Wallet-Friendly Summer Fun Ideas – Don’t Get Caught Drowning in Debt

Any parent knows that once school is out, the kids are itching for some fun outside of the classroom. For many, this means summer camps or family vacations, but if you are drowning in debt, the thought of shelling out all that extra dough just to keep the kids entertained may be a bit more daunting than you’d like. With that in mind, check out this list of wallet-friendly summer fun ideas to keep your little ones out of your hair and out of your wallet.

1.      Go to the beach – pack a picnic lunch, grab some towels and some water toys and head out for a day in the sun. Just don’t forget the sunscreen.

2.      Spend a day at the library – just because the kids are out of the classroom doesn’t mean they can’t read for pleasure. Head to the local library and get the kids signed up for a library card. Let them pick out their own book or spend some time on the computer.

3.      Craft day – tie-dyed t-shirts, homemade play-dough, a kite they can fly in the backyard. Check out Pinterest for some great ideas that don’t require a lot of payout.

4.      Berry picking and jam making – not only can you get them out of the house and out of doors, this can be a great way to get some preserving done for the coming months.

5.      Gardening – head to the garden centre and let the kids pick out a plant or two, then head back home and set out a separate space in the garden that they can design all on their own.

6.      Drive-in movies – check out the local drive-in theatre and get great bang for your buck. Take advantage of the outing and bring dinner and snacks with you to save on treats. Go for a walk around or spend some time at the park. And once they are tired out, take advantage of the peace and quiet and sit back and relax and enjoy the movie.

7.      Camp out – set up a tent in the backyard, light a bonfire, and get the ghost stories ready. The close proximity to a private bathroom is just an added bonus!

8.      Take a hike – fill your backpack with bug spray, a few bottles of water and some trail-mix and head to the local nature area. Keep kids’ minds going by creating a scavenger hunt so they can play along the way.

9.      Set up a lemonade stand – not only will this motivate the kids to get out there, letting them make some money, but it teaches them about working and can help you teach them about finances.

10.   Help out – contact local charities in your area and find out if you can help out. Spending the day at an animal shelter or at the community garden is a great way to teach kids about giving back and it doesn’t cost you anything more than your time.

Summer spending doesn’t have to cost an arm and a leg. Get creative, and keep that money in your wallet!

If you feel like you are already drowning in debt, use these tips to keep the spending to a minimum. And if you feel like you need some help getting those debts under control, contact DebtCare today by calling 1-888-890-0888.

DebtCare's Financial and Debt Expert Sara Mitchell Interviewed on CFRB 1010 by Tim Hudak

Sara Mitchell, financial and debt expert at DebtCare Canada, was interviewed on CFRB 1010 by Ontario's PC leader Tim Hudak about the implication of debt on Canadian families and solutions for overcoming it. If you are in a financial crisis, feel free to reach out to Sara or the DebtCare team at www.debtcare.ca or by calling 888-868-1400.

Not So Happy Canada Day When it Comes to Canadian Consumer Debt According to Yahoo Finance

Last week we celebrated Canada Day and that means that half of 2014 is officially over. Just like New Year’s Day, this holiday often leads people to think back on the past 6 months – have you evaluated your current debt load? Well, if you haven’t, Yahoo Finance has, and has discovered just how much Canadian consumer debt is impacting the nation’s economy.

Check out this recent release from Yahoo Finance, “Household Debt Overhang Holding Back Canada's Economy”: https://ca.finance.yahoo.com/news/household-debt-overhang-holding-back-124451782.html. According to the article, Canada was able to overcome the recent financial crisis thanks in part to consumer spending. A hot housing market and consumer spending meant that our economy was able to rebound far quicker than the U.S., but at a substantial cost. Now, thanks to high Canadian consumer debt, individuals are spending less and paying off more, meaning that economic growth won’t reach the levels initially anticipated.

Furthermore, “Canada's disposable household debt-to-income ratio is at a near-record high of 164.0 percent. By contrast, U.S. households reduced their indebtedness in the wake of the crash.” Clearly there are drawbacks to having dealt with the crash in a way that meant less economic meltdown for the average Canadian.

