What a Budget Can Do for You

What a Budget Can Do for You

by | Jan 2, 2024 | Divorce, Finances

What do you think when you hear the word budget? 

Do you think: “Ugh – I know I should do one, but I’m going to discover I can’t spend the way I want,” or, “Budgeting will confirm I don’t make enough money; there’s no way I can afford to live the life I want.” Or perhaps you think you don’t need one, as you’ve always managed just fine. 

What is the thought that is stopping you from budgeting? 

Very few of us proactively plan our spending – many of us spend what we have and only do a budget when we start to notice we are spending more than we bring in and are heading into a financial crisis. 

What if, instead, we proactively planned how to spend our money? 

If we proactively planned our spending, we would have much higher odds of living the life we want instead of being controlled by our money – much like a ping pong ball in a pinball machine, which is how most of the world operates. 

When starting over post-separation, having a spending plan, that is, a budget, allowed me to build the path to my dreams. 

I needed to know where I stood financially, how much money was coming in, and how much would go out. I also needed to understand how and why I spent money. 

At the time of my divorce, I was a stay-at-home mom and had been out of the workforce for five years. I also had a seven-year-old and a four-year-old that I had to care for on a shared parenting basis. In BC, where I live, having a shared parenting arrangement means that each parent must pay child support to their co-parent based on their total income for the most recently ended tax year. I didn’t have any reportable income for the past year, so I agreed that I could have an income of $30,000 imputed to me – this means that I could likely earn $30,000 for the coming year. Imputed income is not actual cash flow coming in, but it did mean that I would receive less child support from my co-parent. 

I had about $1,000 per month coming in for child support, some government benefits ($120 per month) and nothing else. I also had zero cash reserves, but I did have RRSP savings and an accounting designation. 

I also had done my budget – I needed another $1,000 monthly to cover the basics (housing and food). 

I also knew, deep down, that there was no way I was going back to the work I had been doing before I had my children. The hours didn’t work, and it had been slowly destroying my soul as it was not aligned with my values. It would have certainly solved my money problems, though. I had made quite a bit more than the imputed $30,000. 

So, while my budget seemed bleak (it proved I would have to scramble to cover everything), it created a path I could follow, and while I knew I would not be saving anything for a while, I would be living the life I wanted. I would have time to care for my children without worrying about childcare and have enough to cover the basics while creating a life that aligns with me. 

An essential part of the budget process is knowing yourself. 

Knowing yourself and your circumstances opens up an entirely new world. If you know what drives you and what you need in life, your budget will become the empowering tool it is meant to be, a tool to help you make decisions. It is not a set of instructions you have to follow for the rest of your life – just because we put that you get to spend $2000 a year on travel does not mean you can never spend a nickel more. You could take an extra job or cut back somewhere. Your budget allows you to decide where you save and spend your money, and if you know how you like doing this, then your budget combines with this knowledge to make the decisions work for you.

My strong understanding of my cash flow and financial and life circumstances allowed me to stay on my path. I dipped into my RRSP to pay for coaching and sold a few things to give me the extra cash flow I needed to keep afloat. Soon, friends who knew I needed work started giving me the odd accounting job to give me the additional cash flow I needed. At the same time, I built my business to become a collaborative professional supporting people navigating separation, and I then pivoted to become a financial coach. The first accounting gig I got was collections work – this was certainly not something I liked doing, but I knew it was a short-term term gig, and it led me to find other short-term accounting work and introduced me to people and their friends, many of whom would turn up in my life again in my new roles as a financial neutral and then a financial coach. 

Ten years post-separation, I am truly living the life I want, and I’m still budgeting to keep living the life I want. Budgeting is a process that keeps us on the path to living our dreams. 

Evolving Out of “Stuck”

by | Dec 27, 2023 | Divorce, Finances, Parenting, Tools & Tips

We do not have to wait to find happiness somewhere in the distance sometime in the future. Our old ideas about the paths to joy have evolved; we can choose happiness now. 

Do you feel stuck? Do you feel like you’re living in limbo? Do you think your destiny is to keep doing the same things repeatedly – tweaking your life as best you can to survive it? Are you at the mercy of someone else? Is your money controlling you? Are the systems you find yourself in trapping you in a life you didn’t sign up for? Do you feel sorry for yourself, unloved and alone? 

