ARE YOU FACING PERSONAL FINANCIAL RUIN?
Personal financial ruin: Introduction
Thousands of Canadians are facing personal financial ruin. We recently published a vlog #VIDEO-MORE CANADIAN WORKERS LIVING PAYCHEQUE TO PAYCHEQUE AGONY: SCARY NEW SURVEY RESULTS# based on the recent survey by the Canadian Payroll Association. You may not think that $200 sounds like a lot of money but the information shows that 56% of those polled would be close to negative cash flow if they took on another $200 in monthly debt payments.
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This is alarming enough on its own, but just six months ago it was 48% who couldn’t take on more debt burden. What this also means is that if those same people had an emergency where they had to come up with another $200, they couldn’t.
The potential for personal financial ruin is increasing
That’s an 8% increase in six months. According to the Canadian Payroll Association, 48% of Canadians couldn’t make ends meets if they missed just one paycheque. And Statistics Canada reports that household debt as a ratio of disposable income rose to 167.6% in the second quarter from 165.2% in the first quarter. These are statistics that we just can’t ignore.
Interest rates will increase one day and will cause personal financial ruin
The number of Canadians teetering on the edge of insolvency is staggering. Credit rating agency TransUnion released the results of their latest survey.
- 718,000 Canadians can’t even absorb a 25-basis point increase in interest rates without being in a negative cash flow situation
- One percentage point would drive 917,000 over the edge
Canadians who believe that low-interest rates are here to stay are playing with fire. Historically interest rates have gone up and down, and they will at some point begin to rise. Using credit, even cheap credit, to cover monthly expenses is not a good financial plan; it’s a recipe for disaster. What’s going to happen if there’s a 1% increase? According to TransUnion that’s all it would take for 917,000 Canadians to be facing bankruptcy.
Contact us and prevent your personal financial ruin
The time to change your attitude about low-interest rates and using credit to pay your monthly expenses is NOW! Don’t risk losing it all and putting your family into personal financial ruin.
Contact a debt expert – a professional trustee – who can help get you off the credit merry-go-round and back on solid financial footing Starting Over, Starting Now. Ira Smith Trustee & Receiver Inc. can help keep you from financial ruin with immediate action and the right plan. Call us today for a free, no obligation consultation.
