frugal lifestyle Frugal lifestyle: IntroductionLiving in our modern world can be exciting and fast-paced, with new trends and technologies emerging constantly. It can be tempting to want to keep up with the latest experiences and indulge in a lavish lifestyle. However, it’s crucial to remember the importance of living within our means and not overspending. Contrary to popular belief, a frugal lifestyle doesn’t mean sacrificing enjoyment or being stingy. Instead, it involves making smart financial decisions that ensure long-term sustainability and peace of mind. By embracing a financially savvy way of life, the shackles of money-related instability are lifted, and we can chase our wildest aspirations without a care in the world. Adopting frugality as a way of life can be the key to keeping your debts under wraps, and avoiding the need to enlist the assistance of finance gurus to conquer the many trials and tribulations of money management. Frugal lifestyle: Definition of frugal livingLiving a frugal lifestyle means choosing to live a life of purpose and intention. It’s about recognizing the value of every dollar and making conscious decisions that align with your goals and values. By living simply and mindfully, you can achieve financial freedom and create a life that brings you joy and fulfillment. Embrace the power of thriftiness, unlock your creativity, and discover the joy of living a life free from excess and waste. Let your frugal lifestyle be a source of inspiration to others, as you lead by example and show that happiness comes not from material possessions, but from the richness of human connection and the beauty of the natural world. According to Merriam-Webster, being frugal implies an absence of luxury and a simple life. It involves using resources efficiently, being thrifty and avoiding waste, and making wise financial decisions in your daily life. It does not necessarily mean a cheap person! Typically, living frugally involves being mindful of one’s spending habits and choosing to prioritize expenses that bring genuine value to one’s life. This kind of lifestyle is often associated with practicality, self-reliance and an eye toward financial security. Embracing frugality might mean opting for used items over new, cultivating a garden to produce fresh produce, and avoiding frivolous expenses that don’t contribute to overall well-being. Ultimately, a frugal lifestyle is about making conscious choices that support long-term financial stability and personal satisfaction. Frugality is a term that holds different meanings for different folks. As per Wealthsimple, adopting a frugal lifestyle requires a conscious effort to regulate one’s expenses and concentrate on a few financial objectives. Those interested in frugal living should assess their aspirations and explore ways to leverage their finances to achieve them. Frugal lifestyle: Importance of frugal livingTo begin with, adopting a frugal lifestyle fosters introspection and reflection, enabling individuals to discern their priorities and values when establishing budgets. As a result, individuals can ensure that their expenditures are congruent with their financial objectives, thereby enhancing their financial stability and security. In addition, frugal living serves as a powerful tool for averting needless debt and financial strain. By adhering to a lifestyle that is commensurate with their financial means and avoiding superfluous spending, individuals can steer clear of debt accumulation while maintaining their creditworthiness. Lastly, embracing a frugal life can expedite the attainment of financial goals. By prioritizing savings and curbing extraneous expenses, individuals can optimize their monetary resources and achieve their financial aspirations with greater speed and efficiency. We normally associate a frugal lifestyle with low-income families, but as you will see below, that is not always the case. Frugal lifestyle: Meet Herbert Jones, the Sensible SpenderHerbert Jones is a promising 6’7″ 24-year-old small forward/shooting guard hailing from the University of Alabama who is making waves for the New Orleans Pelicans of the National Basketball Association (NBA). Jones’ admirable fiscal habits have caught the attention of many, as he displays a rare sense of financial consciousness living a frugal lifestyle that is never associated with professional athletes. Jones is a frugal person and shows a profound appreciation for financial stability and practicality and is indeed a much-needed respite in a society that is fraught with materialism and the seduction of social media. Jones confronts enormous pressure to deliver exceptional performances while simultaneously meeting the standards imposed on him. Undeterred by these trials, Jones remains unruffled and continues to exhibit a laudable degree of fiscal prudence. Jones has already made a name for himself as a prudent spender. During several interviews, he has emphasized his commitment to putting aside a significant portion of his earnings and investing them wisely for the future. Raised in a family that instilled in him the value of responsible financial management, Jones takes a methodical and cautious approach to his finances. Although he can spend hundreds of dollars or even thousands of dollars on any single item, he chooses not to. His financial acumen is not only impressive but also inspiring to young athletes who often fall prey to impulsive spending. What we can learn from Herbert Jones’ frugal lifestyleHerbert Jones just wears team gear rather than buying expensive clothing. Some might see this as a sign of being cheap. The fact is that he is simply wise with his cash. By benefiting from the free clothing offered by the Pelicas, Jones is able to conserve money on apparel expenses and also place that cash towards more important things, such as savings and investments for his future. As an NBA star, he is among the richest people but does not act like it. The average person can learn a lot from his philosophy about money and where to spend it in their everyday life. Jones’ prudent technique to fashion should make us all think about how we can all make clever economic decisions, regardless of what we each earn every year. By remaining concentrated on long-term monetary objectives, we can all be a bit like Jones so that can make sure that we are able to take pleasure in a comfy retirement and also take care of our households long after our employment days are over. Herbert Jones has undoubtedly thought about the influence his way of living will have on his long-term monetary well-being. This includes every little thing from making smart purchasing decisions, preventing out-of-control financial debt, developing healthy and balanced routines as well as focusing on self-care. By taking a holistic method to his monetary planning and decision-making, he can make sure that he is able to attain his financial objectives while preserving a healthy and balanced way of life. Frugal lifestyle: The Importance of Being Financially SavvyRegardless of each of our annual income levels, we can all learn from Herbert Jones’ frugal lifestyle. Spending less than we earn (after tax) so that we can pay off debt, have an emergency savings fund and save more for the future works for everyone. Suffice it to say if you live this kind of lifestyle, you will be able to handle financial challenges as they come your way. You won’t need to ever consult with a licensed insolvency trustee! Mr. Jones’ financial philosophy is not limited to frugality; rather, he also subscribes to the notion of astute investments. During his conversation with The Athletic, Mr. Jones divulged his interest in the real estate sector and expressed his intent to explore investment opportunities in this domain. This manifestation of his sagacity implies that Mr. Jones is not merely fixated on the present, but he is also judiciously contemplating his future prospects. The prudent practices of Herbert Jones are not only commendable but also imperative, particularly for professional athletes whose relatively short careers can end at a moment’s notice. It is widely acknowledged that numerous professional athletes encounter financial ruin once their athletic pursuits come to an end, despite having amassed millions of dollars throughout their active years. This predicament can be attributed to various factors, such as ill-informed financial counsel, unwise investments, and lavish spending patterns. Herbert Jones is obviously striving for financial freedom after his playing days are over. Notably, Jones appears to be an individual who is forward-thinking in his approach to financial planning. He is demonstrating a commitment to securing his financial future by adopting a prudent lifestyle, making astute investments, and seeking the guidance of financial experts. Consequently, Jones is positioning himself for sustained financial security over the long haul. This is not only advantageous for him