Recently, I posted a blog called Easy Steps to Teaching our Children About Money Management.

Basically, you teach your children to track every penny spent and to find ten percent to put into an emergency fund. I remember telling my son Bradley, a story that was told to me by my financial planner. She told me about this young kid about 18 years of age in her office that saved ten percent of his earnings and brought it to her to invest. How much money did that kid have at age 40? The kid had over $800,000. Bradley has never forgotten that story and stated he was going to do the same thing. One of his goals is to graduate from the University of Windsor debt free. He is on his way and was even profiled in the Windsor Star recently!!

I am very proud of Bradley and his plans, but not everyone can graduate debt free. Currently, you may be a student or a recent graduate and finding it hard to secure employment to pay your student loans. Student loans are only automatically discharged if you have “ceased to be a student” for more than seven years prior to when you file a consumer proposal or bankruptcy. You may read more regarding student loans here.

There are generally 3 options to deal with the debt. The first option would be a debt management plan, which is to pay 100% of the debt over a 5 year period. The second option would be a consumer proposal, which is to pay a portion of the debt over a 5 year period and the last option would be a bankruptcy.. This short video explains options you have for dealing with your debt.

If debt stands between you and your future goals, please give me a call at 310-PLAN or 519 250-8060 to help you make a plan for a fresh start!!

Many clients I meet with in Windsor, Chatham and Leamington are concerned about their credit rating and how to repair their credit.

A credit bureau is an information service for credit lenders to exchange information with credit borrowers. The credit reporting agencies receives this information directly from the financial and retail institutions and retains it to help other lenders make decisions about granting you credit. Because your credit report contains all the information received from your lenders and provides a picture of your financial health, other lenders will request your report when they are determining whether or not to grant you a loan. Your credit report is a history that will help them determine what kind of lending risk you are – if you are likely to repay your obligation on time or not.

You may or may not already know that there are two major credit reporting agencies; Equifax and Transunion .

Everyone is entitled to get a copy of their credit report once a year to ensure all information reflected on it is accurate. If inaccurate information exists on the credit report then it is up to the individual to contact either Equifax or Transunion to find out how to change the information. The consumer reporting agency works for both you and the business to which it is reporting. It must inform the business of your current credit situation – and be fair and honest about what it reports. It is to the agency’s advantage to provide the best and most accurate information possible to ensure trust in its services. You could be denied a loan if your credit contains an error.

Generally a consumer proposal is on your credit report for three years after your last payment, and a bankruptcy is reflected for six years from the date of your discharge, unless it is a second bankruptcy which is noted for 14 years.

A practical way to re-establish your credit rating is to maintain current house payments or vehicle payments on time or to obtain a secured credit card from a Canadian Financial institution. This type of revolving credit requires you to pledge money as security to use the credit card.

If you are having difficulty handling your bills, then please come in to see me. I can help you get started on a fresh start plan for your future. You can call me at 310-PLAN or email me.

SHOP AROUND and compare as you should be able to compare, price, guarantees, warranties and the duration of the contract.

WHO you are dealing with? Contact the Better Business Bureau or investigate a company online.

NEGOTIATE what you want through investigating the competition. If the sales person wants your business they will listen to your concerns.

READ THE CONTRACT and do not listen to the verbal promises of the sales person. Initial any changes and blank out any spaces not filled out so nothing can be added after you sign.

UNDERSTAND EVERYTHING IN THE CONTRACT and do not feel pressured into signing right away. It is a good idea to bring it to a lawyer to review before you sign.

KNOW WHO TO CALL TO GET HELP OR LODGE A COMPLAINT if you are not given customer service information then request it when signing documents. You should know how to resolve issues in advance.

KNOW HOW TO GET OUT OF IT. Sometimes there is a period of time to get out of your contract without penalty. Most of the time it will cost you to get out of your contract early.

SLEEP ON IT especially if you are prone to being impulsive. That will give you time to think it over and ask yourself if it is a need or a want.

GET A COPY OF IT as you may need to refer to it down the road for customer service inquires.

Signing paperwork you don’t understand can lead to financial problems down the road. If you find yourself in this situation and you need advice about your debt call me at 310-PLAN.

Thanks!

Answer: When you file a consumer proposal you give up all of your credit cards; they are cut up and sent back to the credit card companies. In order for the proposal to be successful it is important that you do not incur any additional debt, which is why you lose your credit cards.