Last night, while searching the internet, I came across of YouTube video that piqued my curiosity titled “how we became debt free”.
The story is actually an interview by a well known US news organization. It tells us of a marriage couple with three children and how 5 years ago they had $125,000 in debt (not including their mortgage) and that today through, amongst other things, money management they now have zero debt.
Many of the things they did are things we should all be doing:
1. They started shopping smarter at the grocery store. Instead of always buying brand name goods, they started buying “no-name” brands. I agree with that. I will admit I am loyal to certain brands of ketchup and peanut butter, but for most other products, I would rather save money than have the brand name in my freezer.
2. They started eating out less. Many people I meet with don’t realize how even a small thing such as buying lunch every day can add up. If you are buying a sandwich every day of $5, that is $25 a week. If you brought your lunch instead, that is $25 a week that could be put towards debt repayment.
3. The father took on a part time job. While I applaud his efforts to increase his income, this needs to be balanced with having time with family. He commented that he was frequently too tired to play with his children.
4. Instead of coming home after his part time job, he slept in his car to save gas. This is just weird, not to mention the poor effect on his hygiene.
5. They did not file bankruptcy, but instead went to credit counsellor for help to lower their debt. This is the point that I felt cheated by the interview. Instead of a feel good story of how a family was able to dig their way out of debt on their own, it was a story about how they used outside tools to help them. There is nothing wrong with getting help but the story made it sound like they did it all on their own. They didn’t, they had a qualified professional help them negotiate with their creditors and manage their money. Just like I help people every day.
They did nothing that hundreds of people in Chatham can’t do every year. Since this was a US story, a better option in Chatham would have to to file a consumer proposal. The effects are the same, people avoid bankruptcy and become debt free after making payments towards their debt.
The moral of the story is the same. If you need help with your finances, just ask.
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