More Money Podcast - 009 Confessions from a Shopaholic - Michelle Summerfield, Blogger at Budget Bloggess

Episode Date: July 15, 2015

Michelle Summerfield, from the personal finance blog Budget Bloggess, and I discuss the challenges of managing money after divorce, paying down debt and conquering your inner shopaholic. Long episode description: Michelle from Budget Bloggess was one of the first personal finance bloggers I met when I moved to Toronto over two years ago, so it was inevitable that I would have her on my podcast at some point. If you aren’t already a reader of her blog, I highly suggest it. She is super open about her struggles with debt and shopaholism, which we discuss in-depth in this episode, plus I just love her blog post series about her alter ego — Spenderella.  We also got to bond over our frugal dads in this episode, and we even talk a bit about her divorce and how that influenced her debt repayment. Lots of great topics covered in this show I must say! We both mentioned a few of Michelle’s blog posts during this episode, so here they all are. Thanks again for reading and listening, and make sure to check back here next week for episode 10. It’s a particularly special and personal episode all about my experience moving from Vancouver to Toronto. Blog Posts Michelle Mentioned The No Spend Challenge 2015 – 6-Month Check In This Is My Frugal Dad – Lessons in Frugality Ask the Reader: Birthday Gifts – Debt Repayment or A Gift? Things Spenderella Did When I Wasn’t Watching #4 Thou Shalt Not Spend Shownotes: jessicamoorhouse.com/9 Learn more about your ad choices. Visit megaphone.fm/adchoices

Hello and welcome to Episode 9 of Mo Money Mo Houses. I'm your host Jessica Morehouse and today I'm pretty pumped to talk to my guest today. Her name is Michelle. She is the blogger behind Budget Blog S. She is a Toronto personal finance blogger like myself and she's actually one of the first personal finance bloggers I met in town, actually, because we tend to get together and just hang out, talk about money and nerdy stuff like that. And so I'm super excited that she's on the show today. Before we get into things, since this is episode nine, find the show notes at momoneymohouses.com slash nine, or check out momoneymohouses.com slash podcast for all the episodes and show notes up until this point. So today we're going to be talking about some

pretty interesting topics that I haven't explored yet. Mainly shopaholism. And I know lots of people probably think, oh no, being a shopaholic, you know, air quotes here. Really, like, that's not a big deal. Like, that just means you need to stop shopping, right? No, I personally, I feel like it is a form of addiction. You know, it's not, you're not being rational when you're shopping in that kind of state. So we're going to kind of talk about that and also just Michelle's journey. She's also been through quite a bit. She's been through a divorce and it's interesting to see what does that mean for your finances? We all kind of heard that it can really affect your finances when you're divorced and 50% of marriages

end in divorce. So we're going to talk a bit about that and some other really awesome stuff. So let's get to it. Thank you, Michelle, for joining me on the program today. Thank you for having me, Jess. You're so welcome. So let's kind of start from the beginning because I think most of our kind of money stories and personal finance journeys really start from kind of how we were raised. So how are your parents i know you do talk a lot in your blog about your frugal dad you want to talk about that a little bit yes um my dad's very frugal borderline cheap he's very proud of it yeah um i remember uh journeys and trips in the car where my father would go and scrounge at construction sites. What's that? Like, what do you get?

He would actually go and ask the foreman if they had extra insulation or two by fours. Because if he, for example, one of our houses, we were finishing the basement or he was finishing the basement. I was a teenager at the time. And we literally went around to construction sites and he would ask do you have any lumber that you're throwing away do you have any insulation that you're throwing away and he would go and scrounge for stuff and i swear amazing our basement was like all patched together with all this lumber he found everywhere that's actually funny that you mentioned that because

thinking about like what's in my parents basement it is stuff that my dad has somehow found places like i don't think most of it's bought it's like we don't have like a normal we didn't like just put in a bunch of carbon in there it was just like cement flooring but he has a bunch of patches of carpet that makes up one big carpet it's like the macgyver generation or something right exactly and i'm like he was kind of smart because he didn't spend any money to like furnish her whole basement. It's a pretty big basement. So it's like, that was funny. Yeah. I guess I have a frugal dad too.

