Four Warning Signs That Indicate You May Need Debt Counselling Soon
Debt is money you owe to someone else. Being in debt is not necessarily a problem if you can afford to make your repayments each month. However, if you’re paying only the minimum repayments and are struggling to pay your household bills, you may have a debt problem. Here are some other warning signs to look out for, along with suggestions on where to get help if you need it.
1. You’ve missed several repayments
Missing a single repayment because you can't afford it can often be attributed to temporary cash flow problems. It could result in you being charged for late repayment and may have a negative impact on your credit rating, making it more difficult for you to borrow money in the future. Missing several repayments in a row may be a sign that you're becoming overwhelmed by your debt.
2. You’re avoiding opening your bills
Avoiding opening your bills is a clear sign that you’re concerned about your financial situation. The first step in trying to resolve your debt problem is to contact your creditors and explain your situation to them. The main bills you need to pay each month are your household bills, including your rent or mortgage payments and your utility bills.
3. You’re taking out loans to pay off your existing loans
Taking out a new loan to pay off all your existing loans can save you money, but it won’t solve your problems if you continue to accrue new debt. It can also cost you more in the long run, as you could be charged a penalty for paying off your existing loans early. Your focus needs to be on eliminating your existing debt rather than adding to it. Before you find yourself taking out additional loan, consider debt counselling and the many good options it offers.
4. You’re lying about your debt
Facing your debt problem can be challenging, and speaking about it with your partner can be a frightening prospect. However, it's important that you tell your partner as soon as you can, as the sooner you speak out, the sooner you can work towards dealing with your debt.
Whatever the extent of your debt, there will always be a solution that could help you. One such solution is filing for a consumer proposal. A consumer proposal allows you to pay off part of your debts without interest or penalty within a given timeframe. Many Canadians have opted to take this direction to address their debt problems. Start by going for debt counselling in BC, through companies such as 4 Pillars Debt Consolidation & Credit Rebuilding for Victoria, BC, so you could talk to someone who can provide you with the starting point for becoming debt-free.
Sources Warning Signs of Debt, ic.gc.ca Dealing with Debt: A Consumer's Guide, ic.gc.ca