Consumers who file insolvency are in severe financial distress, but surprisingly this does not mean they are behind on their payments. According to Equifax Canada, about 70 per cent of consumer accounts are paid as agreed at the time the individual files for bankruptcy, and this is definitely consistent with what we see every day. More debtors are turning to subprime debt as a way of balancing payments. While any one payday loan, high cost instalment loan or low credit car loan will not necessarily lead to bankruptcy, it does begin a slippery slope and these loans are a primary indicator of an increasing percentage of insolvencies.
Looking at our study, the percentage of women filing bankruptcy who were living on their own, either because they were single, divorced or widowed, increased over the four year study period. The largest growth occurred in women who were divorced or separated. We also saw an alarming increase in the percentage of female single parents declaring bankruptcy.
Although aging Canadians were typically the most financially stable age group, older Canadians are piling up debt more quickly than other demographics. A recent study by the Vanier Institute of the Family showed that more than 70 percent of those aged 55 to 64 held some form of debt in 2012, up from 61 percent in 1999.
Conventional wisdom says that debt used to purchase something of lasting value, like an investment, or a house, or a car, is good debt, because you benefit from the purchase. An example of bad debt would be borrowing to go on vacation, because when the vacation is over you have nothing to show for it. In some cases both of these examples are true.
Small and medium-sized business owners are risk takers and dreamers. But most small and medium sized business owners are either unfamiliar with, or put off the purchase of Legal Expense Insurance. Though the benefits could mean the difference between success and bankruptcy, few are aware of the many compelling reasons for such a policy. Here are the top five reasons to look into legal expense coverage.