash flow on day-to-day basis, you’ll likely end up with multiple accounts, struggles over who should pay for what, and resentment about how the other guy spends your money.

You’ll also want to chat about what you each are bringing to the relationship. Couples hook up all the time without talking about how much money they have or how much debt they’re carrying only to face the horror of the other person’s past financial indiscretions. While one partner is not responsible for the other’s debt unless that person borrows jointly or co-signs, old debt has a way of haunting new relationships. If one of you has been lax in your repayment history, it’ll cost you both more to borrow when it comes time to get a mortgage. If one of you has racked up dozens of credit cards and is barely making the minimum payments, it’ll cost you both when it comes to achieve the goals you’ve set together.

Don’t forget to talk about your goals. Do they mesh or conflict? If you have chatted about when you’d like to buy a home, how many kids you’ll have and who will care for them, and how often you should take a vacation, these are but a few of the hundreds of things you still have to cover. Don’t get overwhelmed… you don’t have to do it all at once. But it does mean you have to make your goals – and your money – a regular topic of conversation.

As you move from Me to We, do your relationship a favour and make communication a top priority. No matter how well paired you seem at first, as time goes by and you each change, you won’t be the people you were when you married. So communicate, don’t disintegrate.

People are under the misconception that when you’re self-employed you work for yourself. There’s nothing further from the truth. Self-employed people work for every customer they have. And customers can be a demanding lot. If you think entrepreneurship is a secret path to wealth and a short work-week, forgedaboutit! You’re going to have to bust your arse. You’re going to have to jump through hoops. You’re going to sweat bullets, pull your hair out and cry in the shower. If you’re up for all that, along with working 70 or 80 hours a week to make the sucker go, then you’ve got the goods to be an entrepreneur. If not, get a job!

You’re going into business to make a living. If you keep spending all the money you make on crap (think fancy cars, swishy office space, all the toys) and don’t have enough to support yourself, you’re playing at a hobby. Businesses earn money. Yes, it may take some time to make big money, but if you’re not making at least enough to support yourself, think seriously about what you’re trying to accomplish.

For anyone living on a variable income, the trick is to even out that income. First you decide how much you need to take as an income to meet your Must Have Needs. Next, you open up a separate bank account for your professional income (not your personal income) and you deposit all the money from your biz in there. (It doesn’t have to be a biz account specifically, just a separate account.) Every month regardless of what you make, you take only the Must Have income out as your compensation.

Over time the biz account will build up a surplus that can be used in the months when billings are lower. Once you’ve got that built up to about three months’ worth of your personal income, you can increase your personal income to include your nice-to-haves, always making sure you continue to build your biz account up for flexibility.

Being in business for yourself is no cake-walk. So what are the financial advantages of being self-employed? Oh, there are quite a few, but most of the advantages aren’t financial, they’re personal: The ability to set your own course; the control to decide what you love to do and do it with passion; time flexibility. I’ve been getting up to write at 4:00 a.m. for what seems like forever. That gives me hours during the day to do things for and with my children, to explore other opportunities or to have a nap!  I’ve been self-employed since I was 25 and I wouldn’t change it for a minute.

Women’s Money Week is about encouraging women to speak up about money, take control of their money, and reshape their financial future. It runs from March 5th-11th, 2012 on WomensMoneyWeek.com — coinciding with International Women’s Day.

Women’s Money Week is about raising awareness for important money-related issues impacting women. But it’s more than that, because through the voices of hundreds of bloggers, we’ll work to do something about those issues too. One voice is hard to hear, but many amplify the message.

The topics that will be covered will include:

Monday: Entrepreneurship / Making Money

Tuesday: Relationships & Money

Wednesday: Saving & Investing (I’m not writing on this… It’s Wednesday!)

Thursday: Budgeting

Friday: Money in Your 20s/30s/40s/50s/Retirement

Saturday: Debt

Sunday: Goals / Taking Action

I encourage you to use this week to increase your financial literacy, look at things from a number of perspectives and discover new voices that can help you achieve your goals. Here’s a link to the list of bloggers participating/

Not every writer appeals to every reader, nor does every topic strike a cord, but pushing beyond your comfort zone may mean finding a voice that speaks directly to you, that helps you understand yourself and your money better.

While there’s been a great deal of blah, blah, blah about financial literacy and education, women are still behind the eight-ball when it comes to economic insecurity.

