Save. Spend. Splurge.

I’ll just pay cash.

Honestly, this is my mantra for two main reasons.

1. I hate debt

The first point is simple – I don’t like holding debt. Even with a mortgage at such “low” rates, scares me.

I feel like those interest rates are not worth the trouble, especially if you consider even 2% on let’s say $300,000 is $6000. I feel like I could better use the money elsewhere.

You could also make the argument that it is gaining more invested in the stock market than in your home, but still, that lingering stench of “debt” doesn’t make me sleep well at night. I don’t like owing anyone, anything. Even if someone gives me a gift, I reciprocate. I cannot leave it open.

2. I am unable to obtain said debt (sometimes)

The second is a little complicated.

It is only with my own “banker” (sort of) who I can call and talk to, that I am able to for instance, get a pre-approval for a $600,000 mortgage. They know I’m able to pay it, they want my business, and they want to lock me in to something like that, knowing my house is collateral and they can just take it if I don’t pay.

For things a little less concrete? Let’s say a car? Forget it.

The line of credit I get is $10,000 and the interest rate is 5%.

I also find that financing even at car dealerships is an issue because as a freelancer they want me to prove SO MUCH. Way more than an employee. They want me to prove that I’m stable, I have good income, and basically, that I already have the cash to clear it in full if need be.

So.. what’s the point? I”m a freelancer but it doesn’t mean I’m any riskier than an employee.

People lose their jobs all the time. People run into debt all the time and are unable to pay it off, moreso than someone like me.

The main things banks should look at is:

  1. Assets
  2. Credit history
  3. Liabilities

If I have great Assets, great Credit and no Liabilities, what’s the problem?

All the rest? Confirmed salary or income?

That stuff is less important (or should be) for freelancers because any freelancer worth their salt, doesn’t take out the maximum salary every year from their company, and just leaves it to grow there.

For smart tax planning, we take out just what we need to live, and invest the rest under the company, drawing upon it when we need it, and paying a lower tax rate as a result. THAT, is smart business.

Banks however, don’t see it like that.

Lastly, a reason why I get rejected for loans or debt, is also because of my age and gender. Say what you will, but my partner is always asked to co-sign for me like I am some child, to secure the debt and make sure someone else is on the hook.

All that, is the reason why my motto usually ends up being:

“I will just pay it in cash. Less trouble.”


  • PwedePadala

    I can definitely relate about having a co-signee. What’s the point of having a good credit score and lack of debt. I gladly pay the government for my pension plan as self-employed and also the bank if only applying for a loan is easier and faster. Wanted: co-signee or better yet better, fair banking system.

  • Jodie Bierbrauer

    Obtaining credit can be very challenging if you’re self employed as well. Dh and I used to have to jump through endless hoops to obtain a mortgage. (In the US). I always felt as though lending processes favored employees and agree that that line of thinking felt unfair. Our business was younger then. Now banks come courting. Basically, the less need you have for credit, the more likely they are to offer it to you.

  • Revanche @ A Gai Shan Life

    As much as our system is flawed, I do hate that it’s so hard for you to get credit just because you’re a freelancer! It makes no real sense.

  • Budgeter

    Basically anytime u ever shop around for financing products you’ll forever be discriminated for not having a t4. The world is all about reducing risk and maximizing returns right.
    Everything you write about no job security today is absolutely true but it’s also harder to fire an employee than a contractor and contractors get cut first in downturns of course.

    Unfortunately the feds are undergoing higher taxation increase for incorporated self employeds

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