Dealing with Debt the Wrong Way

Here are seven common mistakes people make with they are having trouble with debt

Consolidated Credit Counseling Services of Canada has helped over 500,000 Canadians take care of their debt. We are dedicated to providing Canadians with suggestions on how you can gain control and live a debt-free life. We can show you exactly what you should do, to enjoy financial freedom.

But this page is different. Below you will find some of the pitfalls that Canadians find themselves in. While it is encouraged to find a solution for yourself, you should be selective in the path you take. Instead of working with the expert advice from our trained credit counsellors, you should be aware that not all paths lead to success. Often misguided choices can put you into an even worse situation. If you are considering these solutions for yourself, it might be time to try a Free Debt Analysis on our website, or speak to a trained credit counsellor now by dialing . You’ll receive customized advice that reflects your own unique financial situation, along with suggestions to help you conquer your debt.

When dealing with debt, don’t…

  1. Ignore the problem. It won’t go away. Falling behind on payments and doing nothing about them will make your issues exponentially worse. You will incur finance charges, penalty APRs, and your account could go to a collection agency. All the while, your credit score will plummet. Be proactive and take care of your credit problems when they appear.
  2. Spend the way you always did. If you’re facing debt problems, you should immediately reevaluate your budget (or create one). You might find that you’re spending too much money on wants instead of needs. Every debt situation is unique, but living beyond your means will almost certainly keep you in debt.
  3. Pay debts with borrowed money. You want to avoid the proverbial situation of robbing Peter to pay Paul. You can never borrow your way out of debt. Paying loans with cash advances or payday loans is only delaying the inevitable, and you might also rack up extra interest while you’re at it.
  4. Close out a credit card without knowing the impact. Sometimes closing a credit card can hurt your credit score. If your card still has a balance, or if you’ve had it for a very long time and it makes up a big part of your credit history, you should try to keep it open.
  5. Take your credit card shopping. If you’re having difficulty keeping up with your credit card payments, it’s probably time to banish it from your wallet or purse. If possible, switch to a cash-or debit-only policy. Your debt levels are already growing due to interest; don’t magnify your problems by adding to the principal balance.
  6. Give up on negotiating with creditors. If you have tried to reach an agreement with your creditor but were denied, try speaking to someone more senior, or call back another day to speak with a different agent. Refer to our do-it-yourself negotiation guide.
  7. Be afraid to reach out for help. Non-profit credit counselling services like Consolidated Credit are designed to offer non-judgmental, confidential, expert advice to people who are struggling with debt. Call our trained credit counsellors today at or try our Free Debt Analysis online and find out your available options.