Sad to say, our greatest gift is also a major contributor to our economic insecurity. Our desire to nurture gets in the way of our ability to build our financial security. Whether we are taking time off to have and raise our children, to care for our elders, or to accompany our partners across the country for a new job, putting our own careers on hold, women spend far less time in the work force than do men. And then there are all the women who retire when their mates do.

Having and raising children is one of life’s great joys. The birth and care of my children changed me dramatically. I went from a 17-hour–a-day-7-day-a-week worker to a woman who cannot bear to be away from her kids. I still work. I choose my work carefully so that I don’t have to be away from the kids for too long a time. It’s affected my income stream dramatically. While my children were under ten, I earned about 70 percent less than before I had ’em. I had to restructure my priorities in order to balance a work life with a family life. But I managed. Other women are far less fortunate.

One of the issues I had to deal with was the interruption in my income stream while I was pregnant, and during my “maternity leave”. Having two pregnancies-from-hell gave me a whole new appreciation for women who work through their pregnancies. But I found I was not alone. In sharing my horror stories with other women, I found many who barely dragged themselves through their pregnancies, and whose work and careers had to be put on hold temporarily. Since I have always been self-employed, I also had no financial support (no maternity benefits) during my time off with babies. Again, I was not alone.

Commitment to family is in direct conflict with a woman’s desire to be financially independent. The way things are now, it’s a choice. And it is our financial security that loses when we make the “right” choice.

Women choose to use their vacation or sick days to care for kids.  And according to Donna S. Lero’s Canadian National Child Care Study, child-care problems are three times more likely to affect mothers’ productivity or involvement in the work force than fathers’. The most common effect of child-care problems reported include:

• not being able to work overtime when requested or desired
• worrying about children’s care while at work
• reduction in commitment to one’s job because of child-care problems
• reduction in work hours
• turning down job offers
• leaving a job because of child-care problems.

As our parents age, eldercare becomes more of an issue. And since, traditionally, the responsibility for eldercare has fallen firmly on the shoulders of women, we can expect even more interruptions in income. Only a small number of employers surveyed by the Conference Board of Canada provided benefits to employees to assist with the care of elderly or disabled family members.

So has your role as mother, daughter, wife, or care-giver affected your ability to be independent? What do you feel you have given up to take on one of the more traditional roles? And would you have done anything differently with the benefit of hindsight?

1. Take stock of your debt situation: Make a list of all the places to which you owe money, except for your mortgage, unless you’ve consolidated consumer debt in your mortgage. If so, then add the amount you consolidated to your list.

2. Prioritize your debt: List what you owe by interest rate with the most expensive (the highest rate) at the top of the list. This is the order in which you’ll pay off the debt.

3. Calculate the minimum payment on each debt. That’s what you HAVE to pay to keep current and not bruise your credit history. Write the minimum payments beside each debt, add them up, and that’s the least you can put toward your debt every month.

4. Figure out how much to repay to get out of the hole: If you owe $2,500 on your credit card at 18% and you want that credit card debt gone in six months, you already know it’s going to cost you $37.50 a month in interest. But if you want to get that credit card paid off in six months, you’re going to have to slap about $417 a month against the principle to make it go away. That’s a total of $454.50 a month you’ll have to come up with to make the credit card debt disappear in six months or less. Once you’ve paid off the credit card, you can use the $454.50 you were using to pay it off for your next most expensive debt. That’s called snowballing..

5. Decide where you’re going to get the money: If you want to be debt free, you have to find the money to pay off the debt. It may mean going over your budget with a paring knife. It may mean finding a way to make more money. You’ll do whatever it takes.

6. Make your debt repayments automatic: Set up an auto pay for each debt you’re working to pay off, taking the guess work out of it, and making a firm commitment to the process. Initially you’ll pay the minimum required on all the debt. On your most expensive debt, you’ll auto pay the amount you came up with to have the debt gone by your Debt Freedom Day.

7. Chart your progress: Create a chart that shows how much you owe. You can use boxes or a thermometer graphic. Whatever works for you. Each time your auto pay goes through, colour in one of your boxes, or move your marker up the thermometer so you can see the progress you’re making.

There are good reasons for women’s sense of financial insecurity. One factor that affects women’s income is their family status. Women make up the large majority of lone parents. Women head up 80% of all one-parent families and single-parent households headed by women have by far the lowest incomes of all. According to  the Canadian Research Institute for the advancement of Women, “51.6% of lone parent families headed by women are poor.” It’s no wonder we fear for our children and ourselves. The statistics are frightening. And if you are one of the statistics, your whole life can be frightening. What could be worse for any mother than wondering how she will put food in front of her children, keep them housed and provide for their well being?

