Category: Help with Debt Winnipeg

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Start A Summer Savings Account for Next Year’s Summer Vacation



Summer vacations can be the highlight of the year for many families and are a great way to spend quality time together. However, these trips can cost well over a thousand dollars and can be a strain on a family budget when no money has been put aside. The best way to avoid using credit cards unnecessarily or getting behind in everyday bills due to a summer vacation is to plan ahead. By starting a savings account now for next year’s summer vacation, families will be able enjoy their time together without worrying about financial repercussions.

Make Saving A Priority
It is all too easy for money that was meant to be set aside for a vacation to be spent on other things when it is put into a bank account that is also used for other expenses. Instead, start a separate account that is specifically for the family vacation. First decide on how much the family can afford or wants to spend on the next vacation and divide that number by the months remaining before the next vacation. This will give you the amount that needs to put aside each month to reach the goal. This should be treated just like any other expense or bill and be put away before any other extras are bought each month.

Finding Extra Money
If a family’s budget is already stretched tight, it may seem hard to find that extra $100 or more to put away. If this is the case, then one of two things must happen: spend less or make more money. You may find the monthly vacation amount right in your current budget by reducing grocery costs, cutting down luxury expenses or even taking the bus instead of driving. Another way to finance your vacation savings is to find ways to earn that extra amount by getting a second job or selling unneeded items via garage sales or on eBay.

By planning ahead, families can have a great summer vacation without it causing a huge strain on their bank account. The result is less stress and a more enjoyable vacation for everybody.

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Getting Out from Under, A Personal Story

The following is a letter we recently received from a client who wanted to share their debt story anonymously. They want people to know that you are not alone in your struggle.

If you are interested in sharing your Debt Story, post a comment below or email us at info@creditaid.ca
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When I reached adulthood as dinosaurs continued to walk the earth I could never have imagined that I would some day be a senior citizen with a debt problem. But here I am at 65 years of age, trying to rid myself of credit card balances and a bank line of credit totaling more than $40,000.

We are told that more than 30% of Canadians are in, or have been in a similar boat. Our economy is a house of cards and I am very grateful that there are folks like Creditaid available to help us.

For Baby Boomers like me, a credit problem was much less possible back in the 1960’s. Visa and Mastercard didn’t come along until the 1970’s and most of us were raised on mottos like “pay as you go, and if you can’t pay, don’t go”.

In 1978, at age 31 I got an American Express card. I felt uneasy having it in my wallet, and I used it very sparingly. As the years went by I added both Visa and Mastercard to the collection, but for the most part I paid the outstanding balance in full each month. I was always fully employed and I was never a reckless spender.

If there was a turning point, it was probably around the age of 40. My personal version of a midlife crisis included a marriage breakup, a job change and dealing with aging parents with failing health. Other than that life was still ‘one laugh after another’, and I still invincible in every way, including financially.

My income continued to grow and there was no reason to believe that would change anytime soon. Slowly but surely those cards in the wallet started to have outstanding balances that were carried over from month to month.

My well meaning friendly banker suggested a personal line of credit. That way the credit cards could be kept closer to zero in favour of one larger balance with a substantially lower interest rate. Eventually I found myself on a career path that was shrinking rather than growing, and some bad choices got me where I am today.

“Where will it end?” you wonder at times. But you don’t dwell on the problem. I think it’s called denial and it makes basic functions like sleep possible. You do silly things like buy more lottery tickets and plug coins into VLTs. You believe the old slogan “You can’t win it if you’re not in it”.

But there has to be a day of reckoning for most of us. Finding the right path then becomes the issue. Over the radio you hear the slick pitches with their toll free numbers. You call one or two of them and you know there’s something ‘too good to be true’ about what they’re selling.

I’m very glad to have found Winnipeggers at Creditaid who have been able to help me come up with a plan that works. It’s nice to know that you are not alone.

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Paying Down Debt Is an Increasing Priority According to RBC Survey

There were some very interesting statistics generated from a recent online poll conducted by the Royal Bank of Canada, which made comparisons between the debt carried by Canadian households in 2012 versus 2011. The number of survey respondents who had no personal debt, outside their mortgage, increased from 22% to 26% during the last year; a very positive move towards debt-free living.

