Top 6 Phrases I Learned During My Consumer Proposal
(written by a 4 Pillars client)
When I first started looking for financial advice, I didn’t expect to learn another language. The vocabulary of financial and legal proceedings is thick with jargon, technical terms, complex legalese, and self-reflection. Here are a few key phrases that I managed to learn on my journey to complete a consumer proposal.
“I need to ask a professional.”
There are many ways to get in touch with an expert that can guide you through this process. Plenty of non-profit credit counselling organizations were available to provide me with advice but I later learned that they were funded by the banks so were hardly impartial! For this reason I turned to 4 Pillars.
“There are alternatives to bankruptcy.”
When I recognized that I needed to take action to regain control of my finances, of course the idea of bankruptcy came up. The 4 Pillars professional that I consulted at the beginning of this process examined my situation and explained all of my options. Many people, including myself, who are considering bankruptcy opt for a consumer proposal instead after getting all the facts.
“There are different types of debt.”
Secured and unsecured, good and bad. When you’re assessing the details of your consumer proposal, this is one of the first things you examine. Where did my debt come from, and who are my creditors? Which debts will be eliminated in the consumer proposal? These questions all need answered and a professional can help you with this
“There are different kinds of assets.”
An asset is anything you own that has monetary value. Most of these get liquidated and sold to your creditors during a bankruptcy but are fully protected in a consumer proposal. In my case, all of my assets were protected as I opted for a consumer proposal.
“Your debts have been consolidated and forgiven.”
A consumer proposal didn’t forgive all of my debt, but it was reduced by about 70% which was really helpful. I now make a single payment each month to a bankruptcy trustee (although I did not file for bankruptcy) instead of several, and with zero percent interest rate
“You can keep your surplus income.”
The concept of “surplus income” is another important difference between a consumer proposal and bankruptcy. If I had declared bankruptcy, half of my surplus income above a certain level would have to be paid to the bankruptcy trustee that handled my case and paid to the creditors. With a consumer proposal, I keep any extra income and instead pay it towards my retirement plan
A lot of this vocabulary looks like it came from another language. As most travellers will tell you, it’s empowering to learn another language, and it was equally affirming for me to take control of my financial life. Just a few key words and phrases, and those confusing legal and financial terms will become much clearer.
This article only touches the surface of this topic
Please do not hesitate to call me at 778 340 4002 or visit my Burnaby Debt Help Page
Gurinder Dhaliwal, 4 Pillars Burnaby
gurinderd@4pillars.ca
