Should Credit Counselling be your New Year's Resolution?

Should Credit Counselling be your New Year's Resolution?

Written by Caitlin Wood
Last Updated June 8, 2021

With the New Year on its way, the majority of Canadians are looking for a financial fresh start. January is the perfect time to set goals and get your finances back in order. The reality of the average Canadian’s financial life is that they carry at least some high interest credit card debt and are having serious problems paying it off. So whether you’re in dire need of help or simply want to get a head start on dealing with the bills from the holiday season, credit counselling could be exactly what you need to help you get back on track in the New Year.

How Credit Counselling Works

Everyone’s credit counselling experience will be different as everyone has different credit and debit issues. Furthermore, most professional credit counsellors have their own methods and tips and tricks they like to share with their clients, this means most people will have their own unique counselling experience. But just as a general guide line here are a few things you can expect from credit counselling:

  • Credit counselling is typically not a free service, so expect to pay a reasonable fee.
  • During your first meeting your counsellor will ask a lot of questions and then analyze your current credit and debt situations.
  • You’ll work with your counsellor to credit a budget.
  • Your counsellor will teach you how to better manage your finances in the future.
  • If your credit issues are extreme your counsellor may suggest that you enter a debt management program (click here for more information on debt management programs).

While these are just a few things you can expect, they should still give you a good sense of whether or not credit counselling should be your New Year’s resolution.

Who Qualifies for Credit Counselling?

Anyone can seek the help of a credit counsellor; you can enter a credit counselling program voluntarily and work with a counsellor on a weekly basis to get the financial help you need to get your credit issues back under control.

We think an even more important question to ask is; what are some of the warning signs or financial habits of someone who might need credit counselling? Learning to spot someone who might be having some serious credit problems, whether it’s you or a friend, can and will help get the problems under control as soon as possible.

  • Someone who always uses their credit card because they never have cash.
  • Someone who only makes the minimum payments on their credit cards.
  • Using one credit card to pay off another credit card.
  • Taking out cash advances on a credit card to pay off other debts.
  • Someone who is always worried about phone calls from creditors.
  • Someone who never turns down a credit card offer.
  • Using a retail credit card to pay off another credit card
  • Someone who is always looking for a limit increase because their card is maxed out
  • Hiding your credit card statements from your significant other or family members
  • Borrowing money from family members or friends for necessary monthly expenses

If any of these seem far too familiar to you then you might want to consider looking into credit counselling in the New Year.

Getting the Guidance You Want

One of the best things about credit counselling is that you’ll be taught how to manage your finances so that you won’t end up back in the place you are now. A credit counsellor is a trained professional who will be able to cater their advice to your specific needs. Sometimes all it takes is support, advice and help from someone that knows what they are talking about and has the experience to back up their claims. Getting the guidance you want will make finally getting your finances make on track easier to handle.

A New Year, a New Beginning

While the New Year is a great time to start deal with your debt and credit issues from the previous year, you should also us it as a time to reflect on your financial habits that create your credit issues in the first place. Set a goal for yourself to identify your spending, budgeting and credit issues and then work to correct them. This way, come next New Year’s Eve you won’t need to make the same resolution.

Learn about some of our debt management programs here.

Caitlin Wood is the Editor-in-Chief at Loans Canada and specializes in personal finance. She is a graduate of Dawson College and Concordia University and has been working in the personal finance industry for over eight years. Caitlin has covered various subjects such as debt, credit, and loans. Her work has been published on Zoocasa, GoDaddy, and deBanked. She believes that education and knowledge are the two most important factors in the creation of healthy financial habits. She also believes that openly discussing money and credit, and the responsibilities that come with them can lead to better decisions and a greater sense of financial security.

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