Based on working in the Credit and Financial industry for over 8 years now here is what I feel are the best ways to get out of debt. Really, if you condense down every program offered online these days in Canada for dealing with debt the all pretty much fall under one of these categories as there are really no other ways out of debt (legally) in this country.
So here they are the best ways to get out of debt:
1) Sell Assets:
- ADVANTAGES – Pays down debt with no effect on credit; reduces your interest cost.
- DISADVANTAGES – For some people they have no assets to sell. And having no car is the first thing to consider when seriously wanting to get out of debt it is often what you can sell to eliminate your debt. This is the option that is “easy to say, but hard to do!” Sure, it hurts to sell that extra car or even consider selling the home but the seriousness of the debt situation may call for more extreme measures to fix it. If you work with a certified financial planner this is something you should discuss with them to help determine what might be the best item to liquidate and pay off your debt. For example – it may be worth liquidating a poor performing investment to pay off extremely high interest credit card debt but it may not be worth cashing in RRSP to pay off low interest debt.
Adults know they need to save money for that proverbial “rainy day,” but how do you teach a child that saving money is a good idea? Whether they are saving up for a new toy or a long-term goal, it’s important to teach them the skills needed to achieve that goal.
Needs vs. Wants
A good first step is to teach your child the difference between needs and wants, because otherwise it is the foundation of good money skills.
Needs: Explain to your child that your income must first pay for necessities such as rent/mortgage, heat, electricity, clothing, and food.
Wants: Once the necessities are covered, what remains are wants. These include things like family vacations or eating out, and can only be paid for if there is enough money left over after paying for your family’s needs.
Knowing the difference between needs and wants will help your child:
- that they must learn how to live within their means
- that they cannot spend all of their money only on the things they want
- the importance of saving for the things they want
Create a three-jar system, each “Saving,” “Spending,” or “Sharing.” Every time your child receives money (more…)
It’s 2 o’clock in the morning and you’re still awake worrying about how you’re going to make ends meet this month. You’re not alone. Canadians have been particularly anxious about finances since 2007, when Lehman Brothers bank collapsed, plunging the world into the worst economic crisis in years.
According to the Holmes and Rahne Stress Scale, the 16th highest stressor is a major change in financial position (good or bad).
In 2012, the Canadian Institute of Chartered Accountants issued a survey in which 61 percent of respondents said they were worried about money.
Nearly half (47 per cent) of those surveyed wish they spent more time reviewing their finances, and almost a quarter (24 per cent) purchased items they could not afford.
“The survey results sent a clear message,” noted Kevin Dancey, FCA, president and CEO, CICA. “Saving more, spending less and developing a budget and sticking to it will go a long way in providing some peace of mind.”
How Financial Stress Affects Your Sleep: Insomnia’s Physical and Mental Consequences
Prolonged insomnia can have serious repercussions both mentally and physically. Mental clarity and concentration are affected, weight-gain can occur, and your judgement becomes impaired. Death may even occur. In 2007, British Researchers surveyed 10,000 civil servants to see how sleep loss affected their mortality. Over 20 years, they found that those that cut their sleep from 7 to 5 hours or fewer per night doubled their risk of death from all causes. Specifically, lack of sleep doubled the risk of cardiovascular disease.
There are long-term health problems associated with insomnia: (more…)
Debt-related stress affects everyone in a family — adults aren’t the only ones who feel that anxiety. Children pick up on stresses around them, even if you think you’re hiding your own anxiety well. Keep in mind that just because you speak about your situation in hushed voices doesn’t mean your child doesn’t hear and understand. Children are much more astute than we realize and pick up on all the little changes in our manner, speech, and personality.
Young children don’t understand what it takes to manage finances and can make broad assumptions about the consequences (“We’re going to lose our house and have to live on the street.”). Usually, financial issues result in cutting back on unnecessary expenses (eating out, movies, etc.) and not foreclosure.
Symptoms of Stress
Watch for signs of anxiety in your children. They include:
- Changes in sleep patterns, or bedwetting
- Stomach aches and headaches. Others have trouble concentrating or completing schoolwork. Still others become
withdrawn or spend a lot of time alone.
- Younger children may pick up new habits like thumb sucking, hair twirling, or nose picking; older kids may begin to lie, bully, or defy authority. A child who is stressed may also have nightmares, difficulty leaving you, overreactions to minor problems, and drastic changes in academic performance
What You Can Do To Help
Talk to your children at an age-appropriate level. Explain what’s happening, (more…)
More and more people are getting into debt because of how easy it is to get a credit card or to switch credit companies. Most people don’t want to be in debt, but sometimes circumstances are out of their control.
Let’s say you’re in a two-income household and your partner loses his or her job. You still have car payments, house payments, daycare, and other bills to pay. These don’t stop when you lose your job. You may be able to defer them for a short period, but eventually those bills must be paid.
What Is The Debt Cycle?
Simply put, any time the amount of money we earn is less than the money being paid out for expenses, we go into debt.
There are fixed (non-discretionary) expenses like heating and mortgage and there are discretionary expenses like eating out and going to movies. Fixed expenses can’t be changed, but we can control the number of times we go out for dinner or go to a movie. It’s when we don’t manage those expenses that debt becomes a reality. (more…)