Debt trouble – now what?

It can be tough to cover your basics and some of the stuff you enjoy in life when you start out. Credit cards, banks, and pay day loan companies seem like a helpful idea to cover your unexpected expenses, but that isn’t necessarily the case. Lending you money when you are in need is a business! Credit card companies, pay day lenders and financial institution make their money by charging you for borrowing money.  

There are some great strategies to help you deal with debt.

How to avoid debt

A good plan will help you avoid debt and the cost to borrow money. Mistakes are common, but financial literacy is an important part of being independent. And debt is a major cause of stress! Some common strategies to avoid debt accumulation are:

  • Prioritize your bills and payments (needs vs wants
  • Pay debts off as quickly as possible – you pay interest on the interest and it starts to feel like you are never going to get ahead
  • Make a budget and stick to it – plan to save a little every month for emergencies
  • Keep track of how much money you have in your account and track your expenses
  • Talk to the people you owe money to and negotiate payments you can afford
  • Only use your credit cards in emergencies or better yet have an emergency fund
  • Avoid pay day lenders – they have the highest fees!

How to deal with debt

There are lots of services to help you plan out how you will move forward from debt. If you’re ready, here is a good plan to start with

  • Stop using credit – get rid of your credit card
  • Collect and record your debt information
  • Rework your budget
  • Negotiate and consolidate your debt
  • Make a debt repayment plan (Credit counselling society of BC
  • Stick to your plan

Get help to get out of debt

Credit Counselling is when someone takes a look at your budget with you over the phone or in person. They will ask about your expenses, spending habits, goals, and any money that you owe.


Consumer Proposals are created with a credit counselling service. They start a legal process in which you pay some percentage of what you owe to each creditor over a set period of time.


Bankruptcy is a way to remove yourself from most of your debt, but can be costly and has long-term consequences. 

I need some help. Where can I go?

The Credit Counselling Society of BC is a non-profit organization that helps people get out of debt. When you are ready, give them a call and they will set you up with a credit counsellor who can help you break down your budget and come up with a plan to pay off your debt.

The credit counsellor can also speak to your creditors on your behalf and negotiate a new plan for you to become debt free. This might make more sense for your needs than the bills and amounts sent to you in the mail.

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