personally, but also for the prosperity of the NBA as a whole. The NBA is often perceived as a league that celebrates indulgence, with players ostentatiously displaying their affluence and living lavish lifestyles. However, while certain players may indeed embody such behaviour, it is not a viable or sustainable way of life in the long run. In order to prevent its players from falling into financial traps and to ensure their future stability, the NBA can play a crucial role in inculcating financial literacy and responsibility among its members. Frugal lifestyle: Benefits of a frugal living lifestyleHaving financial security opens up a range of possibilities for joyous living. It’s the art of balancing your finances like a professional and waving farewell to financial distress. A few of the benefits that come with being financially secure are: Reduced financial stressThe application of cost-containment strategies in the pursuit of a frugal living journey can alleviate the financial strain experienced by individuals who habitually outspend their income. As a consequence, this methodology promotes an elevated degree of fiscal equilibrium and psychological well-being. Helps you spend according to your prioritiesBy welcoming a frugal habits way of life, you will become the master of your cash, living life on your own terms. It’s everything about taking stock of what genuinely matters to you and aligning your spending routines with those priorities. With this method, you’ll never engage in meaningless splurges or frivolous expenses, since every penny you spend will be deliberate and intentional. It’s all about being wise and also accountable for your finances. Increased productivityThose who are financially secure can channel their energies toward their work without the baggage of nagging financial concerns. The absence of money problems allows them to be highly productive without the burden of carrying their financial worries to work. On the other hand, individuals grappling with financial hardship might find it near impossible to focus on their work and be easily distracted by tension, as well as feelings of stress and anxiety that come with their financial predicaments. Improved relationshipsUnlock the key to harmonious relationships with a solid financial footing. Eliminating financial strains releases the shackles of anxiety, allowing people to nurture their interpersonal connections with renewed vigour and unbreakable bonds of love. Better mental healthAchieving a sound state of mind is no small feat, but securing your finances can undoubtedly take you a long way. When your pockets are filled with abundance, the weight of financial woes no longer drags you down. Imagine the feeling of being in full command of your life, the power of financial stability can bring you that and more. Anxiety and depression brought about by money troubles become a thing of the past, as tranquillity and contentment take over. With financial security, your mental well-being is given a boost that can only be described as liberating. Ability to pursue passionsFinancial stability can also allow individuals to pursue their passions and interests. When people are not weighed down by financial worries, they can take risks and pursue new opportunities without fear of financial ruin. Unlock the secret to lavish living without breaking the bank: Master the art of frugal budgeting!Crafting a budget that aligns with your financial goals can be daunting, yet it’s crucial for your economic well-being. You don’t have to navigate this process alone, as we’ve gathered some tips to assist you in fashioning a budget that suits your individual needs.
Frugal lifestyle: 22 tips to live a financially sustainable lifeIf cash is in short supply and you need to make your family budget balance, here are 22 tips to help you. Saving Money at Home
Saving Money on Transportation
Saving Money on Shopping
Saving Money on Food
Saving Money on Entertainment
Frugal Lifestyle: SummaryI hope you enjoyed this frugal lifestyle Brandon’s Blog. It is my hope that those experiencing money problems can use these frugal life tips as inspiration to correct course now without needing the services of a licensed insolvency trustee. Revenue and cash flow shortages are critical issues facing people, entrepreneurs and their companies and businesses. Are you now worried about just how you or your business are going to survive? Are you worried about what your fiduciary obligations are and not sure if the decisions you are about to make are the correct ones to avoid personal liability? Those concerns are obviously on your mind. Coming out of the pandemic, we are also now worried about the economic effects of inflation and a potential recession. The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious. It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now. We have helped many entrepreneurs and their insolvent companies who thought that consulting with a trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring. We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you. The Ira Smith Trustee & Receiver Inc. team understands that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel. Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now.
Original article: ACHIEVING A FRUGAL LIFESTYLE TO AVOID MONEY PROBLEMS: 22 TIPS FOR SAVING ©2023 Ira SmithTrustee & Receiver Inc. - Brandon's Blog. All Rights Reserved. Via https://www.irasmithinc.com/blog/frugal-lifestyle-2/
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How long do receiverships last in Canada? IntroductionIn my September 2021 Brandon’s Blog, THE CANADIAN RECEIVERSHIP EASY BEGINNERS GUIDE, I provided an easy-to-understand guide to understand the receivership process. To summarize, I described that in Canada, a receivership is a legal remedy available to secured creditors to recover outstanding amounts under a secured loan if a company defaults on its loan payments. It may also be used in shareholder disputes to complete a project, liquidate assets, or sell a business. A court may appoint a receiver to take possession of assets, oversee liquidation proceedings, and distribute the proceeds according to the applicable legal priorities as outlined in Canada’s Bankruptcy and Insolvency Act (BIA). Or, a secured creditor may issue a letter of appointment to the same effect. It is essential to recognize that receivership and bankruptcy are distinct legal proceedings. Bankruptcy is a formal proceeding, regulated by the BIA, to provide debtors with debt relief when they are financially incapable of paying their unsecured creditors. Conversely, a receivership is a process available to secured creditors to recuperate outstanding debt arising from a secured loan or to address shareholder disputes. The purpose of this Brandon’s Blog is to answer the question I am often asked: “how long do receiverships last in Canada?”. How long do receiverships last in Canada? Understanding what receivership isThere are two types of receiverships in Canada: court-appointed receiverships and private receiverships. Court-appointed receivers are appointed by a court to oversee the management and disposition of a debtor’s assets. Private receivers are appointed by secured creditors as part of a loan agreement and the security agreement between the debtor company and the creditor.to manage and sell a business debtor’s assets outside of the court system. The receiver, regardless if it is a court-appointed receiver or privately appointed receiver, takes control of a company’s assets and business operations to repay outstanding debts to creditors. The receiver’s primary duty is to maximize the value of the assets and distribute the proceeds to the creditors according to their priority ranking. The receiver has the power to sell, manage, or liquidate the assets and may also negotiate with creditors to restructure the company’s debt. Some key players in a receivership process are:
The powers and duties of a receiver can vary depending on the nature of the assets or the court order appointing them. Generally, it includes taking control of the assets, managing them in a financially responsible manner, and reporting to the court and parties involved in the dispute. The duration of receiverships in Canada can vary depending on the specific circumstances of the case, but it typically lasts for a few months to over a year. How long do receiverships last in Canada?Several factors will affect the duration of receivership in Canada, including:
