Debt is an ongoing issue, and one that’s not restricted to any age group. A recent CIBC poll found 59% of retirees are in debt.
Meanwhile, one-third of students are feeling anxious about their finances, says TD.
And it’s no wonder. The average debt of a university student is $27,747, finds TD. If a graduate were to pay approximately $260 each month towards this debt, assuming an 8% annual fixed interest rate, it would take 15 years and more than $19,000 in interest to become debt-free.
This is why it’s important for all clients to set financial goals.
Students, for example, should create a budget and list income from scholarships, work, family and loans, says Raymond Chun, senior vice president, TD Canada Trust. Next, calculate expenses like tuition fees, books and rent, and subtract estimated expenses from income.
“If you have a negative balance, you need to rethink your spending or look for alternative financing options for school, such as a part-time job or additional bursaries,” says Chun.
And after graduating, finding a job to pay off debt can be difficult, especially with an unemployment rate that’s rising at 7.3%, notes Statistics Canada.
Tell unemployed clients not to stress. Setting clear goals, customizing their resumes, working with a recruiter and preparing for interviews are some tips to help them on their job hunt, says Lannick Group of Companies, a Toronto recruitment firm.
Read these articles for more tips on helping clients become debt-free.