This week was a big one for me. I got a job. After three or four months of applying, interviewing, not hearing back, getting rejections and getting discouraged, it finally happened. I got the news on Thursday and I am flying out to Calgary later today for training. I will be working for a major bank and my official title is Transactional Sales Manager. This means I can officially stay in Toronto after moving here from Montreal a few weeks back so I believe we should all take a brief moment and celebrate, well, me.
Now that we are done celebrating, let me ask you this. What do you think was the first thing I did after I got the news? That’s right; I called my mother. Now, what do you think the second thing was? All I can tell you was that it floored even me after I realized what was going on. The second thing I did after I found out I got the job was shop.
I am not anti-consumer. I like my things and I have plenty of them. That said, the last few months that I have been scraping by without work have given me a distinctly new perspective on my spending habits. I had to stop buying all the little gifts for myself that I rationalized as warranted all the time. It isn’t treating yourself if you’re doing it all the time. A treat is inherently something that comes along only once in a while after all.
Not working though turned groceries into what I used to know as treats. Yet here I was, not having received a single penny from my new employment and just moments after getting said employment, and I was falling back into familiar habits. I was justifying to myself that winter is coming and I need this new scarf despite the fact that it costs 50 bucks and that I could definitely find one that was just as functional and twice as cheap or that I already had two other scarves sitting in my closet at home.
I think what scared me most was how naturally or how instinctively it happened. The number one reason that I can think of for buying things I don’t need is to bring happiness, albeit fleeting, into my life. I had gone without buying things I didn’t need for months but I had not gone without moments of happiness during that time. When I realized this, I understood that consuming is nothing more than another addiction and one that I surely suffer from.
Some of you might be coming to the same conclusion about yourselves as you continue to keep track of your daily spending habits. Another great way to smack yourself out of this spending haze is to just look around you and add it all up. How much did all those movies cost on your shelf? How much did all those shoes cost in your closet? While I might be talking about my shelves and my closet right now, take your own look and see what you see in front of you. In the meantime, my name is Joseph and I am a consumer.
Note about the author:
Joseph Belanger is a Toronto-based writer who blogs about film at www.blacksheepreviews.com
I seem to be catching the same commercials over and over again these days. I should probably change the channel on my television every once in a while or, better yet, maybe watch less television altogether. As I have been making that resolution every new year for as long as I can remember, I will just continue to judge everything I see on the box harshly in the meantime.
There is one particular commercial that keeps catching me off guard as of late. This lady is out and she’s shopping up a storm. She’s got so many designer bags in her arms, she can hardly carry them all up to her apartment. She may be struggling but she is looking slick and swaying her hips back and forth because she knows she’s got it. Then, the happy musical soundtrack to her luxurious shopping spree cuts out just in time for her to almost walk right into the eviction notice waiting for her on her door.
First of all, I’m pretty sure that anyone close to eviction doesn’t have the kind of space on their credit cards to buy groceries, let alone expensive shoes. Plausibility aside though, this is an advertisement for Credit Canada, a not for profit charity that has been in existence since 1966. They want to help you in your hour of need. Or do they?
Albeit, you may not be as far gone as the girl on the TV, you might easily identify with the promise of getting assistance so that you can manage your debt better. Credit Canada offers to make arrangements with your creditors regarding the monthly payments they expect. Once they have negotiated a better rate for you, they set up a monthly payment directly with you that you provide to them and they, in turn, provide to your creditors on time. As a Canadian charity, funded by different banks and financial companies, they do this at no expense to you.
It all sounds too good to be true. The reason for this is because it can very well be too good to be true for some of you. Credit Canada, just like banks themselves, is not about to take on clients who have proven that time and time again, they cannot make their payments when they are due. They can help you get out of debt and get on with your life but they cannot perform miracles.
