If you're questioning whether you have too much debt, that’s probably the best sign that you do – and you’re not alone. Many Canadians are feeling overwhelmed by their debt and are struggling to make ends meet. Job loss, divorce and illness are just a few of the many life challenges that can lead to debt – but once you recognize that you have a problem, you’ll see there are many options available to help you leave it behind.
Having too much debt can lead to other financial problems like not being able to save money, missing bill payments or having to borrow more money just to stay afloat. Setting money aside for a minute, it can also seriously affect your health and mental wellness due to overwhelming stress and sleepless nights.
Here are a few signs you have more debt than you can handle, and that it might be time for you to come in and meet with a Licensed Insolvency Trustee to help you take back control of your financial situation.
Burying your head in the sand doesn’t make your debt go away. You need to stop ignoring your debt – there’s no better time than now to face your finances. Pull your most recent account statement from your creditors and make a list of your debts so you know exactly who you owe and how much you owe and then make a plan to deal with it.
If your debt payments are more than what you earn each month, you’ve got too much debt. We all know that paying your bills late only makes your debt problems worse because you now have to deal with late payments and insurmountable interest charges. Look closely at your monthly spending to figure out what you can eliminate to better afford your bills.
When debt collectors start calling you it means your debts have become delinquent and there's probably no way you can afford to pay them. You may be able to avoid debt collector phone calls for a while, but don’t underestimate your creditors and debt collectors – they may decide to sue you for what you owe. If the creditor wins the lawsuit, they may be able to get court permission to garnish your wages or freeze your bank accounts.
A major sign that your debt is becoming unmanageable is if you have to pay your bills with loans from family, friends, credit cards or pay day loans. When it gets to this point, there’s no denying that you have too much debt. You'll eventually run out of places to borrow money from and you'll have to face the debt you've accumulated with your creditors and your loved ones.
When you’re so worried about your bills that you can’t sleep at night, that’s a definite sign that your debt has got out of control. Debt-related stress is no joke and can lead to other serious medical issues. Making a plan to deal with your debt can go a long way in eliminating stress and, in some cases, it could literally save your life. If that’s not enough of a reason to reach out to a debt professional, we don’t know what is!
When you’re forced to buy groceries with your credit card, it’s a sign of a deeper issue – you don’t have enough money to sustain your lifestyle. This is a major indicator that you’re mishandling the money you’re making.
If you’re honest with yourself about why you feel the need to hide your spending from your family, the answer will probably be because you know they will not approve. If you can’t be honest with your loved ones about your debt, chances are you have too much of it.
There are many options available to help you leave debt behind, and the one thing we do know for certain is that doing nothing is not an option. We often meet with people who have let fear stand in the way of reaching out to a Licensed Insolvency Trustee, only to find themselves in the same place or worse a year later.
If you’ve put a check beside even one of these warning signs, there’s a good chance that you’re headed towards financial difficulties. At Smythe, our Licensed Insolvency Trustees are trained to work with you to determine the underlying cause of your financial issues, as well as assist you in improving your financial management skills, and provide you with effective budgeting strategies to help you achieve your monetary goals.
If you’d like to get a handle on your spending, or discuss ways out of debt, contact us today for your free, no-obligation consultation.
Licensed Insolvency Trustee
Greg Best enjoys working with clients to create solutions for their financial needs.
CPA, CA, CIRP
Licensed Insolvency Trustee
Chris Sinclair believes a practical approach is required to solve serious financial difficulties.
Cynthia’s goal is to ensure that every client feels respected and understood and to instill hope that they can get their life back by giving them the fresh start they deserve.