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By Teena Monteleone

Managing Debt

Insolvency trustee encourages consumers: ‘Don’t be afraid to talk about debt’

Apr 25, 2022 | 3:00 PM

More people are reevaluating their personal budgets and finances following the global pandemic.

That’s according to Pamela Meger, a licensed insolvency trustee who knows the weight of debt can weigh heavy on mental health. In fact, the latest Consumer Debt Report found that 31 per cent of Canadians feel worse about their finances today than at the beginning of the pandemic.

“Just due to high inflation, effects of the pandemic, the Bank of Canada increasing interest rates, the increase in gas prices and groceries…everything has gone up, but not necessarily wages. So, it created a bit of a panic as people started to look at whether they could weather this storm.”

Meger, who works with MNP in the province, a chartered accountancy and business advisory firm, said she has started to see more people simply talking about debt.

“They don’t necessarily understand it, so we can help them with that,” Meger said. “So they’re looking at their budgets and their debt, whether that’s a line of credit or a credit card. They’ll ask, ‘what’s my interest rate? What is it costing me? How can I get it paid off?’ and they’re talking to their banks which are all the right things they need to be doing to help weather this storm.”

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Depending on what the bank says and what their debt looks like, Meger said some people may ultimately need to look at a consumer proposal or bankruptcy, but it’s not the end of the world.

“Lots of times, life happens and you can’t control things. We couldn’t control the pandemic or that people were laid off for long periods of time or your wage was decreased or you have a health issue. A lot of those things you can’t control, but a lot of people will wear that like they failed and its not failure at all. You just have to get the right person to help you through.”

The Consumer Debt Report for 2022 showed nearly three-in-ten people in Saskatchewan feel pessimistic about their finances, most commonly low earners and those burdened with debts. The real problem Meger said, is waiting too long to deal with it.

“Debt can seem like a bumpy road with no end. Bankruptcy can be a bumpy road with an end and sometimes that’s what you need. Move on, learn from whatever happened and more forward.”

The top lesson learned by Saskatchewan residents following the pandemic was the need for emergency savings, according to the report. Meger suggests two or three months of income is the minimum amount one should have saved.

“If you qualify for those GST credits or income tax refund, have them go to a separate bank account and you’d be surprised how quickly that will build.”

Other lessons learned due to the COVID-19 pandemic, particularly for younger Canadians were reigning in costs of living, keeping debt levels low, and following a budget.

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teena.monteleone@pattisonmedia.com

On Twitter: @princealbertnow