Are you drowning in debt and trying to find ways to put cash back into your monthly budget? The Government of Canada offers several benefits and debt management programs to help make life more affordable. Keep reading to learn about the government debt relief programs and benefits that can help put money back in your pocket.
Financial Assistance for Parents and Families
The Canadian government recognizes that it’s expensive to raise children. This is why they offer the Canada Child Benefit (CCB). CCB is a tax-free monthly payment available to eligible families to help with the costs of raising children under 18 years old. If you’re a parent looking for ways to increase your household budget, the CCB can help.
Eligibility for the CCB includes:
- You live with a child under 18 years of age
- You are the primary caregiver
- You are a resident of Canada
- Your spouse or common-law partner is a Canadian citizen, permanent resident, protected person, temporary resident, or an individual registered under the Indian Act.
Access to Dental Care
When you’re struggling to keep the lights on and put food on the table, dental care might fall to the bottom of the priority list. However, the government is taking steps to ensure all Canadians have access to the dental care they need.
The Canadian Dental Care Plan (CDCP) available to Canadians who meet the following eligibility requirements:
- Family net income less than $90,000 per year
- Don’t have access to dental insurance
- Canadian resident
- You filed last year’s tax return
Debt Relief for Student Loans
If you have student loans that you can’t afford to pay, the federal government offers the Repayment Assistance Plan (RAP). Depending on your income, you might qualify for reduced payments or the total elimination of your payments.
You can apply to the RAP program as soon as you start to repay your student loans and must reapply every six months.
If you’re approved for RAP, the federal government will:
- Pay any interest owing on your federal loan that your reduced payments won’t cover
- Pay down both the principal and any remaining interest after 60 months of RAP, or 10 years after you finish school.
The government also offers the Repayment Assistance Plan for Borrowers with Disabilities (RAP-D). If you qualify for this program, the government of Canada will pay both the principal and interest that your reduced monthly payments don’t cover.
Canada Workers Benefit
The Canada Workers Benefit (CWB) is a refundable tax credit created to help low-income individuals and families. The CWB is composed of two parts:
- Basic amount
- Disability supplement
Eligibility requirements for the basic amount include:
- You earn working income, and your net income is below the threshold set by your province or territory
- A resident of Canada throughout the year
- 19 years or older
Eligibility requirements for the disability supplement include:
- Eligible for disability tax credit and have an approved Form T2201, Disability Tax Credit Certificate with the CRA
- Net income is below the threshold set by your province or territory
Debt Management Options
Even with these government relief programs, you may still find it difficult to make ends meet. If so, it’s time to speak to a Licensed Insolvency Trustee (LIT). A LIT can assess your financial situation and recommend a debt management solution.
Credit counselling
If you want to learn how to create a budget for your household income or how to manage your credit cards, then credit counselling may help. Credit Counsellors provide information and tools to help you manage your finances and can get to the root of some of your financial challenges.
Debt consolidation
Debt consolidation involves rolling up multiple debts into one monthly payment. You can consolidate debt with a debt consolidation loan or a 0% balance transfer credit card. The goal is to find an interest rate lower than what you are currently paying. This can help to lower your monthly payments and the amount of interest you pay over time.
Consumer Proposal
A Consumer Proposal is a legal debt relief process that can only be administered by a LIT. In a Proposal, you and your LIT create an offer to pay your creditors a percentage of what you owe, extend the time you have to pay, or both. If your proposal is accepted, you have a maximum of five years to pay back what you owe. A Proposal can significantly reduce the amount of money you have to repay your creditors without losing your assets.
Bankruptcy
Bankruptcy is another legal process that can discharge you from most of your debts. While the thought of Bankruptcy is scary for most, the goal is not to punish. Instead, the purpose is to provide debtors with a second financial chance. Licensed Insolvency Trustees are the only professionals in Canada who can administer a Bankruptcy.
Speak to a LIT about your Debt Relief Options
To find the debt relief program that’s best for you, a Licensed Insolvency Trustee (LIT) can help. A LIT can work with you to assess your current debt situation, and explain the debt management options that are available. For a free, no-obligation consultation, contact us at 1-888-371-8900, or reach out online.
