I have just written a post on my Facebook page about one of the most common questions I am asked:-

“Should I consolidate my debt?”

20111702_sBefore I give an answer, I always ask if they are still using credit cards and if they are, are they paying them off in full every month. If they are then debt consolidation can be useful. It makes payment easier, just a single payment for all of the different debts you have eg. credit card(s), store cards, personal loans etc and it is often a much lower interest rate than credit and store cards.

If however, they tell me that they are still using credit cards I strongly advise that they don’t go for debt consolidation.

Why? It is all too tempting. Suddenly, all your credit cards are paid off and all that wonderful credit is available to you again and you are still in the habit of using it. The first time you tell yourself “I need a new dress, pair of shoes (fill in the blank………) you’ll be reaching for the credit card! In an earlier post of mine http://bit.ly/1IuNvVj I discussed the difference between needs and wants and the impact, not knowing the difference, can have.

I wish I’d had that advice a long time ago. I had a very friendly bank manager and I was always consolidating my debt, only to go back in a month or two to do it again!! The only people who benefitted by this apart from the bank, was the guy who was always coming to put a value on my home so that I could borrow against it. By the time I sold it  and paid off all my debt ( the ultimate debt consolidation) there wasn’t much equity in my property.

So if you are thinking of consolidating your debt, make sure you are not increasing it before you do. This means for most people, stopping using your credit cards first.

If you want to get out of a hole, first you have to stop digging! So it is with debt. If you want to get out of debt, first you have to stop incurring it.

href=”https://jillporter.files.wordpress.com/2012/03/12637931_s.jpg”>Shame

It’s been a funny few days.

I have had some great responses to telling my back story.

The odd questioning ones as well.

Why would I tell this?

Maybe I should have made it more positive? Maybe it would be off putting if someone was wanting to work with me, if they knew I didn’t have it all sorted out?

None of them were doubts I hadn’t had myself, trust me. However, I take heart from Brene Brown’s quote : “Owning our story can be hard but not nearly as difficult as spending our lives running from it.”

My purpose in telling my story is not only owning it myself but also, hopefully, providing encouragement to others who may be thinking that they are walking this path on their own. They are not.

I am on that path too and I meet people all the time, who are on their own version of this journey.

In our society, money is not talked about unless it is bragging about how much you have! Most people don’t do that. My mother went to her grave at 93, not ever knowing how much my father earned!!

Things have changed from then but it is still considered shameful to be in debt, to have to borrow money and god forbid to go bankrupt. (At the same time as we are bombarded with advertisements to buy, buy, buy! And to get this credit card and be jetting off on overseas holidays etc, etc,etc.)

I know how lonely it can feel to have these issues and feel that you are all alone. How scary it is. How alienating it feels. Just how fucking ghastly it feels!!

I hope by being honest about my path I can help someone else not feel so alone and to feel braver about reaching out for help, or just to tell someone else, so that it doesn’t feel so lonely and scary.

Another Brene Brown quote helps too:- “If we can share our story with someone who responds with empathy and understanding, shame can’t survive.”

Ok so here is Part 2!

If you didn’t see part 1 yesterday, here is the link:

https://jillporter.wordpress.com/2015/04/29/changing-up-the-back-story/

Having got myself back on track following Mum’s death I then had to take another break whilst I had surgery on my hip. I was on crutches for 6 weeks and sore and tired, so not much work got done!

Now I am not going to bore you with all the details but during the next 4 years  I had another 4 lots of surgery! Most of them quite big surgeries and requiring significant recovery time. Between each one, my business would grow again and be on the brink of becoming successful and bang, another surgery, and back down it would go.

Bugger! But great excuses for absolving me of any kind of blame or responsibility, right?

Wrong!

Now I needed all of those surgeries but on some level I needed the hiccough they brought to my business success too.

I’ve done quite a lot of exploration of this over the years but as many of you reading this will know, I’m not much into woo-woo stuff, so I also rejected any idea that I may have had a part to play in any of this.

Recently, I’ve come to accept that I surely did. Law of attraction! On some level I am still a bit skeptical about the role of the Law of Attraction when it comes to needing surgery or for that matter getting other physical illnesses. The traditional medicine which I have known and practiced as a nurse for so long, still has me pretty firmly in it’s grip!

However, what I have come to accept in the past few months, was how my surgeries allowed me to play the victim, not be responsible for my business success, or lack thereof, and to just coast along with it, blaming my “bad luck” for the lack of momentum.

What I had unwittingly done, was go from overspender to underearner..the flip side of the same coin!

The end result is the same. I end up in debt and never have any money…initially from spending it all and more, and more recently, from not earning it!

What have been the effects of all this?

My relationship ended. I may have stopped overspending but now I didn’t have any money at all and that still put the relationship in precarious territory and F left. We remain great friends still.

I moved into an apartment but for the first time in my life couldn’t pay the rent, moved out and went housesitting. I actually love doing this. I stay in some fabulous homes and look after some amazing animals and have wonderful experiences. I hate moving though and living out of a suitcase can get pretty tedious!

When I moved into an inner city apartment I sold my car and walked everywhere. I haven’t been able to replace it.

I have had to borrow money from friends and family. This has strained some treasured relationships.

For some months I was on a WINZ accommodation supplement.

My pride has taken some massive hits.

But, I now know and believe that I truly have something to offer so many people.The lessons I have learned about our relationships with money are too valuable not to be shared. The work I do is important and who could be more qualified to do it! I am taking responsibility for that. There are people out there who need me.

Now that I have spilled all that ( whew!!) I intend that this blog will be a way to chronicle my journey and adventures along the way, whilst also giving some personal finance tips and information. You will also meet some of the funny and sweet animals I look after, and see some of the wonderful views I enjoy.

