Taking on debt shouldn’t be a shame: financial specialists


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Taking on debt when needed shouldn’t be viewed as a bad thing amid the COVID-19 pandemic, says a finance specialist.

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Bromwich + Smith, a debt relief firm, surveyed more than 1,500 Canadians last month to ask them a range of questions, including how they feel about getting into the red. More than 50 percent thought people who didn’t pay their debts were irresponsible, 34 percent thought they were selfish, and 26 percent thought those who got into debt were lazy.

Jasmine Marra, vice president of the company, said she believes that people’s self-esteem is tied to their money, which is why they view debt as a negative.

“We start projecting that something is wrong with our self-worth, which is not the case when you break down,” she said. “I think debt is neutral. We use it to use and gain our hopes and dreams. It’s the way we manage our money or debt that drifts into this notion of shame and stigma. Many of us who thought we were financially stable are really struggling now. It’s not because someone was lazy or irresponsible or selfish. “

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Marra said she wasn’t surprised by the poll results because she saw comments online about people sharing their stories about going into debt and then being embarrassed. She said there are many forms of debt that are not stigmatized, such as mortgages and student loans.

Marra said she hopes the pandemic can be viewed as a teachable moment to highlight that it’s okay to turn to professionals for debt counseling.

She said people should be careful with credit cards or payday loans with high or compound interest.

“It’s really important that they understand the terms of the repayment,” said Marra. “When we have problems, ask what should we do? I think the very first thing you should do is reach out to your creditors. If you know you have defaulted on a payment, it is best to get in touch early. There is a legitimate interest in the relationship with your creditor to help you and carry out the repayment. “

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She said the flexibility of creditors can vary at times, but she has found that most are open to the idea because of the pandemic.

The survey also found that low-wage earners, seniors, people with disabilities and women have lost the most economic soil in the past six months. Marra said economists were hoping the recovery would look like a “U” or a “V”, but instead the shape is more like a “K”.

“You have part of the population that is recovering in this V and then you have another part of the population that is not recovering as quickly and actually has more trouble getting back to that rebound,” she said. “If you look at women, for example, there has been so much socio-economic advancement for women before COVID. We are at historic levels of women in the workforce, and now that COVID continues, we are actually at an all-time low … for women retiring from the workforce. This is primarily due to the need for childcare, and women generally earn a little less. “

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Twitter.com/jefflabine

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