Bankruptcies will rise in '09: trustee
Edmonton bankruptcy trustee Leon Miller predicts the number of people filing for bankruptcy in the city will increase in the new year.
The owner of Leon Miller Group Inc. said his client list is growing because of the slumping economy and high interest rates.
Business started picking up in October, Miller said, and hasn't slowed since.
According to the Office of the Superintendent of Bankruptcy Canada, the number of bankruptcies filed by consumers started to rise in 2008.
In September, 46 per cent more bankruptcies were filed than in the same month in 2007, and October had 51 per cent more bankruptcies filed than in the same month of the previous year.
It's too easy for some people to get credit, Miller said, pointing out that most of his clients have at least six credit cards — and one client has more than 20.
"I think it's just bad use of credit cards and not fully understanding that the interest rate is very high and they have to be paid off," Miller said.
"Everyone sees that [credit] as just an ability to borrow more money to finance their lifestyle, rather than sitting down and reconciling when you have to pay the piper."
Miller said he tries to work with credit companies to lower the amount clients owe, and insists bankruptcy is the last resort.
Deb Eerkes is one Edmonton resident who said she's determined not to be one of the many who are expected to file bankruptcy in 2009.
"I use a credit card but I only put on it what I can pay off at the end of the month," she said. "I will never go into a debt where I'll be lost.
"To me, it doesn't make sense to live in the red all the time. I would much rather live in my means."
If people want to stay out of his office, Miller said, they should follow Eerkes's example.