Being in debt is something to feel ashamed about, right?
Wrong, says Matthew Keenan and Allyson Schmidt of the Credit Counselling Service of Sault Ste. Marie and District.
The service is the subject of this week’s Mid-Week Mugging.
The service’s office, located in an historic former bank building at 298 Queen St. E., remains, for many, one of the best kept secrets in the Sault, but a valuable resource for those who need it.
Local debt problems, which can strike all ages, include:
- inability to budget
- misuse of credit cards
- sudden, unexpected job loss due to a layoff or illness
- divorce, or similar relationship breakdown
- poverty (there is a sad increase in the number of elderly people facing hard times, Keenan said)
- being a victim of scams
“We’re the only non-profit agency in town whose sole purpose is to help the people of Sault Ste. Marie and district manage debt, get out of debt, build healthy financial budgets and prosper, to provide the skills and tools to the community so they can make good financial choices to better themselves,” said Keenan, Credit Counselling Service’s education coordinator.
“We’ve been around for almost 50 years and we are one of the first credit counselling agencies in the country. We’re trailblazers,” said Schmidt, Credit Counselling Service’s financial empowerment coach.
Their service is much-needed.
“We don’t have financial literacy. As a country, most of us get a failing grade,” Schmidt said.
“Consumer debt in Canada is roughly 168 per cent of our take home pay, so for every dollar we take home we owe $1.68,” Keenan said.
That debt is closer to three dollars for every one dollar for those below the poverty line.
Another primary cause of debt for many, Schmidt said, is a lack of parental education and the instant gratification that comes with buying fun but unnecessary items.
“The only consumer education most kids and young adults see is the actual purchasing of goods, the point of sale, and they don’t see how to pay off that credit card, or understand how much their cell phones cost,” Keenan said.
While saving money is, of course, the wise thing to do, Keenan and Schmidt said saving is seen by some as a self-depriving depressant, robbing one of the rush of buying those attractive but unnecessary things.
“It all comes down to rewards. You can feed that reward by purchasing something, or instead, you can exercise or simply eat a doughnut. Change the reward,” Keenan said.
“In that moment (when tempted to buy), walk away, take about five or 10 minutes, and if that desire is still there, feed the reward by playing a game on your phone, for example. If you’re playing that game, your brain is being rewarded and that desire to buy is not as strong. That’s one of many ways,” Keenan advised.
“We come up with tailored options for our clients. That first appointment is about an hour and it’s free and completely confidential. Creditors, banks won’t know you were here, we don’t report it. Confidentiality is paramount,” Keenan said.
Schmidt emphasized people should not feel ashamed about seeking credit counselling, as debt problems can affect high or low income earners.
“Debt affects their feelings about themselves, their relationships with their partners, their children, people feel it’s really hard to walk through our doors, but when they do they feel so much better.”
“Every day when I’m out in the community people will whisper to me ‘I’ve been to credit counselling,’ but they say ‘that meeting changed my life’” Schmidt said.
Keenan said his role as an education coordinator is to come up with debt management plans for clients, enabling them to reach agreements with their creditors, lowering monthly payments and pay off their debts over a five-year period.
Schmidt’s area of expertise is helping people tap into little-known sources of income and services, such as helping parents sign up their children for a Registered Education Savings Plan (RESP), working with the Community Volunteer Income Tax Program, making people aware of GST and Trillium Fund deposits and other income sources for those who need it.
“Throughout last year I was able to bring in over $200,000 worth of benefits for people in our community,” Schmidt said.
“It’s a high to help people get money back on their taxes.”
“For me, I’m in my sixth year here, and these debt management plans last five years, so I’m starting to see some of my first-ever clients who may have had up to $50,000 in debt now debt-free and absolutely ecstatic that we as an agency were here to help them,” Keenan said.
“It’s very gratifying.”
“Come see us before debt becomes a problem,” Schmidt said.
Credit Counselling Service of Sault Ste. Marie and District is supported by the United Way and Prosper Canada, and can be reached through their Facebook page and by phone at 705-254-1424.