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Kitchener Ontario Personal Bankruptcy Blog provides free personal bankruptcy information and helps Kitchener residents dealing with their debt. |
Below are the most recent personal bankruptcy questions. Be sure to check out our Frequently Asked Questions page for answers to more common questions about personal bankruptcy in Kitchener. Remember, you can always post an anonymous question, as well as arrange for a free consultation with a personal bankruptcy expert near you. |
Recent Bankruptcy Questions:
I read in the Waterloo Region Record this past Saturday that the area's unemployment rate has increased to 9.9%. Across Canada, the average is down to 8.3%. Obviously, the national figures are not great news compared to historic levels, but it is showing a positive trend. That Waterloo Region would be lagging behind was a bit of a surprise, and somewhat concerning.
As I flipped through other sections of the paper, I came across a report on house sales for January 2010 for the region. The paper is already lining a hamster cage, so I don't have the precise numbers, but the headline was shouting all about the record highs for sales. I found myself even more confused. If so many people are out of work, who is buying these houses? The confusion of these mixed messages is a phenomenon that I have commented on before.
I meet with people in our Kitchener-Waterloo bankruptcy offices to discuss their finances. We talk about the state of their financial affairs and try to develop a plan to deal with their difficulties. What matters most to the people I meet with is not what is happening statistically across the country. What matters most is what is happening in their house. Period.
Here's my suggestion: SHUT OUT THE NOISE.
Yes, you need to be aware if your company is closing down. Yes, you should be looking for ways to develop skills to keep yourself employed. However, worrying about things that are beyond your control is useless if you do not have plan of action.
Sit down with your partner and take a long hard look at your finances. How much money is coming in each month? Where does the money go? Are there ways to reduce expenses? Do you need to save up money for going back to school?
Develop a plan together and hold each other accountable to it. A budget is not something you look at once and throw away. It is a tool for setting goals and measuring performance.
Here's one more thing to think about. The Office of the Superintendent of Bankruptcy publishes statistics on the rates of bankruptcies and proposals in Canada. The latest results, for November 2009, show rates above historic levels, but decreasing compared to recent months. No guarantees, but hopefully the worst is over.
If you want to talk about your situation, feel free to give us a call at 310-PLAN, or send us an e-mail.
In honour of the big game coming up this weekend, I present a special Super Bowl theme because I know there are lots of football fans in Waterloo region. For me, I am more a fan of crokinole than the pigskin.
Now that Christmas is becoming a more distant memory, businesses need a new angle to try to separate you from your hard earned money. Sure, Valentine's Day is coming up, but the Super Bowl will do just fine for now.
This week you will be bombarded with messages that may cause you to ask yourself questions like: How can I watch the big game on my little old TV? How can I enjoy the game in my tired little rec room? What would it cost for a last minute flight to Florida (and ticket) to catch the game in person?
Let's focus on the TV question. The answer retailers are looking for is that you need the biggest, latest high definition flat screen to appreciate the subtlety of the 350 pound linemen.
What it comes down to is temptation and separating wants from needs. I recently read a good article on this topic. Here's my two cents:
Having a new television is not going to change your life for the better. If you have the money saved up and want to indulge, suit yourself. If you have to put the purchase on a credit card, maybe you should stop and think twice. Maybe think about three or four times, maybe more.
In meeting with people in our Kitchener-Waterloo bankruptcy offices, I see too many people who were not able to control impulse spending on credit. We are all guilty of it to some extent. Most people survive just fine until something else happens like having reduced hours at work or being laid off entirely.
The bottom line is that CASH IS KING. Each of us is in the best position to analyze our own financial resources. Each of us should pause and reflect before parting ways with our money.
If you find your debt situation overwhelming, feel free to give us a call at 310-PLAN. You can also send us an e-mail. We will discuss your situation and talk about all the options, including consumer proposals and personal bankruptcy.
I heard a radio advertisement recently from one of the big banks regarding a service to help people save money. I think they called it "Bank the Rest." It works something like this:
- You link a savings account to your credit card or chequing account
- When you make purchases with your debit or credit card, the transaction is rounded up to the nearest dollar
- The difference is deposited into the savings account\
The concept is simple. You set aside money for a rainy day in small, manageable pieces.
How many times have you seen coins on the ground and just walked by, thinking that it wasn't worth your time. Think of this as an easy way to bank those coins without getting your fingers dirty.
Unfortunately, some people find themselves in situations where saving some money or changing spending habits is not enough to get out from under their debt load.
If you find yourself swimming in debt, feel free to give us a call at 310-PLAN or send me an e-mail. We'll review all of the options, including personal bankruptcy and consumer proposals
Many people these days feel overwhelmed by the challenges of day-to-day life: work, finances, family, and so on and so forth. Human beings have a limited amount of energy, mental and physical, to deal with these stresses.
