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UNDERSTANDING AND OVERCOMING FINANCIAL STRESS: A COMPREHENSIVE GUIDE TO GET FROM WORRIED TO WELL-PREPARED

financial stress

Financial stress introduction

Financial stress and anxiety are an undeniable reality as well as a major source of anxiety for many people in Canada, as the expenses of a living surge, incomes stay stationary, and financial debt gathers. This scenario can result in anxiousness, nights invested tossing and turning, and also physical health conditions. However, it’s vital to keep in mind that your life doesn’t have to be dictated by economic stress and anxiety. By employing ideal techniques and adopting the ideal attitude, you can seize control of your funds and also alleviate the worry that accompanies them.

Within this Brandon’s Blog, I offer the recent findings of the FP Canada ™ 2023 Financial Stress Index, along with techniques for managing and surmounting financial stress. You’ll run into functional guidelines and also expert support that will certainly encourage you to take back command of your financial resources and obtain tranquillity of mind. Whether you’re coming to grips with cash worries and financial difficulties or endeavouring to enhance your financial stability, this blog will certainly equip you with the tools and knowledge needed for triumph. Allow us to start an expert voyage to dominate economic anxiety and also stride toward a future of monetary safety and security.

Definition of financial stress

Financial stress is the psychological and emotional concern experienced by people or families as a result of their financial situations. It arises from money worries when there is an inconsistency between a person’s funds and their financial obligations or ambitions, giving rise to feelings of nervousness, concern, as well as unpredictability concerning money matters.

The origins of financial stress can be credited to different factors, including considerable levels of financial debt, limited earnings, joblessness or underemployment, unexpected costs, medical bills, not enough financial savings, or the failure to fulfill financial objectives. It can impact individuals from all walks of life, regardless of their income level or socioeconomic status.financial stress

Financial stress and illnesses

In February 2022, I wrote the blog “WHAT PERCENTAGE OF ILLNESSES ARE DIRECTLY OR INDIRECTLY CAUSED BY FINANCIAL STRESS? FINANCIAL STRESS IS THE MOST COMMON OF ALL TRIGGERS”. In that Brandon’s Blog, I delved into the significant impact that financial strain and money worries can have on the onset and progression of various health issues, ranging from common tension headaches to more severe conditions such as cancer.

The symptoms of monetary anxiety can materialize in different methods, consisting of:

  • Consistent worrying about money matters, such as expenses, loans, or future financial stability.
  • Trouble sleeping or sleeplessness as a result of money issues.
  • Feeling overloaded or powerless regarding one’s financial scenario.
  • Strained connections, disputes, or stress with family members or friends because of financial problems.
  • Avoiding or ignoring financial problems, which can lead to further issues.
  • Physical symptoms and signs like headaches, tiredness, high blood pressure or stomachaches because of financial stress and anxiety.
  • Increasing degrees of chronic stress, anxiety, clinical depression, or various other mental health challenges
  • and other wellness problems.
  • Difficulty focusing or reduced performance at work due to financial concerns.

The serious impact of financial stress can significantly disrupt an individual’s holistic well-being. It has the potential to influence one’s mental and physical health, interpersonal connections, occupational performance, and the overall essence of life. Moreover, it may initiate a recurring pattern of economic hardships, as anxiety can impair the capacity to make sound decisions and prevent efficient financial strategizing.

To effectively handle the burden of financial stress, it is crucial to devise and execute well-rounded approaches. These approaches could encompass devising a budget for your household, trimming unnecessary expenditures, exploring diverse income sources, seeking advice from financial professionals, and diligently building a financial cushion through consistent savings. Moreover, giving utmost priority to self-care is immensely significant. This may entail reaching out to reliable confidants for support and adopting stress-reducing methods that target the psychological impact of enduring financial difficulties as time goes by.

Without a doubt, the undeniable impact of financial stress affects many people and their families. However, by acknowledging that you are not the only one and actively taking steps to reduce its perilous consequences, one can emerge victorious and steer toward a path of enhanced financial well-being.

The FP Canada™ 2023 Financial Stress Index results

On June 15, 2023, FP Canada™ published its 2023 Financial Stress Index. The purpose is to gain insights into the factors that cause Canadians’ financial stress and how professionals can help Canadians overcome the stress brought on by their financial issues and improve their quality of life through better financial literacy and sound money management principles.

The latest Financial Stress Index findings show that inflation’s impact on the costs of goods and services, and elevated gas and grocery prices specifically, are out of all possible sources of stress, the one that is contributing the most to Canadians’ financial stress. As Canadians struggle to afford groceries, gas and other goods and services, nearly half (48%) have less disposable income compared to a year ago, a substantial increase from 2022 (39%).

