When money gets tight: How families are finding stability in uncertain times

There’s a moment when debt reaches a tipping point. When the pain of worrying about money just has to stop. 

As ordinary expenses keep going up, and when a paycheck doesn’t stretch as far as it used to, Canadians are relying on credit to keep up with their daily expenses. The longer they struggle to make ends meet, the higher their debt balance gets – with higher payments to match.  

“Usually, people find a way to manage, even if it’s a challenge,” says Karen Adler, Director of Insolvency Administration at Bromwich+Smith Inc.  

“For some families, the pressure just builds over time.  With less buying power and growing debt repayments, eventually it all catches up.” The cycle can’t go on forever.   

“In other cases, something changes. A new baby. Reduced work hours. Even a blown engine.  And suddenly it’s not manageable anymore. That’s the point,” says Adler, “where one more expense becomes too much.”   

And it’s happening to more Canadians.  

Last year, about 4 out of every 1,000 adult Canadians filed for debt protection under a consumer proposal or bankruptcy—the highest rate since 2019, according to the Office of the Superintendent of Bankruptcy (OSB). 

Angela and Rick (we’ve changed their names for privacy) experienced financial struggles like these for years, building up credit card debt they couldn’t pay off. And when Angela was diagnosed with a serious illness, the sudden, life-altering shock pushed their already-tight finances into freefall.  

Angela left her job and went on long-term disability. Rick stopped working overtime hours so he could be around more during Angela’s treatment. With their income reduced, it became even harder to make ends meet, let alone tackle their credit balance, said Angela.  

She describes reaching a point where continuing wasn’t an option anymore.  

“There’s a line in the sand,” she said. “Something had to change. I couldn’t live my life like that anymore.” 

Looking back, Angela says she wishes she had reached out for help earlier. It’s something Adler hears often once families begin the debt recovery process. 

“If families seek help before their financial situation becomes desperate, they will have more flexibility and more options,” she explained. That starts with recognizing the signs of financial fatigue that suggest it’s time to reach out to a Licensed Insolvency Trustee. 

What families experience when the numbers stop adding up 

When money gets tight, families try to manage as best they can. They might shift balances between credit cards. Make only minimum payments. Put off a bill and hope to catch up. Some borrow from family or rely on credit to cover other credit. Unfortunately, all of these options are signs that they are already in financial difficulty. And this can show up in family relationships.  

The emotional strain often starts quietly but can build quickly, Adler said. Parents trying to protect their kids by being “mean” when they can’t say “yes”. Spouses disagreeing on where to spend their limited funds, or how to access more money. Friends who feel pressure to help but cannot afford to.  

Angela described it as living in a cycle where she would swing back and forth between desperately wanting to take control of her finances and just wanting to give up  

“You’re so overwhelmed that you kind of switch between, ‘Oh I’m going to solve all this’ to ‘Who cares, I can’t do anything anyway’,” she said. Emotional responses like these are common signs of financial stress and can be a strong indicator it’s time to consider professional help.  

Investigate debt relief options sooner rather than later 

Once a family starts to feel financial stress, Adler emphasized that it’s better to explore their options before things get worse and they are overwhelmed.  

“Don’t be afraid,” she said. “Just call, get some information. Be informed.” 

A conversation with a Licensed Insolvency Trustee doesn’t come with obligations to file a consumer proposal or bankruptcy. It’s simply a tool to get a clear, honest picture of an individual’s or family’s specific financial situation, and the federally regulated solutions that are available. 

One option is a consumer proposal, which can reduce unsecured debt (credit cards, line of credits, personal loans, etc.) to a single manageable monthly payment with no added interest.  

Another option is bankruptcy, which can be more involved than a consumer proposal, but can also be less expensive and shorter. Both options provide relief when someone truly cannot repay what they owe. 

Adler emphasized that learning about these legal and regulated options can provide clarity at a confusing time. Families that know their options are enabled to make informed decisions and take the next steps with confidence.  

How a clear debt relief plan can shift everything 

When people begin working with a Licensed Insolvency Trustee, their financial picture can become very clear, very quickly.   

Angela was amazed at how simple the process for a consumer proposal was, from her very first conversation with a Bromwich+Smith advisor.  

‘How could this be that easy? There must be something that’s hiding,’ she remembers thinking, but quickly learned that the process really was very straightforward.  

She was also surprised to learn that all of her unsecured debt, including unpaid amounts to CRA, could be rolled into the proposal.  

“I never thought for a minute that taxes would be included,” she said. “Or my student loan from eight years ago. I thought it would be just the credit cards, and our advisor said ‘No, they’re all going in’.” 

Once people have a regulated debt relief plan in place, they start to regain confidence in themselves and their future. “People feel like they’re back on their feet,” Adler said. “They feel like themselves again.”  

She sees the same pattern repeatedly. When people understand their options, they make decisions that support both their financial and emotional wellbeing. 

Last words 

Financial stability isn’t built overnight, but the path to recovery can begin with a single conversation.  

When families have a plan in place, they no longer need to wonder how they will pay their debts and meet their expenses at the same time. They can prepare for upcoming expenses instead of reacting to them. They can talk more openly at home and start making decisions with their future in mind. 

For families across Canada, a clear debt recovery plan won’t erase the realities of rising costs or unexpected challenges. But it can provide structure, breathing room and the confidence to rebuild. And taking that first step can be what makes stress-free financial stability possible again.