Tips for Managing Debt

Managing debt takes planning, time, and discipline. Once you understand your spending habits, you can begin to create a sustainable strategy to address any deficiencies and put the right plan of action in place.

Here are six debt management strategies you can do to help you rebuild structure:

1. Make a budget:
Start by laying out all your debt and then make cuts to non-essentials where you are willing to.

2. Pay-off high-interest debt:
Tackle the highest-interest rate debt while you commit to paying the minimum on lower interest rate credit cards.

3. Consolidate debt:
Consolidating your debts onto a lower interest rate line of credit that will allow you to pay off all your debts while dwindling down your monthly payments to one a month.

4. Get a side hustle:
Finding a part-time gig or even selling assets you may no longer need are great ways of aiding your debt management journey.

5. Talk to a creditor:
Reach out to your creditors and attempt to negotiate a lower interest rate on your debts. This allows you to focus your money on paying the debt you owe, rather than using it to cover accrued monthly interest charges.

6. Contact an Industry Expert:
To help advise and guide you through the debt recovery and rebuilding process. That’s us!

Contact us today as we will provide advice and counsel on the different types of consumer credit, managing credit card debt, and how this debt affects your overall credit scores and ratings.

Credit Scores

Canada has two credit reporting agencies: Equifax and TransUnion. Both agencies calculate credit scores differently based on the information they receive from lenders and creditors. They also may score a consumer differently as not every financial institution or creditor reports to both. Here is a general breakdown of consumer credit score ranges and what they mean for you as a borrower.

Excellent
The score ranges between 800 and 900 for an excellent credit score.
Shoot for the stars; anything is possible!

Very Good
With a range of 720 and 799, the very good bracket allows you to choose from a variety of credit options.
Keep up your healthy financial habits!

Good
650 to 719 may be a good range, but you may not qualify for the lowest interest rates. However, with continued maintenance of strong credit history, you can build your credit health further.

Fair
The shortest range of the bunch comes in between 600 and 649. The key here is to demonstrate a solid sense of financial responsibility by showcasing a history of debt repayment. With fair credit, you can still find lenders that will approve

Bad
And our largest numerical range comes in at 300 to 599. Building your credit up should be your goal.
Consider speaking to an expert if you need further guidance.

Contact us today to find out what your credit rating is and how we can help improve your score.