When most people seem to be carrying debt, just how do you know when you’ve got a problem? BC debt expert and Sands & Associates Licensed Insolvency Trustee Blair Mantin recently joined Global News to share some common warning signs about personal debt levels, tips to help BC consumers gauge their financial health when it comes to debt – and what to do if you think you have a debt problem.
Watch the clip here, and read more below:
What is a Reasonable Amount of Personal Debt?
There’s no ‘magic number’ when it comes to understanding how much debt is too much; for some people their debt problem shows up as $20,000, for another $5,000 – or even $100,000 for someone else – and much depends on each person’s unique situation.
Rather than relying on a specific number, consider not just your ‘on paper’ finances, but also how well you are coping with managing your debt and whether you are making clear progress towards paying your debts off.
If you are experiencing any of the following, consider this a sign your debt may be reaching a problem stage, or is potentially on its way to an urgent crisis:
- Often feeling stressed or worried about your debt.
- Making only (or slightly more than) minimum monthly payments on your credit card debt.
- Carrying debts with payments that use up a large portion of your regular income or that would take more than five years to pay off (non-mortgage debt).
- Regularly relying on credit cards (or using payday loans) to meet costs of living, or taking on more debt. (This could be increasing credit limits or considering a consolidation loan to manage debt.)
- Owing a government creditor such as Canada Revenue Agency a balance you can’t afford to pay off.
- Having multiple years of unfiled tax returns, especially if you are self-employed.
- Uncertainty as to who you owe debt to and how much is owed or just avoiding account balances altogether.
- Having borrowed against most of your home equity to consolidate or manage debts.
- Receiving collection action, including calls, wage garnishments or pending court dates.
Debt can snowball over time and because people get used to adapting to cope and manage the situation, dealing with a debt problem daily can all too easily start to feel ‘normal’. It’s important for each of us to do a financial check-in periodically and be honest in how we’re doing.
Identifying and cutting off a debt problem before it’s severe can save you untold amounts of time, stress – and of course money! Take an hour to connect with a Licensed Insolvency Trustee and get some qualified advice about managing your debt, and a personalized debt-free plan.
I Think I Have a Debt Problem – What Should I Do?
The first thing to understand is that if you think you have a debt problem – you’re almost always right. And if this is the case, the second thing to know is that the problem is almost always going to get worse if you don’t take some action.
Talking with a local Licensed Insolvency Trustee in your province is the first and best thing to do.
- Avoid trying to ignore the problem, or assuming you don’t qualify for help.
- Consumers can access a Licensed Insolvency Trustee directly for support any time at no cost, there are no eligibility requirements to seek advice.
- Be cautious about where else you seek debt advice. Licensed Insolvency Trustees are the only government-qualified debt help professionals.
- Advertisements from debt consultants and credit counsellors can be misleading and may imply a company is part of a ‘government program’, which is not the case. The only ‘government programs’ to deal with debt are those accessible by working with a Licensed Insolvency Trustee.
- Be on guard for high-pressure sales tactics, up-front fees, high-interest loans, and unrealistic promises.
Talking with a Licensed Insolvency Trustee
Every day Licensed Insolvency Trustees provide advice to people who are dealing with problem debt or looking to pay off their debt with less interest and/or in less time.
- There is no cost to talk confidentially with a Licensed Insolvency Trustee and get guidance on the options available to you.
When you connect with a Licensed Insolvency Trustee it is our responsibility to ensure you are aware of and understand all your options. We help people make informed decisions on how to address their financial difficulties and move forward. We’ll review potential solutions such as:
- Credit counselling programs, and negotiating directly with your creditors.
- Consolidation loans, and consolidation without borrowing using a Consumer Proposal.
- Bankruptcy, and other laws or resources that may help you resolve your situation.
Many people have a difficult time asking for help or feel embarrassed or ashamed to be struggling with their finances. Please know, you owe it to yourself to get debt help and you are not alone. Licensed Insolvency Trustees are your best allies – here for you with solutions and support, not judgment.
What would your life look like, without debt? Take an hour to learn about your options and get a debt-free plan that’s right for you. Book your free, confidential consultation with a non-judgmental expert at Sands & Associates.