Tips for Managing Your Debt

 There are a number of ways you can reduce your debt load depending, of course, on your financial situation and if you expect it to improve right away or not for awhile.

Check out the tips below and consider the options that will work for you in the short term and the long term.

1.  Re-think your spending plan

Do you have any expenses that you can decrease to free up some extra cash to maintain your monthly credit payments or put extra payments down?   Things like taking the bus instead of driving, cutback on eating out, buying lattes…

How about income?  Can you increase it in anyway?  Get a part-time job?  Offer personal services such as babysitting, home repairs; sell some unsecured assets, etc?

2.  Refinance

Got a personal loan, car loan or mortgage?  Look into extending the length of time you have to pay on it which may reduce the monthly payment required.

3.Consolidate

Review the option of a consolidation loan which brings all of your debts under one loan so you only have to make one payment.  Be sure that the loan has a low interest rate and do not continue to incur more debt!  It defeats the purpose. 

4.  Rely on Friends or Family

Call on a friend or family member to see if they can lend you the money.   This way you can make payments to your lender rather than the creditor at a more flexible payment schedule, lower or no interest.

5.  Lump Sum Payment

Expecting a large lump sum of money?  Talk to your creditors to see if they will take a lump sum payment.   If they do be sure to get a final agreement in writing that states that you have settled for a final payment.

6.  Negotiate with Creditors

Occasionally, creditors will set up a different payment schedule for you to make your payments more manageable.  You make lower payments over a longer period of time.    If you are able to negotiate this with the creditor, be sure to get the agreement in writing.  Find out more information regarding what creditors can do from Service Alberta.

7.  Debt Management Programs

Consumer Proposal

This program is under The Bankruptcy and Insolvency Act that involves less than full repayment of unsecured debts. 

Bankruptcy
Bankruptcy relieves you from your unsecured debts without payment to your creditors.  Also under the Bankruptcy and Insolvency Act. 

Orderly Payment of Debts Program
The OPD program is exclusive to CCSA and it is designed to help you pay off your debts to creditors at a reduced rate as well as provide you full protection from your creditors. Due to the fact that this program is under the Bankruptcy and Insolvency Act, it has several advantages:

• Interest rate is automatically reduced to 5%
• Your counsellor will deal with creditors on your behalf.