Will joining the army solve your credit problems?

Author's Note: This blog touches on the 'drowning in debt' situation of many young people today, but I also wrote this piece as a tribute to our guys and gals in camouflage. For those of you who oppose Canada's role in Afghanistan, I respect your opinion, but in the short time I have been working with the military, I have nothing but respect for what they stand for, and that is to serve their fellow Canadians in whatever task they are asked to do.


I hear them again. "Don't worry, I haven't got my full pay yet, but as soon as I do I'll send you the money so you can pay them", "Tell them I'm in the military now. Don't say I'll call them, I can't, I've only got ten minutes break." "Look, I'm getting paid before month end, please don't return the cheque, please can I talk to somebody else?" Outside my tiny, unmarked office on the 2nd floor of the megaplex at the St. Jean military base are two public telephones and, I am guessing, because the telephones look like they are in a private area, they are often used by recruits on break to make phone calls of a more personal nature. I don't mean to eavesdrop, but the quiet earnest largely English-speaking voices seem to rise about the steady francophone hum of the mega, and given the nature of the conversations are almost always about money owed and money to be paid, a particular interest of mine because I have been hired to teach personal financial management here at the base, I hear what I should not hear.

The base is teeming with new recruits, over 6200 are expected to undergo their Basic Military Training or BMQ over the next 12 months. They are mostly anglophones and mostly young men in their twenties although there are many more francophones, thirtysomethings plus and women recruits than I would have thought prior to being hired by SISIP, the agency providing financial services to the members of the Canadian Forces, in July 2007.

Myself, I am a 20-year veteran of the financial services industry. We used to joke that working for one of Canada's big six banks was like being in the army. I survived training in the trenches of branch banking back in the late 80's and was promoted to various loan officer and field management positions, all of which I thoroughly enjoyed, until my resistance to the "new sales culture" of modern banking in Canada sidelined my wonderful financial career. I became a "fee-only" certified financial planner (in other words no sales commissions, client pays for advice on hourly basis) and, over the next five years, developed a passion for delivery of objective financial counselling as well as financial education.

I was fascinated by how personal behaviour and interpersonal dynamics would confound the best-laid financial plans of the people I was working with, and further explored this avenue by completing a Bachelor's in Social Work at McGill. It was at this time that I resolved to do something to help ordinary people better manage their own affairs, mostly by promoting basic financial education, as a defence against what I saw as an increasingly predatory financial services industry.

So fast forward, I thought I would find a job as a social worker and use my financial skills to work with clients, but by fluke (those internet job applications do work) found myself being hired full time as a Personal Financial Educator whose main duties would be to deliver lectures on budgeting and use of credit to platoons of up to 70 recruits on an almost daily basis.

But why a financial management lecture to guys and gals who are running drills and learning to use weapons? Because the CF recognizes that money problems are prevalent amongst its members. By supporting the SISIP program at the recruit stage, a program consisting of easy to digest financial tips and interactive activities, hopefully future financial stress will be avoided. One of the student recruits' favourite activities is when we ask them to write down their "dreams" and then use the paper to make airplanes which they all gleefully throw at a target. Later, I read the paper airplane dreams privately. "My own house", "To give my daughter everything she needs", " A fully loaded 4X4 pickup truck and to marry my girlfriend".

All in all an excellent plan to bulk up the psychological morale of our defensive forces. But we have been attacked from the rear. As I have painfully learned from the recruits who ply me during class break to please tell them what should they do because they are already "a little late" with some payments and they thought they would be getting more on their paycheques, the financial well being of our recruits has already been compromised. From what I have seen, the average amount of debt of a young male recruit is at least $15,000, not counting car or student loans. The monthly payments scratched out to the penny are the minimum amounts due on credit cards and lines of credit already maxed out, consolidation loans for old consumer debts and new "Buy now-pay later" consumer debt loans now due. (What was consumed? They don't remember.) Add the car loan "which I gotta have" and the student loan "which doesn't count because I got interest relief for 6 months", and the tally is some $45,000 in debt by someone whose last job was as a cashier at Tim Horton's. It used to be said that a banker was someone who begrudgingly gave you an umbrella even when the sun was shining, but now it appears a banker is someone who happily hands you the rope ample for your hanging.

At this time, I can only tell them to try and see the SISIP staff counsellor for a budget review, which is difficult to do because they must ask their platoon sergeants to make the appointments for them. SISIP, through a non-profit charitable foundation, does offer special loans at beneficial rates to help consolidate debts and relieve financial distress to CF members who have served at least one year, but no direct financial assistance is available to recruits for understandable reasons. More than half the recruits will drop out before completing their BMQ. They will not longer be the military's problem. They will rejoin the ranks of the civilians, still carrying their $45,000 of crappy credit.

But right now, at the 3rd week of their 15 week BMQ, all is possible: a steady paycheque to satisfy hungry creditors for now, and the promise of a rewarding CF career to enable them to attain their dreams with dignity and pride. But who are these guys, and gals, really? For the corporate suits on Bay street, hungry for market share and quarter-end profits, these young men and women are prime targets when launching marketing campaigns aimed at snaring long-term steady credit consumers. For those of us who watch from the sidelines, who support our troops in carrying out their many duties, dangerous and controversial as they may be, these young people represent the best of who we are as Canadians. They are all brothers, sisters, sons, daughters, fathers and mothers and they work very hard to be at their best in order to be ready to do the jobs we ask them to do.

I finish writing this and I hear one last phone conversation before I close my door: " Don't worry about the money, it will be ok, I love you and I love the baby too".