A financial wellness tool for Canadians

Household debt in Canada has climbed in recent years to a record $2.5 trillion. But the global pandemic and the employment disruptions it caused aren’t the only reasons for the increase. According to the Bank of Canada, many families have taken on worrisome levels of credit card and mortgage debt in recent years due to a sustained period of low interest rates.

That’s why the government group Credit Counselling Canada joined with the Canadian Bankers Association to launch the Debt Money Quiz. It’s designed to be an effective “wake-up call” for people in debt to discover if they need help.

A study of Canadians and their financial health suggests the need for this online tool. In it, one in 10 residents admitted that they had to resort to such measures as making installment payments or payday loans to keep up with payments on their debts. Recognizing a debt problem early can lead to a better outcome for the entire household.

How the quiz works 



The quiz itself is a pretty simple, effective way to encourage people to think more about their debt. Over a series of pages, quiz-takers are asked questions related to debt. Among the topics that are discussed:

• Do you prepare your own budget?
• How successful have you been at maintaining a budget?
• Do you use credit cards for everyday expenses?
• Do you pay beyond the minimum on your credit cards?
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Has your card ever been declined when purchasing an item?
• Have you needed to use a payday loan company to reduce debt or keep up with debt payments?
• Have you received calls or letters from collection agencies?

Debt counseling assistance

The CBA also has its own page that seeks to give Canadians resources to better manage their debt. There are five attributes it lists that are warning signs of financial distress:

• If you can’t make your minimum monthly credit card payments.
• 
If you don’t know the specific amount of debt you owe.
• If financial issues are at the heart of the conflict in your work or family life.
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If credit cards are used to meet the basics of living expenses.
• 
If you feel that your debt is constantly unmanageable.

The site also suggests that people use the CCC or the Canadian Association of Credit Counselling Services (CACCS) to get some advice and guidance on debt. These groups can also intervene by crafting structured debt management plans for Canadian residents.

Debt problems can make an entire household miserable. The hope from this initiative is that a consumer in debt trouble can recognize the problem — and get help— earlier, increasing the odds of a positive outcome.