Protect Your Relationship From Debt

By Bonnie Krisher (K&G Debt & Credit Professionals)

Financial stress is considered one of the major causes of divorce today.  Unfortunately, couples are not equipped with the valuable information that could move them beyond the stress of debt and into a plan of action.  Perhaps the following information can assist in minimizing the stress that debt is causing in your relationship:

1. Consider debt the problem, not the person.  There are often legitimate reasons for debt.
2.  If debt has not yet consumed you, but still compounding, then consider the following:

• Utilize creditor protected investments (i.e. a new RRSP bill may be passed)
• If assets are transferred into your spouses or others name 12 mths or more prior to trouble, a creditor can not touch them.
• Eliminate liabilities where possible (two car payments, etc)
• Always pay secured debt before unsecured debt (unsecured is credit cards, while secured is mortgage).
• Research you legislative rights as a consumer and understand your creditor’s limitations.

3. If debt is consuming you, then consider the following:

• Options include Debt Arbitration (having 40-80% of your debt forgiven), Credit Counseling, Debt Consolidation and Bankruptcy/Proposals (know the pros/cons of each, some are hidden).
• If all the debt is in one spouse’s name, the creditor can only come after the debtor, and not the other spouse.
• A creditor will take less than what they are owed.  Speak to a Debt Arbitrator about this; sometimes you can do it on your own.
• As a couple you have the benefit of two credit reports, if one is damaged then the other can carry you while you repair the damage (2-4yrs).

Finally, and most important, consider the bigger picture.  If you are in debt, then you are part of the majority and not the minority.  Place more value on life and love and less on the paper and the coins that cause us stress.

Bonnie Krisher
K&G Debt & Credit Professionals
www.kgdebt.ca