More Nova Scotians are going broke as they struggle to make ends meet, according to an expert in bankruptcies. 

About 300 more Nova Scotians became insolvent over the last twelve months compared to the previous year, said Robert Hunt, a licensed insolvency trustee and partner with Grant Thornton Ltd.

Insolvency occurs when a person no longer makes enough money to pay off their debt.  

'Ahead of the national average'

As of June 30, 2016, a total of 5,500 Nova Scotians had either filed for bankruptcy or entered into a consumer proposal to manage their debt.

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Hunt says many people facing bankruptcy aren't living extravagantly. They simply don't have enough money to make ends meet. (Shutterstock)

"It is worrying that we're ahead of the national average," said Hunt. "There's a lot of Nova Scotians who truly are having trouble making ends meet. They're not making enough income."  

That combined with credit card debt and job losses are dragging more Nova Scotians into bankruptcy, according to Hunt.

Credit card woes

"If you're using credit to purchase the necessities of life, and you're not paying that credit off each month then the interest cost really becomes part of, really, a new cost that you never had before. It's a tough cycle to get out of."

Credit cards

More credit could lead to more problems, says Hunt. (CBC)

That reliance on credit is a trend Hunt is seeing more and more of. 

"The ability to pay that debt off over time just gets lower and lower as the balance builds up because interest does get added on," said Hunt. "People are carrying more debt and it catches up to them after a while." 

People aren't living extravagantly 

Hunt said most people running into insolvency troubles aren't living extravagant lives. Many are just struggling to get by because they simply don't make enough money to keep up with the cost of living. 

Oil workers

The downturn in the oil industry has seen a lot of Nova Scotians return home looking for work. Many aren't finding anything, Hunt says. (Associated Press)

Job losses in Alberta's oil industry have also hurt many Nova Scotians' finances said Hunt. 

"People are coming back to Nova Scotia. They haven't been able to find work. They still have a debt level that's unmanageable. I think that has certainly contributed to it."

'Economy isn't doing as well as we had hoped'

Scott Purdie, an accredited financial counsellor with Credit Counselling Services of Atlantic Canada, is seeing similar problems. 

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Experts say having a budget helps people avoid financial disasters like bankruptcies.

Since the start of this year up to 20 of his clients in Cape Breton had to file for bankruptcy. 

"When you're looking at an increase in insolvencies, that tells me that the economy isn't doing as well as we had hoped," said Purdie. 

Live by your budget

 "At least here in Nova Scotia there's been stagnant job growth. There's still job losses. I mean, look at Sydney in particular where at the Saputo dairy plant here there were 100-plus jobs lost."    

Both Purdie and Hunt said people need to develop a realistic budget and live by it. People should also limit their use of credit cards and credit. They said the only way people's finances will turn around is if they face their money troubles head on and get help.