Whether it’s going to the dentist, hiring a plumber or getting debt advice, we tend to wait until the last possible moment to seek professional help. Perhaps it’s because we’re worried about the cost. Maybe we don’t want to admit defeat. Or, could it be we think we’re blowing the situation out of proportion and simply don’t want to be an inconvenience?
But if you’ve been considering debt counselling help – and you’re hesitating – know the only person you’re inconveniencing is you.
If it’s getting difficult to pay your monthly bills and debt payments… If you’ve tried everything to pay down your debt … Or if you’re worried about the impact of debt on your long-term future, hopefully the following information will help you determine if credit and debt counselling is right for you.
How to Know if You Need Debt Counselling Help
Everyone’s experience with – and ability to tolerate – debt is different. Monthly income and expenses, savings, the number of outstanding debts and their interest rates and the support of family and friends all factor into the difficulty of making debt payments or paying it off completely. In other words, what might feel manageable for one person may be utterly unsustainable for another.
So how do you know if you need debt counselling help?
Perhaps the most telling sign of all is simply questioning whether you need debt counselling help. If you’re constantly stressed by your monthly debt payments, feel like you’ve exhausted all other options or worry you’ll never be able to get out of debt, those are all major warning signs you may want to speak with a Licensed Insolvency Trustee or credit counselor.
Some other indicators include:
Making only the minimum payment each month – If you can only afford to pay the interest or bare minimum on your debts, you will not make any progress paying them down and your situation will not be sustainable long-term.
Borrowing from one credit account to pay another – If you are borrowing from one creditor to pay another, the total value of your debts will only continue to increase – and you will eventually reach a point where there will be no more money to borrow to make your regular payments.
Missing payments – If you’re unable to make your full debt payments each month, you risk not only harming your credit, but also collections action, wage garnishments and court judgements. Depending which credit account(s) you’re missing payments on, you could also risk losing your home, vehicle or other assets.
Frequently applying for new credit accounts or limit increases – If you feel like you never have access to enough debt, this is a good indication you probably have too much already and may need help structuring a plan to get out from under it.
Feeling constantly distracted – If debt is getting in the way of a restful night’s sleep, doing your job effectively or your relationships with family and friends, the problem has almost certainly reached the point of being unmanageable on your own.
Debt Counselling Services
Licensed Insolvency Trustees and credit counselors offer a broad range of services, strategies and opportunities to help consumers address problem debt and eliminate it for good. But that’s not all they do. A large part of credit or debt counselling is also developing better financial management skills and concepts, building financial self-awareness and addressing the underlying causes of debt and how to avoid them.
A debt counsellor will usually begin by seeking to understand your financial situation, along with your unique challenges and goals. They will then use that information to recommend a range of available opportunities to address your debt, and its underlying causes, head on.
Some of the services and opportunities debt counsellors and Licensed Insolvency Trustees offer include:
Help building a comprehensive budget and spending plan
Insights and advice to help you get your finances back on track
Informal debt solutions, such as a Debt Management Plan, to consolidate multiple debt payments into one monthly payment – generally less than you’re currently paying (Credit Counsellor)
Formal debt solutions, such as a Consumer Proposal, to settle your debts into one monthly payment – usually less than you’re currently paying (Licensed Insolvency Trustee)
Helping you work with creditors to halt current collections action and prevent future collections action from occurring
Identifying the reasons for your problem debt and helping you prevent it from recurring in the future
Connecting you with third-party services to address underlying mental health, additions or income-related challenges
Find Debt Counsellors Near You
No matter where you live in Canada, there are credit or debt counselling services nearby, ready to help you address your challenges and reach your goals. The internet can be an extremely helpful resource to locate organizations in your area. It is also an excellent place to read customer reviews and vet businesses for complaints with the Better Business Bureau or your provincial consumer affairs office.
If you are looking to work with a credit counselling service, look for licensed non-profit services with positive customer ratings, demonstrable results and – ideally – several Consumer Choice Awards for business excellence. And if you worry your situation is too severe for a credit counsellor to manage, consider scheduling a Free Confidential Consultation with a Licensed Insolvency Trustee.
Licensed Insolvency Trustees must offer an unbiased and fair appraisal of your situation and are the only professionals licensed and certified by the federal government to administer formal debt solutions under the Bankruptcy and Insolvency Act such as Bankruptcy and Consumer Proposals. Even if you don’t qualify for a formal debt solution – or they don’t believe it’s the best path forward for you – they can refer you to a reputable and qualified credit counsellor who would be happy to help.
Don’t Suffer in Silence
Don’t let shame, embarrassment or fear of judgement stop you from getting the help you need to improve your finances. Debt counsellors have seen and heard it all – and chances are they’ll tell you whatever you’re going through is more common than you think.
Also, don’t wait until you’re absolutely out of options to ask for help. The sooner you can address your challenges, the more options you’ll have, the more likely you will be able to avoid more serious solutions like Bankruptcy and the sooner you’ll be able to become debt free. Remember, Licensed Insolvency Trustees and credit counsellors offer more than just debt solutions – so take advantage of the learning and coaching resources available and begin re-writing your financial story today.