There you go. You do. So growing up, did you kind of see what he was doing and wanted to be the same or how did he, his frugality kind of influenced you? Some of my father's wisdom did rub off on me, but some of it unfortunately didn't. The saving my money and investing in an RRSP, that all came from my father. I started doing that when I was 16. I started my own RRSP when I was 16 and put whatever I could in, which was pretty much, I think like $25 a month because I was working part-time at the time in high school.

And I slowly increased it as I got older. So that's one thing I learned from my dad. I've always learned to put your money into the RRSP and take advantage of your company's RRSP plan. But when it comes to budgeting and frugalness and credit cards, I didn't learn so well on those lessons. The credit card one was a tough one because you turn 18 and basically you're in college, you get into college, you turn 18 and that's when you can have credit cards and the credit card companies are all there. Oh yeah, they want you. They're all there with their free mugs and their free t-shirts.

Frisbees at the college. Yeah, trying to get you to sign up and of course, silly me, I signed up for the credit cards and that was my first journey into debt and racking up credit cards. And I got myself into a bit of trouble. Yeah. And not good. Did that, so was that like kind of just in your kind of early,

you know, 18 or whatever, or was that just like the beginning and then it just kind of continued throughout your 20s and then 30s? Yeah, it was the beginning and I've basically known debt pretty much all my life. Wow. That's interesting. Yeah. It's unfortunate, but I got into it and I just got in over my head. And the other thing that happened was my parents helped me out a couple times. So that first time in my early 20s, they helped me out because the banks at that time didn't have to advise you when they were raising your credit limit. So they would just keep raising your credit limit.

So I'm in my early 20s and I get my first job and I have a $15,000 credit limit on my credit card. That's a lot of money. You give that to a 20-something in your early 20s and hi, hello, $15,000 racked up instantly. Let's go to Disneyland five times. For me, it was clothing. It was stupid crap. I got sucked into the whole consumerist nature. I also had the mindset where you could call it a traditional mindset where I believed what society put out is what you should do with your life.

That you need to go to school. You need to get a good education. Then you need to get a great job. Then you need to get married. Then you got to have the white picket fence and the kids. Yeah, the whole thing. Yeah. And you fall into that mindset. And it's amazing how easily all of us fall into that. Oh, yeah.

And you get into that consumerist mindset. And the next thing you know, you're buying China for God knows who. And you're sucked into buying gifts for the cousin of a cousin. And yeah, you're in debt for everybody else and yourself yeah and you're like how did i get here exactly yeah so um one of the things i find very interesting about your personal finance journey is you know you were kind of this you know shopaholic you kind of mentioned that on your blog that you were kind of this shopaholic throughout your 20s and then you got married. And did that kind of shift things for you? My Spenderella has always been around. Yeah. But I think it kind of shifted. So the first debt that I really racked up was more clothing because

my parents, well, my father being frugal like he was, I wasn't allowed to have all the clothes I wanted it was kind of like in high school no you're going to get what we buy you and what's in the budget and here you go yeah I know I feel your pain I was there I swear it must have been a form of rebellion that's the only way I could explain it it's a form of rebellion because I went and spent all my money on clothes and then when I went and got married, well, we were actually together for a while, but we were renting, so it wasn't necessarily decorating. It wasn't until we got married

and had a house of our own. Things do change when you get married. You kind of have, like I'll totally admit, like I was with Josh for maybe five, possibly six years, I can't even remember, just dating and living together.

But it wasn't until we got married that I felt like something switched my mind i'm like i care about furniture now yeah why do i care you want to build this beautiful home you want to build this whole life that you feel like you know you need now because you have a ring on your finger and you went through the whole thing you totally know where you're coming yeah and it's like you occupy yourself with painting walls and putting pictures on the walls and putting up curtains and buying furniture. And before you know it, you've been to Home Depot every single weekend, dropping $200 every weekend. And you're like, I didn't sign up for this. What was I thinking? And it just turns into a huge disaster and you rack up even more debt. And so you kind of get into this kind of lifestyle of just like buying stuff to create this life

that you feel like you need. And then there's another shift. Yes. Yeah. Divorce. The D word. The D word. Divorce.

