Debt freedom is beginning to feel like an impossible dream

Debt freedom.  We all want it.   But it’s beginning to feel like an impossible dream.

Many of us feel trapped in unfulfilling jobs that we need to pay the bills.  Our salary may not go up as much as we would like each year, if it goes up at all.  The long hours we put in may barely allow us to earn enough to keep up with the increasing cost of living. Even if we are lucky to have a job we love, finding enough money to pay our bills and still feel like we have enough left to enjoy our life is a challenge that affects more people than you may think.

I know this first-hand.  I’m a Certified Financial Planner professional who has spent the last seven years meeting with clients – and listening as different people told me the same story, time and again. I’m here to tell you that you’re not alone.  Ipsos Reid let us know that in 2016, 48% of Canadians were within $200 per month of not being able to pay all of their bills. The stress is formidable, and honestly, most of us have been there.

Before I became a financial planner, my husband Cameron and I were in the same situation.  We moved from Winnipeg to Metro Vancouver in the summer of 2008 right before the financial markets crashed. We were 24 years old, neither of us had jobs waiting for us, and we found ourselves with a line of credit that grew to $10,000. As time passed we found work, paid off our line of credit and bought a townhouse.  Over the next six years we put over $150,000 toward our mortgage debt.  When we began, I was earning $40,000 per year and my husband was making $38,000. In 2011, the National Household Survey showed a median income of $76,000 across the country.

So how can two kids in their mid-twenties with a salary right around the median make that much progress? When we began, we didn’t have all the answers. All we knew was that we wanted to live a debt free life – to experience the freedom that comes with not owing money to anyone and living in a fully paid-for home.

I began to separate our decision-making into two categories: big decisions and budget decisions.  The big decisions are the choices that take up the largest percentage of our income, such as where we choose to live, the type of home we choose to live in, our transportation costs and so on.  These choices are not always easy to change in the short term but they are important because they determine how much money we have left to spend on everything else.  We chose to buy a townhouse, close to public transit and well below the mortgage amount we qualified for.  Once all of the costs associated with these choices were factored in, it was much easier to create free cash flow.

Which bring us to budget decisions. These are the day-to-day spending choices we make with the money left over once the big-ticket items are paid.  If the big decisions we’ve made fit with our income level, we will have enough money left to choose what we do next. This means we can enjoy a lifestyle we love, and have enough free cash flow left to begin accelerating our financial goals.

If the big decisions don’t fit our income level, things start to grind to a halt. It may begin with throwing that one bill on the credit card or line of credit, then, when an unexpected expense occurs, it happens again – and reinforces our dependence on debt.  Over time, we start to make minimum payments on our credit cards because the odds are stacked against us. No matter how hard we work at it today, we’ll need access to that credit again tomorrow, and the cycle will continue. Before we know it, we’ve stopped believing that we can become debt free.

It doesn’t have to be that way. But trying to scrimp and squeeze out a lifestyle when the big decisions don’t fit means that our financial success is based entirely on our willpower.  Instead of spending our money on what we want, we’re forcing ourselves to make hard choices. We are trying to squeeze another $50 out of a budget that’s been pushed to the max, when really we should be looking at why there’s only $50 left. 

Our ability to achieve financial success depends on how well we integrate our finances with our lifestyle choices. Cash flow is key, but the amount of cash flow we have is all based on how we structure our lifestyle.  My book, The Debt-Free Lifestyle tells the story of what worked for us – and what didn’t – because no one should have to go through this alone.  It’s available on Amazon or at any Chapters/Indigo/Coles locations across the country.  You can visit me online at and follow our personal finance journey on the blog, listen to the podcast and get a free study guide to help you take the first steps toward your own debt-free life.