Managing bills while in debt

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Canadians are finding themselves deeper and deeper in debt. But the good news out today, is we are managing our bills anyway.

Not long ago, Canadians were urged to lower their household debt to avoid losing everything if interest rates go up and they can’t afford the payments. Interest rates are still low, and now a study by a credit monitoring agency says consumer debt in Canada was more than $518 billion at the end of last November. That’s 4.2 per cent higher than the year before.

The shortage of cash flow. That’s what it is. You don’t have the cash to buy the big things, so you borrow and don’t get a chance to pay it back.”

“It’s definitely going to collect over the next few years. I don’t know how long I’ll be in school for. It’s just adding up right now.”

The same study shows that Canadians are managing their debts. The deliquency rate, or the number of bills overdue by more than 90 days, is at record lows.

Marvin Ryder is with the DeGroote School of Business: “That means 99 per cent of us are taking debt responsibly. The message is use debt wisely and it can help you advance in life.”

Marvin goes on to say that consumer confidence has been driving the economy.

“We have debt. I call it good debt. Because it’s fixing up our home, going on vacation, stuff like that. We live once. Enjoy life. It’s too short.”

“I’m a senior citizen, I live on a budget, and I don’t go over my budget every month, in fact I’m usually under. That way when I want to splurge, I have the extra money to buy it.”

Ryder says interest rates likely won’t go up until 2016, so it can be a good idea to borrow for a house or car now. As long as you can manage the payments.