Warning Signs

If you frequently pay bills after their due date, regularly bounce cheques or receive calls from a collection agency, you may be carrying more debt than you can handle. Now is the time to take action. Depending on your personal circumstances and the size of your debt, you have several options to help you better manage your money and debt.

The starting point: A budget

A budget is a tool that allows you to take control of your personal finances. It can help you make the best use of your income, plan for the future and, most importantly, know exactly where and how your money is being spent. The Financial Consumer Agency of Canada has a Budget Calculator to help you make a realistic budget. You may also download a paper version of a budget worksheet from the Take Charge of your Debts tool. Choose, "Before going further" then "Rework your budget".

Budget / Credit Counselling

If you are struggling financially and feel that you need help, consider talking to a budget advisor or credit counsellor. A counsellor will help you establish a realistic plan for managing your money and offer suggestions to help you get out of debt.

• You can use a counselling service even when you do not currently have any problems. Such services are there to help you with financial strategies to avoid trouble in the future.
• Many community and consumer organizations offer this service for free or for only a small fee, although it is often possible to find no-cost options, for those services.
• Private organizations may charge a fee. Make sure to get details about these fees. Is the first consultation free? What about the costs for any subsequent consultations?
• If a debt consolidation or debt management plan is proposed to you, double-check before signing anything. What will be the total costs (they may be built into your overall monthly payment)? How much of your payments will go directly to reducing your debt?
• What is the length of the program that you are committing to and what are the terms and conditions (for example, if you want to opt out)? Be wary of any counsellor who pressures you to sign up for such a plan, without first taking the time to fully evaluate your situation and discuss options.

Take your time when choosing a counsellor. There are people who appear to be offering to help but may end up taking advantage of your vulnerability. Call your provincial or territorial consumer affairs office for help or the Better Business Bureau to see whether any complaints have been filed against the person or company you are considering.

For more information on debt, go to:

• The Collection Agencies section in the Handbook
• Take Charge of your Debts
• Be Informed About Debt

For those who declare bankruptcy, the Office of the Superintendent of Bankruptcy works to ensure that the bankruptcy process is conducted in a fair and orderly manner. Under certain circumstances the Office will assist debtors in finding a trustee in bankruptcy. It also investigates complaints from debtors regarding a possible wrong. You may contact an office in your area.

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