By Jasmin Brown, BDO Debt Solutions

BDO Debt Solutions

How to overcome debt and affordability challenges due to COVID-19

Oct 20, 2020 | 9:18 AM

More than four-in-10 Saskatchewan residents have taken a financial hit because of the pandemic. That number might not shock you. Maybe you have friends or family who are struggling financially, or you may be struggling yourself. What may surprise you is that the same number of Saskatchewan residents (about four-in-10) say that the pandemic has had no effect on their finances. Fifteen per cent say their financial situation has even improved since the pandemic began.

What our third annual BDO Affordability Index clearly reveals is the widening affordability gap and growing economic disparities between Canadians who are worse off due to the pandemic and those whose financial situation is unchanged or better off.

Canadians who are worse off because of COVID-19 are more likely to have experienced a layoff or reduced income. This group is also more likely to be self-employed or working part-time, have a lower-income, or to be living with parents or relatives.

Compared to the rest of Canadians, those who are worse off are more likely to say:

· Debt has become overwhelming due to COVID-19

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· Groceries, utilities, transportation costs, housing costs are difficult to afford

· They are living paycheque-to-paycheque

· Their financial readiness for unexpected costs, financial independence and retirement is poor or terrible.

To overcome debt and affordability challenges, keep calm and make a plan

Following a budget that fits your current financial situation is important. The costs of raising a family, unexpected hikes in rent or mortgage payments, or a change in your work situation could all cause month-to-month affordability challenges. No one is certain how long the pandemic will last, so make it a habit to review your finances regularly and adjust your budget accordingly. Cut back on non-essentials and essentials if you can. Contribute to an emergency fund if possible.

What if you are overwhelmed?

If you are relying on credit cards, a line of credit or payday loans to make ends meet each month, speak to a debt help professional as soon as possible. A Licensed Insolvency Trustee (LIT) will review available debt solutions with you and can help you decide if a formal solution, such as a consumer proposal is best. A consumer proposal often will reduce the amount of debt you owe so can pay down your debt effectively and then focus on creating a plan for your future.

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BDO Debt Solutions

1-855-BDO-DEBT

Prince Albert and Area

North Battleford and area.