In spite of this positive direction, there were still some indicators of concern.

For those respondents which did have personal debt, the average amount of that debt did increase by $84 over last year’s number, instead of going down. Just over half, 51% of the respondents, indicated that they were more concerned with paying down debt than investing in the future. In addition, one in three of the survey’s participants noted that they experienced anxiety over their debt levels, an increase in those statistics over 2011.

Canadians appear to be moving in towards more debt-free living, according to this survey, but there is still work to do, to increase the financial stability of Canadian households in general.

Read More about RBC Debt Poll – http://www.rbc.com/newsroom/2012/1010-debt-poll.html

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Helping Canadians Get Out of Debt

How well do you know the credit counselling agents that you deal with? Are you looking for a more personal experience with a high level of discretion? At Creditaid, we offer you a different kind of experience. Personal finances can get very complicated. Budgets and bills are not just numbers on a piece of paper – they have real life
implications.

How well do you know the credit counselling agents that you deal with? Are you looking for a more personal experience with a high level of discretion? At Creditaid, we offer you a different kind of experience. Personal finances can get very complicated. Budgets and bills are not just numbers on a piece of paper – they have real lifeimplications.

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Its True – Cost of Kids is Rising

You are not imagining things, the cost of raising kids has indeed increased. Everything from food, entertainment, education, sports and clothing, comes at an astronomical cost. We are living in times where prices are rising faster than we can shuffle our budget to accommodate them. We all want the best for our kids, however, we need to step back and redefine exactly what that means. Here is a hint – it doesn’t mean the product with the highest price tag.

Food is perhaps the quickest way to make savings. Buying fresh ingredients, bulk buying staple foods at discount and pre-planning meals are all great ways to cut down your shopping budget. Forget about the high priced brands too, find a cheaper equivalent. Coupons have not gone extinct either, so seek them out in newspapers, stores and online. Most importantly of all, reduce food waste as much as possible. You paid for it, so make sure you use it.

The word retro is your friend – at least when it comes to clothing, sports and entertainment. Ask any musician or sports fanatic and they will tell you that used equipment is best. Second hand musical instruments and sports equipment will dramatically cut your costs. Similarly, you can find last season’s clothes, along with some in-style throwbacks, in any thrift store. As for games consoles and media – pre-owned means paying half the price within a month of release. The average game takes less than a week to complete for most avid gamers. Your kids can also trade in their games, once they have completed them.

Planning for your children’s education will require the most forward planning. Start saving for school, college and university from the second that you find out you are expecting. Contact schools to find out about the annual costs of books, extra-curricular activities and other expenses. Compare college investment plans and choose the one that best suits your budget. When your child begins school, re-evaluate your plan year on year.

Kids can be expensive, but if you plan and spend sensibly, you can greatly cut the cost.

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How to Prioritize Your Expenses

You may feel tempted to pay expenses to those who shout loudest; however, you need to prioritize. Rent, electricity, water and food. Without those things you do not have a functioning home, and you will find yourself in deep water for not keeping up with payments. Next, you have to consider the things that enable you to earn a salary, such as your car, travel costs or childcare; including child maintenance payments. All these expenses are absolute necessities, and you will find that out the first time you let your payments lapse. In short – unless an expense can put you out of your home, take food off your table or prevent you from earning money, it is not your first priority.

Now, that is not to say that your other expenses are unimportant. Keeping up all your payments, even if you are only able to pay the minimum, is of huge importance. Your credit cards, loans and other expenses may not be secured loans, however, neglecting them will only serve to perpetuate the cycle of debt. Once you have allocated funds to priority expenses, budget the rest of your cash flow to cover your other expenses. This will provide a template for how to best pool your financial resources. If you are having difficulty finding the cash flow to cover all your expenses, speak to your creditors. They would rather work with you to come to a payment arrangement, than not receive payment at all.

