KITCHENER, ON, Jan. 14, 2013 /CNW/ - Of Canadians currently carrying a balance on their credit card, almost 50% say they always or often carry a balance, according to a recent Hoyes Michalos / Harris/Decima poll.
Of those carrying a balance, 1 in 4 say it will take more than a year to pay off their outstanding balance, and 1 in 20 say they will never be able to fully pay off their credit card debt.
"If you don't pay off your balance every month, a credit card is really just another form of debt", says Douglas Hoyes, a bankruptcy trustee with Hoyes, Michalos & Associates Inc. "Let's call it what it is: a debt card" says Hoyes.
"If you are able to pay down your balance in full each month, credit cards are very convenient" says Ted Michalos, a bankruptcy trustee with Hoyes, Michalos & Associates Inc. "But if you are one of the 46% of Canadians who always or often carry a balance each month, credit cards can become a debt trap," adds Michalos.
The good news is that when asked which options they have considered to eliminate their credit card debt 56% of Canadians who are carrying a balance on a credit card or line of credit have considered cutting expenses, and 32% have considered increasing their income (through a second job or working overtime).
"Cutting expenses is a great start," says Michalos. "It probably means you'll use less credit in the future and have more money available to pay down your debt. But if you are one of the 12% of Canadians who can only make the minimum payment each month, cutting expenses may not be enough to deal with the problem. Professional assistance may be required.
"We were surprised that while 10% of Canadians who are carrying a balance on a credit card or line of credit have considered talking to a credit counsellor, and 4% have considered a debt settlement, only 3% have considered filing a consumer proposal as a way to deal with their credit card debts. That indicates that Canadians are not fully aware of their debt management options," cautions Hoyes.
The bottom line is that too many Canadians are only making the minimum payments on their credit cards each month. "Perhaps if we called them "debt cards" Canadians would be less inclined to use credit cards as a form of borrowing," concludes Hoyes.
The survey was conducted by Harris/Decima using their national telephone omnibus (tVox). A total of 1,004 surveys were completed between December 6th and 10th, 2012. A probability sample of this size has a margin of error of +/-3.1%, 19 times out of 20.
Hoyes, Michalos & Associates Inc., a consumer proposal and trustee in bankruptcy firm with offices throughout Ontario, helps people in financial difficulty. Further information is available at
SOURCE Hoyes, Michalos & Associates Inc.