There is a path out of limbo, but it’s hard to find and often hard to stay on once you find it, as it requires the evolution of your beliefs about the path to happiness. 

The well-worn paths we can see in front of us are the ones we naturally follow and find ourselves on. The paths the world shows us are so well-trodden and easy to follow that we need to develop our minds and eyes to see the uncommon paths that will lead us to a better place. 

It can be hard to head off on a path that no one else is taking, and it often seems like we are hand-delivered right to the start of those well-worn paths. What paths does the world hold out to us? 

  1. To wait for someone to rescue us. 
  2. To “fix” our lives until they are tolerable. 
  3. To silently suffer until we do something dramatic to propel us out of limbo. 

If you choose path one, waiting for someone to come to the rescue, you will likely wait a long time because more people need to be rescued than rescuers. Path one has us grab onto anyone who provides us with a glimmer of what is missing from our lives. Whether it is someone who is “nice,” “fun,” or “exciting” or provides us with a different experience from the limbo we find ourselves in. While doing something different can give us a mental boost for a time, eventually, we find ourselves back in limbo, as stuck as we ever were, but now we have one more person or pursuit to deal with. We have compounded our unhappiness because we begin to notice that even with this new person or a new hobby, we are still, deep down, unhappy. 

Then there is path two: fixing what is wrong in our lives or a life lived in reaction. While path two relates to what will get you out of limbo, there is a fundamental flaw: you are often tweaking things to live a life someone else has suggested is the right way to live. Path two is the most soul-destroying and dangerous way to live. While path one can invite outside danger into your life, path two creates a situation where you take yourself down into a hole that can be difficult or impossible to climb. 

In path two, you usually don’t have the resources or personality to live that imagined perfect life, but that doesn’t stop you from trying. You work hard to achieve the life reflected in the world around you (especially on social media) or try to live according to what your family has told you is the right way to live. You have a vision of what a happy life looks like, and off you head in that direction, “fixing” your circumstances and yourself to get there. You become the “people pleaser” and the “master of control,” all rolled into one. But it is impossible to please others, and you cannot control the world – chaos reigns. Path two is the path many of us take – and many of us persist for years and years, working hard to get to happiness and achieving as we go. But the cruel irony of path two is when you get to your desired destination (losing pieces of yourself along the way), you realize you are not happy. With this realization that your life has been a struggle for seemingly naught, you fall into anger or depression and often despair. Path two leads to path three. 

People crash their way onto the third, often travelled path, from their combined anger and depression from having travelled path two. Path three begins by doing something dramatic. Doing something dramatic does propel us out of limbo, but we have little control over what happens next. Path three is like setting off a bomb, which, while it creates change, may lead to cleaning up the debris and fallout for years to come, making it impossible to find happiness. 

Finding our path to happiness

Discovering our path to happiness requires personal evolution. If you feel stuck, it may be because you have followed the well-worn path that the world has pointed out. It may take time to recognize that you are following the wrong path, especially if everyone else is continuing along that path. Once you gain awareness that you are lost, stand still, evaluate your surroundings, and consider your resources before moving forward. Instead of rashly choosing any direction to escape being lost, stop and get your bearings. 

With awareness, you can begin again on your journey, slowly and steadily and savouring each step. Begin enjoying the journey, reminding yourself to look for your path, one that may not look like anyone else’s. When uncertain about the next steps, pause again to get your bearings instead of succumbing to panic and remind yourself of who you are, what you dream of and what you carry with you before heading off again. You’ll gradually identify paths that align with you. Along the way, you will encounter fellow travellers with similar aspirations. Whether you continue independently or join others on the same path, you’ll begin to appreciate the fulfillment of navigating a journey aligned with you. Cultivating gratitude for your ability to rescue yourself and navigate a fulfilling path becomes a transformative journey. Carry on, and one day, you will stop, not to find your bearings, but to notice that you have finally found happiness – it is in you, and you carry it with you. Your thoughts have evolved, and you understand that happiness is not the destination – it is with you, every step along the path you take. 

Does Salary Level Determine the Worthiness of a Job?

by | Nov 20, 2023 | Divorce, Parenting

dollar-499481_1280

Does salary level determine the worthiness of a job or a person?

Most of us would say “NO WAY!” including myself, yet actions and behaviour speak louder than words.

