managing debt Archives - Ira SmithTrustee & Receiver Inc.

Managing debt or talking about sex?

It’s commonly believed that all parents dread having the “sex” talk with their kids, but a recent study from BMO shows parents would rather talk to their kids about sex than their financial situation and managing debt. Imagine that! Canadians are stressed about money and probably feel ill-equipped to educate their kids about finances and managing debt.

Personal debt in Canada

According to a new national study conducted by Leger:

Canadians struggle with regret over financial decisions
Argue over spending
Feel pressure to keep up with friends or colleagues
Bend the truth to friends and family about their financial situation in order to save face

A Bank of Montreal study reports that:

More than 33% of all Canadians are ashamed of the debt that they have
Almost 40% say they stress over debt levels multiple times a day

There’s no doubt about it, money and managing debt is the top source of stress in our lives. Why are we so financially stressed? Why are Canadians stressed over debt and have so much trouble managing debt? Here are 10 of the most common reasons:

Expenses are greater than your income
You worry about job security
You’re living paycheque to paycheque
You’re fighting with your spouse/partner about money
You’re paying bills late
You use your home equity like an ATM machine
You’re counting on an inheritance to solve your money problems
You’re late on student loan payments
You’re helping out your parents and your kids
You don’t have a financial plan

Dealing with debt

It’s time to become financially literate and educate your kids, not just about the birds and the bees, but about finances and managing debt. Foresters recently offered 5 tips to get smarter about your finances:

Learn everything you can about your finances, including your mortgage terms, bank interest rates and credit score
Start with the simple things like contributing to RRSPs, setting up RESPs for your kids and protecting your family’s financial future with life insurance
Keep track of every penny you spend for a couple of months and look for ways to cut back and start saving. Even a small commitment to saving will make you feel better about your finances
Look ahead 10, 20 and 30 years. Imagine the life you want and what it will take to make that happen
Talk to your kids regularly about money, involve them in household budgeting, open bank accounts for them and encourage them to save for things they want

How to get help with debt

All of this is great advice to avoid financial problems, but if you are already in serious financial difficulty and don’t know where you will begin on how to manage your debt, you need professional help now. Contact Ira Smith Trustee & Receiver Inc. Don’t ignore your debt issues. Face them head on and with the help of the Ira Smith team you’ll be on your way to conquering debt Starting Over, Starting Now.

Debt. It is easy to get into debt that is way beyond your means to repay it. And, it seems that managing it and repaying it is on everyone’s minds these days. CIBC’s yearly poll on consumer financial priorities has revealed that repayment of debts is becoming increasingly important to Canadians who are nearing retirement age; with 31% of those aged 45-54 saying repayment is their top priority. This is certainly not a surprise as a Manulife survey reports:

50% of respondents expect to be in debt when they retire.
10% planned to borrow against their current homes.
8% were looking to downsize and use money from the sale of their home as income.

“Using home equity as a “fallback plan” suggests some Canadians are struggling to balance retirement with paying down debt”, says Manulife Bank CEO Rick Lunny. “If people think they’re going to take out second mortgages and larger mortgages when they retire, that’s a pretty concerning view and evidence of no financial plan whatsoever,” Lunny said.

Many Canadians have no financial plan what-so-ever and as well are not really financially literate. However, some mortgage brokers are recognizing the importance of client education. “There is no doubt that client education should be the cornerstone of any mortgage broker’s marketing plan,” Jackson Middleton of Kilted Media wrote on MortgageBrokerNews.ca.

If you’re like many Canadians who don’t have a plan to deal with debt repayment, you need professional advice. Contact Ira Smith Trustee & Receiver Inc. before your debt load becomes critical. The earlier you begin to deal with it, the more options you’ll have. We approach every file with the attitude that financial problems can be solved given immediate action and the right plan. Starting Over, Starting Now you can live a debt free life.