Yeah. So we've been together for 12 years. Wow. And we bought the house it was the last few years of our relationship that we bought the house and so we had to sell it because neither of us unfortunately at that point

could afford anything I couldn't afford a house on my own I really couldn't afford to rent anything I had over $33,000 worth of debt racked up on a line of credit and credit cards I couldn't afford a house on my own. I really couldn't afford to rent anything. I had over $33,000 worth of debt racked up on a line of credit and credit cards. And I know that he had debt as well. But it was an amicable divorce. We kind of just said,

okay, you leave with your debt and your assets and I leave with my debt and my assets and we take care of it that way. So I'm thankful that things ended that way because it could have been much worse because we could have been splitting debt and cars and asking for RRSPs and it just gets crazy at that point. So we just basically said, okay, write down, take what you came with basically. That's good. Yeah. So it was pretty good. But of course then, you know, I move out and I'm left with all this debt and I

move back in with my parents. It seemed like the only logical option for me so that I could get my debt paid off and, um, and get back on my feet again. But again, silly me. Um, any other probably really super frugal, financially minded person would have gone to town on their debt yeah and just paid it right down but me i i don't know whether it was just because i was free for the first time since my early 20s that i just kind of has a lot to do with it it probably does like an emotional state really like that's like the most emotional thing you could probably go through is a divorce. So, you know, and being like a shopaholic, one of the things is like you shop through emotion or, you know, it's an emotional shopping. Like that's probably, I don't know. Is that some of the shopping?

Yes, absolutely. Absolutely. That's, that's probably the worst type of shopping. That's the worst kind because it's the impulse. It's the impulse. You get into a particular mood, whether you're sad because you're single now or, hey, I'm single in my mid-30s and I'm never going to date again. Because you do, you do. You hate to say it and you hate to be negative about it, but you do get into that mindset. And it does affect your finances.

It totally affects your finances because your moods dictate, you know, everything you do, your actions each day, and it could totally derail you. And it's, it's one of those things where you have to be able to stop and pause and say, what am I doing? Get groceries delivered across the GTA from Real Canadian Superstore with PC Express. Shop online for super prices and super savings. Try it today and get up to $75 in PC Optimum Points. Visit superstore.ca to get started. Well, it's interesting that you mentioned that because I feel like that reminds me of one of your most recent posts. You did this post about how you bought some really expensive makeup brushes from Sephora.

And it wasn't probably not necessarily an emotional buy, but it was definitely an impulse buy. Like one of those kind of moments where you're like, why am I buying this? Yes, absolutely. So that was the birthday gift post. Yeah. And that was my parents giving me a gift, some cash for my birthday um and basically i decided well hey i wouldn't mind to have these sephora pro makeup brushes i can't just have the regular sephora brushes i gotta get the pro ones quality over you know right you know what that is my mindset quality over quantity

way and it i mean sometimes yeah like yeah you do want to buy the quality, but sometimes it's like, just get the normal brushes. Yeah. Well, because in this case, two brushes, $90. My God. Yeah. Wow. And you know, when you put that online and you post it and you listen to what people

are saying to you and you're kind of like, you think about it and you're like, that was totally impulse. That absolutely was impulse because who in their right mind spends $90 besides Kim Kardashian on two Sephora Pro makeup brushes? You know, like, no. Yeah. And so you ended up returning them, right? I did.

I did. And I put that on Instagram. No, I think that's great because I feel like with like being a shopaholic, it's so easy to buy something and kind of feel that guilt, but then just hold on to the thing. It's kind of, I think, an extra step to return it and get your money back. I don't know about you. Well, and the big thing is the excuses. You start making excuses on why you should keep it.

First, you make the excuses on why to buy it. Then it continues with you making the excuses on why you should keep the item. Like I might need it or it was on sale. I don't know where the receipt is. On sale has got to be the worst. That was probably one of my biggest problems in all of my spending is I would see things on sale and I'd be like, well, but it's 50% off or it's 70% off. And you get caught up in that euphoria of buying something and that you're getting it on sale, but you totally forget the fact that you're in debt. That's going to go on a credit card.