Further, Canadians say they are struggling to save money. Saving enough for retirement (35%) and saving for a major purchase (32%) are two areas of growing concern. Younger generations are also more likely to feel the pinch, and Canadians aged 18-34 are the most concerned about saving for major purchases (50%).financial stress

Importance of financial wellness

Nowadays, the importance of money administration and financial wellness has never been more pivotal. With the perpetually escalating cost of existence and the unpredictability of the fiscal panorama, it has become crucial that we embrace responsibility for our finances and guarantee our economic steadiness. Financial well-being is a fundamental facet of overall welfare and is the key to a satisfied and pressure-free existence. This requires making knowledgeable and perceptive fiscal judgments, establishing realistic financial aspirations, and devising a budget that is customized to your necessities.

Obtaining and also maintaining a state of financial security includes more than simply generating wealth. It demands a thorough approach to money administration that involves thoroughly inspecting your financial situation, developing a detailed approach, and actively pursuing properly stated goals. This method additionally entails supporting sensible financial practices that cultivate security and lead you on the path toward withstanding and also lasting success over time.

How to Overcome Financial Stress

What is the cause of your financial stress?

In the middle of the current world of rapidity and dynamism, financial stress has gained extensive acknowledgment as a pressing concern affecting many individuals. Whether you are overcome with seemingly insurmountable financial debts, just barely surviving paycheque-to-paycheque, or constantly plagued by anxiety over financial issues, such stress factors cause significant damage to your well-being.

To effectively navigate the complexities of financial stress, it is imperative to embark upon the initial stage of discerning the underlying origins of this stress. It may arise from excessive expenditure exceeding one’s earnings, inadequate income to meet fundamental necessities, uncertainties surrounding employment, insufficient savings, the volatility of markets, or unexpected expenditures.

Establishing a robust financial foundation necessitates undertaking pragmatic endeavours, such as delineating precise financial objectives, formulating a budgetary framework, and fostering constructive monetary practices. Identifying the fundamental catalysts of your financial burdens holds the key to implementing attainable strategies that can pave the way toward a more financially stable future and, ultimately, instill a sense of tranquillity.

Create a budget and stick to it

Managing your finances on a tight budget can prove to be quite a challenge, and it often leads to feelings of stress and strain. Financial stress has the potential to cause a range of negative consequences, including strains in relationships, issues with both physical and mental health issues, and even a decline in productivity at work.

To steer clear of these problems, the best approach is to develop a budget and adhere to it diligently. A budget serves as a financial roadmap, outlining the amount of money you have coming in and the amount you have going out. It’s a powerful tool that aids in the management of your finances, enabling you to prioritize your spending and save for the future.

If you find yourself grappling with financial difficulties, barely making ends meet from one paycheque to another, or simply aspiring to enhance your financial fitness, a financial budget is an invaluable asset. Essentially, a budget acts as a comprehensive blueprint for your finances, mapping out your earnings and expenditures while imposing certain constraints on your spending across different categories.

By establishing a budget, you can gain a clear understanding of your financial situation and identify areas where you can cut back and save money. Adhering to your budget helps you steer clear of overspending and accumulating debt, ultimately relieving financial stress and enhancing your overall financial well-being.

Creating a budget lays the foundation for financial stability and represents a crucial step toward overcoming financial stress. With a budget in place, it becomes easier to devise a plan for repaying debts and setting realistic long-term financial goals. However, bear in mind that crafting a budget is merely the initial stride. Sticking to it demands discipline and regular review to ensure you stay on course. A seasoned financial advisor can offer tailored advice and an effective strategy to help you remain on budget and achieve financial success.

Prioritize debt repayment

Establishing a well-thought-out technique for dealing with financial debt payments can be highly effective in handling and getting over financial stress. It is critical to focus on debts with higher rates of interest first to fully pay them off first. By adopting this technique, the total interest problem is decreased, and the rate of getting rid of financial debt is increased.

Equally substantial is creating a monthly payments strategy that sets regular monthly targets vigilantly and stays with them with resolution. Furthermore, discovering options such as debt consolidation loans, negotiating with creditors, or getting help from an accredited non-profit credit counselling agency in your local community all need to be considered.

Constantly applying these methods empowers individuals to regain control of their financial situation and reduce and ultimately wipe away money stress.

Build an emergency fund

Determining the optimal level for your savings in case of emergencies is extremely important. As previously suggested by Brandon’s Blogs, it is advisable to possess a reserve amounting to three to six months’ worth of your family’s expenses. Precisely calculating your monthly expenditures at home plays a pivotal role in identifying the appropriate sum to allocate for unforeseen circumstances.

Taking the crucial step of opening a separate account that accrues interest solely dedicated to your emergency savings is highly recommended. It is imperative to refrain from withdrawing from this account unless it becomes necessary. By doing so, you enhance your capability to handle any unexpected costs that may arise. It is of utmost significance to perceive this account as a safety net of last resort rather than utilizing it as a regular source of funds.

