Personal Finance

Faistonbudget.ca

Resorting to credit

Getting out of debt

An effective and useful tool!

Pitfalls to avoid

Useful advice

Benefits of Loans and Bursaries compared to a line of credit

The debt situation

Practical advice

Debt-tracking Table

Comparative Table

Making a budget may sometimes seem tedious, but the benefits can be big. It helps you achieve specific financial goals, focus on your priorities, reduce stress, prepare for unforeseen events, and avoid the consequences of excessive debt.

Faistonbudget.ca provides tools to help you increase or update your knowledge of personal finances and an interactive calculator so you can create a personalized budget to guide you when making financial decisions.

Using credit is part of managing your personal finances. Here are some examples of types of credit:

Government student loan
Credit cards
Line of credit
Personal loan

Computer loan
Borrowing from parents/friends
Creditor leniency (late rent payments)

Giving in to tempting products offered by lenders
Impulse buying
Using credit with very high interest rates
Making late credit card payments
Having multiple credit cards
Failing to monitor credit card limits, which institutions can increase with or without notice

Use only one credit card that has a very reasonable limit
Check your receipts against your bank account and credit card statements
Pay your credit card balance in full each month to avoid paying interest
Shop around when it comes to lenders’ interest rates for all types of credit
Avoid using credit for living expenses like food

	Line of credit	Loans and Bursaries
Interest rates	Determined by the institution, sometimes variable Very often, the interest rate increases after graduation	Determined by the government, usually lower than rates offered by financial institutions
Interest during studies	Must be paid during school or added to the debt	The Ministère pays the interest during Full-time studies
Acquisition	Credit check required	No credit check
Other features	Life insurance may be required during studies Possible over-indebtedness	Amount determined by the Ministère to fulfil students’ everyday needs
Other benefits	Total amount must be repaid after the end of studies	Possibility of earning scholarships that do not need to be repaid after graduation Possibility of receiving a 15% loan remission Tax credit on the interest paid on the student loan Possibility to apply to the Deferred Payment Plan which allows you to repay your student loan, according to your budget and despite your financial difficulties

A problematic debt situation is when you are unable to pay basic expenses such as

The minimum amount on your credit cards
Your telephones bills
Your rent
Your tuition fee

When you use credit to cover your living expenses and don’t know how you will pay off your debts, there are ways of resolving the situation. Here are some tips:

Examine your spending habits and ask yourself: do I really need it?
Destroy your credit cards or just keep one if you think you need it
Keep a small amount of cash on you
Assess your ability to work
Review and analyze your personal expenses in depth
Prioritize debt repayment
Make arrangement with your creditors
Consider consolidating your debts with your financial institution
Deposit your income in a savings account and transfer the amount you need for your regular expenses twice a month
Meet with a counsellor

Amount due

Interest rate

Minimum monthly payment

Interest start date

Repayment start date

To get a good idea of your financial situation, it may be useful to make a list of all your debts, whether owed to a financial institution or to an individual. To better plan the repayment of your debts, you can use tools such as a debt repayment calculator.

Example of a debt-tracking table

Download the table (Excel)

Sample Student Annual Budget Budget Consultation