You're probably going to pay 18% interest. So that 40, 40 50 discount you just got is gone you're basically paying regular price by the time you pay that item off on your credit card if you can't pay your bill right away and also just i mean i know i sometimes get caught up when i'm shopping i'll be like oh yes need this. And I totally get drawn in by the sales. Cause I'm like, I, it's, I love me a good deal. I love it. And, but then I, I'm always like, there's actually one specific time that, um, I went to a clothing store and they were having some sale where it's like, uh, buy two and they're like 50% offer some crazy deal or buy two shirts for $25. I forget. And I'm like, yeah,

that sounds great. And so I find two shirts that I really like go to the cashier and they say that my total is like, I don't know, $80. I'm like, uh, Skay, use me. Uh, I thought these were on sale. And they're like, oh no, not this shirt from this rack. And of course they always do that. They always try to do that. They always try to like make the signage super complicated and i could have like my credit card was out i was about to swipe and i'm like do i actually want to spend 80 on just two shirts two shirts that i don't actually even need i walked it i didn't even need to buy any clothes i walked into the store because i saw the sign like you know it's just like little steps luckily i was strong enough that day to like no i'm not going to goodbye and also it's kind of pissed that like you didn't get it i felt like an

idiot because i didn't understand the sale so i was kind of mad i'm like no you were not going to get my money today but it's hard to do that like i was it was literally split second away from being like whatever and swiping and then of course i would have come home and been like what yeah damn it why'd i do that well because when you're there you feel embarrassed you feel the embarrassment i almost felt embarrassed not to buy it but then i don't know well and you know i honestly think that a lot of stores are very good in their marketing they know exactly what they're doing like come on look at abercrombie and fitch for example they're always pumping out their cologne into the store

to get you to come in. You do one circle in that store and you reek of their cologne. It's all the marketing. They know what they're doing. They know what they need to do to draw their consumer in. It's exactly what you just explained. They do that type of thing. They draw you in with a sale.

They know that you're probably going to pick something that's not on sale yeah and then you're going to feel too embarrassed when you get to the cash register to say no i'm not paying that they think you're going to swipe and good on you for for fighting it it is tough it was really hard to walk away but the thing is like looking back i'm like i don't remember what the shirt looked like. Cause I didn't need it in the first place, you know? So it's like, it's just a willpower thing and just a habit to create. Like I wasn't always, you know, like this, but yeah, it's just habit. And habits are, it's, it's huge. And that's one thing I'm learning with my conquering my Spenderella right now is that you have to fight that comfort that you're normally used to. And you just have to tell yourself, no, I can't do this. And here's why. Or no,

I can't do it. I need to pay off my debt. And you know what? I can have a way better item once I save up the money and I can buy a really nice whatever it was I was going to buy. And it's interesting how quickly you forget about something and you just move on. And I actually was euphoric the other day when I found a hole in one of my clothing. I'm like, wow, I don't think I can fix this. I got to throw it away. I got excited.

I can't even remember the last time that that happened. Seriously, the last time that I've had a hole in a piece of clothing. And that's part of the consumerist mindset is our society nowadays is this throwaway culture. And it's frustrating because we're all worried about the environment. And yet we don't look at our day-to-day consumption and how we buy clothing and how we buy food and how much we buy. And we forget so easily. It's like we walk around in this mindless state and forget that, well, even look at my frugal dad and your dad. They were the MacGyver generation. They're like, fix it until you can't fix it anymore. And yet now everybody's like, eh, there's a new one around the corner. I'll just put

it on my credit card. And people don't realize what they're doing to themselves. It's a nasty cycle that you get trapped into. And once you've created that habit, and it is a habit, you've created that mindless consumerist habit, you get stuck in it. And it does take a lot to change. It takes a lot to kick your Spenderella's arse to the curb and say, I'm not doing this anymore. I'm not going to be a part of it. On that, what kicked you in the arse to get you like, all right, let's get on this? Because I know right now you're on this spending ban, basically, right? What did it was basically being silly and doing, what do they say?