Incorporating the practice of automatic payments constitutes another effective technique. You have the option to establish regular transfers from your primary account to the interest-earning fund of your emergency savings. This ensures that you consistently contribute to your emergency fund without the requirement of constant monitoring. It is a reliable approach to steadily building up your financial safety net.

Seek professional advice

When it comes to managing and overcoming financial stress, seeking professional financial advice can make all the difference. A trained financial professional can help you assess your financial situation, determine your exact level of financial difficulty, identify areas where you can make improvements, and develop a plan that will help you achieve your goals, achieve good financial health and live a more financially stable life.

Whether you’re dealing with debt, struggling to make ends meet, or simply want to take your finances to the next level, a financial advisor can offer the guidance and support you need to succeed. So don’t hesitate to reach out to a professional if you’re feeling stressed or overwhelmed – they’re there to help.financial stress

Financial stress: Common traps to avoid

Payday loans

Payday loans may appear to be a convenient option when faced with unexpected expenses or financial emergencies. However, it’s essential to recognize that these short-term loans often carry exorbitant interest rates and fees, which can trap borrowers in a cycle of debt. Before entering into any agreement, it is crucial to fully understand the terms and conditions associated with payday loans.

In reality, payday loans can have detrimental effects on your financial well-being. Instead, exploring alternative forms of financial assistance, such as low-interest credit cards or personal loans, might be a wiser choice. These options typically offer more favourable terms and can help you manage your financial situation without falling into a debt spiral.

To safeguard your financial health in the long run, it is advisable to establish a budget and build an emergency savings fund. By carefully managing your expenses and setting aside funds for unexpected circumstances, you can reduce the need for relying on payday loans in the future. Creating a financial safety net through savings provides greater stability and flexibility during challenging times.

Remember, the allure of quick cash from payday loans can be enticing, but the potential drawbacks and long-term consequences outweigh the short-term benefits. Prioritizing financial responsibility and exploring alternative avenues for assistance will contribute to your overall financial well-being and help you avoid the pitfalls associated with payday loans.

Credit card debt

Financial stress in Canada is a common issue, with credit card debt being a significant contributor. Many people are drawn to the convenience and rewards offered by credit cards, leading to overspending and a high accumulation of debt with steep interest rates. It is crucial to carefully plan and prioritize payments to avoid falling into the trap of owing money to credit card companies. Understanding the complex terms and conditions surrounding credit cards, such as payment deadlines and interest rates, can help individuals make informed financial decisions.

In addition, seeking guidance from a reputable financial advisor or community-based non-profit credit counselling services can provide valuable support and direction in managing credit card debt. By adopting effective strategies and practicing responsible fiscal habits, anyone has the potential to overcome credit card debt and achieve a state of financial stability and peace of mind.

Impulse spending

Impulse buying can quickly become a major contributor to financial stress. We’ve all experienced the temptation to purchase something we don’t need on a whim, only to regret it later when our finances suffer.

It’s important to recognize the role that emotions can play in our spending habits and to practice mindfulness when making purchasing decisions. By creating a budget, prioritizing our needs over our wants, and taking time to consider our purchases, we can avoid falling victim to impulse buying.

With discipline and self-control, we can regain control of our finances, reduce our stress levels, and achieve our financial goals.

Lack of financial education or financial literacy

One common trap that individuals fall into when it comes to financial stress is the lack of financial education. Many individuals simply do not have the knowledge or skills necessary to effectively manage their finances. An absence of proper financial education can lead to poor decisions when it comes to budgeting, saving, and investing, which can further contribute to financial stress.

It is crucial to seek out resources and education in this area to develop a strong foundation of financial literacy. By arming oneself with knowledge and skills, individuals can strengthen their financial position and alleviate the stress associated with concerns about money management.

Financial stress: The benefits of being financially prepared

Peace of mind

Being financially prepared generates a myriad of benefits, with the most remarkable among them being the extensive feeling of tranquillity that comes with the guarantee of your financial affairs being well-ordered. By taking charge of your financial situation, mastering the art of expense management, as well as having a detailed understanding of your financial objectives and the methods to attain them, you can escape the stress caused by unanticipated expenditures and the perpetual cycle of living from one paycheque to one more.

By using efficient methods and a diverse range of tools, people can create a durable framework for their fiscal future, thus instilling a feeling of steadfast security and fortified safety and security while doing so. Eventually, the reward of the peacefulness of the mind that accompanies financial readiness, enables people to relish life without the perpetual problem of financial worries.

Increased ability to handle emergencies

Being financially prepared means having the ability to handle unexpected emergencies without causing undue stress and anxiety. It’s important to establish an emergency fund as part of your financial plan. This fund should be easily accessible and able to cover at least three to six months of living expenses.

