You blame them for your circumstances and can turn nasty by
blocking access visits with the kids, taking them to court for
more money, becoming difficult and abusive when
communicating, and using the children as an emotional whipping
tool.
9. Knee-jerk sale stage - This is also the time when the house is
more likely to be sold or re-mortgaged. If you’re angry,
emotioinal and irrational you’re more likely to sell your last
remaining asset of value (the house), but if you have come to
your senses and recognised the errors of your ways you’ll try to
regain some financial control and if possible re-mortgage.
10. The Dawning stage - Now you’re back to where you started,
you have a better wardrobe and new furniture but realise
that those objects haven’t brought you any long-term
happiness, just a momentary buzz. You can’t work out why
you did it or where all the money has gone. You reflect on the
waste and where you went wrong.
This whole process was about worth, your worth, or lack thereof.
You need to recognise the signs before you lose the lot - like I did!
If you are aware of these steps that happen time and time again just
after a relationship breakdown, you have the insight and knowledge to
avoid the pitfalls. Surely enough emotional trauma is taken up with a
relationship breakup without it being the catalyst to your financial
demise?
Child support
How can this help?
Answer: a lot!
If you’re like me, or should I say like I was? … I didn’t really fight
hard to get what I was entitled to for child support. I just didn’t want to
upset the apple cart with my ex or create any animosity when we had to
face each other at the children’s visiting changeover times. All I thought
about was keeping the peace and upsetting the fewest people as possible,
especially my children. So I went along with what I was told I could get
as child support and accepted the crumbs thrown my way.
By the time I had reached rock bottom financially (I must admit
through much of my own doing), I was receiving a miserly $27 per
month child support.
Now, given the fact that over 90% of custodial parents are women
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and as such are likely to earn much less than men in a working lifetime
(check out the ABS statistics), and that for as much as 20 years
(sometimes more now when children are being forced to stay living at
home due to lack of housing affordability and income), wouldn’t you
think that the amount of money paid in support would be more
encompassing than just accepting what the taxable income is?
Then where does that leave you? You are still responsible for the
welfare of your children and you and your children will pay the price in
financial hardship, all for ‘being nice!’
For the sake of your children’s future you need to stop being nice!
If you’re involved in a private agreement - great! But please, please,
don’t short-change your children’s financial future just to keep the
‘monkey off your back’. Make sure you’re getting what is fair for the
upkeep of your children lives based on the true and accurate income of
your ex. In addition always have the ability to reassess that payment
each and every year or as your ex’s financial circumstances improve.
If you are already under a Child Support agreement, make sure you
stay in touch with what is happening regarding the assessment. Don’t
just accept the amount if you believe in your heart of hearts that the
numbers don’t stack up!
What can I do if I don’t think I’m getting the right amount?
Answer: Don’t give up! Fight!
The moral of my story is that you must be objective and driven when
it comes to pursuing child support. Trying to just keep the peace isn’t
going to help you or your kids. Child support is more than a prop-up of
finances, it is a long-term financial commitment that can be taken into
consideration when you apply for some home loans and can also provide
the surety of income when and/or if other income go pear-shaped.
Wake-up call
My mother is a Justice of the Peace and works voluntarily witnessing
and signing documents in her local shopping centres. On this particular
day, Mum and I had made arrangements to go for coffee after her stint of
witnessing. I sat at her table and waited patiently for her to finish. A
middle-aged woman walked up and asked for some advice. Now, while a
Justice of the Peace can witness legal documents, they do not have the
authority to provide advice as such, so my mother proceeded to explain
this but said she would provide help wherever she could.
The woman felt the need to tell my mother about her circumstances
and it was obvious she was looking for a sympathetic ear. She wanted to
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know if the real estate agency she rented from had the right to put her
rent up. She went on to say that she was expecting a new lease and had
requested it on several occasions but when it had finally arrived the rent
had gone up another $15 per week. She was a pensioner, living on her
own and she told us that the raise in rent would leave her with only $60
per week to live on.
Her distress was apparent and not knowing who to turn to wasn’t
helping the situation. As far as the woman was concerned, the real estate
agent and the owner of the property couldn’t do this to her.
