You’re past 55, you’ve put significant time, energy and effort into your career. You’ve been contributing to retirement funds your entire life, and you can practically hear the golf course calling your name every day. It sounds perfect, except your outstanding debt, and those high interest payments are keeping you heading out the door every day, instead of hanging up your spurs for good.
If this scenario sounds familiar, you’re not alone. Almost a quarter of Canadians nearing, or at retirement age are struggling with their debt loads, leaving them tired, still working and trying desperately to get out of debt before walking away from their work-related income. According to a recent CBC story, 1 in 5 Canadians aged 55-85 are still making mortgage payments, and nearly 66% are carrying credit card debt every month.
It’s a troubling statistic, and equally troubling is news that nearly a quarter of working Canadians aged 20-64 have dipped into their retirement savings to pay off various forms of consumer debt and health-related expenses.
Reasons for Debt at Retirement
Life doesn’t always go according to plan. According to a Sun-Life study on debt and retirement of Canadians aged 55-85:
- 26 percent were making car payments.
- 7 percent had unpaid health expenses.
- 7 percent owed money on holiday expenses or vacation property.
- 6 percent hadn't paid off home renovations.
In the same study, it was also discovered that the same Canadians were still racking up new debt, for reasons such as:
- 63 percent did so because they needed to, for medical expenses, debt repayment, etc.
- 24 percent withdrew money as part of the Home Buyers’ Plan.
- 13 percent took out money simply because they wanted to buy a car, go on a vacation, etc.
Aging boomers also frequently help their children with down payments on their new homes or other related expenses, or they may be incurring costs related to their own parents' health and care as they continue to age. Emergencies requiring immediate cash injections can also arise, leaving many Canadians nearing the golden years of their lives in a precarious condition.
It all adds up to a precarious situation, but if all of this sounds familiar, you’re not alone and there are strategic options available if you act sooner, rather than later.
How BNA Debt Solutions Can Help You
If you’re drowning in a mountain of consumer debt, the first step in getting back on track towards retirement is to contact us at BNA Debt Solutions and talk to a Licensed Insolvency Trustee. Our team can advise you on the best possible steps to take in eliminating high interest debt, securing your pension and home.
If your debt is over $10,000 you may be very well suited to file a consumer proposal, which has significant advantages to the aging debtor. Under it, all of your assets are protected (such as your home, vehicles and additional properties) provided you are still in good standing with the lender and not behind on your payments. Additionally, retirement funds are also protected, meaning that you aren’t in jeopardy of losing the nest egg you’ve been so diligently working on for decades.
When you come in to file a consumer proposal, creditor harassment stops very quickly. Our Licensed Insolvency Trustees talk to your creditors and create a mutually agreed upon arrangement that sees you paying back a portion of your debt on terms that you are able to afford (on average our clients pay back just 37% of their debt). Your credit report will be clear 3 years after your consumer proposal payments are completed.
The quicker you pay down your consumer proposal, the quicker it is completed, which means you can retire faster. In almost all cases, your debt will be eliminated much quicker, at less cost to you than making payments to your creditors on your own.
The most important thing to keep in mind is to make a move to come and see us sooner rather than later, getting you much closer to closing off your debt for good, giving you more time to enjoy the time you’ve spent so many years working towards.
Help is out there, and you’re not alone. Give us a call today at BNA Debt Solutions to talk about your debt options as you near retirement. We’ll get you on the right track to financial freedom.