Understanding Debt Problems: How to Solve Debt Problems

The key to understanding debt problems is to understand your debt.

Most Canadian adults have debts, but there are different levels of debt.

While some people can manage their debts without any problems, others find themselves in a very tricky financial situation.

If you’re worried about your finances, it’s important to recognise the risks of amassing more debt, but also to understand that help is available.

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Understanding the difference between manageable and serious debts

Most people have debts in the form of mortgages or loans.

If you’ve taken out a mortgage or a loan, you’re up to date with repayments and you’re paying the loan back without borrowing more money or using credit cards to get from one payday to the next, there’s no need to worry.

If, on the other hand, you’re borrowing more and more money, your credit card balances are increasing and you’re at risk of falling behind with bills and rent or mortgage payments, this poses problems.

It’s very easy for debts to spiral, especially if you have credit cards or you use payday loans.

According to Equifax, the average Canadian had $23,800 of non-mortgage debt in 2019.

Signs of financial problems

There is no universal answer to the question, ‘how much is too much?’ when it comes to debts, as everyone is different, but it’s wise to look out for these warning signs:


  • Struggling to pay bills on a regular basis.
  • Making the minimum payment on credit cards.
  • Using credit cards for everyday expenses.
  • Experiencing stress and anxiety caused by money worries.
  • Lying about your finances or hiding the truth from your partner or relatives.
  • Missing payments.
  • Taking out additional loans to pay off existing debts.
  • Receiving calls, emails and messages from creditors.


It can be very easy to lose track of spending, especially if you have direct debits or you use contactless payments, so it’s critical to keep a close eye on your finances.

If you tend to avoid opening statements or checking your balances, it’s essential to bite the bullet so that you know how much debt you’re in and who you owe.

Should I seek help?

Around 40% of Canadians are worried that they will never be free from debt and a third of adults admit to being ‘very stressed’ about money.

If you’re living from paycheck to paycheck, and you’re at risk of falling behind with payments, or your debts are rising day on day, it’s important to take swift action.

It can be daunting to ask for help, but the longer you leave it, the worse the situation will become.

There are ways to deal with debt, and you should never feel embarrassed or ashamed to ask for advice and support.


Most people have debts, but there are varying levels of debt.

If you’ve reached a point when you can’t pay bills, you can’t repay debts, and you’re borrowing and using credit cards, don’t hesitate to seek help.

Information on Consumer Proposals

Consumer Proposals in Canada – An Alternative to Bankruptcy
What is a Consumer Proposal?
How to Amend a Consumer Proposal
What are the Benefits of a Consumer Proposal?
What are the Steps in a Proposal?
Consumer Proposal Eligibility
What Debts Are Erased in a Consumer Proposal?
Is There Life After a Proposal?

Canadian Bankruptcies

How to File for Bankruptcy
What is Bankruptcy?
Bankruptcy FAQs
How Does Bankruptcy Work?
What is the Cost of Bankruptcy in Canada?
How to Rebuild Credit Following Bankruptcy
Personal Bankruptcy in Canada
What Debts are Erased in Bankruptcy?

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