When I was earning a decent salary (actually, some would have probably considered it indecent), for my age, people treated me differently. They seemed to respect me automatically, and I never felt I had to justify my actions. I was making a lot of money; therefore, my work was worthy, and by default, I was too.

Then I became a stay-at-home mom, and we all know how much we stay-at-home parents get paid, and that amount is zip, zero, nada.

Nobody questioned my decision when I first decided to become a stay-at-home parent. I had some savings from work and was expecting my second child. I had worked enough during the year to guarantee that I would get parental leave benefits when my second child was born.
Now that I think about it, it is fascinating how many people had opinions on my new status.

Most people told me I was making a good decision. They said, “Your children are only young once; you’re lucky to spend time with them when they are young.”

And I agree. I was fortunate to spend time with my kids when they were young.

But the other message I internalized from this comment was that I wasn’t genuinely working or working at a job that benefited anyone other than me.

As time went by and my kids got older (four years old and two years old), my justification for staying at home became more and more of a topic of conversation, and I became more internally defensive. I started keeping a mental list of how I was contributing to our overall household, which I began to obsess over almost daily.

The first question out of my spouse’s mouth, when he got home from work, was, “What did you do today?” although he may not have been looking for proof that I had worked, I had my list at the ready to prove I had not been surfing the web all day. My husband didn’t have to justify his actions because he brought home a paycheque every two weeks that confirmed he was working and contributing.

To make myself feel more justified in what I was doing, I decided I could live with less “fun” funds than my husband. I cut my leisure spending to one-third of my husband’s.

It is funny what my pay cut did to our family dynamic. I didn’t need that extra money, but in a sense, I had just taken a notional pay cut, which further minimized my mental worth. My relationship with my spouse was becoming more unbalanced – we were no longer equal in my eyes or his.
At that point, my husband and I had monetary proof that my job wasn’t as worthy as his.

This concept carried over into our divorce process. There was limited discussion about how I contributed to the household; my contribution was glossed over, and the main discussion revolved around when I would start “work.” We didn’t discuss the fact that I had effectively lost my job because being a stay-at-home parent is not recognized as a job. I had been on a lark, and now I had to get down to business and find something worthy.

What was the difference between my job and my (now) ex’s? His was paid; mine was not.

So, if you are considering becoming a stay-at-home parent, I strongly encourage you to set up your finances as follows:

Take your spouse’s salary, divide it by two, and automatically transfer half into your own bank account every pay period. Then, you and your spouse pay half of the joint family expenses, and you each pay for your personal spending from your remaining funds.

If you are about to become a stay-at-home parent, I encourage you to discuss a financial arrangement with your spouse before your baby is born. If you discover that your spouse does not support a proposal like the one I recommend above, you may have some talking to do with each other. It’s better to find this out before you give up your career to focus on a dead-end, unpaid job as a stay-at-home parent.

If your spouse supports this financial treatment, you will know that your spouse considers it a worthy endeavour – its worthiness is supported by the fact that you earn money to do the job. Despite the saying that money does not define the worthiness of jobs or people, actions and behaviour speak louder than words.

Trigger Warning

Trigger Warning

by | Dec 20, 2019 | Divorce

Christmas

What?

Yes, Christmas is the word that can suddenly switch my day from ticking along smoothly to suddenly becoming one of “those days.”

Yes, “Christmas,” and yes, just the word “Christmas”.

Christmas starts to pop up in discussions (or so I have noticed) in about September and becomes a significant theme on November 1st. The other thing that pops up (for me) is the thought, “I hate Christmas,” every time I hear the word.

I have been a self-proclaimed Grinch for most of my adult life.

I have a friend, you can think of her as Cindy-Lou Who, who always looks at me incredulously whenever I say I hate Christmas:

How can you hate Christmas? It is a day when you don’t have to work, you get to spend time with friends and family, eating food, and the decorations are so wonderful at this dark time of year! There is nothing to hate!”

I usually look at her skeptically and think to myself:

“You just don’t get it.”

I then do what I do best: bury my thoughts, get on with it, and suffer through Christmas.

I also do something else; I tire myself out, and each year I compile more evidence that Christmas does indeed suck.

As I make it through another Christmas, I say to myself: “I don’t think I can do this again…”

But guess what? Christmas keeps coming back. I have not managed to convince the multitudes that perhaps we should banish Christmas once and for all.

Wait a minute; this is starting to remind me of something if I could just put my finger on it.