In the event of an emergency such as job loss or a medical issue, having an emergency fund can provide peace of mind and reduce financial stress. By prioritizing financial preparedness, you can feel confident in your ability to handle unexpected expenses and maintain your financial stability.

Improved credit score

You have the power to attain financial stability, and it all begins by constructing an extraordinary credit rating. A remarkable rating unlocks opportunities for loan and credit card approvals, favourable interest rates, and access to outstanding financial products.

Through the cultivation of astute financial practices and the alleviation of monetary burdens, you can propel your credit score to new heights. Keep a vigilant eye on your financial obligations, employ prudent credit card usage, and handle your credit responsibilities with diligence.

The ability to assume command over your financial circumstances resides deep within you. A robust credit score paves the path toward a brilliant and prosperous future. Place your trust in your capabilities, and take decisive action to accomplish financial triumph. The possibilities before you are limitless.

Financial stress: Conclusion

I hope you enjoyed this financial stress Brandon’s Blog. Financial stress is a growing concern in Canada, affecting individuals of all ages and income levels.

Creating a solid financial plan can be the key to unlocking a brighter and more successful future. By taking control of your finances, you can prioritize your expenses, set clear financial goals, and build a strong foundation for your dreams to come true. With the right mindset and approach, financial planning can empower you to regain control, eliminate this issue as a source of stress in your life and find peace of mind.

Individuals must take proactive measures to address financial difficulties and promptly seek assistance when necessary. It is crucial to recognize that financial stress is a prevalent concern and seeking help is a demonstration of fortitude, rather than vulnerability. Should you encounter challenges in managing your finances and find yourself burdened by stress, do not delay in pursuing aid.

Revenue and cash flow shortages are critical issues facing people, entrepreneurs and their companies and businesses that are in financial distress. Are you now worried about just how you or your business are going to survive? Are you worried about what your fiduciary obligations are and not sure if the decisions you are about to make are the correct ones to avoid personal liability? Those concerns are obviously on your mind.

The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious.

It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team uses innovative and cutting-edge methodologies, to adeptly navigate you through the intricacies of your financial challenges, ensuring a resolution to your debt-related predicaments without resorting to the rigours of the bankruptcy process. We can get you debt relief now!

We have helped many entrepreneurs and their insolvent companies who thought that consulting with a Trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring.

We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you.

The Ira Smith Trustee & Receiver Inc. team understands that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel.

Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now.financial stress

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THE HIDDEN EFFECTS OF FINANCIAL STRESS: WHAT YOU NEED TO KNOW

financial stress
finacial stress

Definition of financial stress

Are you feeling weighed down by money worries? Is your quality of life disintegrating before your very eyes? You’re not alone. Financial stress is a common problem that affects many people. It’s defined as a feeling of unease or worry caused by the lack of financial resources or the belief that you don’t have enough money. It can be caused by both happy and troubling events. Whether it’s an unexpected expense, a lost job, a major purchase such as a home or just the everyday stress of trying to make ends meet, it can take a toll on your well-being.

In this Brandon’s Blog, I will discuss financial stress and how a person can take control of it. I will give actionable tips to relieve stress and improve your financial well-being. Don’t let money worries overwhelm you – take the steps needed to reduce your financial stress.

Understanding the causes of financial stress

Do you know someone dealing with financial stress? You’re not the only one! Money stress from financial concerns can be a major source of stress. The most common causes of financial stress are:

  • trying to cover all your expenses;
  • feeling overwhelmed by debt;
  • having no savings;
  • housing insecurity;
  • unexpected costs;we
  • living pay cheque to pay cheque; and
  • an ever-growing debt load.

It can feel like you’re stuck in a never-ending cycle. But don’t worry – there’s always a way to get back on track! Taking the right steps can make a huge difference.

financial stress

Financial stress and its impacts

Consequences of financial stress on your physical and mental well-being

The burden of financial stress can take a serious toll on your well-being emotionally and physically. Those dealing with money worries are twice as likely to suffer from poor health and four times as likely to experience sleeping troubles, aches, withdrawal from social life and social integration and more. Furthermore, financial stress can cause depression and anxiety symptoms and can be a major contributor to heart issues. Not to mention, it can also cause fractures in relationships and make it increasingly difficult to stay on top of finances and other obligations.F

How it can affect your work

Financial pressures can take a toll on any individual, and that strain can seep into their work lives. Struggling to make ends meet can result in a drop in job performance, more days off, or worse – a potential job loss. Additionally, it can bring about emotional and physical health issues, reducing productivity and contentment with their work. In addition, it can generate a decrease in morale, job satisfaction and a greater sense of unease.

Financial tensions leading to emotional tension can significantly negatively affect an employee’s job performance. It is essential that employers are aware of the impact this can have on their staff, offering resources to manage their financial situation, and minimize the effect of financial stress in the workplace.

