How to survive the January bills
TORONTO, ONTARIO, January 05, 2016 – If you spent a small fortune on your holiday shopping and used your credit card to make all of your purchases, there’s a strong chance you’re scared to open you’re January bills when they arrive later this month.
Being scared of opening your mountain of credit card bills is a real fear for many consumers. At Consolidated Credit Counseling Services of Canada, the condition is commonly referred to as Bill Avoidance Disorder (B.A.D.). It is a condition that plagues many Canadians every January especially for those who are struggling to keep up with their household finances in the first place. The reality is almost 50 per cent of Canadians are living paycheque to paycheque and B.A.D. is common among the most vulnerable consumers. And for many Canadians the holidays are a very expensive time, on average Canadians spent $876 on their holiday purchases last year.
“I understand there can be some fear in opening your bills this month however ignoring your credit card debt is not the way to go about it. If you ignore the problem, it will get worse. Instead of turning a blind eye this year, take control of your debt management,” says Jeffrey Schwartz, executive director, Consolidated Credit Counseling Services of Canada.
“It is the beginning of a new year and it is the perfect opportunity to take a step back and learn from your past mistakes. You can create a plan to tackle your debt and ease the symptoms of B.A.D.,” says Schwartz.
Starting the year with a heavy burden of debt is something many Canadians are trying to come to terms with. New statistics from the Office of the Superintendent of Bankruptcy Canada reveal insolvencies year over year for October 2016 are up 4.4 per cent on a national basis. More concerning are the increases in Saskatchewan (+36.3 per cent), Alberta (+36.2 per cent) and Newfoundland (+29 per cent).
“Whether you are in debt or not, it can be so easy to spend more than you’ve planned during the holiday season and then when January comes you struggle with B.A.D. Let this year be the last year you suffer from this condition. Create short and long term financial goals to help you put money aside for all of your future holiday purchases,” says Schwartz.
With January bills about to arrive in Canadian mailboxes everywhere, Consolidated Credit Counseling Services of Canada recommends the following to help Canadians survive the January crush of bills:
Say no to new debt – If you gave your credit card a serious workout during the holidays, it is time to put your credit card on ice. Besides, charging more money to your credit card will only prolong the amount of time it will take you to pay off your debt.
Switch your plastic – Get used to using your debit card more than your credit card. Or in an extreme case, adopt a cash only lifestyle. Carrying cash will allow you to spend only the money you have. When your cash is gone – it is gone!
Avoid resolutions – Let’s be real, resolutions don’t work. So ditch making a resolution and plan to get out of debt this year by creating specific and measurable goals. You can create a goal of saving an extra $5 every week or making an effort to brown bag your lunch – the options are endless.
Total it up! Create a budget to track your household finances. Your budget will help you to prioritize household expenses and see where you can cut back.
Pay more than the minimum – The more money you put on your credit card, the less time it will take you to pay off your debt and reduce the amount you pay in interest. Start small, even $5.00 or $10.00 more than the minimum-it goes directly to paying off your debt.
Don’t adopt B.A.D. – when your bills arrive through the mail, open them. Ignoring your bills will hurt your credit score. Remember late payments are reported to the credit bureaus!
Ask for a life line! If you are in too deep of a hole and your debt is causing you to lose sleep at night, seek the professional advice from a trained credit counsellor.
About Consolidated Credit Counseling Services of Canada, Inc.:
Consolidated Credit Counseling Services of Canada is a national non-profit credit counselling organization that teaches consumers about personal finance.
For more information or to request an interview with Jeffrey Schwartz, please contact:
Natasha Carr, Community and Public Relations Manager, Consolidated Credit Counseling Services of Canada, Inc., T: 416-915-7283 ext.1041, C: 416-830-4720, F: 416-915-5200, E: [email protected]