What is this strange new world called financial freedom? The more I watched her show, the more I wanted it.
Essentially, do I take the blue pill or the red pill?
As the title of this post implies, I took the red pill.
Financial Independence. I wanted the ability to do what I wanted, whenever I wanted without being tied down to a 9-to-5. But how would I do it? I needed a plan.
Much like the Scooby gang needed a Scooby trap, I was going to have to plan my way out of the rat race and into financial freedom. A financial road map. That’s what I needed.
It was like what Gail Vaz-Oxlade of Til Debt Do Us Part would always say in the intro of her show, I needed to go from red to black. My investment picture of over more than a decade is listed below.
Here’s a sneak peak behind Greenbacks Magnet financial magic curtain. Up first, from red. Then fade to black. Or in my blogs case, green.
Financial chaos bleeds. Here’s the red.
Oct, 2023: -$16,000 (market + house value ↓ )
Sep, 2022: -$22,000 (market crash + loss of 2nd income)
Feb, 2020: -$19,000 (market crash; where the bleeding really starts)
May, 2019: -$10,000 (market crash)
Dec, 2018: -$14,000 (market crash)
Oct, 2018: -$10,000 (market crash)
Feb 2018: -$4,900 (market crash)
Jan, 2016: -$4,000 (market crash)
Aug, 2015: -$5,000 (market crash)
Jun, 2013: -$4,000 (market crash)
Sept, 2012: -$14,000 (market crash + cash crash + got a new home!)
Feb, 2010 -$1,000 (market crash + got a new job!)
May 2009: -$3,000 (market crash + laid off)
Financial triage has prevailed. Here’s the black.
Nov, 2023: +$27,000(market rebound + 2nd job + house value ⬆)
Oct, 2022: +$17,000 (market up + mad hustlin’ 2nd job)
Mar, 2022: +18,000 (market up + bought condo)
May, 2020: +27,000 (market rebound; the green starts rollin’ in)
Jun, 2019: +$9,800 (market rebound)
Jan, 2019: +$10,000 (market rebound)
Aug, 2018: +$6,300 (market up)
Feb, 2017: +3,900 (market rebound)
Mar, 2016: +$5,000 (market rebound + tax refund)
Oct, 2015: +$6,000 (market rebound)
Feb, 2015: +3,300 (market up)
Aug, 2014: +$2,000 (market up)
Jun, 2010: : +$4,000 (market rebound)
May 2008: +$2,000 (market up)
Dec, 2006: +$1,000 (got a new job!)
First, I got rid of any payday loans and made a promise to myself to not ever sign up for them or any car title loans. Done.
Second, I needed tp pay off my car loan and stay away from car payments. So I paid off my SUV and freed up that monthly payment of $448.65 in 2009. I have not had a car payment since. Done.
I needed to get rid of the $20,000 personal loan I took out for $333 monthly. Done.
I needed to increase my income. So I finished my bachelor’s and got a higher paying job. Done.
I needed a goal to aim for. I decided upon one short-term and one long-term and one sensational dream goal.
Short-term I needed a $10,000 savings emergency fund. Done.
Long-term I wanted to retire a multi-millionaire. So I needed at least $2 million. Sensational dream goal is $10 million. I decided to break this all up into smaller goals. Therefore, I would start by having investable assets of $100,000. Done.
Then $250,000. Done.
Next was $300,000. Done.
Although, having over a quarter of a million-dollars is an incredible feat in itself, I had no time to rest on my laurels. I must keep going.
Then I started to press on toward my next goal of $500,000. After that is accomplished, I will set my sights on $750,000. The next leg in the journey would be $1 million.
At that point, I would be a 401k millionaire.
The next goal is to double my money. I would get to my next several money milestones by increasing my 401k contributions by 1-2% every year.
No vacations unless they were paid for with cash.
I also got a second job to bring in more income.
I signed up for credit card and checking account bonus offers that brought in thousands.
I invested my old car payments in index funds like the VTSAX and individual stocks like Apple, Google and Amazon.
And every time I got paid I would put a small portion in my Roth IRA.
I also make sure to keep track of my investments every month.