The outcomes of financial stress on human wellbeing

Financial challenges leading to financial stress can be a soul-sucking burden on physical and personal health and cause mental health issues, manifesting in everything from physical symptoms, hypertension (high blood pressure), heart disease and depression to strained relationships and unhealthy sleep and eating patterns. It’s an environment of negativity that can be hard to escape. But there’s hope! Acknowledge the stress and make a plan to overcome it. Start by budgeting, tracking spending, setting up an emergency fund, and if possible, looking for ways to increase income. Life can be so much brighter when you take control of your finances.

Prevalence of Financial Stress

Financial stress is a growing problem in North America, with millions struggling with financial issues to make ends meet and cover essential expenses. The burden of financial stress is even larger when considering its ripple effect on families, relationships, and overall well-being, not just your financial health.

As already stated above, it is well documented in studies that financial stress can negatively impact mental health and lead to physical health problems. Financial stress is pervasive across all socihealtho-economic levels and particularly burdens minority and low-income populations.

Financial stress can be a significant issue for everyone regardless of their financial standing, educational background, or occupation. Financial stress will most certainly lead to greater financial dilemmas if not managed properly.

Many people don’t realize that anyone can experience financial stress at any point in their lives. It is not something that only affects those who have little to no money or cannot balance a chequebook. Everyone should understand that financial stress can upspring from unexpected costs, inadequate savings, poor budgeting strategies, or job loss. Financial stress does not discriminate amongst people who may find themselves in a difficult financial situation due to illness, divorce, or other unplanned circumstances. It is not your fault.

Therefore, it is important to recognize the above-noted signs and symptoms of financial stress and understand how to manage it.

financial stress

Coping strategies for financial stress

Knowing Your Money

It’s time to take charge of your finances! Having a grip on your money and a comprehensive understanding of what’s going in and out of your accounts every month is vital for making savvy financial choices. Crafting a budget to stay on top of your source of income is a great way to use your funds in the most effective way possible. Additionally, it’s a smart move to look into ways to reduce your monthly financial expenses to ensure you have a financial buffer for those unexpected expenditures and can build up your savings.

Taking stock of your finances

Assessing your financial situation is an essential step to gaining control of your finances and improving your financial well-being. To do this, you should create an itemized list or record of your financial resources and debts, specifying the interest rate and outstanding balance.

Having this knowledge can give you a better understanding of your finances and enable you to make more informed decisions. Taking the time to reflect on your financial circumstances can be the first step toward financial stability.

Talking to someone

Financial stress can be overwhelming and it is not something that should be borne alone. Seeking out support from trusted sources can make a world of difference in managing stress and making progress toward finding a resolution. Engaging in dialogue with another person can be beneficial when addressing financial anxiety.

Whether it is a family member, friend, or support group, the act of just talking to someone can help lessen the burden of financial stress. It can be intimidating to open up about financial worries, but talking to someone can be an important source of support and guidance.

Overcoming financial stress by engaging in self-care

This third strategy of self-care as a means of dealing with financial stress deserves its own section. Common methods of self-care which deal mainly with both the physical and the mental stress aspects are:

Exercise

Physical activity is a great way to de-stress and look after your well-being! High-intensity exercises like running, elliptical, and cycling are known to lessen overall stress levels, regulate your mood, enhance your sleeping pattern, and bolster your self-confidence. Even just a short five minutes of cardio can have a calming effect on your stress levels.

Diet

It’s vital to maintain a wholesome diet to keep your well-being in check, and it can even help reduce worry. Nosh on nourishing meals, drink plenty of fluids and dodge caffeine and sugar to elevate your spirits, energy, and focus – all of which can assist you in tackling financial stress.

Relaxation Techniques

Using relaxation methods like deep breathing exercises, meditation, or yoga can be a great way to combat stress and promote mental health. Implementing just a few minutes of relaxation practices daily can help you better tackle financial stressors and improve your overall health and well-being.

Time for yourself

Finding time for yourself can be a vital part of managing financial stress. Taking a break from your daily responsibilities can help to restore and rejuvenate your mental and emotional energy.

Consider activities such as reading, taking a stroll, or napping as a means of giving yourself a much-needed break. Rest and relaxation can be important parts of maintaining your financial wellness.

financial stress

Seeking professional mental health Help

It is recommended to seek professional help for mental health issues as mental health professionals can provide guidance in overcoming challenges, changing negative behaviours, understanding and healing from past trauma, setting goals and building self-confidence, all with the aim of improving your quality of life. There are many resources and services available to those seeking help for themselves, friends or family members. In the case of suicidal symptoms, professional help is essential and should be sought immediately.

Final Thoughts on Financial Stress

I hope you enjoyed this financial stress Brandon’s Blog. I hope that it has helped you to discover the impact that financial stress can have on a person’s mental and physical health and has provided some tips on how to prevent and overcome the negative effects of stress.