If you are one of the many Canadians whose spending has led to a mountain of debt that now seems unmanageable, it might be time to start thinking about some viable solutions. Don’t get stuck barely able to make ends meet because of the interest on credit cards and the looming collection action being threatened by your creditors.  Get in touch with a company today to find out what options exist to help you regain control of your finances.

For more about Canadian consumer debt and taking back control of your money please contact DebtCare Canada today by calling 1-888-890-0888.

Why You should Never Go to a Bankruptcy Trustee in Ontario Without Representation

A bankruptcy trustee is a court appointed officer. Their job is to administer bankruptcies and consumer proposals in Canada – and they do this by representing both you and your creditors. This means that they are expected to get as much as possible from you for your creditors.

Take a look at the typical process and you will see how people get themselves in trouble:

A trustee advertises a financial solution, and you contact them for help (thinking that because you have contacted them that they represent you). However, even though you are the one looking for assistance, they in fact represent both you and your creditors.

Next, the trustee will pitch you on the financial solutions they can provide, which are usually bankruptcy or a consumer proposal. Since a trustee doesn’t make any money if you don’t sign up, things are often very pleasant at the beginning.

At no point during this meeting will they tell you how they get paid, but it is important information. A trustee gets paid based on a tariff (a fee set by the government in the case of bankruptcy, a percentage in the case of a consumer proposal, a percentage of surplus income in the case of a bankruptcy) – this comes out of your monthly payment.

How much you have to pay and the amount of your monthly payments in a proposal and bankruptcy depend on your income and assets – the more income and assets you have, the more you end up paying. In the case of a consumer proposal the amount of proposal you negotiate will be locked in once the proposal is accepted.

In the case of bankruptcy you have to report your income to the trustee each month and they do a calculation called surplus income. If you have income above a certain threshold you will have to pay your trustee 50% of the amount that has exceeded the threshold. In bankruptcy, when there is surplus income (income over the amount defined by the Bankruptcy and Insolvency Act) your bankruptcy will go from being 9 months to 20 months which can make a huge difference.

So, why is being represented when going to a trustee a much smarter idea? Because it gives you the chance to, firstly, openly discuss your information without reprisal or pressure to sign. This representation can mean negotiating a much lower proposal, or a much stronger financial picture with contingencies in place to help you bounce back quickly. Finally, when you have your own representation, you won’t have to deal directly with the bankruptcy trustee – that individual will handle most negotiations and correspondence for you!

Before you call a bankruptcy trustee directly, call DebtCare Canada – we can help keep you protected. Contact us today by calling 1-888-890-0888.

Self Employed? Is a CRA Garnishment Going to Your Clients?

Anyone who is self-employed knows the many challenges that come with owning a business – and one of the greatest is dealing with the many complexities that come with the intricate tax process in Canada. Because of these complexities, many self-employed individuals find themselves owing money to the Canada Revenue Agency (CRA), for numerous reasons, and if unable to pay, face strict enforcement actions as a result. One of the most common of these is a CRA garnishment of your receivables.

Here are some numerical facts when it comes to a CRA garnishment:

The CRA can garnish up to:

·        100% of subcontracted income

·        100% of other income like pension

·        100% of self-employed income

If you are self-employed, the CRA can send a notice to your clients to direct your receivables to the CRA. This can cause significant financial hardship and stress, as well as the negative impact it can have on your client relationships.

So, can you stop a CRA garnishment? It is difficult, but you do have options.

1.     You can try to get the CRA to agree to stop, but know that the chances of this happening are slim to none. As far as the CRA is concerned, you owe the money and their job is to retrieve it. Also important to remember, in the process of trying to cooperate, many who attempt to negotiate divulge information to the CRA that can cause even more problems; providing financial disclosure can prompt further enforcement action, a frozen bank account or a property lien for example. This option should be avoided at all costs!

2.     Consumer proposal. By entering into a consumer proposal you can immediately stop a garnishment – with the added benefits of stopping interest and likely reducing the size of your overall debt. However, there are a few caveats:

o   If you have other creditors they will be included in the proposal too.

o   If the CRA is your majority creditor, they have to agree to the proposal (if they don’t respond within 45 days they are deemed to have agreed).

o   If you own a home and the CRA has a lien on it, this greatly complicates things.

