“Debt is the slavery of the free”
– Publilius Syrus (Roman author)
THE CLASSROOM: Tobermory, Ontario—Despite the lack of proper hiking gear, in the summer of 1997 I was determined to embark on a three-week hiking trek with my younger brother, Nicholas. Starting from the trailhead in Tobermory, our plan was to hike as much of the 700 kilometer Bruce Trail as possible.
Convinced we needed to bring absolutely everything, we demonstrated our trekking inexperience by over-packing our bags to the point where they each weighed as much as a child with an overeating disorder.
Less than a kilometer into the hike straps on Nicholas’s ancient and inadequate pack snapped off, sending the behemoth, over-flowing pack crashing to the ground, raising a cloud of dust at its impact and sending nearby wildlife scurrying away.
Since we couldn’t repair the duffel bag’s straps we had to devise another way to affix the bag to Nicholas’s back. Eager to try anything, I unpacked a massive roll of duct tape (I told you we packed everything). I then proceeded to tape the duffel bag to my brother’s back. Round and round I went in a blur of silver adhesive. Around his chest and stomach, over his shoulders, and around his waist, I wrapped the tape. Before long the pack from hell was a permanent fixture on Nicholas’s aching back.
In the end, our three-week expedition only lasted three days. For some strange reason, Nicholas was unwilling to sleep with the pack attached to him and so we quickly ran out of duct tape.
Not much of a team player if you ask me.
THE LESSON: Our hike along the Bruce Trail is a lot like the burden of debt so many Canadians are carrying these days. The Certified General Accountants Association of Canada reported that in December 2010, household debt in Canada peaked at $1.41 trillion. That’s over $40,000 on average per Canadian.
Over the past few decades, spending has far outpaced any increases to our incomes, driving Canadians to borrow more to maintain our increasing standards of living. In fact, in 2003, for the first time ever, the average household in this country owed more than what it was brining home in income.
Our values have changed as well since the 1960s and 70s. We live in a world of constant updates and upgrades. So where a TV a couple decades ago would be a one-off purchase to last fifteen years, getting a new one every couple years nowadays is not uncommon. The same goes for our mobile phones, personal computers and even our homes.
And with interest rates so low people are eager to borrow and pay for that big house they want. The problem of course is when interest rates inevitably go up, homeowners are going to find it more difficult to pay their mortgages. Like Nicholas trying to carry his giant backpack, he may have been able to for a while so long as the trail remains level, but as soon as that trail got steeper, it became much more difficult to manage.
And the consequences are significant: bad credit; bankruptcy; compromising on important things like food and health in order to service our debts; a legacy of debt our children inherit; and a fragile economic system that can collapse as we saw with the US housing market recently.
THE HOMEWORK: Don’t overstuff your backpack. We need to relearn how to live within our means and be more credit savvy. Check back tomorrow when I’ll have a Top Ten list of ways to stay out of debt.
Funny stories. Good advice. Josh Martin is author of the book “Simple(ton) Living: Lessons in balance from life’s absurd moments.” Click here to learn more and to purchase a copy.