You may also wish to read my February 28, 2022, Brandon’s Blog, WHAT PERCENTAGE OF ILLNESSES ARE DIRECTLY OR INDIRECTLY CAUSED BY FINANCIAL STRESS? FINANCIAL STRESS IS THE MOST COMMON OF ALL TRIGGERS.

Revenue and cash flow shortages are critical issues facing entrepreneurs and their companies and businesses. Are you now worried about just how you or your business are going to survive? Are you worried about what your fiduciary obligations are and not sure if the decisions you are about to make are the correct ones to avoid personal liability? Those concerns are obviously on your mind. Coming out of the pandemic, we are also now worried about the economic effects of inflation and a potential recession.

The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious.

It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now.

We have helped many entrepreneurs and their insolvent companies who thought that consulting with a trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring.

We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you.

We understand that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel.

Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now.

financial stress

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WHERE IS LAURENTIAN UNIVERSITY WITH ITS HELPFUL CONCLUSIVE COMPENSATION CLA1MS PROCESS?

where is laurentian university

We hope that you and your family are safe, healthy and secure during this COVID-19 pandemic.

Ira Smith Trustee & Receiver Inc. is absolutely operational and Ira, in addition to Brandon Smith, is readily available for a telephone consultation or video meeting.

Where is Laurentian University in dealing with ‘An ugly stain for years to come’: Laurentian University students, staff reeling from cuts

As regular Brandon Blog readers know, I have been writing about the financial difficulties leading to the Laurentian University creditor protection filing under the Companies’ Creditors Arrangement Act (CCAA) as major events unfolded. The filing for bankruptcy protection was to allow for ongoing operations to continue and to come up with a Plan of Arrangement to deal with creditor claims.

The end of this week was scheduled to be another milestone in the Laurentian CCAA insolvency process, but it appears that event won’t happen on time. The purpose of this Brandon Blog is to discuss where is Laurentian University at with its compensation claim process for current and terminated faculty and staff?

Laurentian University situation so dire, it couldn’t afford to pay staff

This post-secondary institution faced a cash crisis and many financial issues leading to having filed its application for creditor protection on February 1, 2021. So far, I have written on:

Where is Laurentian University with the Amended and Restated Claims Process Order?

I previously wrote about the Laurentian University Amended and Restated Claims Process Order (A&R Claims Process Order) when it was obtained from the Court on May 31, 2021.

Among other things, the A&R Claims Process Order developed a claims process to recognize, identify and deal with certain claims of creditors. The A&R Claims Process Order left out Compensation Claims to allow Laurentian, with the help of the Monitor and in discussions with the Laurentian University Faculty Association (LUFA) and also Laurentian University Staff Union (LUSU), to establish a process as well as a method for the identification of Compensation Claims.

Compensation Claims usually consist of the claims of current and previous employees, retirees, and also the labour unions relative to employment, benefits, pension, and/or labour contracts among the stakeholders and Laurentian University, and also claims of specific third parties relative to involvement of their employees in the retirement health benefit plan.

In their application to Court last May, Laurentian University told the Court that they would be back to have the Compensation Claims process approved no later than July 30, 2021.

where is laurentian university
where is laurentian university

Where is Laurentian University with its creditor protection compensation claims program now?

Laurentian told the Court that its Compensation Claims process will:

  • develop the key groups of claims to be covered in a Compensation Claims
    procedure;
  • determine what info and also how the information needed to calculate such
    claims can be assembled based upon the information in the hands of Laurentian and third-party service providers;
  • develop the Compensation Claims Methodology; and
  • think about alternate procedures for notice as well as claims handling.

In its motion record dated July 23, 2021, Laurentian has advised the Court that although it is working diligently with the Monitor, LUFA and LUSA, Laurentian will not be able to serve materials explaining its Compensation Claims process in time to seek Court approval no later than July 30. So, Laurentian is asking for an extension from July 30 to August 20, 2021. In the motion record, it is not stated exactly where is Laurentian University in this process. Laurentian has advised that its lawyers have booked time with the Court to hear the motion on August 17, 2021, at 9:30 AM.

UPDATE: On July 28, 2021, the Court approved amending paragraph 46 of the Claims Process Order to extend the date that Laurentian University must bring a motion to the Court to seek approval of: (a) the Compensation Claims Methodology, and (b) the process for notification of Employees and claims process, from “no later than July 30, 2021” to “no later than August 20, 2021”.

Where is Laurentian University? Ask current President Dr. Robert Haché

In support of this motion for an extension of time, the motion material includes the affidavit of Dr. Robert Haché, University President and Vice-Chancellor of Laurentian University of Sudbury, sworn on July 23 (the Haché Affidavit).