As tempting as it may be, never hide from your debts. Speak to all your creditors, explore the possibilities of reallocating funds and create a budget that is both realistic and workable. When you do prioritize your expenses, consider that money as gone. It is not available for juggling debts or tapping into it in the hope of securing future funds. If you have to seek additional disposable income, then do so; however, never stretch your budget beyond its means.

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Automate Your Payments – Takes Away The Temptation

Automating payments presents a number of advantages. You can earn discounts, budget your cash flow better and forecast your financial requirements. When you get used to set amounts debiting from your account, you will eventually remove them from the equation. This takes away the temptation to tap into those funds, allowing you to create a workable budget that won’t leave you deeper in debt.

Remembering scattered payment dates throughout the month can become confusing. Your aim is to allocate money then forget about it – until such a time as you need to re-examine your budget. Depending on how often you get paid, you should set all your automated payments to come out on the same date, each month. To better manage your finances, there are various online apps and resources that can help you. Applications such as Mint, You Need a Budget and Mvelopes, are ideal. However, if you are not tech savvy, then keeping a calendar of your automated payments, when they reduce and completion dates, will suffice.

Another important point to remember is that automated payments do not only apply to regular household bills. You can set up regular payments for insurance policies, retirement funds, college plans and investments. Although many of these payments are not essential to everyday life, by budgeting automated payments, you are preparing for the future. Before you know it, that money won’t even exist in your mind. In fact, you will probably find yourself looking for other sources of income before even thinking about touching your monthly automated payment funds.

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Getting Married? Have You Had the Debt Talk?

So you have decided to get married. No doubt you have planned everything with meticulous precision, right down to the smallest detail. However, there is an elephant in the room that no one wants to address. It’s time to have the debt talk – and how you approach the issue could make or break your marriage – before it has even begun. The good news is, with honesty, commitment and forward planning, there is no reason that debt should stand in the way of a lifetime of marital bliss.

They say a problem shared is a problem halved; but when it comes to debt, it’s not quite that simple. One partner may have significantly more debt than the other, for instance. However, that does not automatically mean that they are less frugal. Although a high debt amount should ring alarm bells, how that debt was accrued and the measures your future spouse is taking to address it, will paint a much more accurate picture of what you are getting into. This is why honesty is so important. When all the cards are laid on the table, you can assess where you are and how you want to move forward.

Marriage is all about commitment. You are not just committing to each other though, you are committing to each other’s debts as well. When having the debt talk, it is important to examine how each of you has addressed your own debts. Before you even think about marriage, both of you must prove a commitment to making regular payments towards debt, that won’t completely cripple your lifestyle. Approach the problem with the same precision that you would when planning your actual wedding. Make no mistake, debt is a big deal when considering marriage. Forward planning will prevent any nasty surprises; so make sure you are both prepared for the financial strains, before you say those vows.

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Get Closer to Your Goals with Multiple Savings Accounts

Have you ever tried to perform mental gymnastics with your finances? It is no mean feat, and you are quite likely to forget at least one important payment. Creating a budget is one thing, but ensuring that all the funds in your bank account go where they should is not so easy. When you created your budget, you probably divided all your payments into categories. If you didn’t, then now is the ideal time to create a system that is both efficient and easy to manage. This will make life so much easier, once you split your payments across multiple accounts.

You would imagine that trying to manage multiple bank accounts would be a nightmare. However, nothing could be further from the truth. Separating your monthly expenses and savings across multiple accounts will help you focus on your budgets and goals. There are cost effective accounts like Tangerine Bank where you can have multiple accounts and even name the account the same as your budget category.

If you have financial goals that you are determined to achieve, focus on each one individually. Create an account where you can save towards specific goals. Once you have reached your target, you can use that account to work on your next goal. Keep all your regular payments in one account, where you can allocate a set amount each month, with the security of knowing that you will not overdraw. Next, create an account for your irregular payments. This account should allow for enough breathing room to accommodate ad hoc payments.

Should you be lucky enough to consistently have cash flow to spare, you may want to set up an account for luxuries. Filter your spare cash flow into this account, whenever you can. Once you have been using your multiple accounts for a while, you will find that management your finances becomes much less of a chore.