Beating debt, one step at a time

France Michaud | Desjardins Group

Marie* is a 27-year-old student and a single mother of a 5- and a 6-year-old. Her income is a combination of loans, scholarships and benefits. Unfortunately, she had accumulated almost $30,000 in debt and it was putting real stress on her finances.

In search of solutions, Marie went to the ACEF Montérégie-est, a consumer advocacy community organization. "I wanted help getting a better understanding of my finances. I wasn't able to sit down by myself to sketch out my financial situation and draw up a plan to improve it." The ACEF is one of several budget consultation organizations that partner with Desjardins caisses in the region through the Desjardins Mutual Assistance Funds program.

"At our first meeting, we looked at Marie's monthly budget," says Roger Lafrance, the ACEF coordinator. "Including her debt payments, her monthly deficit was $611; no small sum."

Marie admits she didn't know how serious her problems were. "When I went to the ACEF, I didn't even know how much monthly income I had or how much I was paying for different things of my life," she explains.

A welcome financial cleanup

The first step to improving things for Marie was reviewing her budget:
  • First, she was asked to list her actual expenses using the personal finance guide from Protégez-Vous. That provided an accurate picture of her financial reality.
  • Second, she was asked to set expense limits and monitor them every day to make sure she didn't go over.
By the time the first follow-up meeting came around, Marie saw that she was paying more attention to what she was buying. Her monthly deficit had been quickly reeled in to $146, including her debt payments. The result was encouraging and she wanted to keep working at it.

She set other spending goals so she could eliminate her deficit and eventually start creating a surplus. She also met with Hydro-Québec to set up a payment schedule for the balance she owed.

Her personal finances were looking considerably better.

"The budgeting consultation helped me build a trusting relationship with an advisor, and I was able to ask them about things I didn't understand. I never felt like I was being judged or sold anything during our meetings," says the young mother. Today Marie is much better equipped to handle the financial challenges ahead of her.

*Marie is a fictitious name used to protect the client's identity.

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