Christmas reminds me of my divorce.

Six years ago, I was thrust into a new reality as a part-time single parent. Being a single parent was something I had never wanted to be, and saying that I was depressed to find myself in this life situation would be an understatement. I felt like a pawn with no control over my life.

My life was happening to me against my will; it did not reflect what I truly wanted or believed.

Pain

The pain of thinking you have no control over your life and that despite having tried to follow all the rules, you are stuck being someone and doing things that go against everything you hold to be true.

I cannot describe my pain to do it justice, but I can tell you what that pain did to me.

It changed me. It changed me because I could not live with that level of pain in my life. I had to change.

I had to change.

And so, I did.

I changed both myself and the way I thought.

I began to change my life, so I was no longer a part-time single parent but a full-time co-parent.

Then I realized that I had to stop calling — and thinking — of myself as a part-time single parent: I noticed that as soon as my thoughts started to go along this path, my pain began to resurface.

As I have changed myself, some other changes have happened, including how my family and I celebrate Christmas. Christmas has changed.

About time my thoughts around Christmas change accordingly.

Getting Through the Wall of Pain and Suffering

Getting Through the Wall of Pain and Suffering

by | Sep 25, 2018 | Divorce

I often come across clients who are on a path that brings deep emotional pain, and they cannot see how to find a healing way forward.

I want to help my clients find a better, less emotionally overwhelming path. Still, I have noticed that the emotional overwhelm acts like a soundproof barrier – despite my “telling” my clients what I think works, they can’t hear me. Then I often notice that I often resort to the megaphone-style email:

Dear, not quite yet ex-spouse-client:

This process we are in together is not collaborative; you are right.

We are working in the litigation-style model where you submit a proposal with all the reasons you are right and then threaten dramatic action when you do not get the desired answer. This style of managing a separation is the traditional way of handling a separation and divorce.

That said, the traditional method may work for you:

1. Your spouse might finally come to her senses and agree to all your demands (wouldn’t that be a relief!).

2. You will liquidate everything (even if it means you take yourself down simultaneously) and split the remnants (this includes your co-parenting relationship).

3. You will “win” in court.

On the flip side,

1. You have yet to manage to convince your spouse so far. In the meantime, your spouse is getting more and more evidence that you are trying to push something through, the conflict between you is increasing, and she is getting more and more resistant as she gathers information that your opinion is exactly that, yours. Things are getting more and more delayed.

2. You can’t liquidate everything – that one doesn’t work. Your spouse is a shareholder of your business and is also on the title to your home.

3. The court will take a lot longer and cost you thousands of dollars more. There are no winners in the court system. Children lose the most.

I have sent variations of this email to many clients, and so far, it hasn’t turned them into willing collaborative clients. Huh. Puzzling – my email is so very rational and logical.

Lightbulb moment.

There is no way to rationalize away pain and suffering. I know that’s frustrating for those of us trained as accountants, lawyers, engineers, doctors and teachers.

So what to do instead? Well, this is the part I missed in my megaphone email. Collaboration takes listening. That is the first step and what I now practice with my clients. It is the only way through the wall of pain and suffering. First, we must truly understand it, and only then can we find a path forward.

 

September – Decision Making Time

September – Decision Making Time

by | Sep 3, 2018 | Divorce

September – Decision Making Time

September. Labour Day.

A day of transition (understatement).

If you are a parent to school-aged children, September can be a bit much (I’m polite here).

If you are separated and divorced and share parenting with a co-parent, September can be too much.

It can be too many decisions, and it can be too many decision implementations, especially when you have to navigate those decisions with a co-parent.

It really can be too much, but does it have to be?

It depends on how you approach it.

Let me tell you a story. It is a story of two parents with a 5-year-old and eight-year-old child heading back to school.

Both parents have recently signed their separation agreement. Both parents believed the separation agreement was the clear document they needed to help them make decisions. The parents had spent a lot of money and done a ton of work to finalize this agreement. The parents were pinning their hopes on this agreement.

I’m sorry to say that both parents were a bit deluded.

These parents had a separation agreement, but that was all they had.

They didn’t have a shared understanding of how to interpret that agreement, and they didn’t have a process to get to a shared understanding.

What did they have?

They had a lot of anger, grief, and blame directed at the other parent.
And they also had to make a joint decision.

What was the decision?

Which parent was going to buy the back-to-school shoes? Seriously? Was buying shoes the big decision?