Divorce treats women and men very differently. According to the Vanier Institute of the Family, in the first year after divorce, women’s household income plummets between 20-40%. Three years after divorce, women’s income remains far below what they had during marriage and far below their ex-husbands’ incomes. According to the Canadian Women’s Foundation, 21% of single-parent mothers are poor, compared to 7% of single parent fathers.

The most frightening statistic of all is the fact that approximately 30% of all support orders are in default nationally. And some of those support orders are a joke! I had one mom say to me with tears in her eyes, “How could they say my child is only worth $50 a month?” So, not only do women have to face the full emotional responsibility of raising their children, they often receive little, if any, consistent financial support from their children’s fathers. It’s no wonder women are scared.

Not only do women have less money to deal with the challenges and crises that arise, they are also more likely than men to encounter these challenges. Our longer life expectancies put us in the position of having to cope for more years on less money and it also makes us more vulnerable to disabilities, since physical deterioration increases with age. Thirteen percent of Canadian women and 42% of women 65 and older had disabilities.  And the unemployment rate among women with disabilities is 75%.

Disability in later years puts more pressure on financial resources. At a younger age, a disability can completely wipe us out because it eliminates or severely hampers our ability to earn an income. Even here, men and women play on different fields. Of all disabled men and women with an income, while men’s average income was $26,890, women’s average income was only $17,230.

As a woman, do you worry about your financial security? Do you think things are different for men and women? What are you doing to ease your fears?

My girlfriend, Jack, calls me up the other day to say she’s thinking of buying a house. Jack has been to see her friendly neighbourhood banker who has reassured her that she can most certainly afford to buy the house she’s looking at. Jack doesn’t have a downpayment, but that’s okay. The banker is happy to arrange her downpayment for her; she’ll only need 5% after all. And amortized over 30 years, the mortgage payment works out to be a little less than Jack’s current rent. It’s a good deal.

Jack: Don’t you say that you shouldn’t spend more than 35% on housing?

Me: Yup, that’s what I say.

Jack: My banker says it’s 44%.

Me: Really? That’s because your banker wants to bury you in debt.

Jack: Yeah, I’m not sure this is really such a good idea.

Me: What all is he including in your 44%? Just mortgage payments?

Jack: Mortgage and property taxes.

Me: What about utilities, insurance and maintenance.

Jack: No, none of those things.

Me: So with those things you’d be over 44%

Jack: I guess.

Me: Is that 44% of your net income or your gross income?

Jack: Huh?

Me: Money in the bank, Jack, or your annual gross income?

Jack: Gross, I told him I made $60,000 a year.

Me: But you also pay tax, have union dues deducted and a whole bunch of other stuff. You don’t take home $5,000 a month.

Jack: Yeah, I know.

Me: What do you take home?

Jack: About $3,200 a month.

Me: And your stupid lender thinks on a net income of $3,200 a payment as high as $2,200 would be okay?

Jack: It does sound kind of weird when you say it that way.

Me: So are you going to buy the house?

Jack: I dunno. I’m thinking about it.

Me: Y’know, even if the dope calculated it on your net income, you’d have just $1,800 left a month to cover your transportation costs, food, house insurance, maintenance, and everything else.  Didn’t you tell me that with your car payment, insurance and gas you were spending way too much on your car?

Jack: Yeah, with all my commuting it’s about $800 a month.

Me: Okay, so that’d leave you with $1,000 for everything else.

Jack: Doesn’t seem like much, does it?

Me: Hey, it depends on how important owning a home is to you. Far be it from me to tell you what to do. You never listen anyway (with a smile.)

Jack: Well, I’ll think about it some more.

Clearly the lender is over-estimating Jack’s Capacity to repay the loan. Capacity is one of the 5 C’s of lending (which lenders seem to be totally ignoring these days) and it measures your ability to actually get the debt GONE (as opposed to just making minimum payments). Lenders are supposed to weigh the amount of discretionary income you have to repay your debt. And they’re also supposed to look at Capacity based on the term of the loan you’re taking and your other obligations like family responsibilities and other existing debt.

Once upon a time lenders used to insist on a Total Debt Service Ratio (TDS) of about 30%. But with the fight for market share and the increase in housing costs, that’s gone out the window. Sadly, our incomes have NOT kept pace with the rise in housing costs, and so TDS levels have increased… not really a good idea if you want to also be able to save for the future and have a life right now.

