Have a Debt Free Christmas This Year

We can all relate to how frustrating it can be to start a new year with last year’s Christmas bills.  With Christmas being only a few more weeks away, we can be prepared for shopping season by planning ahead and creating a budget to work off of.

Here are a few tips to help you stay within your budget this Christmas:

  1. Create a Budget – if you shop without a list, it is easy to overspend or give in to impulse shopping.  Download our Holiday Gift Giving Planner that can help you get organized.
  2. Comparison Shop – starting Christmas shopping early also means you have more time to shop around and check prices at different stores.  Many online stores offer discounted prices or one day only sales.
  3. DIY Gifts- there are many gifts that you can make to give as gifts that won’t break your budget. You can tailor the gifts to the person you’re making it for – all the more thoughtful!

Careful planning can help you debt free – you just need to invest some time now to get organized.

Selling Your Assets to Get Out of Debt

Life can throw many hurdles your way and sometimes you may find yourself in a situation where your debt has become more than you can handle. You may have lost your employment or had unexpected expenses that have put you in more debt than you are able to pay back. It is at these times that many look for creative solutions to satisfy their debts before it negatively affects their credit standing. One way to do this can be selling assets you own free and clear to pay off some or all of your debts. However, before you sell off something you own, take the time to consider a few points.

– How much will it cost to sell? While most items can be put up for sale through a local paper or even a website for little or no cost, there are some assets that will have costs attached. A old car that needs work may cost more to get running than it is worth to sell. Some other types of items may require a professional appraisal or other expenses to get any value from the sale.
– How much will it cost to replace? Even though you need the money now, you do not want to pay off one debt to end up incurring another. If you sell your car to pay off debt, just to have to buy another one that may not be in as good of condition, you may end off worse in the long run.

If you can easily sell an asset and not be saddled with any extra costs or issues down the road, it is a reasonable solution to a bad debt situation. Just be sure that you look at all the angles before selling something that will either not cover your debt or will cause you further debt problems later.

Collection Agencies – Know Your Rights

When you are behind in paying a debt, creditors may turn your account over to a collection agency in an attempt to recover the amount owed. Whatever the situation is that landed an account in the hands of a collection agency, there are certain rules that they must abide by. It is important to know your rights when dealing with collection agencies.

– Written notification. The collection agency must notify you in writing that they have assumed your account. If you are receiving phone calls from an agency that has not sent you written notification, ask for this to be sent to assure that it is not a fraudulent action.
– Only pay what you owe. Collection agencies are not allowed to collect more than the amount owed in Canada. Their fee is taken out of the amount owed to your creditor so no additional fees should be added on top of what your originally owed the creditor.
– No harassment. While collection agencies are allowed to contact you to collect the debt, they are not allowed to harass you or your family. There are also certain times of day that are restricted from collection attempts, check with the rules within your province or territory.
– Contacting others to collect your debt. Collection agencies are not allowed to contact your friends, neighbors, family or any outsider to try and get information besides phone number or address to collect your debt.
– Legal action. You must be notified before a collection agency can begin attempting to collect the debt through legal or court action.

If you owe the debt, it is always best to pay it in full as soon as possible or make arrangements with the collection agency to do so. However, if you feel they are using illegal or unjust means to try and collect money from you, contact your provincial or territorial consumer affairs office and report the agencies actions.