What would you do with an extra $850.00 each month?

September 5, 2017

That’s a question I posed to some friends and I got a mixed bag of responses

Some people said “pay off debts” some said “pay down my mortgage” or “take a vacation”.  It’s certainly an enticing and interesting idea to consider having the luxury of a little extra cash in our pockets each month.

So why $850.00?

According to recent media articles Statistics Canada has reported that the average Canadian unsecured (credit card and lines of credit) debt load has increased to over $28,000.00 per person.  With minimum monthly payments at 3% of the outstanding balance that would mean that the average Canadian is paying about $850.00 each month to “service debt”.

Notice that I used the term to “service debt” and not to “pay down debt” or “pay off debt” – that’s because in many cases it will take more than a lifetime to “pay off” debt with minimum monthly payments.  Read the fine print at the bottom of your credit card statement – where it says that “it will take 128 years to pay off this debt with minimum monthly payments”.

Now imagine what would happen if that debt were eliminated through the filing of a proposal or bankruptcy proceeding and instead of relying on family and the food bank to help you out, or the need to keep dipping back into the line of credit to make the minimum payments, that $850.00 were in your pocket and actually available to save.

Buddhists talk about being chained to the wheel of life with spiritual freedom finally coming when the adherent is able to let go of their clinging to this world.  That is a great analogy for debt.   If you want to get free from the “wheel of debt” you have to let go of the idea that you “need debt” (or credit as it is preferably called).   Now that would be financial freedom.

Free yourself from the wheel of debt – talk to Tom and get your fix.