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It can feel overwhelming to be young and in debt. With student loans, credit cards, accommodation and groceries, your expenses quickly add up. Fortunately, there are concrete solutions to help you regain control.
Having debt at a young age can feel like a huge obstacle. However, there are concrete solutions to reduce the financial pressure and get back on track. These are the key takeaways:
The cost of living has risen in Quebec and many young people, often before they have launched their career, enter adulthood already saddled with debt. This reality can be very daunting. Luckily, you can get back on track. However, it’s important that you act fast to prevent the situation from getting worse.
Before you can take action, you must pinpoint the sources of your debt. There are many different kinds of debt. Debt can be in the form of a student loan, credit card or car loan, for example.
Make a list and note:
This exercise will relieve a lot of your stress because anxiety is often caused by the unknown. Understanding your financial situation is essentially regaining some control.
Having debt does not mean that you’ve failed. Many young people with debt feel guilty. They think it’s due to mismanaging their money. However, credit is easily accessible in our society. And social pressure is powerful. FOMO (fear of missing out) is increasingly common and it pushes us to live beyond our means. As a result, debts keep piling up. There’s no point in judging yourself. What’s important is choosing to take action now.
You don’t need to change everything at once. Each individual step has an impact. Even a small sum can make a huge difference.
Cancel subscriptions and reduce restaurant meals and takeout.
Credit cards often carry interest rates over 20%. If you make only the minimum payment every month, your debt will continue to grow.
You won’t forget deadlines or incur late fees. This is important since payments that are 30 or more days late impact your credit rating.
The labour shortage has created opportunities. For example, you could help out in a store or restaurant or walk your neighbours’ dogs. Any additional income can get you closer to your goals.
Wiping out your debt won’t happen overnight. You shouldn’t strive for perfection or move too fast. Instead, move forward at your own pace. What’s essential is taking the first step.
Set clear and realistic goals. For example:
Each small victory is important. As you make progress, your confidence will grow.
Does the thought of talking to the people or institutions you owe money to (what we call creditors) intimidate you? However, it’s a common approach and the response may surprise you. Your creditors could agree to review the terms and conditions of your agreement, reduce the interest or propose a more flexible payment schedule.
There’s no shame in negotiating. Try it and see!
If, despite your efforts, you’re drowning in debt, call on professionals. Asking for help is not a sign of weakness. On the contrary, it shows courage. The Licensed Insolvency Trustees at Raymond Chabot offer a free consultation. Their role is not to judge you, but to work with you to find the best strategy. In certain situations, simply opting for debt consolidation can get you back on track.
Being young and in debt isn’t a life sentence. You still have time to turn the situation around. Many Quebecers entered adulthood with a heavy financial burden. And many of them made it through. Your debt does not define your identity. Debt is a temporary challenge. If you take action today, you’ll be one step closer to a more stable life and a more peaceful future.
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