The form of stupidity is repeating the same behavior over and over again and not learning. Well, I got halfway to debt freedom in November of 2013 and then I decided I wanted a whole new wardrobe. I got into this quality versus quantity mindset. And I realized that the wardrobe I had really wasn't very good and off I spent again. Away I went. And I've done this a couple times, whether it's been with travel or with clothing. Those are my two major vices. And I've gotten myself to a good situation where I've gotten a lot of debt paid off. And then I just get myself right back up to 30 something

thousand dollars worth of debt again. And doing that several times, it's been twice now, doing that several times has just been a kick in the pants. And that's why I started this no spend year because I'm tired of it. I'm frustrated. I'm tired of it. And you know what? I feel like a fraud, especially I'm writing a personal finance blog, even though it is about my personal journey. I'm not telling people how to do their finances still. I feel like a fraud because I keep falling backwards. And the other thing is, is I've made promises to family. My family has helped me. They've been very generous in helping me. They've paid off my debt and then I've repaid them at a lower interest rate than the bank. They've helped me in that way. So I've still had to pay it back. They've not forgiven it. Well,

the last time my father did forgive the last $8,900 and said, promise us, please, no more spending, no more debt. And I went and did it again. And I felt like such a fraud. I felt so horrible. And I don't know how many times I've apologized to them. I have apologized to them so many times for the behavior. And I've said, sorry sorry so many times because they had this high expectation of me. We're helping you out. We have this huge expectation. And then I go and do it again. And the one recommendation I have for people, do not let your family help you. Do not. You have to do it yourself. I know where my parents were coming from. I'm their only daughter. They wanted to help. They wanted to see me get back on my feet. It was out of the goodness of their hearts that they did it. I know where my parents were coming from. I'm their only daughter. Yeah, they just wanted to help you. They wanted to help. They wanted to see me get back on my feet. It was out of the goodness of their hearts that they did it.

I understand where they were coming from, but I would recommend to anybody, do not take money. You need to do it yourself. You got yourself into the situation. You need to get yourself out of it because otherwise you're not going to learn. You're not going to learn the hardships that come with debt

repayment, the sacrifices that you do have to make because you do have to live within your means. And you actually have to live even more within your means because you have to try and create a surplus of money that you can put even more towards your debt. So I would highly recommend to anybody don't accept any money from family ever. No matter how much they beg and plead with you and say, we want to help you, tell them it would be better help by not helping me. Yeah, just support me by, you know, ask me how I'm doing or like... Exactly. Just support you, but not monetarily. Yeah, not monetarily, being supportive and saying that they believe in you and that they know that you can do

this and that it does take time. I think that was the biggest challenge that I had is I would get to a certain point and I would get impatient. I would get frustrated with the amount of time it takes. But people, it takes time. You're not going to do it in six months. You might not even do it in a year. It could take you a year to two years depending on your debt level. Or several years, really depending on your debt level. Or several years. Yeah. Really depending on your situation and your income. Oh yeah. Because I think what you need to remember, it's like, yeah, you may be living below your means and trying to save up as much money as you can so you can pay out if you're dead. But the end result if you do all that and yeah,

kind of maybe suffer for a few years is you'll be debt free and you won't owe anyone. And that's such an amazing feeling being not in the red anymore. Exactly. Yeah. And I'm looking forward to it once and for all. Do you have a date that you're hoping to be debt free by? I'm hoping for December 31st, 2015. I've got my fingers crossed. So less than a year away. That'll be a great way to ring in 2016, won't it? It will be. Well, and you know what?

December 31st is the real drop dead date that I'm aiming for. But you know what? If it takes a little bit longer, it takes a little bit longer. But what I've really got in my mind is I don't want to be 40 with debt. So I turned 40 next year. And that's one of the things I said to myself, man, I'm going to be 40 years old. And I've known nothing but debt for pretty much all my life. What the heck have I been thinking?

