Do-It-Yourself Ontario Debt Assistance: You Control Your Debt

Credit cards work on a “buy now, pay later” basis. Buy anything you want today and worry about how you’ll pay for it once the bill arrives. This grand yet simple idea has remarkably enticed buyers into biting off more than they can chew. And it has given rise to one of the most rampant forms of debt—credit card debt.

Credit card owners are fighting back. Equifax’s Canada headquarters said the average credit card debt fell by 3.4 percent in 2011. Likewise, TransUnion reported a decrease of credit card debt by 1.49 percent compared with last year. While figures vary, a slower trend in consumer debt may just be what people filing for Ontario debt consolidation need.

There are (relatively) simple steps you can take to avoid your credit card debt from pushing you to the brink of bankruptcy.

Practice restraint

Just like going on a diet, take note of your spending and work towards controlling it. Limit your reliance on credit cards. Credit cards are handy when you truly have money to cover the full payment of a transaction but don’t have cash in hand. Paying in cash whenever you can will stop you from spending beyond your cash flow limits. If you have to literally hide that plastic cash where you can’t access it easily, go right ahead.

The common problem with control is that most people don’t have it. Credit counseling experts say that people run into trouble with their credit card debts because they can’t keep their spending in check, or can’t restrain themselves from paying on credit. They advise people to buy only things within their means.

Always pay in full

If you have credit card debt, it’s better to be done with it today than to pay in servings over time. Credit counseling experts say a credit card debt of $10,000 carrying an 18-percent interest rate may take you 23 years to pay off completely if you just keep paying the minimum each month. Ontario bankruptcy cases are usually driven by mounting debts similar to the above.

Credit counselors further say you may end up paying another $10,000 for the interest over time. It may have been better if you paid $10,000 from the get-go within the grace period given to you. Even Ontario debt assistance advisers from firms like Paddon + Yorke Inc. say the same.