The industry is paying a lot of lip service to “financial literacy” these days. And Credit Education Week is just one more example of the lip service. After all, if banks were serious about ensuring that customers were building financially sound foundations, they wouldn’t be offering them credit that would make that foundation crack with the smallest change in personal income or interest rates, would they?

Have you joined School Lenders on Facebook yet? Have your sent your letter off to your member of parliament? What are you waiting for?

Next week: More about the 5 C’s: Character.

You just have to look at the way so many people deal (or don’t deal) with their money to know that there is still a whole bunch of people who don’t think money is important. It flows in and out of their hands without them having any idea where it’s going.

There are the folks who spend without giving a second thought to their spending. Want a cuppa coffee? There’s a Timmies, we can just drive thru. And while we’re there, we’ll pick up a 20-pack of Timbits. Never mind that that’s the money The Other Half set aside for the hydro bill. Hey, it’s just a cup of coffee, right?

How many times have you bought something without thinking about it? You walk up to the cashier and as you’re waiting to pay you pick up the magazine, the pack of gum, the candy bar that sitting right in front of you. Was that a “thought about” purchase?

And then there’s the instant-response purchase. Think of all the money that’s been made on shamwows and easy-graters, miracle health remedies and anti-aging serums, bracelets designed to return your flexibility and pills designed to return your sexual vigour.

Some people don’t have a budget, so they don’t have a plan for how they will spend their money. They keep their fingers crossed and hope they get to the end of the month before they get to the end of the money. Then they scratch their heads and wonder why they always seem to be in overdraft. Duh!

And then there are the hard-working, lazy-assed dopes won’t spend even one hour a month organizing their money. They throw bills and receipts in a drawer – or worse, they shred ‘em without even opening them. They don’t want to look at their bank balances because that would mean they might have to do something differently. And they’re “too busy” to do the detail required to be in control of their money.

Hey people. Your money is important. You should know where every cent has gone. You should have a plan for how you’ll use your money so it doesn’t just vanish leaving you wondering what you’re doing wrong. And you should invest a little time to keep track of it.

You drag your sorry butt out of bed every day to go to work to make money. Don’t you think your money is important enough to warrant at least a little time thinking about how best to use the fruits of your labour?

It’s an interesting paradox, isn’t it? We’ll expend all kind of energy making money, but some of us won’t spend even a little time thinking about how to put it to the best use possible. Whazzup with that?

Hey, I guess it’s because YOUR money is just not that important.

This is the state of our lending these days. I’m hearing stories of children in high school being shipped credit cards once they turn 18. Lord love a duck! It’s got to stop.

And so I’m asking for your help. I want you, all your friends, your family, your co-workers, anyone who gives two hoots about fixing our very broken lending system to pay attention.

Over the next six weeks, I’m going to be talking about what good lending is supposed to look like. And I’ll share your stories about crappy lending experiences. I want it all to culminate during Credit Education Week, which is November 13-19 this year.

Ah, Credit Education Week: the week given over to helping we bears of very little brain understand how to better use credit.

Let’s turn this puppy on its head. This year, we The People are going to use Credit Education Week to School Lenders.

If you want to be part of the effort to School Lenders, join the School Lenders group on Facebook.  Then stay tuned for announcements about Twitter and Facebook chats leading up the School Lenders Week. Get out your pen and write to your MP to demand a change to the legislation. Tell everyone you know, and tell them to tell everyone they know, that it’s time to make lenders stop lending irresponsibly!

During School Lenders Week, I want Canadians to commit to not using credit for anything during that week. Yup, that means it’ll be a cash-only week.  You can do that, right?

If banks put profits before people, it’s time for people to hit banks where it hurts most: their pockets. By forgoing credit for one week, lenders will not only lose all the new charges for that week, they’ll lose all the retailer fees for processing credit card payments. You betcha that’s big money.

If you’re ready to make a difference, all you have to do is:

•          Commit to not using your credit for one week (Nov 13-19),

•          Join the School Lenders Facebook group to show your support

•          Write to your Member of Parliament and tell them you want new legislation that ends the use of the credit score as a credit-granting tool. There’s a sample letter under “Resources” entitled School Lenders.

•          Spread the word to family, friends, co-workers, and whoever else will listen.

The message we want to send is that we’re not happy with the way lenders are doing business. We’re not happy with the way the credit score is being used. Get back to good lending!

Next week: More Schooling Lenders and the 5 C’s.