Yes.

Parent A (ahem, type A, so you can remember) always did the back-to-school shopping.

Parent B (yes, that would make this parent type B) had worked outside the home and, in the past, had provided the money for the shopping.

Under the agreement, Parent A and Parent B were now to share parenting and the costs associated with parenting, but they both had different ideas of how this looked.

Had I mentioned Parent A was feeling devastated and depressed? Parent A went from being a full-time parent to a part-time parent trying to find work to cover all the costs of running a part-time single-parent household. Parent A managed to cover the bills, but there was nothing for extras.

Parent B was also feeling devastated and depressed. Parent B went from being a full-time employee to a full-time employee with a new part-time parenting job (which seemed like full-time!). Parent B also felt financially strapped. How was it possible to run two households on one income (which is what was happening as Parent A still had yet to find work!)?

Parent B was also providing child support to Parent A.

Queue the back-to-school shopping.

Parent A had bought the summer pair of shoes for the kids and decided it was Parent B’s turn. Parent A was tired of being taken for granted. All anyone cared about was money, and no one had given Parent A any credit for the years of work as a stay-at-home parent. Well, no longer! That was going to change. Parent B could buy the shoes.

Parent B had just transferred money to Parent A for child support. Child support is supposed to cover the basics. Back-to-school shoes are basics. Parent A needed to understand how hard it was to cover the funding for two households. Parent A could buy the shoes.

The first day of school approached, and Parent A noticed the kids were still running around in their Crocs. “Has Parent B taken you shopping for new shoes?” asked Parent A. “Nope.” said the kids.

To keep the kids out of the middle (though, it is reasonably sure that the kids noticed Parent A’s eye-rolling when they answered “nope.”), Parent A contacted Parent B to talk about back-to-school shopping. “It’s your turn to buy the shoes,” said Parent A to Parent B, “but I know you’re busy, so I can buy them if you agree to pay for them.”

Parent B disagreed.

“Well,” thought Parent A, “the kids can go to school without new shoes. Then maybe Parent B will finally start to understand the work I did all those years and stop taking me for granted.”

So the kids didn’t get new shoes.

The teachers sent notes home that the kids needed running shoes. The kids said they needed running shoes. Parent A and Parent B dug in their heels.
Parent B to Parent A: “I just gave you child support; you can buy the shoes.”
Parent A to Parent B: “I’ll buy them if you pay me to go out and do that. I charge $50 per hour for parenting services. I bought the shoes last time; it is your turn based on our 50-50 sharing of parenting. I will kindly do this on your behalf if you pay me to do it.”

Did I mention that this argument occurred at the five-year-old’s first soccer game and in front of both kids?

What was the outcome of all of this? Parent A and Parent B eventually resolved this decision, and the kids got new shoes.

The kids also got put in the middle and witnessed their parents having an embarrassing fight at a soccer game for five-year-olds.

Parent A and Parent B had not figured out how to address these decisions either; they were still using old methods of communication where there was a winner and a loser, and the next time they had to make a joint resolution, the same thing happened again.

And it continued.

Every simple decision took days, weeks and months to resolve, and Parent A’s and B’s approach was hurting their kids.

Sometimes, Parent A felt like the winner, and sometimes, Parent B did, but I can tell you everyone lost in this situation.

“This is exhausting,” thought Parents A and B. “Life is hard enough – running a single-parent household without trying to work with my difficult co-parent.

Do simple decisions seriously have to take this long?”

Both Parent A’s and Parent B’s depression deepened.

Back-to-school, Thanksgiving, Christmas, Birthdays, Spring Break, Summer. It is already stressful enough without the added stress of the battles associated with decision-making.

Both Parent A and Parent B knew it couldn’t continue the way it was. They tried various methods to make things easier.

Parent A and Parent B sought help. They both went for counselling and coaching, separately at first and then together after they learned ways to be around each other.

Parents A and B have been separated for five and a half years and divorced for four. Their kids are 12 and 9. They are not the parents they used to be, and it is hard to pinpoint the exact moment when Parent A and Parent B became true co-parents, but I do know it wasn’t when they signed their separation agreement.

September.

Labour Day.

A day of gratitude for Co-Parents A and B.

A day to remind them how much easier it is to make decisions now, which is a massive relief as the decisions never stop and only seem to increase with each passing September.