To avoid debt, one must remember to “always live within your means.” Unfortunately, that is easier said than done. If you are one who's violated that rule on one too many occasions to count, it's likely that your debt has spiraled out of control—and you may not even be aware of it.
Recognizing the signs of out-of-control debt is the first step to solving the problem, not filing for bankruptcy in Ontario right away. Once you become aware of those things that make your problems worse, you become more equipped to handle them. Here is a brief look at the signs you're getting deeper into financial trouble:
Using credit to pay for daily needs
Ideally, your monthly income must be enough to cover expenses for daily living, such as food and gas. However, if you are using your credit card to pay for these things, it is a sure sign that you are sinking in debt. Credit cards are ideal to use for emergencies and big-ticket items like vacation packages or plane tickets, and not everyday necessities.
Savings are there to give you peace of mind in times of family or health emergencies. In Ontario, one has great opportunities to make the most out of his/her savings because of the good interest rates offered by banks; in fact, one bank offers an interest rate of 1.7 percent on savings accounts. You shouldn't be getting a huge chunk of your savings to pay credit card bills or mortgage or you'll be left with nothing when rainy days come.
Taking advantage of pay day loans
These days, people who are unable to meet financial obligations sometimes consider pay day loans. These are loans—as the name suggests—to tide them over until the next pay day. However, these loans are primarily designed to be used for emergencies and not to pay off outstanding debts. This type of loan also comes with high interest rates, so you're bound to end up with more debt than before.
The above are just some of the signs that you are headed for financial trouble. However, by getting the right help from a financial consulting team to help you devise an ideal plan for debt settlement in Ontario, you'll get a chance to reduce your debt and get rid of these signs. For more information, visit wisegeek.com/what-is-a-debt-settlement-agreement.htm.
Thinking of Declaring Bankruptcy in Ontario?