In actual fact, they could put the rent up. At the end of a lease a
landlord can raise the rent with an existing tenant.
As we gained more information we discovered that the woman was in
fact paying a very low rent as apposed to the market rate. The increase in
her particular rent may have been for a number of reasons, but given the
low amount she was already paying the owner may have needed to start
lifting the rent just to keep in line with the CMA (comparative market
analysis) but this lady was taking it very personally.
Unfortunately, we found it difficult to console her but I suggested she
contact the Residential Tenancies Authority to get information relevant
to her situation. If nothing else, they would guide her as to what her
rights were and what action she could take, if any.
I felt a great deal of sympathy for the lady because her life was
obviously a financial struggle already and when I walked away it
occurred to me that there are many, many people in our society who
experience the same vulnerability every day. Their lives are controlled,
affected and determined by others. The sense of stability and security
that comes with your own home is an unknown for many people in this
position and as a consequence their lives are continually impacted by the
uncertainty.
The woman in question was in her twilight years and totally reliant on
the decisions of others as to whether she got to stay in her premises or
was forced to look for alternate accommodation. Meanwhile her
financial circumstances were also constantly under threat when the rent
can ris
e steadily at the end of each lease, an added expense that places
substantial stress on an already limited income.
In addition, the domino effect of this situation can have momentous
implications if we consider her health and well being. Already fragile,
her state of mind and physical health might also be at risk.
While we do not know much else about this lady’s circumstances,
what we do know is that she was in a stage in many people’s lives when
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she should have far less stress to deal with. What’s more, the comfort
and security of home is something that should be a foregone conclusion.
Shouldn’t it?
Unfortunately, this is not the case. Like so many people (in particular
women who had less access to superannuation throughout their lives)
who have not been educated on the need to prepare for long-term
financial independence by ensuring self-funded retirement, by investing
and even buying their own home, the outcome is dubious and
indeterminate.
So what does this mean to the rest of us? To me, it highlights the fact
that without preparation for long-term sustainability we subject
ourselves to the hands and decisions of others. In addition, the longer we
leave the groundwork to be put in place, the shorter time we have to fix
it. It’s very hard to play catch up when your health has deteriorated and
old age has set in.
Finally, even if you take some risks and lose at a younger age you
have the ability to learn from those mistakes, but you have something
else under your belt that you won’t have later on… time!
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Story Time
(The stories I use throughout this book are based on real
people who have overcome real adversity and I’ve been
touched by their lives either in my personal life or through
working closely with them. Many people who wrote to me
found the examples of inspirational stories in my last book to
be the best form of encouragement for them.)
Ode to Gay
I first met Gay’s husband, Carl5, when I was 19 years old. He worked as a
mechanic with my then boyfriend and came round for the occasional drink. We
hadn’t long been in Adelaide, South Australia, after working and travelling our
way around Oz. During this time we had run out of money (for the umpteenth
time) so were forced to put down roots for a while ( only I didn’t realise the while
would last 12 years! ). Anyway, Carl was 25 years old, had two children, and was
separated from his wife at the time.
A couple of years later, Carl reconciled with his wife and I was fortunate
enough to finally get to meet her. Her name was Gay and we immediately hit it
of .
Gay was a very intelligent woman, with a quick wit and a mind of her own.
She had had her first child when she was 16 years of age and then her second
child a few years later. To do the right thing she and Carl had got married.
They were both very young and tried hard to create the right home. They
were on a very limited budget because Carl was only an apprentice and
5 Not his real name.
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received a very small wage, so they decided to buy all the items they really
needed such as a fridge, washing machine, television, lounge suite and so on by
hire purchase. It meant that they could have all the items they needed by just
paying them of . Of course, they also needed a car and so what bet er way of
get ing one now than also paying that of ? So with all the wonderful items that
made a house a home they would be happy, wouldn’t they?
Wrong!
Hire purchase during that time had one of the highest interest charges with
up to as much as 30% interest at ached and they very quickly realised that they
couldn’t keep up with the repayments and pay for rent, petrol, food, medical and
clothing.
One by one the items were repossessed but they had accumulated extra
debt through not being able to even meet the interest rate payments.