3.     Bankruptcy. Like a consumer proposal, this would immediately stop a garnishment, and is likely to stop interest and perhaps reduce the size of your overall debt. Things to keep in mind:

o   You have to report income and your financial circumstances to a trustee every month – if your financial situation improves you will have extra repayment added which has to be paid before you can get discharged.

o   Your payment to the trustee depends on your income and can change if there is an increase in income.

o   If you own a home and the CRA has a lien on it, this greatly complicates things.

If you are suffering from a CRA garnishment of your receivables, there are options to have the garnishment lifted while keeping yourself protected from further enforcement action. DebtCare has the tools and experience to help. Contact us today by calling 1-888-890-0888.

Will a Consumer Proposal Ruin my Credit?

Many of us have been there – finances are tight, and even making the minimum payments on your credit products has become difficult. Maybe you are opting to make payments on one card each month, or are continually increasing your available limit just to be able to keep your head above water. Whatever the situation, know that there are solutions, one of which is the consumer proposal.

Maybe you have already looked into this option but are asking yourself, ‘will a consumer proposal ruin my credit.’ Among the many things to be considered with this form of debt relief, the impacts are important. That being said, it definitely isn’t the only thing you should be thinking about.

The Process: The process is fairly straightforward. A consumer proposal must be conducted by a trustee in bankruptcy, but it is always smart to have your own representation – someone who can negotiate on your behalf and keep your best interests in mind. A proposal is drawn up that addresses your debt, and this is forwarded to your creditors. Once the majority of your creditors have approved the proposal (they have 45 days to accept or reject it), it is filed and you begin making monthly payments to a trustee, and that is then handed over to your creditors. Most proposals are made over five year terms, but can be paid off in full at any time.

The Benefits: There are many benefits of a consumer proposal. Firstly, it reduces your debt. Since you make a proposal to your creditors with an amount that matches your budget, this can mean a significant reduction in the overall amount that you owe. Secondly, it stops interest. Often, especially with regard to credit card debt, it is the interest that kills you, and so with a consumer proposal the interest is stopped and you can actually make significant payments of the principal, rather than the majority continuing to go to interest. Furthermore, a consumer proposal means a single monthly payment, rather than a bunch of payments on different days (again, a great deal of which goes directly to interest). 

The Impacts: Will a consumer proposal ruin my credit? Firstly, if you are considering a consumer proposal, your credit may not be in the best shape as it stands currently, and so before getting even further in over your head, it is best to gain control of your finances. The consumer proposal, like any credit activity, will show on your credit. It will remain on your report for 3 years following the date it is paid in full (so it is better to pay it off quickly).  Although it is not considered positive credit activity, you can actually start rebuilding your credit as soon as you enter into a consumer proposal.

If you are thinking about a consumer proposal but are worried about the impacts on your credit, please contact DebtCare Canada today for a free consultation:  1-888-890-0888.

The Challenges of Dealing with Debt Through a Divorce

In Canada, divorce is one of the biggest causes of debt, and debt is one of the biggest causes of divorce. No matter how you look at it, financial strain wreaks havoc on your life in a number of different ways.

When you separate, and go from a 2 income household to a 1 income household, it can become incredibly difficult to navigate this change in your financial situation. Maintaining a hold on your current debt load, meeting minimum payments, even establishing and sticking to a realistic budget can be really tough.

Check out this video of DebtCare’s own Pam Shimmerman, our financial restructuring specialist. With a legal background, Pam has helped countless individuals deal with the debt that comes from divorce.

One of the best things that you can do once a divorce is initiated is to take a detailed look at your household income and expenses, as well as your current debt load and future financial goals. Working through these items with a financial specialist can help ensure stability and can help you to achieve your financial goals.

If you are in the midst of a divorce and would like some help dealing with the financial repercussions, please contact Pam for a free consultation. You don’t have to do it alone. Please call 1-888-890-0888 or email Pam directly at pshimmerman@debtcare.ca.