Generational Debt: Who Is Feeling It The Most?Nov 07, 2018
When it comes to generational debt, which generation do you think is the most indebted? According to BDO Canada’s Affordability Index, which surveyed Canadians across the country about their financial and debt situations, 80% of Gen Xers (age 35 to 54) are carrying some level of personal debt, which is a higher percentage then any other generation.
With so many Canadians, especially Gen Xers, carrying an average of $20,000 in non-mortgage debt, it is critical to understand the warning signs before it turns into a problem. Regardless of what generation you belong to, here are the warning signs to look out for when it comes to your finances and debt load:
- Consistently relying on credit to pay for monthly essentials such as mortgage/rent, utilities, and other bills.
- Regularly making late or missing bill payments.
- Don’t know the amount that you owe.
- Avoiding calls from creditors.
- Feeling stressed because of your finances.
- No money in savings.
- Requesting new credit or limit increases and being declined.
- Keeping your debt load near or at their max limits.
- Finding it difficult to make any progress on paying off or reducing your debt.
If you find that these warning signs relate to your current financial and debt situation, there are steps you can take on your own or with the help of a debt professional to get you back on track.
Here are three suggestions you can do on your own to get started:
- Perform a financial health check-up.
November is Financial Literacy Month in Canada, which makes it a great time to brush up your financial knowledge. There’s no better way to do it than to get a thorough understanding of what your current financial situation is.
A financial health check-up requires you to look at how much money is coming into the household and where it’s being spent. This includes looking at mortgage/rent, utilities, groceries, bills, debt payments, and anything you may be contributing to your savings.
Knowing where you stand financially is the first step in building a plan to address the warning signs.
- Find a budget solution that works for you.
Whether you like to work with a pen and paper or prefer to do your budget through an app, it doesn’t matter. Find a method of building a budget that works for you and stick to it. This is the most important tool to keep you on track with making sure bills are paid, personal debt is being reduced, and money is being set aside into savings.
If you can master sticking to a budget it will mean positive things when it comes to paying off debt and building a brighter financial future for you and your family.
- Don’t wait to get started.
If you plan to tackle your personal debt on your own or with the help of a professional like a Licensed Insolvency Trustee, get started as soon as possible. The quicker you take steps to find solutions to remedy your financial situation, the easier it will be to get back on track. When it comes to professional debt help, if you seek help early you will have more options available such as consolidation loans and consumer proposals to reduce your debt.