Our most recent video helps explain why so many Canadians turn to bankruptcy or a consumer proposal as a way of dealing with overwhelming debt and describes the early warning signs of financial problems.
TRANSCRIPT: The causes & warning signs of bankruptcy.
If you are considering bankruptcy, you are not alone. Every year, more than 120,000 Canadians declare insolvency.
What causes bankruptcy?
39% Job loss or reduced income.
Losing your job can make it increasingly difficult for you to make your debt payments.
18% Divorce or separation.
Marital breakdown can mean that you no longer share expenses, and must handle bill payments on your own.
16% Medical problems.
If your are sick or injured, and cannot work, this can lead to a lot of financial problems.
55% Financial mismanagement.
Overspending and excessive use of credit is the number one cause of bankruptcy.
Without adequate savings, the costs related to one of these major life events can lead you to bankruptcy.
What are the warning signs?
- You use overdraft protection often.
- You make only minimum payments on your credit cards.
- You charge more than you repay on your credit cards every month.
- You use credit for your everyday expenses.
- Arguments about money cause problems with your loved ones.
- Creditors are threatening legal action.
- You’re unsure of how much you actually owe.
- Collection agencies are calling your regularly.
- You are over your borrowing limit on your line of credit, credit cards or overdraft.
Are you on the path to bankruptcy?
- Continue to borrow money.
- Borrow from friends & family.
- Ignore the problem.
- Create a budget.
- Track your spending.
- Consider all debt relief options.
- Talk to a debt advisor.
Want to learn more about bankruptcy? Visit
Hoyes Michalos & Associates Inc. Hoyes.com.
Money problems, money solutions moneyproblems.ca.