Other factors may include the availability of qualified professionals to manage and sell the assets, the level of creditor involvement and negotiation, and the overall economic and market conditions at the time. Ultimately, the length of receivership will depend on the specific circumstances of each case. Court supervision is the oversight provided by a court in a court-appointed receivership. The purpose of court supervision is to appoint the receiver, to allow for the receiver to obtain the approval of the court to decisions and actions the court-appointed receiver wishes to take, to ensure that the receiver acts in the best interest of all parties involved and follows the court’s orders and to allow a forum for any aggrieved party to bring their dispute to the court for adjudication. Termination of a receivership occurs when the court is satisfied that the receiver has fulfilled their duties and objectives or when the receiver’s appointment is no longer necessary. The court terminates a receivership by court order after approving the receiver’s final report and accounts. How long do receiverships last in Canada? Frequently asked questions (FAQs)
Navigating receiverships can be a tricky and complex situation. Asking questions like “how long do receiverships last in Canada?” is essential to any company dealing with financial hardship. Here I will cover some of the common FAQs associated with receiverships in Canada, and provide an in-depth look at the timeline of these proceedings. It is essential to have a thorough comprehension of receiverships to successfully manage this situation. What are the differences between bankruptcy vs. receivership?Receivership is a process to secure the rights of secured creditors, allowing for the control and eventual sale of the assets of a distressed company. Bankruptcy, on the other hand, is a legal process which allows a company in financial difficulty to reorganize its affairs or liquidate its assets under the guidance of an insolvency trustee – providing a safety net to unsecured creditors. What happens during a receivership process in Canada?As part of the receivership process in Canada, a receiver is appointed to handle a company’s assets and activities, facilitating the sale of these to settle the company’s debt to creditors. How does a receiver sell a business or assets?To sell a business or assets, a receiver has many options available. A receiver can:
Regardless of the process chosen, the receiver’s aim is to market and sell the assets or business and obtain the best price for the assets or business under the circumstances. How does a creditor apply for receivership in Canada?Secured lenders can apply for receivership in Canada by filing an application to the court under a federal or provincial statute or enforcing their security rights by appointing a receiver privately through a security instrument by way of an appointment letter. A receivership is a remedy that allows a secured creditor to take control of and sell the debtor’s property and assets to collect their secured debt through a private or court appointment process. Can a receivership be stopped or avoided?Receivership can sometimes be stopped or avoided through negotiation with the secured creditor(s), restructuring or refinancing of debts, or by finding alternative sources of funding. However, whether or not it can be stopped or avoided depends on the specific circumstances of each case. The cessation of receivership will not be easy unless the secured creditor is being paid out. How does a creditor enforce a secured loan in Canada?In Canada, a creditor can enforce a secured loan by appointing a receiver under a private contract or through the court process. Upon appointment, the receiver will seize and sell the secured assets or the assets set out in the court order to recover the amount owed. However, before being able to appoint the Receiver, there have to be one or more events of default as described in the loan agreement. Then, the lender must be reasonable in allowing the company borrower to cure the default. If the company in default does not remedy the default(s) and the lender has lost confidence, the lender can then make a written demand on the company to repay the entire loan, plus interest and costs and also serve the necessary statutory form on the defaulting borrower. The lender must give the borrower a reasonable period of time to repay the secured lender’s debt. Reasonable time will vary depending on the unique circumstances of the situation. In Canada, the minimum amount of time that has to be given is 10 days, unless the borrower acknowledges in writing that they can never repay the debt and is waiving the notice period. What are the legal options available to recover outstanding loan payments?Legal options available to recover outstanding loan payments may include sending demand letters, filing a lawsuit, obtaining a judgment and using collection methods such as wage garnishment or asset seizure. How long does the bankruptcy process take in Canada?The timeline of a corporate bankruptcy process depends on the uniqueness and complexity of each individual situation. There is no typical timeline, but, it could be a year or more from the start of the bankruptcy until the licensed insolvency trustee is discharged. How do I liquidate assets in Canada?When seeking to divest yourself of some assets you have a plethora of choices – in the case of an asset like real estate, you can list it on the public market. Alternatively, you can try to find the right buyer on your own. Or, if you’d like some professional assistance, enlist the help of a savvy broker or financial adviser. What are the consequences of not paying off secured loans in Canada?In Canada, if you don’t pay back a secured loan, the lender may reclaim the collateral you put up, personal property like a car or real property such as a house. Don’t let your possessions be taken away! Be sure to make all loan payments in a timely manner. How long do receiverships last in Canada? ConclusionSo I hope that you now have a good appreciation for receiverships in Canada including the answer to the question “how long do receiverships last in Canada?”. If your company or business is under financial pressure and your secured creditor is about to demand full repayment of all loans, you need immediate professional advice. Revenue and cash flow shortages are critical issues facing entrepreneurs and their companies and businesses. Are you now worried about just how you or your business are going to survive? Are you worried about what your fiduciary obligations are and not sure if the decisions you are about to make are the correct ones to avoid personal liability? Those concerns are obviously on your mind. Coming out of the pandemic, we are also now worried about the economic effects of inflation and a potential recession. The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious. It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now. We have helped many entrepreneurs and their insolvent companies who thought that consulting with a trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring. We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you. The Ira Smith Trustee & Receiver Inc. team understands that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel. Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now. Original article: FROM GRIPPING TAKEOVER TO DISCHARGE: HOW LONG DO RECEIVERSHIPS LAST? ©2023 Ira SmithTrustee & Receiver Inc. - Brandon's Blog. All Rights Reserved. Via https://www.irasmithinc.com/blog/how-long-do-receiverships-last/ Romance Scams: IntroductionDoubtless, you read many blogs in the last couple of weeks that incorporated Valentine’s Day into their theme. Now that Valentine’s Day 2023 has passed, I thought I would write about an increasing trend among online scams; romance scams. Online romance scams are becoming increasingly prevalent and can have severe financial and psychological repercussions for victims. The COVID-19 pandemic has further exacerbated the growth of these types of scams, making it essential for people to be aware of how to recognize and avoid such schemes. Unfortunately, victims may be reluctant to report this type of crime out of shame and fear of being mocked, which suggests that the actual amount of cases is likely much greater than what has been reported. In this Brandon’s Blog, we’ll explore the psychology and tactics of romance scammers, the staggering costs of romance scams, and the emotional trauma that victims face. I’ll also provide practical advice on how to avoid becoming a potential victim of online scams, from identifying warning signs to protecting your personal information online. Don’t let love or the chance for a fast money score blind you – stay informed and protect yourself against (romance) scams. What are romance scams? Their prevalence in the digital ageRomance scams are a type of cybercrime in which a person is misled into believing they have formed a romantic connection with someone they met online. In reality, the other person is a cybercriminal utilizing a false identity to win the victim’s trust and eventually request or threaten them for money. Scammers tend to create false identities in order to establish a sense of closeness and trust with their victims. After this connection has been built, they use their victim’s belief it is a real romantic relationship to try and extract money from their victims. Romance scammers are skilled at creating fake online dating profiles with attractive photos stolen from the internet. They may even assume the identities of real people and study information people share online to pretend to have common interests. Romance scams are prevalent in the digital age, with reports indicating that they have hit record highs in recent years. It is important for individuals to be aware of the signs of romance scams and to exercise caution when engaging with individuals they meet online. Scammers have all sorts of tricks to try and fool people, and it’s important to know what they’re up to in order to stay safe. In addition to the fake identity, here are some of the methods they usually use for scamming people in all sorts of ways, not just romance scams:
It’s super important to keep an eye out for scammers and protect yourself. Don’t click any sketchy links, watch out for requests asking for money or personal info, and steer clear of promises that sound too good to be true. How to Identify Romance ScamsThere are several red flags to watch out for that may indicate that someone is trying out a romance scam on you because they:
It is important to be cautious when interacting with people online and to pay attention to any red flags that may indicate a romance scam is taking place. Do not send money to anyone you haven’t met in person. Do a reverse image search on their profile picture to check if it is a stock photo. Romance fraud or any other kind of online fraud can be difficult to detect because scammers are skilled at manipulating their victims’ feelings and expectations. The lies romance scammers tell: Common lies and storiesIt is important to be aware of potential signs of romance scams. Signs of a potential scammer include:
It is essential to be watchful when engaging with individuals on the internet and be aware of any signs that may suggest a romance or any other type of scam. Under no circumstances should you provide money to someone you have not encountered face-to-face. Utilize a reverse image search for the individual’s profile picture to ascertain if it is a stock image. Always be on guard. Online fraud, particularly romance fraud, can be challenging to identify due to the expertise of scammers in exploiting victims’ emotions and expectations. Real-life stories of people who have fallen victim to romance scamsHere are some real-life stories of people who have been victims of romance scams:
Just the facts: What the Federal Bureau of Investigation says about romance scamsIn 2022, an estimated 72,806 people in the United States became victims of romance scams, resulting in losses totalling over $1 billion for the first time. This data was collected from the Internet Crime Complaint Center, the Federal Trade Commission, the Better Business Bureau and the American Association of Retired Persons. Many of the scammers persuaded their unsuspecting victims to send them cryptocurrency. Gift cards were the most commonly reported payment method used by romance scammers in 2022, accounting for 24% of reported losses. Although not the most expensive payment method, it is still important to be aware of their potential use by scammers. Uncovering the reality of romance scams: What the RCMP has to sayAccording to the Canadian Anti-Fraud Centre, in 2022 losses to romance scams ranked as the second-highest source of financial fraud-related losses, totalling over $59 million. Of this amount, victims in Ontario accounted for more than $20 million. Investment scams were the only type of fraud that was more lucrative for perpetrators. It is important to note that the actual number of romance scam victims is likely higher than reported, as many do not report the crime or share it with their loved ones due to feeling ashamed, fearful, and even in denial about what has happened. How to protect yourself from romance fraudRomance scams can be devastating for individuals and families, necessitating caution when engaging with people online. Signs of potential scams include requests for money, refusal to video chat, or insistence on meeting in person. Should you or those you know have been victims of such scams, it is important to report to the authorities and seek help from trustworthy sources such as family, friends, or professionals. Protecting yourself from romance scams essentially means recognizing the scam signals discussed above and not falling for them, notwithstanding as persuasive and enticing as they may be. If it is too good to be true, then it is. Romance fraud can happen to anyone, but there are some things you can do to reduce your risk:
Romance scams: Strategies for protecting your personal and financial information onlineIn this digital age, it is critical to take the necessary steps to secure your personal and financial information online. Unfortunately, cybercriminals are constantly looking for chances to access your confidential data for malicious purposes. Fortunately, there are multiple methods you can employ to safeguard your confidential data while using the internet. Take extra care when it comes to the personal data you share on social media sites. Things like your date of birth and location can be used by cybercriminals for identity theft and fraud, so be aware of the potential risk. To stay safe from cyber threats, make sure your software and operating system are always up to date. This will ensure that the latest security patches are installed. Additionally, install anti-virus, anti-malware and anti-spyware programs on all your devices in order to stop cybercriminals from accessing the system remotely and putting in files that can steal your data. It’s essential to protect your personal and financial information from malicious online activities. To do so, reduce the number of online accounts you hold and delete any unused mobile apps or browser extensions. Additionally, make sure all devices are secured with a strong, original password or PIN – one that you don’t use anywhere else. Following these steps can help to minimize the risk of a security breach. Romance scams: ConclusionI hope this romance scams Brandon’s Blog has been an eye-opener for you. This information is really about any online fraud, not just romance scams. Have you been scammed out of money and are now facing financial hardship? Revenue and cash flow shortages are critical issues facing entrepreneurs and their companies and businesses. Are you now worried about just how you or your business are going to survive? Those concerns are obviously on your mind. Coming out of the pandemic, we are now worried about its economic effects of inflation and a potential recession. The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious. It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now. We have helped many entrepreneurs and their insolvent companies who thought that consulting with a trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring. We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you. We understand that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel. Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now.
Original article: THE DEVASTATING EFFECTS OF ROMANCE SCAMS: UNREPORTED LOSSES AND EMOTIONAL TRAUMA ©2023 Ira SmithTrustee & Receiver Inc. - Brandon's Blog. All Rights Reserved. Via https://www.irasmithinc.com/blog/romance-scams/ Definition of financial stressAre you feeling weighed down by money worries? Is your quality of life disintegrating before your very eyes? You’re not alone. Financial stress is a common problem that affects many people. It’s defined as a feeling of unease or worry caused by the lack of financial resources or the belief that you don’t have enough money. It can be caused by both happy and troubling events. Whether it’s an unexpected expense, a lost job, a major purchase such as a home or just the everyday stress of trying to make ends meet, it can take a toll on your well-being. In this Brandon’s Blog, I will discuss financial stress and how a person can take control of it. I will give actionable tips to relieve stress and improve your financial well-being. Don’t let money worries overwhelm you – take the steps needed to reduce your financial stress. Understanding the causes of financial stressDo you know someone dealing with financial stress? You’re not the only one! Money stress from financial concerns can be a major source of stress. The most common causes of financial stress are:
It can feel like you’re stuck in a never-ending cycle. But don’t worry – there’s always a way to get back on track! Taking the right steps can make a huge difference. Financial stress and its impactsConsequences of financial stress on your physical and mental well-beingThe burden of financial stress can take a serious toll on your well-being emotionally and physically. Those dealing with money worries are twice as likely to suffer from poor health and four times as likely to experience sleeping troubles, aches, withdrawal from social life and social integration and more. Furthermore, financial stress can cause depression and anxiety symptoms and can be a major contributor to heart issues. Not to mention, it can also cause fractures in relationships and make it increasingly difficult to stay on top of finances and other obligations.F How it can affect your workFinancial pressures can take a toll on any individual, and that strain can seep into their work lives. Struggling to make ends meet can result in a drop in job performance, more days off, or worse – a potential job loss. Additionally, it can bring about emotional and physical health issues, reducing productivity and contentment with their work. In addition, it can generate a decrease in morale, job satisfaction and a greater sense of unease. Financial tensions leading to emotional tension can significantly negatively affect an employee’s job performance. It is essential that employers are aware of the impact this can have on their staff, offering resources to manage their financial situation, and minimize the effect of financial stress in the workplace. The outcomes of financial stress on human wellbeingFinancial challenges leading to financial stress can be a soul-sucking burden on physical and personal health and cause mental health issues, manifesting in everything from physical symptoms, hypertension (high blood pressure), heart disease and depression to strained relationships and unhealthy sleep and eating patterns. It’s an environment of negativity that can be hard to escape. But there’s hope! Acknowledge the stress and make a plan to overcome it. Start by budgeting, tracking spending, setting up an emergency fund, and if possible, looking for ways to increase income. Life can be so much brighter when you take control of your finances. Prevalence of Financial StressFinancial stress is a growing problem in North America, with millions struggling with financial issues to make ends meet and cover essential expenses. The burden of financial stress is even larger when considering its ripple effect on families, relationships, and overall well-being, not just your financial health. As already stated above, it is well documented in studies that financial stress can negatively impact mental health and lead to physical health problems. Financial stress is pervasive across all socihealtho-economic levels and particularly burdens minority and low-income populations. Financial stress can be a significant issue for everyone regardless of their financial standing, educational background, or occupation. Financial stress will most certainly lead to greater financial dilemmas if not managed properly. Many people don’t realize that anyone can experience financial stress at any point in their lives. It is not something that only affects those who have little to no money or cannot balance a chequebook. Everyone should understand that financial stress can upspring from unexpected costs, inadequate savings, poor budgeting strategies, or job loss. Financial stress does not discriminate amongst people who may find themselves in a difficult financial situation due to illness, divorce, or other unplanned circumstances. It is not your fault. Therefore, it is important to recognize the above-noted signs and symptoms of financial stress and understand how to manage it. Coping strategies for financial stressKnowing Your MoneyIt’s time to take charge of your finances! Having a grip on your money and a comprehensive understanding of what’s going in and out of your accounts every month is vital for making savvy financial choices. Crafting a budget to stay on top of your source of income is a great way to use your funds in the most effective way possible. Additionally, it’s a smart move to look into ways to reduce your monthly financial expenses to ensure you have a financial buffer for those unexpected expenditures and can build up your savings. Taking stock of your financesAssessing your financial situation is an essential step to gaining control of your finances and improving your financial well-being. To do this, you should create an itemized list or record of your financial resources and debts, specifying the interest rate and outstanding balance. Having this knowledge can give you a better understanding of your finances and enable you to make more informed decisions. Taking the time to reflect on your financial circumstances can be the first step toward financial stability. Talking to someoneFinancial stress can be overwhelming and it is not something that should be borne alone. Seeking out support from trusted sources can make a world of difference in managing stress and making progress toward finding a resolution. Engaging in dialogue with another person can be beneficial when addressing financial anxiety. Whether it is a family member, friend, or support group, the act of just talking to someone can help lessen the burden of financial stress. It can be intimidating to open up about financial worries, but talking to someone can be an important source of support and guidance. Overcoming financial stress by engaging in self-careThis third strategy of self-care as a means of dealing with financial stress deserves its own section. Common methods of self-care which deal mainly with both the physical and the mental stress aspects are: ExercisePhysical activity is a great way to de-stress and look after your well-being! High-intensity exercises like running, elliptical, and cycling are known to lessen overall stress levels, regulate your mood, enhance your sleeping pattern, and bolster your self-confidence. Even just a short five minutes of cardio can have a calming effect on your stress levels. DietIt’s vital to maintain a wholesome diet to keep your well-being in check, and it can even help reduce worry. Nosh on nourishing meals, drink plenty of fluids and dodge caffeine and sugar to elevate your spirits, energy, and focus – all of which can assist you in tackling financial stress. Relaxation TechniquesUsing relaxation methods like deep breathing exercises, meditation, or yoga can be a great way to combat stress and promote mental health. Implementing just a few minutes of relaxation practices daily can help you better tackle financial stressors and improve your overall health and well-being. Time for yourselfFinding time for yourself can be a vital part of managing financial stress. Taking a break from your daily responsibilities can help to restore and rejuvenate your mental and emotional energy. Consider activities such as reading, taking a stroll, or napping as a means of giving yourself a much-needed break. Rest and relaxation can be important parts of maintaining your financial wellness. Seeking professional mental health HelpIt is recommended to seek professional help for mental health issues as mental health professionals can provide guidance in overcoming challenges, changing negative behaviours, understanding and healing from past trauma, setting goals and building self-confidence, all with the aim of improving your quality of life. There are many resources and services available to those seeking help for themselves, friends or family members. In the case of suicidal symptoms, professional help is essential and should be sought immediately. Final Thoughts on Financial StressI hope you enjoyed this financial stress Brandon’s Blog. I hope that it has helped you to discover the impact that financial stress can have on a person’s mental and physical health and has provided some tips on how to prevent and overcome the negative effects of stress. You may also wish to read my February 28, 2022, Brandon’s Blog, WHAT PERCENTAGE OF ILLNESSES ARE DIRECTLY OR INDIRECTLY CAUSED BY FINANCIAL STRESS? FINANCIAL STRESS IS THE MOST COMMON OF ALL TRIGGERS. Revenue and cash flow shortages are critical issues facing entrepreneurs and their companies and businesses. Are you now worried about just how you or your business are going to survive? Are you worried about what your fiduciary obligations are and not sure if the decisions you are about to make are the correct ones to avoid personal liability? Those concerns are obviously on your mind. Coming out of the pandemic, we are also now worried about the economic effects of inflation and a potential recession. The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious. It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now. We have helped many entrepreneurs and their insolvent companies who thought that consulting with a trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring. We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you. We understand that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel. Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now. Original article: THE HIDDEN EFFECTS OF FINANCIAL STRESS: WHAT YOU NEED TO KNOW ©2023 Ira SmithTrustee & Receiver Inc. - Brandon's Blog. All Rights Reserved. Via https://www.irasmithinc.com/blog/financial-stress/ WHEN TO FILE BANKRUPTCY: OUR COMPREHENSIVE GUIDE ON WHEN IS THE RIGHT TIME TO FILE FOR BANKRUPTCY2/13/2023 When to file bankruptcy to get a fresh startDefinition of BankruptcyAre you feeling overwhelmed by unmanageable debt? Then bankruptcy might be the perfect solution Though the thought of filing for bankruptcy may be daunting, it can be the best option when you’re facing unexpected expenses or other emergency situations. To make sure you’re making the right decision, it’s important to understand when to file bankruptcy and what you can expect. Bankruptcy allows a person to get back on top of their finances and start fresh. Weighing the pros and cons of filing for bankruptcy can be an alarming task, but it can ultimately be the best when your back is against the wall with debt. This Brandon’s Blog lets you find out when to file bankruptcy, what you should expect and what the bankruptcy alternatives are. What is Bankruptcy and How Does it Work?Bankruptcy in Canada is a liberating process for those who have found themselves under a burden of debt. The Bankruptcy and Insolvency Act (Canada) (BIA) provides debtors with a discharge from most debts, allowing them to have a fresh start in their financial lives. The process is designed to help those who cannot pay their bills as they come due, and have no way of paying back their debt load. By taking advantage of the bankruptcy discharge, individuals can find themselves free from the chains of debt and start anew. On the other hand, unlike a person, a company that files for bankruptcy will not survive in the long run, and thus, there is no discharge process for a company. When to File Bankruptcy?Don’t let debt take the life out of you! Bankruptcy law can give you the fresh start you need. Although not to be taken lightly, a bankruptcy filing can be an absolute lifesaver when the debt becomes too much to bear. Filing for bankruptcy is no small decision and has the potential to drastically alter your financial future. It’s essential to be informed on when to file bankruptcy and the process involved to ensure that your credit and ability to access money in the future are not adversely affected. Start the legal process off right by filing for bankruptcy with the help of a licensed insolvency trustee (formerly called a bankruptcy trustee) (LIT or Trustee). The LIT will submit all the documents at once and get the ball rolling. When an individual has too much consumer debt and files for bankruptcy, the LIT takes possession of their property and assets (subject to provincial government exemptions). The Trustee is the appointed authority in charge of liquidating the assets and depositing the proceeds into a trust account that will eventually be distributed among the creditors in the priority laid out in the BIA. It is crucial to understand when to file bankruptcy and the process involved to make informed decisions about one’s financial future. When to file bankruptcy: Identifying signs of financial distressHere are 5 common signs of financial distress:
When to file bankruptcy: The process of filing for bankruptcyThe process of filing for bankruptcy in Canada is handled by a Trustee under the supervision of the Office of the Superintendent of Bankruptcy Canada (OSB) under the BIA. The time to complete the bankruptcy process for a 1st time bankrupt with no surplus income, where neither the Trustee nor any creditor opposes the individual bankrupt’s discharge is 9 months. If a first-time bankrupt gets a discharge at the 9-month point, then they have received an automatic discharge from the LIT. During bankruptcy, the creditors can no longer harass the bankrupt person or carry out legal proceedings or wage garnishments. The LIT provides an information form for the person to complete, and uses that information to prepare and then file the bankruptcy paperwork. The LIT needs personal information (name, address, birth date), a list of creditors and a list of assets. The LIT then files the bankruptcy documents electronically with the OSB and then they will issue a Certificate confirming the acceptance of the bankruptcy filing. It is the day and time of the issuance of the OSB’s certificate that marks the beginning of the bankruptcy process. When to file bankruptcy: What is the impact of filing for bankruptcy?Once your bankruptcy is filed, there is an immediate stay of proceedings. This means that unsecured creditors cannot begin or continue lawsuits, wage garnishees, or even contact you to request payment. Within five days of the bankruptcy starting, the LIT will send a copy of the bankruptcy paperwork to creditors so they can file a claim. Overview of the bankruptcy processCan I keep my assets when I file for bankruptcy? In most cases, yes. However, the trustee may sell some assets to pay off your creditors. The assets you can keep will depend on your province’s exemptions. The Trustee’s job is to manage the sale of the bankrupt’s assets and place the proceeds into a trust, safeguarding them for the creditors. In other words, the Trustee is a guardian of funds, making sure everything is handled properly. Are you worried that filing for bankruptcy will destroy your credit? Don’t fret – while bankruptcy will certainly leave its mark on your credit report, it’s far from a death sentence. Once your bankruptcy is approved, you can start taking steps toward restoring your financial health. A fresh start is waiting – be smart and make decisions that will get you back on the right track! Wondering just how long you’ll be in bankruptcy? That all depends! If it’s your first-time bankruptcy filing with no surplus income, it should only last nine months. But if you’ve filed for bankruptcy more than once and don’t have surplus income, it will take 21 months. For those who have surplus income, this process will take longer. 2 financial counselling sessions. In a consumer restructuring or bankruptcy administration under the BIA, the debtor is required to go through two financial counselling sessions with the LIT. The reason is that one of the objectives of the BIA is financial rehabilitation. Financial education and teaching financial literacy tips are important parts of that rehabilitation. Requirements for filing bankruptcyTo be eligible to file for bankruptcy in Canada, you must meet certain requirements. You must owe at least $1,000 in unsecured debt and be unable to pay your debts as they come due. You must also be insolvent, meaning you owe more than the value of the assets you own. Additionally, you must either reside, do business or have property in Canada. There are other acts of bankruptcy contained in the BIA, but the normal requirement is as I just described. Role of Trustees in the bankruptcy processThe role of a LIT in Canada is to assist individuals or companies in the bankruptcy process as laid out by the BIA. They help to explain to the debtor the various options in dealing with their debt and provide advice on the best course of action. The Trustee also prepares the necessary paperwork, including reviewing the debt and completes the process from start to finish. One of the key responsibilities of the Trustee is to take possession of the property not exempt under provincial law, or subject to a trust or secured claim. The LIT then does this by selling the available assets and depositing the funds in trust for the creditors in the bankruptcy administration. When to file bankruptcy: Alternatives to BankruptcyThere are several alternative solutions that a LIT can recommend to a debtor in solving their debt problems. Bankruptcy is always the last resort and is to be avoided if at all possible. The main alternative solutions are: Debt consolidation and debt management plansIn Canada, consolidation loans are available to assist individuals in reducing their high-cost debt payments. If you qualify for such a loan, it is an advantageous solution. These debts may include credit cards, payday loans, and unpaid tax obligations. By consolidating higher-interest-rate debts into one lower-interest-rate loan, it is possible to make affordable monthly payments and work toward eliminating debt. If you’re in need of financial help, a Debt Management Plan (DMP) may be the answer. A DMP is an effective way to repay credit card debt, and with the help of a non-profit, no-cost credit counselling agency, you can get the support to make it work. The agency will assess your situation to ensure that a DMP is the best option for you. Put your debt worries to rest and take the first step towards a sound financial future with a DMP. Both debt consolidation and debt management plans aim to help individuals in Canada manage their debt effectively. Credit counselling and financial planningCredit counselling and financial planning can help someone who has many debts. The services are provided by accredited credit counsellors working for non-profit credit counselling organizations. A credit counsellor will assess