You know, like not to say that I don't have any RRSP savings. I do have retirement savings. I do have money set aside, but I've never really been able to throw a huge chunk of change at my retirement savings because I've always had this debt and I've always been living in this consumerist spend, spend, spend, Spenderella mindset. And it's long overdue. And like they say, it's never too late as long as you get started. It's never too late. And I think that's definitely like for any of you listeners right now that I don't know who's out there, but that's the one piece of advice that I could give to anyone. It doesn't matter what situation you're in or how old you are or what your background is. It does not even

matter. You can take care of your finances. You can get out of debt. You can start saving for your retirement. It doesn't matter. You just have to start. And I think that's the problem with lots of people that I talked to that aren't necessarily, you know, into personal finance or anything like that. They just don't, they're like, well, that's nice for you. But for me, I, that's just not me. And I'm like, well, actually it's pretty easy to do to figure out your, your financials. It's really not rocket science, guys. That's why I got into personal finance because it was easy. It was simple.

At the end of the day, you have a goal and you just keep focused. And it doesn't take a lot. I think a lot of people's expectations... It doesn't take a lot of energy or time. It does not. Well, even monetarily. I think a lot of people's expectations are like, oh, well, I'm going to have to put $500 a month. No. Guess what, folks? I just redid my plan and I'm only putting $25 a

paycheck, $50 a month in my RRSPs right now, because obviously I want to put the majority of my money towards my debt. But do what you can. Even if it's 10 bucks, it's that miracle of compounding that all of us personal finance people talk about. And you know what? Don't be afraid to fail. You shouldn't get hung up on the failures. Absolutely. You have to rise above it and try again. Keep trying. And that's what I'm doing.

That's one thing I'm known for in my job is my tenacious nature. I'll just keep go, go, go. And that's what I'm doing. I haven't let the setbacks and the defeats bring me down and say, oh, well, to heck with it. I can't do it. I'm just going to keep spending the way I am. No, I'm trying again.

I want to get this done because I see it as if I can get myself to this state of freedom, it's going to be absolutely amazing. That's going to be an even better sense of euphoria than spending. Forget about the spending being free. And that means that I could do whatever I want. You can. And you'll be able to put all that money that you're paying down in debt in the bank or to actually spend it on the things that you like. I'm getting excited.

In cash. I'm getting excited about that now. All the possibilities. Yeah, especially the car cash. I'm getting excited about that now. All the possibilities. Yeah, especially the car payments. I look at my car payments. I'm like, wow, what would I do with all those hundreds of dollars of extra money? Exactly. It'd be absolutely amazing.

I know. Well, I look forward to the day that you can say that you're debt free. I really hope it is December 31st. That would be the coolest thing ever. I hope so too. Thank you so much for sharing your story. I think it's really inspiring and

a lot of people can relate to it because a lot of people are in debt and a lot of people will pay it off and then get back into debt. Because once you're in debt, like you said, it's kind of a habit that you have to break. You have to break. You have to break it.

It's not easy to break. Put yourself out of your comfort zone. Exactly. Thank you for having me, Jess. It was a pleasure. You're welcome. Thanks so much. And thank you so much for listening to this episode.

Remember, if you want to check out Michelle's blog, go to budgetblogs.com. I'll also include a link to her blog and some interesting blog posts she's done recently in the show notes, which you can find at momoneymohouses.com slash nine. Before I go, just want to give a shout out to a couple people who left me some Stitcher reviews. Kat O'Four writes, great to learn about others' financial thoughts. Great podcast that so far has a variety of people of financial backgrounds and current financial goals. Hope to learn from future podcasts.

Well, thank you so much, Kat. And Mishy2003 says, excellent show, Mo Money. That's my first Stitcher experience and it's very fun. Oh, I'm so glad you're having the best time of your life, Mishy. I appreciate your review. And if you want to leave me a Stitcher review or a review on iTunes, make sure if you have a blog to leave your links. I'd be more than happy to link to you and check your blog out. But otherwise,

I just really want your feedback. I want to make this blog the best blog it can be. So make sure to leave me a review and I'd be more than happy to give you a shout out on a future episode. All right. So wrapping up, thank you so much for tuning in and make sure you check back here next Wednesday for episode 10. And this episode is not going to have a guest. It's just me talking, but it's on a topic I'm really excited to share. And I'll give you a little hint. It's about me and my experience moving from my hometown to Toronto.

So make sure you check back for that. All right. See you next week. This podcast is distributed by the Women in Media Podcast Network. Find out more at womeninmedia.network.