Having a holiday financial plan can help to minimize further debt, expert says

Christmas is often referred to as the season of giving but for Islanders experiencing debt it can lead to worsening their financial situation.

'This time of year is stressful for absolutely everybody but especially for folks who have overwhelming debt'

To avoid more debt during the holidays, Islanders need to come up with a financial plan, Walter MacKinnon says. (Alliance/Shutterstock )

Christmas is often referred to as the season of giving but for Islanders with debt it can make their financial situation worse. 

"This time of year is stressful for absolutely everybody but especially for folks who have overwhelming debt," said Walter MacKinnon, vice-president at MNP, a debt solutions firm, during an interview with Louise Martin.

"They're trying to now spend something on other folks and they don't have it to spend."  

Making a holiday financial plan

'Planning early and sticking to it is the key here,' says Walter MacKinnon.

A recent report by the Office of the Superintendent of Bankruptcy shows that consumer bankruptcy filings were up in October compared to numbers in 2017. 

The biggest increase reported was on P.E.I., with a 21 per cent jump in consumer bankruptcy.

To avoid more debt during the holidays, Islanders need to come up with a financial plan, MacKinnon said. 

After forming a financial plan and budgeting gifts, MacKinnon said, it's important to begin shopping early as last-minute shopping can lead to overspending. 

When shelves have been depleted and gift options are low people tend to spend more than they intended to, he said.

Using a credit card can also lead to blowing a budget as it gives the illusion of not spending — until the bill arrives in January. 

"Planning early and sticking to it is the key here," he said. 

More P.E.I. news 

  

With files from Louise Martin

Comments

To encourage thoughtful and respectful conversations, first and last names will appear with each submission to CBC/Radio-Canada's online communities (except in children and youth-oriented communities). Pseudonyms will no longer be permitted.

By submitting a comment, you accept that CBC has the right to reproduce and publish that comment in whole or in part, in any manner CBC chooses. Please note that CBC does not endorse the opinions expressed in comments. Comments on this story are moderated according to our Submission Guidelines. Comments are welcome while open. We reserve the right to close comments at any time.