The bailiffs were called in and anything else they had of value was also taken
until eventually Carl became bankrupt and this left Gay liable for the $30,000
owed. Now, in those days, bankruptcy meant you couldn’t ever apply again for
credit or a loan (including a housing loan) for seven years. In essence you had
been blacklisted so you couldn’t even apply for a store card.
Fortunately Gay had a community financial counsellor advocate for her
regarding the residual debt after the bank repossessed their house and ended
up making an agreement to pay a mere $300, over a few weeks to satisfy the
debt. Which she did and maintained her credit rating too.
However, the added stress and heartache left its toll on the young family and
eventually Gay and Carl split up.
Gay had nowhere else to go so she applied through the emergency
community housing for a Trust Home (government assisted housing). She had
to start quite literally from scratch for everything she needed, right down to the
dustpan and broom. Makeshift beds were constructed for her and the children
and all other furnishings were donated or borrowed.
Gay made do with what she had and start to set le. The children had grown
up a little more by now and were now becoming more independent and required
less at ention (the eldest was about to start high school). So Gay took a part-
time job assisting women in crisis. Her work involved women who had been
raped so the work was quite intense, but she had found some worth helping
others and decided to start a course in community services.
Until Carl came to pick up the children for one of his visitations and asked
Gay if they might try again? Within a few weeks she started to feel quite ill
physically. To her shock she discovered she was pregnant again! It wasn’t long
before the relationship soured and they both realised that the reunion wasn’t
going to work.
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Carl left for the final time.
Gay continued with her studies and part-time employment while working
around the demand of parenting three children single-handedly and managing
on a very tight budget. By this time I was also living as a single parent with two
children so we were drawn to each other for friendship and consolation.
I still recall the many ways Gay had found to compensate for things she was
unable to af ord and the meticulous ways she divided up and worked out the
cost of each meal for each night, never straying from that budget. She knew
where to get the cheapest fruit and veggies, and waited until the last minute on a
Saturday before picking up the meat. This was usually the time when
supermarkets heavily reduced the price to comply with expiration dates.
Gay continued to budget, save and study. It was while she was studying
social science at university that she met a new bloke and together they decided
to buy a place of their own. By now, her period of bankruptcy had expired and
she knew she could borrow for a loan. However, this time she knew that the only
way she could get ahead was to get a ‘good’ loan, one that would further her
financial future and that meant a home l
oan. So with her new partner she
purchased a modest two-bedroom house on a large allotment of land.
Unfortunately, her relationship didn’t last but Gay had come this far and
wasn’t about to give it all up. By this time she had secured regular employment
in the social work field and with her diligence in saving was able to refinance and
pay her ex-partner out. It meant some financial struggle again, but at least she
kept her home.
I visited Gay on numerous occasions over the years and what truly amazed
me was how sparse the furnishings were, without any of the usual homely
knickknacks. She told me she was content because for the first time in her life
she had some control, a place that gave her children some security and a sense
of knowing (without any scary surprises).
Years passed and while my life was spiralling out of control Gay was gaining
a positive financial future. Gay continued to drive a second-hand not so
aesthetically appealing vehicle and budgeted just as hard until within a few years
she had paid of the house completely.
In the meantime, the market had moved toward a boom climate and her
house was now worth in excess of three times what she had paid.
I recently caught up with her while I was on the investment hunt in Adelaide
and I marvelled at the achievement she had made, given where she had come
from. She had just celebrated her 50th birthday and was in the process of
subdividing her block to build two more properties. This was to be a new home
for her to enjoy and the other two properties were for investments. She now only
works two to three days per week (by choice), drives a new car, takes regular
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holidays overseas to the United Kingdom and Europe and has the pleasure of
spending time with her children and grandchildren while she is still young
enough to enjoy it.
The timeframe from purchase to fully owned home was a mere ten years on
a SINGLE income.
SOMETIMES A LEARNING CURVE CAN BE A REAL BLESSING.
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Why being a good tenant can
help you into your own home
Good tenants
Be a great tenant and get rewarded
There are two main reasons I feel the need to talk about good tenants:
1. If you’re a good tenant, you are one who is diligent with the
Goodbye Renting Page 15