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Totally debt free!
Posted by: HoboSylvain | 2012-05-12 08:54:08 | Dorval, Quebec, Canada
Keywords: budget, finances, money, preparation
Last month, I was virtually debt free... but now itís real. I donít have ANY kind of passive, no more loans, all credit cards at $0. Being debt-free provides an incredible sensation of freedom, especially in a consuming world like North-America. Month over month, my situation has improved by about $2,000. About half of that came from sales from eBay. Iím almost done with the sale of my spare stamps... will now attack my records collection and a few furniture pieces in order to be able to fit in my new apartment.

Not only am I debt-free, but Iíve also accumulated close to $1 400 in pure savings.

In the past few weeks, I met with a financial advisor at my main bank, another first for me.  Iíve discussed with him about my projects... and my global finance portrait.  Iíve got some answers regarding my pension funds at the company I work for.  I already had regular (savings or cheques) accounts in 3 different banks to vary deposits and withdrawals possibilities (placing my eggs in many baskets so to speak).  After discussion with the advisor I opened a tax-free savings account.  Thatís a special account type created by the government a few years back that allows your interest earnings to be non taxable.  Contrary to RRSPs, you donít tax credit when you deposit money inside a tax-free account, and itís not taxable when you remove it.  Itís just like a regular cheque or savings account, except the interests are tax-free.  This type of account yields a higher interest rate than regular savings or checking accounts, while keeping your money accessible.  Since I will need that money in the short term (less than 2 years), itís a wise choice for me.

Now that Iím totally debt-free and I wonít pay any more interest of any kind, thus putting all the money to work towards the goal.

I recently opened an account into another bank, which is very present in Central America, so it will be an asset for when Iím in that region of the world.

In August, Iíll meet again with my advisor to revise some points and realign some details if needed.  I will also open a new bank account.  Yes, I already have 3, but theyíre all in Canada.  The next one I will open will be a US-based bank account through a subsidiary of my main bank.  And the debit card of that account can also be used on the MasterCard network... allowing me another payment option... covering all 3 major credit cards.  Diversity is a key strategy to allow me to withdraw money from various sources while on the road, in various countries.  So, in case I lose some cards, get robbed, etc.. Iíll still have means to obtain money.  One of my bank accounts also allows me to wire money to any Western Union outlet.  I still have some tuning to do, but Iíll also be able to transfer money between all my bank accounts through Internet.  To do so, Iíll have a few options, including direct transfers, email transfers and even through Paypal, because all the accounts are linked to Paypal.  So, I could move funds from any account to any other one.

Related posts:
Itinerary and finances
First year of savings
Spent more, produced less
Almost debt-free
Prepping goes along

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