I’ll breakdown more of my behavior on how I went from $0 to over $300,000 in my next post.
Til Debt Do Us Part is a Canadian television series that follows couples that are going through financial crisis and financial expert, Gail Vaz-Oxlade, comes in to help the couple find solutions.
The series ran for over 100 episodes from 2005-2011. It also had a spin-off called Princess. She teaches couples to go from red to black and gain control over their money.
The show would air right after the Suze Orman show during its run on CNBC. Read my post Dom Perignon Taste on a Budweiser Budget to see how it all went down on Suze’s show.
#1 REASON COUPLES BREAK UP
Money is the number #1 reason couples break up. She visits couples weekly and gives them challenges to help with their finances. Then at the end of each episode, after about 4 weeks, she awards the couple with up to $5,000 dollars to help them get out of debt.
CUT THE CHEQUE
By far the best part of the show, in my opinion, is when at the end of one month, Gail Vaz-Oxlade gives the couple a cheque for an amount up to $5,000, depending on their attitudes and how well they did during the challenges. Keep in mind, couples could get less and some have. One of the lowest amounts I have seen her give was $3,000, which is a 40% reduction of the prize money.
The show was so popular that a 52-Week Life Planner was released based on the television series and offers day-by-day, step-by-step strategies and tips for successfully managing household finances.
This reminds me of a Tom Holland interview he did for Spiderman talking about how Anthony Mackie always says, “cut the check.”
If you have never heard of the show Til Debt or can’t remember it, no worries, I will take you back down memory lane tonight.
WHO IS GAIL VAZ-OXLADE?
“We feel good when our homes are bright and shiny, put a little elbow grease into your money and it’ll glisten too.” – Gail Vaz-Oxlade
Gail Vaz-Oxlade is a financial writer and was a columnist for numerous publications as a freelancer including Yahoo! Canada Finance. She has helped people from high finance to low-income solve their money problems. Eventually, she became a television personality due to all of her work in finance and that is how the show Til Debt came into existence with her as the host.
She has written numerous books on the topic of finance. I have actually read one of her books called Debt-Free Forever.
Gail has a no-nonsense attitude when it comes to money. And that is what makes her so good at what she does.
FOR THE LOVE OF JARS
“You can have everything you want. All you need is a plan. And how do we spell plan? B-U-D-G-E-T!” – Gail Vaz-Oxlade
Watching the show was very interesting. One recurring theme was the jars. Gail advocated for couples to live on cash.
Every single episode, you got cash jars. You would put in a certain dollar amount. When you spend, you write it down in the budget binder cause cash slips through our fingers easier than that snail did with Julia Roberts in Pretty Woman.
Some couples were taking out cash at the ATM from their bank accounts or doing cash advances, which Gail said she could not track so we don’t know where the money went. When it’s gone, it’s gone. Without writing it down or keeping receipts, there is no other way to track cash. So, jars it is.
MONEY LESSONS FOR GAIL
Gai loves cash and hates banks. She thinks they are bleeding people dry slowly with their interest and fees. Gail says banks are wolves in sheep’s clothing. The only way this will change is to teach financial literacy in school. I say start in elementary when they are old enough to start asking for a $1 lollipop, it’s time to start the finance lessons.
This is the secret recipe to building wealth: You need to make more money and you need to spend less money.
Here are 3 lessons that Gail taught me: (1) both partners need to manage the money, (2) no retail therapy, and (3) debt repayment takes time.
LESSON ONE: GAIL ON COUPLES MANAGING MONEY
Do not have only one partner manage the finances.
“It’s not unusual for one person to assume the nitty-gritty of daily finances…. The problem is that when one person is excluded, or totally abdicates responsibility, it means the other can mess things up with no monitoring or grow resentful at always having to do the detail…. Taking turns managing the chequebook, and having regular conversations so that both of you are clear about what’s going on, means you’re both in the know and working to the same ends. It also means that one person doesn’t have to deal with all the crap, while the other merrily laughs off the stress and frustration with, ‘You’re managing the money, so this is your problem to deal with.’ (Yes, there are dopes who say this.)”
