While it’s very easy to get into debt, it’s much more difficult to get out of it. The average Canadian now has more than $22,000 in debt, not including mortgages. And this number continues to rise.

Unfortunately, debt also often goes hand-in-hand with a bad credit rating. If this sounds like you, here are some tips to help you get out of debt this year:

Choose smart financing

We all need to use finance sometimes. And auto financing comes in many shapes and forms- some better than others if you’re already in debt. If you have a bad credit rating, it can be difficult to get auto financing at all, which is why it makes sense to shop around. The best auto finance companies allow you to submit an application online, so you can know if you’ve been approved within a few days.

Debt doesn’t need to ruin your life, and as long as you’re smart about what you put on finance, you can still drive your dream car while paying off your other debt.


Cut up your credit cards

Credit card debt is one of the worst types of debt around. While compound interest may be magical while you’re saving, that same compound interest isn’t so fun when you’re struggling to pay off your credit cards.


If you’re in massive credit card debt, you may only be paying off the minimum payment each month. But this is just the interest on your debt, and it’s important that you’re paying off the balance as well. Consider consolidating your credit card debt and taking out a short-term loan (often these will have lower interest rates than credit cards) so you can pay them all off at once. Another option is to use a credit card that has an interest-free or low-interest period so you can work hard and spend a few months just paying off your balance.

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Check your expenses

It’s hard to pay off debt and save when you’re barely covering your expenses each month. That’s why it’s time to set a budget and consider your outgoings. Do you really need both a Netflix and a Hulu account, or can you choose one or the other? Do you need a gym membership and a membership to that hot new yoga studio? And how often are you eating out each week?

Take a good, hard look at where your money is going each week and be realistic about how much you could be saving. Slashing all of your expenses will make you miserable, but there will definitely be a few things you can give up and barely feel the pain. Just make sure the money you’re saving is immediately paying back your debt.