My advice is to take time to do things that make you happy, whatever that may be. For me, it's reading a book, playing with my children, or going for a jog. To point out the obvious, reading a book is not going to solve all of your problems. However, removing yourself from the stress, if only for a little while, can help you put your challenges in the proper perspective. It can help you re-focus your energy where it will be most effective.
Accumulating wealth is a simple formula of spending less than you take in. However, making that happen can be much more difficult.
Are there ways to increase your income? Maybe you can find a second job. Maybe you can rent out the basement of your house. Maybe you can share an apartment with a roommate.
What about ways to reduce expenses? Here it is a question of separating wants from needs. Pack a lunch instead of eating out. Make your coffee at home instead of going to Tim Horton's once or twice a day. Skip the deluxe cable package and go basic.
These probably seem like small ideas. To that I say, think about how a trickle of water becomes a stream, a stream becomes a river and a river can, sometimes, become a raging waterfall.
There are definitely situations where increasing income and/or reducing expenses are not enough to fix a bad financial situation. If your debts are accumulating, it may be time to talk about other options like a consumer proposal or personal bankruptcy. Feel free to call us at 310-PLAN or to contact us by e-mail to review these and other options in more detail.
As the year draws to a close, it is customary for people to make resolutions for the New Year. Most resolutions have something to do with health and well being. One of the most common New Year's resolutions is to lose weight. As a society, we tend to neglect our financial health. Keep that in mind as you are making your resolutions.
The first step in making a resolution is to establish goals. Do you want to buy a house? Find a new job? Pay down your credit cards? Go back to school?
A resolution should be a specific statement of action to help you achieve your goals. A resolution "to lose weight" is too vague. Losing weight is the goal. A resolution "to join the local gym and go Monday, Wednesday and Saturday" is more specific and helps you achieve the goal of losing weight. There might be multiple resolutions that work together in achieving a specific goal. In addition to going to the gym, you might resolve "to eat fast food only once per month."
Many people talk about making resolutions and setting goals, but fail to follow through. Write your goals down on a piece of paper. Discuss your goals with family and friends. It sounds simple, but expressing your goals to yourself and others helps to ensure that you are being realistic. It also makes you more accountable, if only to yourself.
That's all for now. I will be back in the New Year to discuss strategies for achieving your financial goals.
I want to talk about a specific part of what happens when you sit down with a trustee to discuss bankruptcy as an option for dealing with a difficult financial situation.
There is a variety of questions that a trustee will ask anyone in understanding his or her predicament. Most people know that there is the potential for losing some of his or her assets by filing for bankruptcy protection. I won't go into detail on that. You can read here for a summary of the most common questions people have about bankruptcy and losing assets.
Let's take a detour and talk about some key principles underlying the bankruptcy system in Canada:
1. The honest but unfortunate debtor (i.e. the person who owes money) has a right to a fresh start.
2. The creditors (i.e. the people you owe money to) have the right to be treated fairly and equally.
3. The trustee acts as a referee in the process to ensure that everybody understands their rights and obligations. A referee's duty is to ensure that the rules are followed.
When somebody files for bankruptcy, his creditors have the right to know what he did with his assets prior to filing. The money that a trustee accumulates by disposing of a person's assets gets distributed to his creditors. Therefore, the concern is that the benefit to a person's creditors is reduced if an asset was given away or sold for something less than it was worth. The term used in bankruptcy law is "transfer at undervalue."
For transfers between people not related to each other, the trustee has a duty to apply to the courts to void a transfer if he believes the following conditions exist:
- the transfer was for inadequate value
- the transfer occurred within one year of the date of bankruptcy
- the debtor was insolvent at the time of the transfer
- the debtor intended to defraud, defeat or delay his creditors
If the courts agree with the trustee, the person receiving the asset will be required to pay to the trustee the difference between what was paid and what the asset was worth at the time of the transfer.
There are additional considerations for transfers between people who are related:
- if the transfer at undervalue was within one year of filing bankruptcy, there is no need to prove intent to defraud, defeat or delay the creditors
- if the debtor was insolvent at the time of the transfer and DID intend to defraud, defeat or delay his creditors, the review period is extended to FIVE years prior to the date of bankruptcy
If you are considering filing for bankruptcy and have any questions about what to do with your assets, my advice is to do nothing for now. You can call us at 310-PLAN or contact us by e-mail to discuss your situation. If you do end up having to file for bankruptcy, you can hopefully avoid inadvertently doing something with your assets that will cause further complications.
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