We live here now.

Let me apologize in advance. This entry could be seen as rather depressing, but it’s important that you read it. Many of us were raised to work hard, get good marks, get a solid, dependable job, raise a family, and that would make us good citizens. My mother tried to do that, and I’d like to tell you what it got her.

My mother was born in May 1947 in Lisgar, Quebec, an English-speaking village surrounded by French-speaking villages. She moved to Ontario around the age of 20, and started working factory jobs in the automotive industry. Even from a young age, my mother had a strong work ethic. After I was born in 1974, and while her marriage was crumbling, she worked even harder, until in 1986, with no viable assets beyond a small amount of equity in their house, we left my father. Within 18 months, my mother, still working factory jobs, taking every hour of overtime she could get, had moved us into our own apartment, had bought a car with 50% cash down payment and was beginning to prepare to help me pay for my university education. I went to school on a generous, but not full, scholarship, so my mother continued to work hard, taking every hour of overtime she could get, to help pay the last thousand dollars per year for me to be at school. This was all something of which she could be proud: all this accomplishment for a woman operating in very much a man’s world. By 1997, her work was done: I was out of the house, working enough to pay my own bills, and she could start to take care of herself.

Around that time, however, she began hearing rumors of layoffs as the company moved its operations south, first to the southern US, then eventually Mexico. Within a few years, she was no longer earning over $20/hour with a strong pension and 20 years of seniority. By 2001, she was scraping by on less than $10/hour, having to move out of her own apartment and back in with one of her sisters. The two of them were in a similar situation, barely getting by between the two of them, each with jobs that paid half of what they had grown accustomed to earning in the 1980s and 1990s.

In 2004, my mother suffered three heart attacks in the space of six weeks. The first hit her while on break at work, reading the newspaper. The other two hit her in rapid succession, less than a week apart. The third one was the charm, as they say: she died March 20, 2004, more than 8 years short of her supposed retirement age of 65. When she died, her net worth was less than $25,000. She owned a car worth less than $1,000, had no equity in a home, no passive income of any kind. Only cash in a bank account.

So why tell this depressing tale? It explains why I will never again work for someone else full time. It explains why I spend so much time taking charge of my own finances, why I don’t just hand everything over to a company to whom I am loyal, or to a financial adviser whom I hire to do all my financial thinking for me. It explains why I’ve read dozens of book on personal finance, business building, investing and even accounting and tax. I would never want my mother’s fate. For all the truly wonderful things she did in her life, she spent the last several years of it essentially a corporate slave. I choose not to do that, and I wouldn’t want you to do it, either.

This is why I want to help rescue people from employment, something I do both through my professional work and just through everyday conversation. It’s something I do because whenever I see someone struggling with their finances, I think about my mother, about her death at age 56, about how much of her life was wasted making some other person rich while she barely got by. It simply isn’t just.

If you are struggling with personal finance, stuck working every hour of overtime you can, then I implore you to grab a few books off the library shelf, take a few hours to read them, then give them an opportunity to improve your life. Start with Your Money or Your Life, then try Rich Dad, Poor Dad. My mother was a lot like Robert Kiyosaki’s “poor dad”, as she bought into the job security myth. I only wish I’d known at age 18 what I knew at age 28. I could have really helped her. Don’t let your children, your spouse or your friends think the same thing about you.

Start today.

Sarah and I live in Toronto, Ontario with our four cats in a rented basement apartment below Sarah’s business venture, Mostly Math. It’s a fine existence, but it’s pricy. We don’t really take advantage of living in the city anymore. Our life revolves around a 5.5-km stretch of Sheppard Avenue East, from Yonge Street to Fairview Mall. I would estimate that we spend a few hours per month away from that stretch of road. This is one of the many reasons we’re moving to Dauphin, Manitoba this summer (2007).

Yep, the corner of Nothing and Nowhere. At least, compared to Toronto.

I would say the primary motivator for leaving the city is financial: we want to own a house, but are not prepared to pay $400-500k for “something decent”. That kind of mortgage is a death sentence for us, given that our goal is financial freedom before age 40 (the year 2014). Sarah, a born researcher and information junkie, found Dauphin on the web in 2004, so we visited it, looking for houses, a business, the possibility of a new life there. We liked what we saw.

In 2005, we acquired the Dauphin location of the Academy of Learning. This has been a definite learning experience for me, as I have never had employees before. Although our business is education, something both Sarah and I already do professionally, dealing with government education bodies is something Sarah already did and doesn’t want to do again. Not only that, but we’ve had to learn how to register for business in a new province and how to manage people from a distance of thousands of kilometers. Overall, I think we’ve done well. No-one has quit on us for incompetence, at least.

In 2006, we began renting out houses in earnest. We’d trifled with it previously, but we bought a second house in October and have happy tenants there. This has brought its own challenges, like dealing with highly transient tenants, handling late rent payments and the other joys of being a landlord. We are now preparing our first house for ourselves to move into this summer.

In 2007, we plan to simply make the transition and try to survive it. I’ll be frank: I’ve computed how long we need to stay in Dauphin before moving there and back becomes less expensive than staying here and renting. Still, I like the people I’ve met, I like the idea of a slower lifestyle and I like the idea of leaving in a well-renovated house we own free and clear. It will be enough, I think, to get through the first winter and enjoy our new life.

In 2008? Well, I have no idea. I’ll revisit that in about six months.

PS: If you don’t get the reference in the title, you must not be a fan of Frasier.

I just received my quarterly statement from ING Direct, with whom we save our money. I like reading their newsletter, as it occasionally has something interesting for me, such as when I learned about high-interest US dollar savings accounts. This particular edition is geared towards tax time, since the deadline is April 30 to submit your returns. It begins, “Everyone loves a tax refund (well, maybe not the government).”

Not me, either.

A tax refund means the government, specifically the Canada Revenue Agency, had money that was rightfully yours, and they definitely don’t pay you interest for your over-contributions through source deductions! When you receive a $1,000 refund and enjoy it, you are willingly submitting to a short-term forced savings program that earns you no interest. No thanks.

The sweet spot seems to be owing the CRA just short of $2,000 per year at tax time, which I recommend paying exactly on April 30 and not a moment sooner! Owing them money means that you had their money interest-free for on average six months, and not the other way around. You can earn interest on that money, even at a measly 3%, rather than let the government do that. Anything more than $2,000, though, and they might sign you up for tax instalments, which is just another short-term forced savings program that earns you no interest. Avoid it.

If you are an employee, you can petition the CRA to reduce your deductions at source. I have never done this, so please contact someone who has done it to learn how. As I am my own employee, I can choose more flexibly when my source deductions are remitted, so I can keep my money out of the government’s hands longer than most employees can.

Stop loving tax refunds. Let them start to make you a little angry. Do what you can to avoid them.