Negosentro.com | Debt Doesn’t Have to Bring You Down: Here’s How to Fight Back | Canadians were struggling to pay bills before the coronavirus pandemic hit. Like people everywhere, they have been scrambling to get their finances in order in the months since it was officially declared a pandemic. The coronavirus has affected every industry but in quite different ways.
Some businesses managed to adjust the way they operated so they could safely remain open. Others began to manufacture different products the market badly needed. Bars were forced to stay closed, as safely operating was impossible. Millions of jobs were affected as a result.
Whatever your current financial situation, you want to avoid filing for bankruptcy but you don’t need to be brought down by debt. There are ways you can stabilize your finances yourself, and resources to help make escaping debt easier.
Have a Financial Plan
The first step to stabilizing your finances is to get a good picture of precisely what they are. Calculate how much you spend each month and how much income you make. As a budgetary rule of thumb, financial planners recommend that it’s healthy for about half your money to go towards necessities, like housing, transportation, and groceries.
About 30% should go to hobbies and pleasures, leaving 20% for savings or debt payments. If you’ve assessed your finances and know your spending is not aligned with these proportions, it may be possible to shift your spending to fix it.
However, with unemployment on the rise, the problem could be that your expenses are simply higher than your income. You may be entitled to EI and CERB, which can provide crucial financial assistance.
Assessing your finances and making a budget is still necessary to control your finances or get out of debt, but there are additional supports you can take.
Debt Consolidation Loan
If you have good enough credit, you may qualify for a debt consolidation loan. In this arrangement, the bank will give you a new low-interest loan with which to pay off all your existing debt and credit card statements.
There will only be one monthly number to pay back, so it simplifies the process. However, it can be difficult to qualify for a debt consolidation loan.
Debt Consolidation Program
Instead of getting a new loan from the bank, when using a certified Credit Counsellor from a non-profit agency, they will advocate with your creditors on your behalf to reduce or even eliminate the interest rate on your debt.
They’ll streamline the process, so there’ll only be one single monthly payment so that getting out of debt will be cheaper and simpler to do. Certified Credit Counsellors give holistic support that is unbiased and free of judgment. It can be hard for people to openly discuss their finances — advice needs to be informative and also sensitive to how people are feeling.
The coronavirus has changed society in many ways. If you need to get your finances in order, first track your spending and make a budget. Then, to get on top of your debt, apply for a debt consolidation loan or speak to a certified Credit Counsellor today.