Debt Tools For A Generation Feeling The SqueezeJun 11, 2015
Feeling the squeeze? If you’re under the age of 45, have burdening debt loads and low job prospects, you’re not alone. The majority of young Canadians between the ages of 25 and 45 are currently subject to a social phenomenon known as Generation Squeeze or Gen Squeeze. Unlike what their parents’ generation experienced when they were younger, the Millennial generation and Generation X are facing staggering debts loads. Household incomes are declining and the cost of living is rising.
Along with overwhelming debt, young families are faced with significant increases in the cost of housing, child care, transportation and essentials. Now more than ever, they are feeling ‘squeezed’ and are struggling to make ends meet. As this is a generation more technically savvy than any other, in this blog we discuss some online tools available to cope with these difficult times and to prepare for a debt free future.
Understanding your budget and your debt
Familiarize yourself with a budget and understand the debt you need to service. Mobile phone apps like Mint.com are a great tool to monitor the inflows and outflows of household income. In conjunction with a debt payment calculator, you can estimate regular monthly debt repayments and their impact on your available monthly income. Not only will you be able to reduce and eventually eliminate interest bearing debt, but by using these tools you will have laid a solid foundation to begin saving for your future.
Do the research – prepare for life changing events and purchases
To better prepare yourself for large purchases or a growing family, educate yourself on the financial consequences of these decisions, including any personal debt you may incur. From the purchase of a home to the addition of a newborn, there are many things you can do to prepare for these life changing moments. The Financial Consumer Agency of Canada offers many tools and calculators to help you with this. By providing accurate and realistic figures into these calculators, you can strategize a decision while obtaining greater clarity on the potential outcome.
Know your options when faced with difficult financial problems
While you may budget diligently, have a debt repayment plan in place, and understand your finances thoroughly, you can’t always plan for unexpected life events. Sickness, job loss and other life changing events may have occurred and you’re now dealing with piling bills, debt collection calls or perhaps a home foreclosure. These times are difficult enough as is, but more difficult if you’re unaware of the options available to you in dealing with your financial difficulties. Whether it be credit counselling services, debt consolidation plans, a consumer proposal or bankruptcy, it’s important you understand all debt options available to you.
Although the above tools are available online and are great resources for Gen Squeeze families, they can’t always answer specific questions regarding your financial situation. If you’re unsure which solution is right for you and your family, it’s a good idea to consult a debt relief professional such as a trustee. A trustee will meet with you, review your individual circumstances and then explain in detail all the debt options that are available to you.