If you cannot find lending with a chartered bank, Credit Canada may be right for you. With a no cost assessment available either on their website or over the telephone, there is certainly no risk in finding out if you are a good candidate for them. They provide budgeting and planning advice to keep you on track and out of subsequent trouble and, according to the testimonials on their website, they do so without prejudice or judgment.
Credit Canada also claims that consolidating through them does not have a negative impact on your credit report. This is up for debate – they say it looks good that you’re putting your affairs in order; a bank might say that it isn’t good you ended up there to begin with. That said, if you follow their plan right through to the end, you could be debt free. And maybe your landlord will let you back into your apartment at that point.
Note about the author:
Joseph Belanger is a Toronto-based writer who blogs about film at www.blacksheepreviews.com
image source: anataman
Whenever I see a number I don’t recognize on my telephone, I tend not to pick up. For reasons beyond my understanding, I broke that rule the other day. “Yes, can I please speak with Mr. Joseph Belanger?” Oh geez, great. I broke my rule and now I was stuck on the phone with a customer service representative from one of my credit card companies. Was I late on my payment? Was that why they were calling? Or did they want to try to sell me insurance for the hundredth time? Oh, why did I pick up? Why?!? (I ask as I wave my fist in the air.)
As it turns out, the phone call was nowhere near as disastrous as I first thought it might be. The reason my credit card company was calling me was to discuss a limited time offer that I was eligible for as a customer who paid his bill on time regularly. When I was done patting myself on the back for being such an excellent bill payer, I allowed the nice lady to continue explaining her offer.
This credit card company wanted me to transfer the balances from my other credit cards to them for a limited time lower interest rate. Ordinarily, I am extremely skeptical whenever any company offers me something for what seems like nothing but, after thinking this one through, I came to the conclusion that this little arrangement I was being offered was sure to benefit everyone involved … well, except for the credit card companies that were being paid out anyway.
Here is the deal. My credit card company would pay the full balance, or whatever balance I told them, of as many of my other credit cards as I so desired or had space on this card to cover. I didn’t have to do anything other than tell them an amount and confirm my account number. That newly transferred balance would be charged an interest rate of 2.99% for a period of six months. Compare that to the 18% I was paying on it already and you’ve got yourself a great deal. Isn’t the best Canadian credit card company offering such deal?
There is of course a catch but I feel it is still worth it anyway. Naturally, the credit card company isn’t going to do this at no benefit to themselves. First of all, they now have that amount in their court. They assume you won’t pay it off before the six months are up and will then pay the regular interest rate on it at that time. Before the six month mark, any payment you make goes toward the transferred amount first until that amount is paid off. This means that any amount you already had owing on this card would be charged the regular interest rate and would not go down at all as long as you had not paid the transfer amount back in full.
The ends undoubtedly justify the means here. Had I left everything where it was, I would be paying high interest on everything instead of high interest on just some and low interest on everything else. This is not an ultimate solution but will certainly help anyone looking for some temporary relief. And with credit card companies increasing their interest rates in light of recent economic difficulties, you’d best take advantage of balance transfer options before they stop offering them altogether.
Now, if you’ll excuse me, my phone is ringing and I have no idea who is calling.
Note about the author:
Joseph Belanger is a Toronto-based writer who blogs about film at www.blacksheepreviews.com
image source: James Cridland
Last time we spoke, or I wrote and you read to be more specific, we discussed missing payments on credit cards and other debts and how that has a direct impact on your credit rating. The recommendation was to keep a calendar of when your debts are due but there is only so much room on a calendar, you know. And if you’re anything like me and the millions of other people out there who have debt in a lot more different places than they should, you’re going to want think about simplifying your debt management. You’re going to want to think about consolidation.
Banks don’t love consolidating debt. You can argue that you’re trying to get your life in order and the bank is going to make its interest off of you anyway so why wouldn’t they want to take your debt on in a consolidation loan? The truth of it is that the interest the bank will make on you is peanuts compared to what they’re making off people who actually have money to invest in the bank. The other truth, the one that is a little harder for all of us to admit to ourselves, is that our credit mistakes and mishaps are not the bank’s problem.