The Haché Affidavit really doesn’t say much and unfortunately, it does not say exactly where is Laurentian University in the finalization of the Compensation Claims process. It summarizes the background about the bilingual university financial troubles as to how this post-secondary education institution got to where it is today in the Laurentian CCAA insolvency process and advises the Court that:

  • Laurentian and the Monitor have been working diligently on settling the Compensation Claims Methodology, nonetheless, as a result of a variety of competing and urgent demands put on the University’s limited resources, (which presumably includes the demands of day to day operations) development has actually been slower than expected.
  • Although the information-gathering phase took longer than anticipated, drafts of the Compensation Claims Methodology have been prepared and also shown to LUFA and LUSU.
  • Regardless of best efforts, Laurentian was not able to finalize the Compensation Claims process in order to have everything in time for the Compensation Claims Methodology to be provided for Court authorization by July 30, 2021, based on the A&R Claims Process Order.
  • Therefore, the University looks for a short extension to that date. This requires a change to paragraph 46 of the A&R Claims Process Order to prolong the day whereby Laurentian can bring a motion to the Court to seek the authorization for the Compensation Claims Methodology to no later than August 20, 2021.

The Haché Affidavit is light on details as to what the issues getting in the way are, what has been agreed to so far and where is Laurentian University in all this? Close or still far off? It provides no real useful information to determine where is Laurentian University on this issue. My review of documents that were made public sheds no more light than what I am telling you in this Brandon Blog. They are obviously hoping that this request will not meet with any opposition so that it will allow for a positive impact on the financial restructuring.

So, unfortunately, there is no real insight into what is holding up the Compensation Claims process for claims of current and former faculty and staff, including severance payments, which certainly will be in the millions of dollars.

I doubt that anyone will wish to try to upset the restructuring over this issue. As of the time of writing this Brandon Blog, there is not a current Monitor’s Report in support of this motion yet made public.

Where is Laurentian University in all of this? I suspect that Laurentian will receive the extension it is requesting.

where is laurentian university
where is laurentian university

Where is Laurentian University summary

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where is laurentian university
where is laurentian university
Categories
Brandon Blog Post

TWO INCOME TRAP OF SEN. WARREN

two income trap

If you would rather listen to the two income trap blog audio file, please scroll down to the end for the podcast.

Two income trap: Introduction

In the last 50 years, women have entered the labour force in real numbers. This did not result in families having a much easier time of it economically. A great number of people thought it would because a family now had two full-time income earners. Financial troubles might if anything be much more extensive among two income households today. This is called a two income trap.

Two income trap: Senator Elizabeth Warren

I recently read an article on the United States Senator Elizabeth Warren. I had not been actually familiar with her history prior to reviewing the write-up. Turns out that she was a lawyer who focussed on bankruptcy legislation. She was a professor at the Harvard Law School.

Senator Warren’s daughter, Amelia Warren Tyagi, is an entrepreneur and management consultant. They co-authored a book “The Two-Income Trap: Why Middle-Class Mothers and Fathers Are Going Broke“. It was first released in 2003 and an updated version was released in 2016. The book is a sociological review of exactly how American households and life have developed from the 1960s to contemporary times. Although it is a testimonial of American life, I think the same concepts and conclusions can be related to Canada’s middle class too.

Two income trap: The rise in middle-class insolvencies

One reality that bothered the writers was that by the early 2000s, bankruptcies in the middle class became greater than in any other American socio-economic group. To put it simply, when considering the family members that are declaring bankruptcy, it’s not the extremely poorest or the really wealthiest. It actually has to do with the middle class and the kind of financial difficulties they meet.

The writers wished to attempt to clarify why much more middle-class households, making even more than ever previously, saw a 500% rise in individual bankruptcy filings from the very early 1980s to the very early 2000s. The writers likewise keep in mind that along with personal bankruptcies, home mortgage foreclosures were up greater than 3.5 times than in the very early 1980s. This is prior to the 2008 economic disaster mess!

Two income trap: The financial disintegration of the middle-class household

Their study began with a solitary reality. The possibility that a family with youngsters would wind up in bankruptcy is more than families without children. They uncovered that households that have youngsters in the family are almost 3 times more likely to wind up declaring bankruptcy than households that do not have children.

The writers think it is really vital to comprehend the problems triggering middle-class economic issues. This is due to the fact that they discovered that 2 out of every 3 households that applied for bankruptcy have actually had a real job loss or loss of income prior to their declaring bankruptcy.

Someone’s lost a job; a person’s had a major downturn when it comes to households where both the husband and wife work. Sometimes both of them have actually lost their job before bankruptcy. So we’re actually talking about individuals that are not just way down on the earnings side. They had no financial savings or emergency money fund to draw on when the unanticipated calamity struck. Stating it a different way, households were damaged attempting to have a middle class lifestyle!