the financial situation of an individual and provide tips on dealing with debt. Financial planning and budgeting will be an important part of the process. If the individual decides to sign up for a DMP, the counsellor will contact creditors on their behalf to request reducing or eliminating the interest rate or fees on their debts. In some cases, the creditors may agree to these requests. Debt settlement, restructuring and negotiation with creditorsDebt restructuring, also known as debt negotiation, is the process of negotiating the terms and conditions of debt repayment with creditors. This process can be carried out by the consumer or company themselves seeking alternative repayment options. The goal is to reach a mutually agreed-upon arrangement that is more manageable for the consumer or company to repay their debt. It can involve the forgiveness of interest, stopping the interest clock and even the forgiveness of principal. If the company or consumer handles the discussions themselves, or with the help of their accountant, it is called an informal restructuring. When a consumer or company restructures their debt with the help of a LIT under the BIA, they would file either a consumer proposal or a Division I proposal restructuring. A large company could also restructure under the Companies’ Creditors Arrangement Act. When to file bankruptcy: ConclusionPersonal bankruptcy or corporate bankruptcy, and when to file bankruptcy, is a big decision, but it can be the right one when you’re overwhelmed with debt. You can make an informed decision by understanding the basics of bankruptcy, including when to file and what to expect. If you’re struggling with debt and considering bankruptcy, it’s important to speak with a professional who can help you assess your options. Bankruptcy can be a fresh start for your financial future, but it’s important to understand the consequences and work with a professional to determine if it’s the right choice for you. I hope you enjoyed this when to file bankruptcy Brandon’s Blog. Revenue and cash flow shortages are critical issues facing entrepreneurs and their companies and businesses. Are you now worried about just how you or your business are going to survive? Those concerns are obviously on your mind. Coming out of the pandemic, we are now worried about its economic effects of inflation and a potential recession. The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious. It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now. We have helped many entrepreneurs and their insolvent companies who thought that consulting with a trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring. We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you. We understand that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel. Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now. Original article: WHEN TO FILE BANKRUPTCY: OUR COMPREHENSIVE GUIDE ON WHEN IS THE RIGHT TIME TO FILE FOR BANKRUPTCY ©2023 Ira SmithTrustee & Receiver Inc. - Brandon's Blog. All Rights Reserved. Via https://www.irasmithinc.com/blog/when-to-file-bankruptcy/ OFFICERS AND DIRECTORS: NAVIGATING THEIR RESPONSIBILITIES IN AN INSOLVENT CANADIAN CORPORATION2/6/2023 officers and directors Officers and Directors: IntroductionIn Canada, it is essential that the individual orchestrating any criminal activity must have the necessary competency to commit the offence before any corporate responsibility can be assumed. The executives and board members of the enterprise are viewed as the ultimate custodians of the company’s ethical obligations. Welcome to Brandon’s Blog! Here I’ll be discussing the court’s ruling on fraudulent intent by officers and directors, and how it affects the transfer of assets at undervalue in insolvent corporations. I’ll be focusing on the 2022 Court of Appeal for Ontario decision in the Bondfield Construction Company Limited (“Bondfield”) and Forma-Con Construction (“Forma-Con”) case as creating new law. After two court decisions over nearly two years, the Supreme Court of Canada has delivered their decision on the Court of Appeal’s decision upholding the lower court decision, granting the application for leave to appeal to the Supreme Court. Officers and Directors: What is the “directing mind”?The term “directing mind” in the context of Canadian corporations refers to a natural person who holds a high level of authority within theand can be considered the “alter ego or soul” of the corporation. The term “alter e organization go” or “soul” of a corporation refers to a person who holds significant authority within the organization. According to the web search results, this person can be considered the embodiment or representation of the corporation. Federal legislation uses a more familiar expression for the directing mind “senior officer”. This includes individuals who have an important role in setting policy or making important decisions within the corporation. A “senior officer” is a person in a position of authority or seniority over others. They are responsible for leading and overseeing a group or organization. The duties of Officers and DirectorsFiduciary DutyIn Canada, the phrase “directing mind” is used to refer to a top-tier individual, an officer or someone on the board of directors in a company who can be thought of as its “alter ego” or “soul”. This individual holds a great degree of influence and power within the corporation, making them its symbolic heart and soul. Duty of CareOfficers and directors are expected to exercise the same degree of prudence, attention to detail, and knowledgeability that any reasonable individual would in similar scenarios. This means that they must stay abreast of the corporation’s financial well-being and make informed decisions using that information. Beyond the necessity of performing their fiduciary duty, they also have a duty of care to the company and its stakeholders. Insolvency and the Obligations of Officers and Directors in Canadian CorporationsAs a corporation’s liabilities come due and it finds itself unable to pay, insolvency looms large. This can be a stressful period for corporate officers and directors, as they are tasked with making crucial decisions that will affect the company and its stakeholders in the long run. It is paramount that they keep the corporation’s best interests in mind as they navigate these difficult waters. Officers and directors of Canadian corporations have two significant legal obligations to fulfill: a fiduciary duty and a duty of care. Failure to uphold either of these duties could result in personal liability for them. Navigating Responsibilities in an Insolvent Corporation: Do officers and directors owe a duty to creditorsWhen an enterprise finds itself insolvent or close to it, the officers and directors of the company accept a nerve-wracking assignment. These decision-makers are required to make authoritative choices that will determine the fate of the corporation and of all those involved. Officers and directors of an insolvent company must jump into action to protect as best as possible the corporation and its stakeholders from added losses. This could include negotiations with creditors, liquidating redundant assets, and reorganizing the firm’s procedures. It’s not a simple task, but it’s a necessary one. It’s necessary to protect the corporation and its stakeholders by focusing on the company’s important resources and operations. Decisions must be made to stave the loss of assets needed to operate and make sure that all of its transactions are in the corporation’s best interests. Aside from their approved responsibilities, officers and directors need to be alert to their obligations and the repercussions that may arise from negligence. They need to be very careful to ensure that their fiduciary responsibility and duty of care are not abandoned and must correct any missteps. With this perfect segway, I now wish to describe a very important recent decision from the Court of Appeal for Ontario upholding the lower court decision on the duties and responsibilities of officers and directors of an insolvency company. This decision has been appealed to the Supreme Court of Canada. It is such an important decision for officers and directors, corporations and especially insolvent ones for the entire country, that the Supreme Court of Canada has agreed to hear the appeal. Officers and directors: Ernst & Young Inc. v. Aquino, 2022 ONCA 202 (CanLII)On March 10, 2022, the Court of Appeal made a landmark decision in Ernst & Young Inc. v. Aquino, which delved into the corporate attribution doctrine – the idea that the actions of a corporation’s controlling figure can be attributed to the firm itself. The ruling was especially pertinent in the bankruptcy and insolvency context. John Aquino was the directing mind of Bondfield Construction Company Limited (“Bondfield”) and its affiliate Forma-Con Construction (“Forma-Con”). He and his associates carried out a