Debt A Reality For Many Baby Boomers
Posted June 5, 2008 12:00 pm.
This article is more than 5 years old.
Steve and Kristi Snary are like many Canadian couples. They own their own home, have one child, and are making the slow climb out of a financial black hole.
About a quarter of Canadians carry $10,000 to $40,000 in credit card debt, and personal bankruptcies have increased 24 per cent in one year.
“One time I can remember we had a company send us a line of credit for 5,000, and we took it even though it was at 29 per cent, which we knew wasn’t good, but it would pay the bills that week,” Steve admits.
Money was tight at the Snary household. They had just had their first baby and bought their first house when Kristi lost her job. The family spiraled into debt.
“We had one line of credit. We also had six credit cards,” Steve adds.
Their solution was to consult with Debt Freedom Canada (DFC), a Burlington company that rolled their debt into their mortgage. They paid the company $3,000, a sum that was amortized over the length of their mortgage, and now save $1300 a month.
“We need something that builds in that discipline, and really gives you hope so you stick to a program that’s good for you,” Steve says.
Another option the Snary’s considered was declaring bankruptcy.
Jeremy Kroll, a certified trustee with A Farber and Partners, Bankruptcy and Debt Restructuring Consultants, pointed out that is a last resort.
“It’s a good option where the person cannot deal with their debts in any other way,” he says.
Luckily, another option is free of charge: many groups can help eliminate your debt at no cost.
The Credit Counselling Service of Toronto is a non-profit organization that can help you sort out your financial situation and get you out of debt.
For more information, you can call 1-800-267-2272 or visit CreditCanada.com.
You can also get advice and credit counselling through the Ministry of Consumer and Business Services at 1-800-889-9768.
You have a debt problem, or are going to have one, if:
- you continually go over your spending limit or you use your credit cards as a necessity rather than a convenience
- you are always borrowing money to make it from one payday to the next
- your wages have been garnisheed to pay for outstanding debts
- you pay only interest or service charges monthly and do not reduce your total debt over many months
- creditors pressure you for payment, threaten to sue or repossess your car, furniture or television, or hire a collection agency to recover the money for them
Bonus Sixth Warning: utility companies cut off service because your bills have gone unpaid.
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