Embarrassment. That is the most common emotion that keeps someone carrying too much debt from asking for help. Granted,we can’t repress how we feel but at what cost?
It’s not always blatantly obvious that we are carrying too much debt. Many survive by living pay cheque to pay cheque and try to pay most of their bills on time. This is not sustainable over the long term. You need to create some breathing room and a plan to get back on track.
Here are some potential pitfalls for someone carrying too much debt and waiting too long to ask for advice from a licensed professional:
- CRA liens and/or garnishments: CRA is not like any other creditor. They do not need to take you to court to register a lien on your home, garnish your income (including pensions) or freeze your bank account. CRA has powers under the legislation to collect overdue accounts.
- Creditor claims: creditors can begin collection and file court claims as soon as default occurs. legal advice may be required which will add to the cost of carrying the debt.
- Collection agency action: collection agencies act directly for creditors or often buy thousands of accounts at a discount from banks, credit card companies and lending institutions that want to get them off the books. Then the letters and calls begin. They are known to be aggressive and will continue calls until the account is settled.
- Marital woes: couples often have difficulty managing money. There are so many other challenges (work, children, household chores, etc.) that finances often take a back seat. Many don’t know where to turn or what to do to make ends meet.
- Health concerns: excessive debt can make you age faster. A recent study published in Research on Aging concluded that people with a high level of financial stress appear to have aged more over a 10-year period than those with low levels of financial stress.
- Your credit rating will tank: any overdue account, missed payment or claim will be noted on your credit bureau report. If you are able to catch up the payments quickly, the overdue account notes will still appear on the credit bureau report for 6 years.
In Canada, there are approximately 1,000 Licensed Insolvency Trustees (“LIT”, formerly Bankruptcy Trustees). Doyle Salewski LITs are well supported by a full team of counsellors and staff to service clients in Ontario and Quebec. All Doyle Salewski professional staff attend professional development sessions on a regular basis and find solutions for thousands of clients every year.
The decision to ask for help with your financial situation should not be taken lightly. Although it can be intimidating for many, no one should be embarrassed to ask for help. Many so called “financial advisers” are lurking on the web and elsewhere ready to take your money and in the end, cannot prevent creditors from taking action such as garnishing your wages, filing court claims against you or freezing your bank accounts. That is more harmful which will frustrate both you and your creditors. You need to call someone you can trust.
If you are burdened with debt stress, asking for sound advice is a sign of strength and the smart thing to do. Asking sooner rather than later is always better. Try our debt reduction calculator and call Doyle Salewski today for your free, no obligation consultation. You’ll be glad you did.