I'm Sarah – a 40-year-old single mother living in Toronto with my 10-year-old daughter, Stella. I wasn't always a single mother; that was a recent development due to my divorce, which caused me a serious lifestyle change and a bit of financial turmoil.
I married relatively young at 26 and did not ever imagine that my then-husband and I would get divorced.
We lived a happy, comfortable lifestyle. I've worked a regular administrative job for a dental clinic for the last 15 years. My salary is a modest yet comfortable $50,000.
My ex-husband was an accountant and brought in most of the household income, starting at a $50,000 salary as a junior accountant and eventually reaching senior associate status and bringing home $100,000 a year around the time of our divorce.
We have one child together and raised her within our means. We had a little bit of credit card debt, but nothing that seriously affected our lifestyle, credit scores, or ability to purchase a home. We bought our 2-bedroom condo around the Scarborough area ten years ago.
Unfortunately, our marriage started to fall apart once my daughter reached five years old. We weren't connecting like we used to, and resentment quickly accumulated into full-blown arguments daily. We did try couple’s counselling, but felt like the problems persisted. After a few months of counselling, we mutually agreed to end the sessions because it felt like a waste of money. We said we’d work it out, but if I’m honest, we were exhausted. I knew that “working it out” would just mean shutting down on each other completely.
Soon after, we just started growing apart. We avoided the fights but essentially lived two separate lives, feigning love solely for our daughter’s comfort for the last five years.
Then, my ex-husband decided it was too much and filed for divorce.
We originally agreed that we’d divorce amicably for the sake of our daughter. But then we started to see things differently, specifically the split. We disagreed over the assets (mainly our condo) and child support payments. My ex-husband wanted to sell the condo and share the proceeds proportionately, but I knew I'd never afford another property at current prices.
I hired a lawyer, fought tooth and nail to keep the condo, and succeeded — $35,000 in legal fees later.
Because I kept the condo, my ex-husband's child support payments were ruled to be lower than I thought they'd be. The one upside there was that he was responsible for Stella’s college fund.
Still, I was down to a one-income scenario. This was a serious shock to our lifestyle, which previously included weekly dinners out with friends, swimming lessons for Stella, bi-weekly shopping for new clothes (I love a good wardrobe refresh), and annual family vacations to Florida.
After separating, I quickly realized how much money all this cost, relying on one income.
Sure, I kept the house — but I was still on the hook for entire mortgage payments, payments to which I previously only contributed a third. So, I got a part-time evening job at a restaurant down the street to help manage my mortgage payments.
Additionally, I borrowed a $25,000 personal loan from my uncle to avoid putting things on my credit card, but it didn’t really work. A year after getting divorced, that money was all gone — I put half of it toward my legal fees, which were eating up my credit card balance. The rest, I used on miscellaneous, surprise expenses like Stella’s cavities at the dentist and a babysitter for the nights I had to work a second job at a restaurant.
Those felt like the “needs;” little did I know, putting off my car repairs would bring me even further in the red as it completely broke down. So I took out a car loan and managed to have my ex-husband co-sign on that one, as I needed to be able to bring Stella to school before work. Eventually, I started relying on my credit card again.
Fast forward to today? I still have about $50,000 of debt on my two credit cards and car loan.
Sarah's advice to herself
I knew I needed to turn things around. If I kept going at this rate, my debt would accumulate with interest because I wasn’t making my payments. So I did something drastic — I took about $50,000 off my HELOC to pay off the car loan and credit card debt.
Overall, I feel a lot better. My uncle told me to take my time paying that $25,000 loan, so while I still have that on my plate, there’s some relief.
Right now, I’m still working both jobs and plan to do this for another year, so I can pay my uncle back and make regular payments on my HELOC. I’ve also gotten used to living a much more modest lifestyle. I don’t treat myself to “wardrobe refreshes” anymore and invest the little income I have left over in an RRSP.