Maxed-out credit cards, unpaid rent: coping with overwhelming debt

When your debts keep piling up, your rent is late and you’ve maxed out your credit cards, you can easily feel overwhelmed. If you are going through a tough financial situation, there are some concrete ways to take back control!

In short

When you’ve maxed out your credit cards and you cannot pay the rent, there are concrete solutions to take back control of your finances and avoid overindebtedness:

  • Don’t keep everything to yourself: talk to someone you trust about your financial difficulties.
  • Take stock: make a list of your debts, income and expenses.
  • Prioritize the essentials: start by paying the rent, groceries, electricity and transportation if required for your job.
  • Contact your creditors: you can set up agreements or extend your debt repayments.
  • Ask for help: the experts at Raymond Chabot will offer you support and respect, without judgment.

Don’t keep your worries to yourself

First of all, you should talk about what you’re going through. It’s never easy to admit that you have financial problems but bottling it all up only makes things worse. Share your story with someone you trust. Opening up is often the first step toward solving things.

Take stock of your finances

Chose a quiet time to assess the situation:

  • What is your total debt?
  • Who do you owe money to (credit cards, loans, rent)?
  • What are your fixed income and expenses?

This might sound stressful but having an overall perspective with allow you to regain some control. Our free online budget calculator can help you figure things out.

Prioritize your essential payments

When there isn’t enough money, you have to make choices and prioritize the following items:

  • Rent (to avoid eviction)
  • Groceries
  • Essential utilities (heating, electricity)
  • Transportation (if required for your job)

Credit cards can wait a while, until everything else has settled, but don’t go overboard. You should pay cash as much as possible and make at least the minimum monthly payment, otherwise your credit rating could be adversely affected.

Talk to your creditors

Many people avoid their creditors, but that’s a terrible strategy! Contact them before they contact you. Explain your situation. In many cases, you can come to an amicable agreement that allows you to set up a temporary payment plan or reduce the interest rate.

Ask for professional help

If you don’t know where to start, our Financial Recovery Counsellors can guide you and offer solutions. They provide personal and confidential support, without judgment. Don’t wait until matters get worse and make an appointment today. Even if you cannot see a way out, there are solutions!

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