I remember it all so clearly. Sitting at the sales representative’s desk in the car dealership, I waited with anticipation as he left to check my credit. I could not wait to trade in the car that I had been driving for years. It was an older model that I had bought for only $800 and it kept breaking down every other day. I was in for an upgrade and this would be the perfect opportunity for me to establish my credit. When the representative came back, he told me that my credit history was not in good standing. In disbelief, I could not understand why. Cash only had always been my guiding principle, which meant I had never had a loan or credit card in my name.
With further investigation, I discovered that someone had access to my information and had opened a credit card using my name. Payment history is the most important element of your credit score and even one late payment will impact it. This mystery person failed to make any payments. Thankfully, since I had never had credit, the limit for this credit card was very low (less than $1,000). While he / she was delinquent in payments, I could rest assured that the amount spent was nothing above what I could afford. I realized then that even with conscious spending habits, it is essential to have a holistic view of your finances – your savings, your credit history and score, investments, etc.
Credit, in particular, is important to achieving many goals in life – from owning a car to securing a mortgage. But according to a recent Capital One Canada and Credit Canada Debt Solutions (Credit Canada) survey, almost 6 in 10 Canadians (58 percent) say they didn’t get the financial education they needed when they were young, and I was definitely among this group. Growing up in Mali, West Africa, credit scores did not exist. We earned money, we saved it and then we spent it. My money mindset was heavily influenced by this culture. When I moved to the United States for education as a teen, my parents used most of the money they had to pay for this opportunity for me. However, with the exchange of the Malian currency to dollars, there was barely any money left for much else outside of tuition. I worked three minimum wage jobs to afford my rent and other expenses. A constant fear of not having enough made me vigilant about allocating every dollar I made. What was not spent on necessities went directly to savings so that eventually I accumulated a cushion of three months’ rent in my emergency fund.
Today, I am a full-time entrepreneur, wife, and mother to two boys. The worries of my teenage years and tight budget are long gone, but I have carried with me the same conscious spending habits that I had when I was younger.
Here are a few key ways we have learned to manage our finances as a family unit:
Rewrite your money story
November is Financial Literacy Month, which serves as a reminder for me to stay on track and remain focused on my financial goals. For better or for worse, financial conversations are a part of my household dynamic which is what helped me to release some of the shame and lack of knowledge I previously had about my finances. Capital One Canada and Credit Canada have partnered to bring Credit Education Week to life across the country from Nov 12-15, 2019, and this year’s theme – #MyMoneyVision – is designed to help all of us envision a brighter future for ourselves. This week is a reminder to all of us that we can write our own financial success story, regardless of our past mistakes. Credit education is a critical step to helping Canadians secure a better financial future, and I’m proud to partner with Capital One Canada to share my story openly and craft #MyMoneyVision for 2019. Taking part in this initiative has helped me reimagine a new future for myself and my family.
Schedule money dates
In our home, my husband and I schedule one day each month to review all of our finances. When it comes to credit, it’s especially important to stay within your limit and make payments that exceed the monthly minimum requirement when you’re looking to tackle debt. We use a budget sheet to track our expenses and we sit down to discuss everything. We assess whether we are on track with our goals, decide what to do with any left-over money once necessities have been covered, which accounts we can move our money to in order to accumulate a higher return, review our assets here and back home in Mali and more. Having these consistent conversations keeps us on the same page and makes money feel less stressful for the both of us. Taking control of our financial future also means taking advantage of available resources and tools, such as the Credit Canada’s helpful monthly expense tracker, and Capital One’s free credit monitoring tool, Credit Keeper.
Learn each other’s money mindset
While my husband is more of a financial risk taker – willing to look into new investments and find ways to make our money work for us, I like to see my money in my bank account. It makes me feel safe and secure. We are opposites but our money values are the same, so we play to each other’s strengths and learn from each other.
Think ahead
Learning from my earlier experience, I recognized the importance of taking responsibility for all aspects of your finances. In today’s social media era, many people are thinking about now and not the future. They are concerned with impressing friends and strangers instead of prioritizing their far-reaching goals. My husband and I are saving for retirement and continue to add to our savings for our boys’ education when they get older. I say to everyone else “you can keep up with the Joneses — I’m investing in my family’s future.”
What do you do as a family to set financial goals?
Share your #MyMoneyVision here so we can openly have a discussion about finances.
*This post is in partnership with Capital One All opinions are 100% mine. Thank you for supporting brands that make this blog possible.