Always know what is happening with your money. I don’t care who signs the check and put it in the envelope. Just make sure you lick the stamp. Be involved. Ask questions. Don’t be in the dark.
It’s kind of like that scene in Charmed in the episode Be Careful What You Witch For. Remember that scene in the beginning, after the opening credits. I want you to be skeptical like Phoebe. Always know who you owe and how much. Nothing is for free.
The conversation went like this:
Phoebe: I don’t get it you’ve been stuck in that bottle for two hundred years then someone finally sends you to us and you’ve no idea who licked the stamp? I find that very hard to believe.
Genie:What? I don’t get it you win the lotto and you’re asking for explanations?
Piper:Actually we’d like to know who to send the thank you note to.
“Plastic is anesthetic — it dulls the pain, and then what happens is you just keep waiting for the next fake high.”
And don’t I know it. I had a huge shopping problem for years. It was done as a way to dull the pain of the things going on around me – low-income, working full-time, going to college – I was a mess!
I had some pretty terrible managers when I was younger too. All the stress was getting to me. I had to find a way to cope, but shopping was not it. As I got more mature, I found ways to de-stress that were cheaper or free.
I have said it before that credit is seductive and addictive. It should not be used to replace your emergency fund (liquid cash). However, if you do, be strategic and use credit wisely and sparingly.
“A goal without a deadline is just a dream.” – Gail Vaz-Oxlade
Slow and steady is the way to repay debt.
“One step at a time. You are on your way. Expect challenges. Keep your goal where you can see it.”
You better believe it. If it took you 8 years to accumulate the debt, thinking you can pay it off in 3 months is delusional. See my post Getting out of debt one step at a time.
The good news is that once you recognize you have a problem with debt, then you can work on solutions. I have noticed that generally 2-3 years of cutting back and attacking debt is usually enough time to pay off most if not all of your consumer debt except the mortgage and student loans. After 5-7 years, the only debt left is usually the mortgage. That is a small price to pay for freedom.
Money can’t buy you love. But keeping love alive without money can be pretty tough. In fact, ninety percent of marriage breakups are due to money problems. And to get advice on how to manage money usually costs money! Til Debt Do Us Part, is a series that offers tough-love solutions to those willing to face their financial troubles head on. In each episode we meet a couple in crisis. Some are on the verge of bankruptcy, hounded by creditors or facing eviction. Others are just getting by, but in the midst of a personal meltdown or relationship breakdown because of money issues. With the sensitivity of a therapist and the toughness of a CFO, our host, renowned financial author and columnist, Gail Vaz-Oxlade reveals what she’s found in a couple’s finances – and then she’ll dig a little deeper. She asks some tough questions and then they’ll be forced to face reality. Where will it end if they continue on this rocky road? To get things back on track, Gail takes control of their finances …
This show was very eye-opening in how people managed their finances. Many did not have a clue what was coming in and going out. Gail would come in with her screen shots of the couples bank accounts and spending and give it to them straight.
Many times the wives would burst out in tears after seeing how much debt the family was actually in. Lots of couples were in over their heads. Some so deep in debt they had to consider selling their house, or worse, bankruptcy!
Some couples did not want to make any changes. Even though they were debt up to their eyeballs. These people needed to get their priorities straight. Much like Hermione, in Harry Potter.
Here is the show’s Intro and theme song along with a promo. This is just a taste, a light sampling, of what you are in store for with this show.
There are 2 episodes that stand out for me. They were called The Worst Family Ever and Love Affair with Luxury.
MONEY WORRIES CAN CAUSE SLEEPLESS NIGHTS
In the S03E13 entitled, “The worst family ever?” One couple were living in the wife’s family basement for about a couple of years. They spent with reckless abandon. Oh, the couple popped bottles night and day. Especially, after moving out and buying their own home for about $225,000. That’s not bad. What is bad is that they saved zero dollars while sponging off her parents.
Then, to make matters worse, they threw non-stop parties at their house for friends and family. This was obviously all to make themselves look good to friends and family. In Yoda speak, so concerned with appearances they are.
