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Wednesday, September 11, 2013

The Dividend Girl Dirty Little Secrets about Debt

Dieting is hard, very hard. I am learning it day by day. I may enroll at a gym at this point, I will see. I had loss 5 lbs so far, but it seem like I cannot loss more. I guess I eat too much for my kind of lifestyle - I spend all day sitting at my desk and once home, I am back in front of my computer. No miracle will happen by its own. I walk around 1 hour per day. I would need to add an extra an hour and a half to that. My plan was to get up 30 minutes earlier to walk 30 minutes more in the morning but hey, in the morning, its hard to get out of bed. I am the luxurious lazy type. Beauty sleep get in front of everything in term of priorities.

One thing that is helping is that I fix myself a weight loss of 10 lbs per month so its not catastrophic not to be able to lose weight for a couple days. Better to be stabilize. I am going to write a more complete post about dieting soon. You,ll see what involve dieting and how much boring it can be.

I don't know for you, but despite being single with no kids, it always like I have laundry to do or something to clean. And it also seem like I have a lot of debt to take care of these days.

My non-registered portfolio complete the session at $117 264.18, which is very good. The amount left on my margin is probably something like 12k. Nice! I really like it when my non-registered was at $118k. Ok so what's the relation between my portfolio and paying off my debt? Maybe not all of it, but partly. Want to know?

Ok, your going to see the ugly true about the debt of the Dividend Girl.

If you had been an active reader of me and real mega fans of me, well for those, you know that for many years now, TD Visa had been offering me different credit card balance transfer promotions. I had been offered over the years several interest rates, like 4.99%, 2.99, 1.99%. And each time, the promotional interest rate offered had been valid for 6 months. But every single months, the promotion just had been there for me. On and on and on. So TD Visa had been very good for me and I even named myself a - watch out, this one is funny - a  "TD Princess". But about 6 months ago, the promotion stop showing in my account!!!

I had a balance of over $11 500 on 2 different offer. One offer had expired recently and one was about to expired by the end of October. But because I had an offered expired on a $7 500, all money paid on the card was "pro rata". In other words, I was paying 22.9% on a $7 500 balance and 1.9% on the rest, $4 000. Its the first time ever I ever had to deal with such things. Before, when I noticed that my promotional rate was about to expired, I simply took the balance, transfer it to my other Visa cards. As soon the transfer completed, I gave TD Visa a call, proceed with the promotional credit card balance transfer at 4.99%or whatever else and voilà, I was good for another 6 months.

But its not working like that anymore because TD Visa stop being good for me. For the past couple months, I no longer have ANY promotional credit card transfer available in my accounts. So that's how the idea of paying off some debt all began. 

This is how I handle my TD Visa misery situation:

I pay off my TD Visa the following way;

I transferred 5k of my credit line at 8.75% (TD) over my TD Visa balance.
I transferred $5 740 of my TD credit line at 9% over my TD Visa balance.

That left me $400 to pay.

I currently had a balance left of $400 on my American Express. I currently have an offer at American Express - a promotional interest rate of 1.99% for 6 months. So I proceed with a $400 from TD to AE. My 400 bucks at 1.99% will expired on April 1st.

I have until September 25th to take advantage of the 1.99% of American Express. What I did is that I transferred the existing balance of my $2 174.71 balance at AE over another Visa card I hold. Once the transferred completed, I will call AE, and proceed with a credit card balance transfer on the same balance. I will get 1.99% for 6 months.

At this time, I can breathe and take care of those 2 debts:
5k of my credit line at 8.75% 
$5 740 of my credit line at 9%

Those 2 credit lines are with TD. Remember that I still have left over 12k worth in margin money with TD Waterhouse? Well, at anytime, after the market are close, I can check the value of my portfolio. If my non-registered portfolio worth 116k+, I can, without any problem, transferred 4k over the $5 740 at 9%. I can easily transfer money from my broker account to any TD credit lines that I own.

The trick is to:
1st - Check the value of the portfolio to ensure that I will avoid any margin call.
2nd - If the value is of 16k+, I can transferred 4k, even 5k over the credit line. The transferred need to be made before midnight.
3rd - In the early morning before going to work, transferred the money back into the margin account. Because with the stock market, we never know. Never take something to grated.
4rd - Repeating the same pattern everyday will help to save $237.50 (4.75% interest on a 5k for a year).

Along the way, I will try to put a maximum cash on my debt repayment.

So that's the plan! How do you find it? Pretty exciting hein?

This is what I was born to do and drive my banker and broker crazy about me.



Anonymous said...

Holy shit, this is insanity..

Anonymous said...

Hey Sunny,

How about this for driving someone mad!!!

I own JE and Dripping it through my broker. I am paid dividends in Canadians dollars. So I receive 6 new shares @6.45. My brokerage says this equals to 36.75. They are telling me that the dividends were paid in Canadian dollars but the stock trades in US dollars...

I am like since when??? If that is true what a mess it will be for conversion to USD for all the dripping I did.

Christine said...

That's pretty awesome and thanks for sharing! I'll be following in your footsteps. Using margin money I need to be better at. I had some margin calls which sucked! I'll have to choose better stocks. I've also been getting these promotional rates from credit cards lately and I want to take advantage just like you. Now I've got a better idea of how to juggle it all!

Anonymous said...

Sell some of your dud stocks and clear the debt, refocus and redeploy further into quality stocks... Debt is and will be the root of your demise at this point. Stop playing games, as time is a commodity you cannot buy and is so important to your future investment earnings potential. - Cheers.

Sean said...

I think you're about to hit a wall. This is the stupidest thing I've read in a while.

Sunny said...

If you had buy JE on the TSX and in Canadian dollars, your JE trade in Canadian Dollars and certainly not in US dollars.

There's some stuff like the Sprott Physical Silver that trade in US dollars even if you purchase it on the TSX. Its pretty annoying to have such thing, but the Sprott Silver is the only stock that I know that is that way.

I think your broker doesn't know its stuff... Time to change!!

Does this happen with TD Waterhouse? They can really mess up sometimes but they might be able to even give you credits for telling you bullshit. And please do so, ask for a $50 at least. Get them hard.

Thanks Christine. I never had a margin call and I hope things will remain that way. I got margin add in my account when I already have a good and strong portfolio. Thanks for following, you'll see, its going to be fun!

Hitting the wall is not going on soon, no one really have the flesh to do things the way I do so as a reader, you have to enjoy.

Anonymous said...

so stupid this game of ping pong with the debt, time to sell your losers and pay off your debt = instant return on your money guaranteed.

Anonymous said...

Seriously? Moving the small amount of margin you have left every night? What a bad idea. You'll have to keep detailed records for the CRA since you're claim is deduction for the interest. This overnight borrowing is definitely going to cause problems..

Anonymous said...

I honestly didn't realize that people with financial management this bad actually existed.

Anonymous said...

There isn't actually anyone this bad. This is a troll blog. Ad revenue from the people coming to mock is greater than that of a generic personal finance blog.

Anonymous said...

why this game of moving margin left and right all the time. it makes no sense. did you know that tdwaterhouse will call you when you have a margin call? then since you have your line of credit at your disposal and also at TD bank you just tell them to transfer the required amount directly to your margin account. this is so stupid what you are doing.

Anonymous said...

another way to look at this, you are over leverage with garbage stocks, you need to pay off you margin and invest in better quality stocks.

Anonymous said...

I said it before more than once. This is a troll blog, put on. No real money being used. Only crazy imagination. Because nobody in real life would do this, not even insane people. And it has even sucked in that Derek Foster to post on here. Sheeple, wake up!


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