That said, if your credit is decent enough and you can at least demonstrate the capacity to repay your loan, the banks will not just shut the door in your face. If you want to increase your chances of getting approved, you should ask for this loan from the bank you’ve been with the longest, assuming you haven’t defaulted on previous loans with them. This bank will know you, in as much as a bank can say that they actually know you, and will take that into consideration when looking at your application.
Be reasonable and be timely. If you walk into a bank looking for a $50K loan because you can’t make your payments next month and you started missing them last month, you’re past the point of assistance. You are basically the kind of client that I would laugh at when I looked at your application. It should be noted that my clients were never sitting in front of me when I reviewed applications and therefore I am not a complete jerk.
Consolidation loans should be considered when you can see that things might get out of hand further down the road. If the bank sees that you’re ready to take responsibility for your debts and get control of your finances, that you’re capable of doing so and that you haven’t mismanaged that debt too poorly beforehand, then you’ll likely be let in the club. Club privileges include one easy payment each month to one creditor, a likely lower interest rate than what you were paying prior and a clear path to actually being debt free by the time you finish paying out this loan.
Considering these club benefits, I would say the membership fees are definitely worth it.
Note about the author:
Joseph Belanger is a Toronto-based writer who blogs about film at www.blacksheepreviews.com
Recently, I have had conversations with a few friends of mine where they revealed to me that they don’t necessarily pay certain bills on time. Don’t worry; you will remain nameless but please, tell me what your logic is? The way they were talking, it was as though it was almost like second nature for them. The bill comes; the due date is listed; they then make their own schedule for repayment. That works fine when we’re talking about a few days between the due date and payday. These friends of mine though are carrying balances with their cable providers and somehow deluding themselves into thinking there won’t be any consequence.
When you don’t pay your bills on time, your credit rating is affected. It sounds simple enough but from what I know, most people don’t have a strong understanding as to how their credit ratings are established. There are a number of factors that have absolutely nothing to do with how much debt you have and how you manage it. (I will get into these some other time). That said, these other factors bare nowhere near as strong an impact on your rating as how you manage your debt does.
Late payments on debts like credit cards, loans and lines of credit are reported depending on how late they are. They range in severity from being late within 30 days from the due date, 60 days and 90 days. Anything past that is like getting a big “F” on your report card – it isn’t clear just how bad you did but you failed and you failed hard. Of course, completely defaulting on your debts is pretty much worse than a failing grade but we’re looking more at short-term mismanagement here.
There is also a financial impact on you when you don’t pay your bills on time. Your credit card companies may not charge you a higher interest rate on a late payment amount but you are paying interest on a larger debt than you should be. Let’s say you owe $5000 and your minimum interest payment was $100. If you miss that payment, you are now paying interest on $5100, or basically interest on top of interest. That might not seem like a lot of money to you, especially when you weigh it against the inability to make your payment on time but the fact is it remains interest that you shouldn’t have to pay.
If you truly cannot pay your bills on time, choose which ones you will pay wisely. Don’t assume that missing your cell phone bill or your gym membership is better than missing your credit card payments. Cell phone providers report just as religiously as credit card companies do. In all my years banking, I’ve seen a fair share of credit reports and I can confidently say that utility companies, like electricity or gas, are the least likely to report your short term missed payments to the credit reporting companies. And a $10 late payment is still a late payment regardless of the how small it is.
The best way to stay on top of your payments is to write them down on a calendar or in your agenda. And if you haven’t seen a copy of your credit report in some time, get a hold of it so you can at least figure out where you stand. Oh, and you should definitely pay all those parking tickets in your glove compartment – those look real bad on your report.
Note about the author:
Joseph Belanger is a Toronto-based writer who blogs about film at www.blacksheepreviews.com