I hope that it will sometimes be funny, it may be irreverent, could well be opinionated on other subjects other than the one at hand but I hope it will be enjoyable. Please interact with me. I love hearing from you and love suggestions and comments….positive or negative. Until later….

There was an interesting article in the NZ Herald on Sunday.

This is my take on the subject!http://https://vimeo.com/124811703

I’d love your comments on this. Do you use credit cards so that you can get air points or other rewards?

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Do you procrastinate? I know I do! I could do it for the Olympics!!

I have been meaning to write this on here for the past week or so, but always found something more important that needed doing, actually probably more urgent if I was truthful, because I’d procrastinated about that too!!

Sometimes procrastinating can be really expensive; both financially and/or just personally. If you don’t stop doing something that is harmful to you, eg smoking it ticks both of those boxes. As soon as you stop, you save money and also start to improve your health. But what I am focussing on here is money.

I have had several conversations recently, with people who intend to deal with their money shit, “in the New Year”!

Great idea you might think and in principle, it is! However, as the graphic says, time is money! The longer you delay taking at least the first step, the more it costs you. At this time of the year especially.

If you are spending without having any real plan or budget, and no really clear idea of where it has been, or is all going, you could be in trouble! This is particularly if you are doing all this spending on credit cards! The New Year will bring some nasty surprises when those credit card bills come in! Trust me I know these things!!

So here are three tips to stop the flood and, depending where you are with the Christmas shopping, lessen the shock of those New Year bills.

  1. Make a plan now! I mean, as soon as you have read this, or at the very least today! The sooner you start the less it will cost you. Detail your income from now until the end of December. If, you have already been paid, then use the balance in your account now. Then put down all of your planned spending until the end of the the month. This should include gift buying, food shopping, meals out, alcohol, parties etc! It is an expensive time of year! If at the end of that you estimate that you will still have money in the bank or your wallet, well done you!! If not, go over it again and you have two choices – either reduce your planned spending or increase your income!! To help with this you can go to my website, Financial Clarity and download a copy of the Holiday Planner developed by Karen McCall.
  2. Stop using your credit cards. I mean NOW! Using credit cards allows you to be completely oblivious to your spending or have your head in the clouds or, deep in the “money fog’ as I like to call it! If you won’t be able to eat unless you use your credit cards, then that’s OK but make a plan for when you are going to use them and for how much. eg I will spend $100 at the supermarket or grocery store. Then just use it for that and NOTHING more!
  3. Shop with a list or even better do all your shopping online! This means that you are in control of your spending. You buy just what you need and spend just what you have planned. You are not tempted by the slick marketing of the retailers or by your own desires!!

…and most of all have a wonderful Christmas, happy holidays and a healthy and abundant 2015

If you think you need more help than this don’t hesitate to contact me jill@financialclarity.co.nz or +64 21 211 5327

Often, when talking to people about the work I do, I tell them that I help people clear their credit card debt once and for all and never have to use a credit card again. For many that sounds like the definition of impossible! They have cleared their debt before, often many times, and know that it just goes back up again.
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Then, when I tell them about the process I use and explain that, if possible, I will get them to commit to not using their credit card at all until I see them next time, I see the horrified looks and panic setting in!

The reason for this is that, like so many people, their credit card is their security blanket! It’s what stands between them and financial disaster if the car breaks down, the child needs orthodontic work, the dog needs surgery, Christmas arrives, someone has a birthday, friends ask them out for dinner, they need a holiday etc etc! It is where they go for “money” when all else fails. I know this, I have done this, more times than I care to remember, but I also knows that it doesn’t work and only makes the situation worse.

I am not going to go into all the other reasons people use credit cards, like air points etc and the reasons why it is better and cheaper to use debit cards or better still cash! Today I am just talking about using them as your back up plan! I have been a bit facetious above with the “emergencies” people use their credit cards for, but I have either given them myself or heard them, and more, many times when people have told me that they only use them for emergencies.

Now, if you are reading this and thinking “but I do only use them for emergencies and then immediately pay them off in full” then fine. Whilst I do think that there is a better way, this message is not primarily for you, but read on because you might be interested in how you could do it differently.

I then go on to explain how I help them save their way out of debt, once and for all!  Doesn’t that sound good? Too good to be true? Not at all. If you follow the method which I teach you, which was developed by Karen McCall of the Financial Recovery Institute, that is exactly what you can do. I never ask people to cut up their credit cards, nor put them in a container of water in the freezer, I just ask them to trust the process, which has worked for thousands and thousands of people, and not use their credit cards until they see me again. As Karen says, “ if you want to get out of a hole, first you must stop digging”!

The other key steps are to pay the minimum on your credit card each month whilst building up a savings account, which we call a Periodic Savings account. Now I can hear all of you with financial backgrounds or those who pay off your credit cards in full every month, exclaiming that this will cost extra because of the interest. Yes, you are right but if you are someone who constantly uses your credit card and can never manage to always pay if off in full every month, then, trust me, this is a much cheaper way in the long run. Remember I teach you how to pay if off, in full, once and for all and to never have credit card debt ever again.

That’s because the Periodic Savings account becomes your security blanket; it’s where you go to get the money to pay the dentist, the vet, the restaurant, the holiday and Christmas! Using a formula I teach you, you can plan for all these and more, and know that you will always have the money available to cover all these events, without having to bring out the credit card. Once this is functioning well we also start another account which we call a “Safety Net” account and here you provide for coverage of all your expenses if you were to have an interruption in income.

So, if you would like to learn how to save your way out of debt, once and for all, use one of the methods below to contact me and we can have a coffee and discuss it further, to see if I can help you.

I’d love your comments about all of this and feel free to share it with your friends either by email or socially below.

Have a great week everyone and give it a try… Can you manage to not use your credit card for the next week?