Canadian household debt is at an all-time high of an astonishing $2.23 trillion as of August 2019. It continues to grow, largely thanks to mortgages.
In fact, about 40% of Canadians are $200 or less away from insolvency (or not being able to pay their bills and loans—or worse) at the end of every month. That doesn’t leave much money for anything else, let alone an emergency.
Despite this massive household debt, Canadians are wary and too embarrassed to seek debt relief—even if and when they really need it.
Let’s first look at the statistics of Canadian’s growing mistrust, lack of debt awareness and information, and stigma against getting financial help. Then, we’ll uncover a few potential solutions.
Canadians’ lack of trust and awareness prevents debt relief
July 2019’s MNP Consumer Debt Index report, Canadians Wary and Embarrassed About Seeking Debt Relief, paints a rather traditional portrait of Canada’s view of debt relief and financial advice.
Here are some of the top findings from the survey:
Too much stigma and pride around debt:
Almost half of Canadians say they’d be embarrassed to get help if considering bankruptcy.
One-third say that it’s the stigma around bankruptcy that would stop them.
Lack of debt relief knowledge:
Three in ten Canadians say they don’t know how to get out of debt or where to get help.
Nearly half of Canadians who are most likely to need help don’t know where or how to get debt relief.
Lack of trust:
More than half of Canadians struggle to trust companies to help them out of debt.
Young adults are the least likely to seek debt relief due to a lack of trust.
Canadian household debt relief solutions
Have you ever heard of the saying “Do what you do best and outsource the rest?” We think that applies to a certain degree when it comes to your personal finances and debt relief.
1 – Arm yourself with financial literacy and knowledge
Of course, you can—and should—always arm yourself with knowledge and information first. Even if finance isn’t what you do best, you’ll have a foundation upon which to build and grow.
Brush up on your financial literacy by reading blog posts (we post regularly on our Marble Financial blog on the topic of financial literacy) on everything you can on topics like how to understand your financial statements to how to create a budget—and when it’s time to get a side gig for some extra cash flow.
The same goes for understanding how to get out of debt and stay out of debt. Do some research and see if you begin to trust the financial advice that’s being given online.
2 – Know when to seek financial help and advice
At a certain point in your financial literacy journey, you may realize that you need to outsource and seek professional financial help.
For example, in the first quarter of 2019 alone, there were over 32,000 consumer insolvencies (that is, bankruptcies and consumer proposals) in Canada. If you find yourself in a position like this—or close to—it’s time to let go of your ego. Let go of the stigma and social pressures to avoid seeking help when you truly need it.
Outsource what you don’t know, but do your research and find trustworthy help.
3 – Financial advice and debt relief solutions you can trust
At Marble Financial, we specialize in helping Canadians pay off their consumer proposals and working together to build a sustainable, healthy plan to get out of debt and build good credit.
We understand how hard it is to break free from a vicious debt cycle. Interest rates and monthly payments can be impossibly high. Falling credit scores can hinder chances of getting loans from major banks and good lenders.
We get it—and we can help.
Once we help you get back on good financial footing after a consumer proposal, our Score-Up solution offers step-by-step plans to build your credit score and get on the right financial track.