RETIRING WITH DEBT: ADVICE & SOLUTIONS
Since 1952, D. & A. MacLeod Company Ltd. Has Been Helping Ontarians Get Debt Free
Are you retired and still trying to pay off debt? You’re not alone. According to Statistics Canada, one in three retirees holds debt. If you’re out of the workforce and saddled with debt that won’t go away, it might be time to seek professional advice. The compassionate licensed insolvency trustees (LITs) at D. & A. MacLeod Company Ltd. can assess your financial situation and help you determine the best course of action. Contact us today for a free consultation.
RETIRING ON A PENSION WITH DEBT
Anyone can fall on hard times, even during retirement. Retiring on a pension with debt can be a challenging situation to navigate. If you recently retired and are struggling with mounting debt, you may wonder if your retirement money will be affected.
Pension Garnishment
The good news is that creditors cannot garnish your pension. The money saved in your Registered Retirement Savings Plan (RRSP), Registered Retirement Income Fund (RRIF) and/or Deferred Profit-Sharing Plan (DPSP) is also protected from your creditors.
Understanding the CRA's Power to Garnish Unpaid Tax Debts
However, the Canada Revenue Agency (CRA) has more power than everyday creditors. If you have unpaid tax debts, the CRA has the power to garnish your Canada Pension Plan (CPP) benefits. You may be able to reach a repayment agreement with the CRA before that happens. It's important to act quickly and seek professional assistance from a licensed insolvency trustee as soon as possible to avoid losing a significant portion of your retirement income.
RETIREMENT DEBT SOLUTIONS
In a perfect world, you would have paid off as much debt as possible before retiring. However, life doesn’t always go according to plan. Here are a few debt relief options you can explore if you find yourself with significant debt in retirement:
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Retirement counselling. Engaging D. & A MacLeod can be beneficial for someone who is retiring and has debt or needs to rely on a pension plan. Our credit counsellors can provide guidance on budgeting, debt management, and financial planning for retirement. We can also help negotiate with creditors to reduce interest rates and payments, helping make your debt repayment much more manageable. We can help you develop a plan to pay off your debt and live within your means while enjoying a planned financial retirement.
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Consumer proposal. A consumer proposal is a legally binding agreement between you and your creditors whereby you pay what you can afford over a period of up to five years. With the help of a licensed insolvency trustee from D. & A. MacLeod Company in Ottawa, a consumer proposal can be tailored to your financial situation, including retirement income, to ensure a manageable repayment plan.
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Bankruptcy. Personal bankruptcy should be a last resort. It may help when retirement income is insufficient to repay debts. However, it’s advisable to exhaust all other options first, so it’s essential to speak with a licensed insolvency trustee to help you explore all available avenues. If declaring bankruptcy is the only option, we’ll be able to walk you through the process step by step.
RETIREMENT DEBT SOLUTIONS IN OTTAWA AND ACROSS EASTERN ONTARIO
Retirement should be a time to slow down and enjoy life’s little pleasures, not spending your time stressing about money and the future. If you’re a retiree living on CPP and have mounting debt you can’t pay off, the licensed insolvency trustees at D. & A. MacLeod Company Ltd. can help. We offer a range of personal debt solutions and are available for virtual and in-person consultations.
We have multiple offices throughout Eastern Ontario, including Ottawa, Kingston, Brockville, Cornwall, Kanata, Pembroke, and Smiths Falls. Additionally, our virtual appointments are available to all residents of Ontario. Contact us today to learn more about our services or to schedule a free consultation with a licensed insolvency trustee to help you better manage your debt in retirement.