Very few people have or can earn enough money to pay cash for life’s most important purchases: a home, a car or an education. The most important consideration when buying anything on credit or taking out a loan is whether the debt incurred is good debt or bad debt.
There are a number of life events that can generate an enormous amount of financial stress, and lead us to incur significant and unwanted debt. It may be as superficial as trying to keep up a lifestyle beyond what our income allows, or as life-altering as a failed business, divorce or serious illness.
It was June. I was attending a wedding of a friend and I met a man in his late 20’s, who had recently fallen into debt. It began with a serious biking accident. His finances had been on shaky ground before his accident. After a six-month hospital stay, his finances were in trouble.
He was better now and wanted to rebuild his life. But he had been out of work for a while and faced the new challenge of climbing from debt. He had amassed $20,000 in credit card debt, private loans, and interest growing every month.
Here’s a true story about a teacher with a 60K salary who couldn’t get ahead because of student loan debt. It’s a sad reminder that education has become a financial chain, rather than head start for many young Canadians. A few months ago, I helped a teacher drowning in student loan debt. The sad thing … Continue reading I Can’t Make My Student Loan Payments: A True Debt Story