“Happy people don’t worry about what other people think about them.” – Gail Vaz-Oxlade
OUT OF CONTROL SHOPPING FOR BABY BUT THE KIDS ARE ALRIGHT
In addition, they expanded their family and had a son, but financially were unprepared for this. At one point, the wife was spending $1200 a month outfitting junior! I couldn’t believe it. What is she buying Versace onesies? Get real. A baby doesn’t care. They just want to be warm, feed, and dry.
This couple were overspending by the tune of $4,100 a month! Holy spending gone bonkers, Batman!
Fun Fact: For those of you unfamiliar with that Batman line, here is where it comes from. The Batman television series from the 1960’s. Batman was American live action television series, based on the DC comic book. It starred Adam West as the titular character and hero Batman and Burt Ward as his sidekick Robin.
It was also turned into a cartoon series. Here is Robin at his finest with his sayings. Hilarious!
I decided to post it so you won’t ever have to get the tongue lashing that Penny got from Sheldon on an episode of The Big Bang Theory about Batman at 2:48 into the video.
It was about The Lord of the Rings. Even Raj used a Holy Robin saying in there!
In this next video, Sheldon gives a fun fact to Raj. Now, you know where I get it from.
Now, back to the story.
The way the couple on the show were able to overspend like that, drumroll please…the credit cards!
When Gail comes along they are so bad she tells them they have to sell the house. They flat out said they could not sell the house. Even though they are on the path to $1.3 million in debt and possible bankruptcy! Gail, at one point in the show, tells them they are the worst couple she has had on the show and that she had a few sleepless nights worrying about how to help them out of this situation. Coming from Gail, that’s scary.
The way it went down, it reminded me of that scene in The Chipmunk Adventure, when Jeanette and Eleanor was telling the Arabian prince that Brittany spends money like a drunken sailor and Brittany got mad. Hilarious. I just so happened to find the footage of that particular scene and the movie on YouTube. Hope you have fun watching! No need to thank me. Like Dean Winchester says, “You’re Welcome.”
SHOULD YOU FINANCE A $100,000 CAR?
“Change brings challenges, learning, and a sense of New. Change is full of promise.”- Gail Vaz-Oxlade
In the S04E03 entitled, “Love Affair with Luxury,” which aired March 6, 2008, is the gold standard of delusions of grandeur when it comes to money management. The wife, Simone, is a champion shopper and a spendthrift who manages to make 53 shopping trips in a single month! That’s nuts. Even though she’s on maternity leave, a luxury car is next on her shopping list.
The only reason the couple is able to afford such luxuries is because they have each other’s incomes. The minute one person’s income is gone or reduced, i.e. disability or divorce, the whole house of cards comes tumbling down faster than the stock market has in the last 30 days.
Frank and Simone’s combined $110,000 annual income is currently curbed by Simone being on maternity leave. Simone is addicted to what she believes she needs to keep up appearances in every respect, which includes working out at the gym, and spending money on “stuff” for herself, such as clothes, getting beauty treatments of various kinds, and having a beautifully appointed house. A $125,000 new car is next on the list. Simone, however, states that she would never do anything that would place her family at risk. But Frank doesn’t realize he is just as guilty, spending money on his electronics, which includes six large television sets in their house of four people, including one infant. This spending has resulted in $55,000 in consumer debt so far. They constantly fight about money, something having to give if their marriage can overcome this issue. As such, Gail issues them challenges largely focusing on dealing with their root problem, namely their addiction to luxury, this focus which not only entails them doing the challenges, but understanding why she has issued these challenges.
At one point in the show she says, “we can finance $100,000 can’t we.” For a car no less! If you have ever read this blog, you know I can’t stand cars for the simple reason that they can keep you in debt forever. You could spend a couple hundred grand on cars in a lifetime. You know how much interest you could earn on $200,000! Here are just a few on my posts on my beef with car loans below.
Money is a tool we use in the present to create the reality we want in the future. Learning about finance is a good start. Practicing good money habits and teaching your kids to understand the concepts of money – budgeting, saving, and spending – you help create their reality.
