Al Thornton, vice-president of Doyle Salewski, provides credit counselling from his Bank Street office.
Ottawa’s high concentration of government jobs may insulate families from the economic hardships faced by those in southwestern Ontario, says a Centretown bankruptcy and financial restructuring expert.
Al Thornton, vice-president of Doyle Salewski, says the need for his company’s services in the Ottawa-Gatineau region has increased, but it pales in comparison to other parts of the province.
Looking at his third quarter results, the demand in the Ottawa-Gatineau region was up eight per cent in 2008 over the year before. By comparison, Oshawa saw a 27 per cent jump, London, 25 per cent and Windsor, 21 per cent.
Health problems, job loss and marital breakdown are the three main reasons clients run into financial trouble and need to visit Thornton at his Bank Street office. But he adds to that list small business failure, poor economic decision making and the overuse of credit.
The majority of clients are between the ages of 35 and 46, but Thornton says an alarming number of seniors have also come to see him recently.
“When we’re 65, we don’t want to be carrying a tsunami wave of debt into retirement,” he says.
Thornton remembers the days when people had to physically deposit and withdraw their money. There was a certain structure to managing finances. But ever since the introduction of debit cards, things have gone downhill.
“People are using debit cards in the same dangerous way they’re using credit cards,” Thornton says.
Canadians racked up $215 billion of debt between 1999 and 2005, according to Statistics Canada.
Meanwhile, a report released last month by the Vanier Institute of the Family found the debt load for average Canadian households soared to more than $90,000 last year.
If people can’t meet the repayment requirements of their various debts or if they’re “robbing Peter to pay Paul,” as Thornton puts it, they may need the help of a debt counsellor.
Thornton says it begins with an assessment of the person’s income, expenses and debt.
If people can’t remedy the situation or consolidate debts, Thornton says a consumer proposal is a better option than declaring bankruptcy. In that scenario, the debtor agrees to pay one monthly payment to the various creditors until the debt is resolved.
Credit counselling scams have become a growing problem in the United States, but the Better Business Bureau’s Diane Iadeluca says she’s not familiar with any in the Ottawa area.
She suggests researching the company, asking for references and making sure the services and related costs are explained upfront. If it sounds too good to be true, Iadeluca says it probably is.
She adds anyone looking for help on the Internet should think again.
“I’m always leery about doing things like that online.”