Ask any Licensed Insolvency Trustee (LIT) and they’ll tell you: One of the hardest things about our job is seeing people wait too long to get help. When an individual or business owner waits too long for help, here are some of the things they may experience:

Stress on top of stress.

Statistics Canada1 indicates that the lives of close to 25% of adult Canadians are impacted by a high level of life stress on a regular basis. And according to the American Psychological Association2, money is the second highest cause of stress. Struggling every day to make ends meet or facing pressure from debt collectors is certainly stressful, but it’s not just the direct financial stressors that impact individuals. According to the Mayo Clinic, common effects of stress include lack of focus and motivation, fatigue and sleep problems, irritability, and anger. It is easy to see how these effects of stress can strain relationships, impact your ability to perform at work, and affect your health, causing even more stress.

According to this article posted on the Canadian Mental Health Association’s website, the top recommendations for dealing with stress involve taking action, talking about your problems, and taking steps to resolve them. Conversely then, delaying asking for help can result in continued or increased stress.

Failure to meet basic needs.

When trying to pay debt, people often avoid or delay spending on things they or their business need in order to meet minimum payments or satisfy debt collectors. This might include things like failing to keep working capital (or an emergency fund), delaying necessary repairs, inability to keep sufficient staff, or in the case of individuals: going without things like dental care, medication, and even food.

Eventual outcomes from ignoring these needs can range from reduced revenue due to low inventory or inability to meet orders, to increased costs to deal with problems when they become unavoidable, to causing or exacerbating personal physical or mental health conditions. It is a shame to see such impacts when programs are available that might have helped avoid them.

When is it time to reach out for help?

The situation is getting worse over time.

When businesses or individuals struggle with their debt over a long period of time, they tend to rack up a lot of interest and fees, sell assets or lose them to foreclosure, and even take on more debt. Not only does this add to the stress, but it can also result in having fewer and fewer options to deal with the debt. When a person or business waits too long to reach out to us for help, sometimes the only viable option left is bankruptcy.

So, how to know if it is time to reach out for help to avoid the above impacts of waiting too long? Here is a list of red flags, any of which on its own can indicate it might be time to ask for advice. If you or your business are experiencing several of these, look for help without delay:

  • You have been served with a legal notice by a creditor
  • You’re paying barely more than the interest on your debt each month (if you’re paying only the minimum balance on credit cards, you’re paying barely more than the interest)
  • You’re facing increasingly urgent calls from creditors or debt collectors who are asking you to pay more than you can afford
  • Your home mortgage is in arrears
  • A creditor is garnisheeing your income or accounts receivable
  • You have taken out a high-interest loan (such as a payday loan) or are considering doing so
  • You have been considering credit counseling or debt consolidation but aren’t sure if it is right for you
  • You’re considering cashing in your RRSP’s to pay down a portion of the debt
  • You stress about debt all the time
When is it time to reach out for help?

Sometimes a conversation is all it takes to make the load start to feel bearable. A Licensed Insolvency Trustee can help you get a better understanding of your options and can refer you to other resources to help with underlying problems that may be impacting your debt. If you already have a plan to deal with your debt, great! But a conversation with a Licensed Insolvency Trustee may still be a good idea, as we can help you make sure the option you are considering will actually fix the problem and tell you about other options you may not have thought of. These conversations are free and confidential, so there is no risk to booking a consultation.

It’s hard to ask for help, especially when it comes to money. And it’s hard to admit you or your business might be in over your head. But a conversation with a Licensed Insolvency Trustee can help you avoid mistakes that make your financial situation worse and provide information on options that might just solve your debt problems for good.

1 Statistics Canada. Table 13-10-0096-04 Perceived life stress, by age group

2Stress In America: The State of Our Nation, Released November 1, 2017