So, I want to always stay in control of your…I will now end this post in the last words of the Til Debt Do Us Part theme song, money, money, money, money, money, money, moneyyyy!
Want to finance an exotic car? No sweat. It will only cost you $157,944.33.
That amount is based on a Porsche that costs $144,750 with loan terms of 144 months, with a 3.3% interest rate, and $14,475 down payment.
Yes, you read that right. Financing for 144 months is the equivalent of 12 years! Just ridiculous.
Especially, considering that a car depreciates in value the minute you take it off the lot.
For example, a $100k BMW 6 Series after five years will likely only be worth $40,000 in resale value. Therefore, over that time period you have paid over $70k. You would still owe approximately the same amount as the current resale value and it would be worth even less in a few more years.
What made me look into this was listening to talk on a radio show I heard about being able to finance a $100k Porsche over 8 years. I was like that can’t be real. Oh, but it is. The people on the radio said that people were doing it and taking out these loans. I was like that’s insane. You can buy houses in different countries all over the world or in certain parts of the United States for that.
If you are so set on having an exotic vehicle, then I think the best course of action is paying cash in the form of a cashier’s check. If you have to finance a $100k car, then that sounds like a red flag that you can’t afford it. Instead of spending $100k on a car, why not invest it? Over a period of 12 years with a 7% ROI you could have $272,641 in your 401(k). Even without investing another dime, you could be a millionaire in about 20 years. Is that car worth a million dollars? I don’t think so.
Who are these people that want to finance a $100k car? The only one I have ever seen was on a Canadian television show called Til Debt Do Us Part hosted by finance writer Gail Vaz-Oxlade. In one episode, a married couple had accumulated a significant amount of debt, but what made this episode stand out was the fact that the wife wanted a very fancy car and was thinking of financing over $100k to get it. Mind you, the couple had kids and debt, so where was this money coming from?
Here is a sample of how the show went on to explain to viewers how people are spending and where the money comes from: credit. If you want to order Gail Vaz-Oxlade or other financial books, then look to the side or go to the top of my blog page and click the Amazon banner link.
Who are these companies that are likely to finance these amounts? BMW Financial, Audi Financial, Porsche Financial, and the like. See the screen shot.
And not only do these companies allow you to finance, but expect a down payment on cars with six-figure price tags.
I have had my car for more than a decade. Actually, it has been 15 years. My car has been very reliable. Once I paid it off I decided I did not want another car note. That was almost 10 years ago. Here is a snapshot below of my last payment. It may become my screensaver.
I have been able to do so much without having that payment hanging over my head. I decided to start paying off my credit card debt, invest more, get Lasik, join a gym, and get another degree. Basically, I invested in myself. I do not regret not purchasing a new car for one second.
Here is my take on it. Why stretch yourself financially, for a car you desire? Ask yourself if you would still be willing to do that, if the most popular car in the world among the money elite was a Honda? Financially savvy folks know that a fancy set of wheels is pricey in more ways than one.
I was told that a rapper was discussing online about owning a Bugatti or some other luxury vehicle that has three radiators. If one goes down, it costs $90k to replace. Gulp! That’s a hard pill or repair bill to swallow.
I heard an NBA player say that he knew people that would buy Bentley’s, but then would stop driving them because they were not meant for everyday driving. The wear and tear was ridiculous. Owners were shelling out tens of thousands of dollars on maintenance. Don’t believe me. I read an article by Forbes about unreliable luxury cars. Apparently, I am not the only one who has noticed that every luxury car that glitters isn’t gold, but merely sold to those willing to fork over their hard earned cash.
That means you basically are driving a house on wheels for the amount you paid. Then after all that, still have to worry about thousands of dollars in repairs. And since this isn’t your run of the mill car, you have to go to specific repair shops. Usually, this means repeated trips to the dealership. Who has time for that?
Luxury cars seem not only to come with a high price tag, but also lots of headaches. I say this: if you can afford the monthly payments, maintenance, and can hire a mechanic or chauffeur to repair or take your car in for service at a moment’s notice, then you can get the car. If not, you’re better off sticking to something you can take to Jiffy Lube.
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