This concern fascinated the writers. We can comprehend the young and careless declaring bankruptcy. We can also recognize a tale about seniors in debt that states decreasing health, limited revenue, no potential to make extra in the future and insufficient funds for retired life will certainly have financial issues. Nevertheless, in the case of seniors in debt, the reasons for their financial difficulties probably began a very long time ago. With restricted earnings and no financial savings to draw on, revealed the concerns which already existed.

Two income trap: The newer generation middle class

Insolvency stories about women and men working and raising children are normal today, but this was not so in the very early 1980s and earlier.

In those days, middle-class stories were not about creating debt to purchase consumable or lifestyle items they cannot afford. Stories about the current middle class in financial trouble inevitably show similar primary factors why these family members wind up bankrupt. They are attempting to spend on not only food and clothing but other costs that have become family fixed costs, such as:

Middle-class families need to have 2 automobiles when both mother and father are in the labour force. The spread of suburban life families have out of necessity opted to get more space for the dollar and overall affordability, also demands being a 2 car family. By the time they make all their fixed cost payments, those two income households think about what was supposed to be their financial success tale.

They have much less cash left over than their one-income dads’ or grandfathers’ households had. It appears that as our society modernizes and allows people to do a lot more, the ambitions of middle-class families do not always come to fruition. The middle class has been and continues to shift. The middle-class size has reduced compared to the 1970s. Families have been either moving up or down. On a net basis, the middle class has not been growing.

This actually does not amaze me. When you have children your expenditures jump astronomically. As lately as the very early 1970s, a Canadian household had buying power on one income. It certainly gave a middle-class way of living. What took place in the 1960s and 1970s, is one income sufficed to sustain a household in what was a typical and comfortable middle-class life.

It absolutely was middle class; it was right in the centre. You may have needed to clip coupons to save money, yet you were buying your food at grocery stores, not going to a food bank. Your home could have been small, yet it was your own and you had the want and ability to hive off savings from your regular employment income to pay off your only mortgage quicker.

Two income trap: So what has changed?

That generation recognized exactly how to stick to a spending plan. They were more successful than their parents’ generation. They learned lessons from their parents about: (i) money; (ii) budgeting; (iii) saving for an objective; and (iv) understanding and being OK with if you cannot pay cash now for something, you simply do not buy it.

Now with both parents in the labour force, expenditures for dining in a restaurant more often, more expensive clothing, gas for the two cars are instances of regular expenditures the modern family has. One or two generations ago families did not have the same level of those kinds of expenses. Modern families spend a lot more than simply for what was the core fundamentals. We constantly recognize that having children is costly. Yet something has taken place in a single generation. The expense of living for a family with kids has actually made what once was a common middle-class life out of reach for the ordinary typical income earner.

Nowadays, the level of a household’s fixed costs is not how an economist would look at costs as compared to the income level. Rather, it is how people today understand what a two income family’s costs realistically are at the same income level. In modern-day culture, people are dining in restaurants a lot more, have home appliances and communication devices that did not exist 1 or 2 generations earlier. Housing expenses have boosted considerably. This is the brand-new facts of life for the contemporary culture household.

Two income trap: So here is the key to release you from the trap

Canadians have a financial literacy problem. Lots of people assume that some are born rich while others are not. The fact is that in most cases, those that are well off simply have a much more reasonable understanding on costs and how to live within one’s means. They also have willpower. In the past, people thought first if they could actually afford something before they spent their money on it. They don’t just look at the interest rate and monthly payment incurring that new debt will have.

I have written several blog posts alerting Canadians about the need to budget and plan thoroughly to make sure that expenses do not surpass income. A spending plan requires to consist of savings; both for an emergency reserve and for retired life. Those that do not do so are more likely to be in financial trouble when an unforeseen occasion happens. It is because they have absolutely nothing to draw on in lean times.

There are many ways to start early in life to avoid financial disaster. If it sounds familiar, that’s due to the fact that they are. Nonetheless, yet few people value them. That’s partly due to the fact that they weren’t taught in either the home or in the schools.

Financial proficiency, like civics education and learning, requires to be a demand in all primary school, secondary school as well as university curricula.

So the key to being released from this trap is twofold:

Two income trap: Are you caught in the two-income trap?

Are you caught in the two income trap? Worried that future interest rate hikes will make presently affordable debt entirely out of reach? Is the discomfort, stress, and anxiety too much debt brings on negatively affecting your health and wellness?

If so, call the Ira Smith Team today. We have decades and generations of experience helping people and companies needing financial restructuring. As a licensed insolvency trustee, we are the only professionals licensed and supervised by the Federal government to supply financial restructuring services.

Call the Ira Smith Team today to make sure that we can begin aiding you to return right into a healthy and balanced and well-balanced, worry-free life.

We will provide a no-cost consultation to aid you to resolve your money troubles. We understand the pain debts and financial distress triggers. We can end it from your life. This will certainly allow you to begin a clean slate, Starting Over Starting Now.

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