MNP Consumer Debt Index
In a recent MNP Consumer Debt Index, it was found that 53% of Canadian’s are within $200 away from insolvency. These results came in light of the recent wind-down of government aid and loan deferral options that were provided to support Canadian’s affected by the COVID-19 pandemic. In addition, MNP found that these consumers are unable to pay their bills or debt obligations. The number of Canadians on the brink of insolvency has reached a five-year all-time high.
As confirmed by MNP, 25% OF Canadians said that they have obtained more debt because of the pandemic. The breakdown of this includes 14% credit cards, 7% line of credit,3% obtaining a bank loan or 3% mortgage payment deferrals. And to highlight, 20% of respondents have reported hacking into their emergency savings fund.
But when it comes to getting help when in this situation, the survey found that many Canadians did not plan to seek out help from a professional, with 4% planning to get such advice and 2% speaking to a Licensed Insolvency Trustee to discuss their debt relief options. But what other options do Canadians have when faced with problems managing their budget, debt and income?
Whereas there isn’t a quick solution to get out of debt, check out some tips on how Canadians can begin to take control of their finances.
Refine your budget and figure out how you’re spending your money
When searching for ways to pay off debt faster, we often overlook assessing our budgets. A well-planned budget is the key to tackling your credit card debt. Once you figure out how you’re spending your money and define if you are overspending on certain expenses, you can begin refining your budget and putting more money towards paying down debt.
Our Marble customers have been doing this easily through MyMarble Dashboard, by connecting their bank account and allowing our technology to divide all their expenses into four categories: income, fixed expenses, flexible expenses and debt payments. Then, it makes it easy to assess how your money is spent and allows you dive deeper into each category to identify exactly where your money is going. By tracking your spending, and finding expenses you can reduce in your budget, you can comfortably pay more money down on your debt.
Pay off high-interest cards first
When paying off credit card debt, our first instinct is to pay off the highest balance first. Whereas this may seem logical, it isn’t always the most budget-friendly option. It’s important to find out what your interest rates are on each card. Then, you should pay off your cards in order of the annual percentage interest rate – so, from highest to lowest rate. This will help you save the most money and clean up your credit card debt the quickest way. To do this, make the minimum payment on each of your cards, then put all your leftover money towards the credit card with the highest interest rate.
Focus on your credit score
When faced with credit card debt, it can often result in a poor credit score. It’s important to maintain a good credit score at all times, in case you ever wish to obtain credit in the future. Following the COVID-19 pandemic and its effects on our finances, we may find that banks and institutions will become stricter on providing approval for financing. t’s essential to make your payment’s on-time to avoid a credit hit, ensuring you at least make your minimum payment on your debt. This way, you can make sure that your credit score won’t see a drastic decrease, and you will avoid credit score worry when it comes to reaching your financial goals.
To help you maintain and improve your score, it’s important to make sure you are checking your credit score regularly and seeking recommendations on ways to increase it. MyMarble can help you do this by providing you with your monthly credit score and allowing you to track your monthly progress. In addition, MyMarble Premium’s Score-Up uses Point Deduction Technology© to provide you with specific recommendations on exactly how you can increase your credit score, leaving no more guessing!
What Is MyMarble?
At MyMarble, we are finding that many Canadian’s are utilizing our financial technology platform to help them plan their finances; whether this means tracking their spending, keep up with debt payments and improving their credit score. MyMarble is an artificially intelligent and data-driven financial technology platform that allows you to track your spending habits, monitor your credit score, manage your debt payments and improve your financial fitness. In addition, MyMarble provides you with personalized recommendations and insights on specific actions you can take to help you put your financial fitness first.
Depending on your financial goals, MyMarble has a subscription plan that will suit you and your lifestyle. Once you pick a plan and securely connect your bank account, MyMarble empowers you to follow a step-by-step financial fitness plan and recommends specific ways you can improve your bottom line. After signing up for MyMarble, you will also have access to our Maestro Educational Courses, to help take your financial fitness to the next level.
Sign-Up to MyMarble & Win $1000
To celebrate the thousands of Canadians we’ve helped get financially fit this year we are giving away $1000 cash to one lucky MyMarble account holder!
To enter, complete our Financial Fitness Questionnaire before 11.59 pm pst on April 16, 2021. It’s that simple!