2019 Debt Outlook

January 9, 2019

What is  your 2019 debt outlook?  The CIBC has reported that 48% of Canadian consumers are at risk of defaulting on debt payments and have no plan for debt reduction.  The Conference Board of Canada and the IMF are both reporting that consumer debt is a significant risk factor for the Canadian economy.  Debt reduction is a major challenge for many reasons including low and unstable incomes as well as the high rates of interest associated with most forms of debt.

The nature of debt has changed dramatically over the last forty years.  Forty years ago, debt was used for emergencies or large purchases that needed to be financed.  Today more and more people are using debt to buy groceries and for the necessities of life.  In fact, according to the Canadian Bankers Association, the average charge (at point of sale) on credit cards is at an all time low.

Consumer proposals allow people to consolidate all their debts into one manageable monthly payment without interest.  They are a great option for people wishing to get out of debt and avoid bankruptcy.  Imagine, for example, making one monthly payment of $200 instead of a series of payments totaling $1,200 to get relief from $60,000 worth of credit card debt.  While the outcomes are not the same for everyone that is a typical scenario for people making a consumer proposal.

Since everyone’s situation is different, what worked for one client may not work for another and that is why we always offer free initial consultations.  Get good information to help you solve your debt problems and get you back on track.  Be wary of promises from unlicensed, unregulated debt consulting companies and deal directly with a Licensed Insolvency Trustee.

The longer you struggle with minimum monthly payments, that often do not reduce the debt at all, the longer you will drain vital (financial) resources away from your family.  Add up how much money you spend every month on repaying the interest on loans and ask yourself if you would like a better solution.  Having a conversation about your debt and possible solutions is free just call 519-646-2222 and let’s get you back on track.