Consumer insolvencies are on the rise in oil-patch provinces

Consumer insolvencies are on the rise in oil-patch provinces

Canada’s oil-patch provinces continue to take a beating according to a recent report from the Office of the Superintendent of Bankruptcy Canada. Consumer insolvencies in Alberta and Newfoundland continue to be well above the national average.

The national average for consumer insolvencies is 3.3 per cent. However the following Canadian provinces continue to rise well above the average:

• Alberta increased by 32.5 per cent.

• Newfoundland up by 26.2 per cent.

• Saskatchewan a 22.5 per cent increase.

• Manitoba increased by 15 per cent.

Given the recent challenges faced by the oil industry, some consumers living in certain provinces will continue to struggle with their rising debt levels.

“When you are struggling to manage your debt, you are in a difficult position having to decide what bills need to be paid on a monthly basis. This is an unfortunate reality for many Canadians,” says Jeffrey Schwartz, executive director, Consolidated Credit Counseling Services of Canada.

“Canadians in Alberta and Newfoundland are faced with a challenging economic climate right now. To overcome these challenges, they need strategies in place to manage their debt,” says Schwartz.

Consumers in Ontario and British Columbia depict a different picture than Canadians living in provinces negatively affected by the oil industry. Consumer insolvencies are below the national average:

• Ontario decreased -1.9 per cent.

• British Columbia is relatively stable at 0.1 per cent

Although the findings from the Office of the Superintendent of Bankruptcy Canada report tells a tale of two Canadas, Consolidated Credit offers the following tips to help all Canadians manage their debt from coast to coast:

• Downsize your lifestyle. It is nice to have the best of everything however if you can no longer afford it, it is time to let it go. You can start the process by reviewing your current cable, internet or cell phone package and remove the services you can no longer afford.

• Create a budget. A well-rounded budget will factor in all of your monthly expenses from what is coming in to going out. You can keep track of your monthly budget from your smart device with a budgeting app. Knowing on what and how you spend your money will help you identify where to cut back.

• Pay more than your minimum payment. Paying only the minimum payment can keep you in debt for decades. If you pay more than your minimum payment on a monthly basis, you will pay off your debt faster and add money to your bank account in the long run.

• Build an emergency fund. Every little bit helps. Have your bank automatically take 5 per cent of your pay cheque so you will not have to even think about putting money aside for your emergency fund on a monthly basis.

• Seek help. Debt can get out of control before you realize it. Debt can affect anyone at any time. You are not alone. However, you can stay on top of it by contacting a trained credit counsellor.

“When you are struggling to manage your debt, you are in a difficult position having to decide what bills need to be paid on a monthly basis. This is an unfortunate reality for many Canadians,” says Jeffrey Schwartz, executive director, Consolidated Credit Counseling Services of Canada.”