false invoicing scheme over a number of years by which they siphoned off tens of millions of dollars from both companies. The monitor and the trustee challenged the false invoicing scheme and sought to recover some of the money. The participants argue that they did not intend to defeat any actual creditors and that John Aquino’s intent cannot be imputed to either Bondfield or Forma-Con. Bondfield was a full-service group of construction companies that operated in the Greater Toronto Area and Southern Ontario starting in the mid-1980s. Bondfield was in financial trouble in 2018 and started proceedings under the CCAA on April 3, 2019. After a careful investigation, the monitor and the licensed insolvency trustee administering the bankruptcy (formerly called a trustee in bankruptcy) uncovered a shocking discovery: Bondfield and Forma-Con had deceitfully dispersed a staggering sum of money to or for the benefit of John Aquino and others via a fraudulent invoicing system! In cross-examination, Mr. Aquino admitted that the suppliers who falsely invoiced Bondfield provided no value for the transfers, but denied intent to defraud, defeat, or delay Bondfield’s actual creditors. Can section 96 of the Bankruptcy and Insolvency Act (“BIA”) be used by the monitor and the trustee to recover the money officers and directors took from Bondfield and Forma-Con?Section 96 of the BIA allows trustees to seek a court order “voiding transfers at undervalue” which are a transfer by the debtor to another party at no or undervalued consideration, which is an improvident transaction from the debtor’s perspective. The policy of the BIA goes beyond the modest origin of the law, which prohibits insolvent debtors from giving away assets to third parties instead of using those assets to repay their debts. This section of the BIA is a remedy to reverse an improvident transfer that strips value from the debtor’s estate, but the trustee must nevertheless meet the requirements of the specific words used. The legal analysis of the false invoicing scheme was no longer in active dispute. John Aquino and his associates dispute liability under s. 96 on the basis that their fraudulent acts were not carried out at a time when Bondfield and Forma-Con were financially precarious. John Aquino and his associates asserted that Bondfield and Forma-Con were financially healthy, so they did not intend to defraud any actual creditors. When assessing the intention of a debtor, a court must look at the information known at the time of the transfer or transaction, and the reasonableness of the debtor’s belief in light of the circumstances then existing. In order to require John Aquino and the other beneficiaries of the false invoicing scheme to repay the money they took under s. 96(1)(b)(ii)(B) of the BIA, the monitor and the trustee had to prove two elements: first, John Aquino and the other participants were not dealing with Bondfield and Forma-Con at arm’s length; and second, at the time they took the money (during the statutory review period), they “intended to defraud, defeat or delay a creditor” of Bondfield or Forma-Con. The first element is amply established by the evidence. This case turns on the second element. The lower court judge’s reasons for the timing of the transfersThe Court of Appeal found that the lower court judge decided correctly based on the legal principles that were presented. John Aquino and his associates presented their case of Bondfield and Forma-Con’s solvency when they received the funds. However, the judge decided that the affirmation of fraud provided an abundant base for deciding that Bondfield and Forma-Con had the purpose of deceiving, obstructing, or delaying their creditors. The judge concluded that the presence of badges of fraud creates a presumption of fraudulent intent and that John Aquino had not rebutted the presumption. The judge also concluded that the true financial condition of Bondfield and Forma-Con at the time of each impugned transaction cannot be determined on the record before the court. Based on the totality of the evidence, documents and information, the judge held that at the time of the fraudulent transactions, Bondfield and Forma-Con were already experiencing mounting financial difficulties, and their creditors were imperilled by the transfers. John Aquino continued on nonetheless, and the court found that the transfers were intended to defeat those creditors. The application judge took a pragmatic view of the evidence, found that John Aquino carried on with the false invoicing scheme knowing that Bondfield and Forma-Con were experiencing increasing financial difficulties, and inferred that he did this with the intent to defeat creditors. John Aquino didn’t care if his scheme had the potential to defraud, defeat or delay creditors according to section 96 of the BIA. His recklessness was enough to show the intent needed to make the fraudulent transfers stand. It’s clear that he wasn’t concerned about the interests of the companies’ creditors. Forma-Con paid over $11 million to certain purported suppliers under the false invoicing scheme during the time period of review allowed under s.96 of the BIA. For the Bondfield 5-year review period, the court found that the total amount of $21,807,693, are transfers at undervalue. The court ordered Mr. Aquino and associates, to repay this amount on a joint and several basis. Officers and Directors: Uncovering the Impact of Fraudulent Intent on Transfers and Undervalue in Bankrupt CorporationsThe application judge was able to uncover John Aquino’s scam involving false invoicing by Bondfield and Forma-Con, giving the trustee the green light under the BIA to reclaim the funds stolen by the fraudsters. The appellants argue that the lower court judge erred legally because John Aquino’s fraudulent intent cannot be imputed to Bondfield or Forma-Con as a matter of law, even though he was one of their directing minds. They assert that the binding principles of the common law doctrine of corporate attribution set out in Canadian Dredge & Dock Co. v. The Queen,[55] do not permit the imputation of his intention to either defrauded the company. Accordingly, s. 96(1)(b)(ii)(B) of the BIA cannot be used to require John Aquino, or his associates as “privies” to the impugned transactions, to repay the money they took. This intriguing argument brings up a difficult issue concerning the relationship between the stipulations of the BIA and common law doctrine. When can a court use common law in interpreting and putting the BIA into effect? I will start by presenting the judge’s rationale for the application. After that, I will tackle this legal inquiry and then consider its effects regarding the implementation of the corporate attribution doctrine in this appeal. The lower court judge reasoned that common law doctrine can be enlisted by a court to interpret and supplement the BIA where necessary to better achieve its purposes, one of which is to protect the interests of the bankrupt’s creditors. She believed that common law can add content to the terms of the bankruptcy law not otherwise defined. In particular, the common law doctrine known as the anti-deprivation rule and its purpose of preventing fraud on the bankruptcy is especially pertinent in this case. The use of common law doctrine must respect the policy of the BIA. The BIA is no stranger to the use of common law doctrines- though it has yet to officially codify ‘good faith’, the Supreme Court has nonetheless held that Parliament is expected to remain true to the traditional understanding of the common law unless there is some explicit and unmistakable indication of deviation. Consequently, when it comes to interpreting the BIA, the concept of good faith unquestionably plays a role, but it is not codified. The fraud on bankruptcy law principle exists to protect creditors from unscrupulous parties who might otherwise try to remove value from an insolvent debtor’s assets. Corporations, being distinct from natural persons, necessitate the corporate attribution doctrine, which provides a link between the entity and the individual whose “guiding hand” propelled the corporation into action. This kind of insolvency officers and directors case was novel in CanadaThe corporate attribution doctrine has been applied in the fields of criminal and civil liability. Before this case, courts in Canada had yet to consider the doctrine in the bankruptcy and insolvency context under s. 96 of the BIA. The court recognized that the attribution exercise is grounded in public policy. These principles provide a sufficient basis to find that the actions of a directing mind be attributed to a corporation, not a necessary one. Accordingly, as a principle that is grounded in policy, and which only serves as a means to hold a corporation criminally responsible or to deny civil liability, courts retain the discretion to refrain from applying it where, in the circumstances of the case, it would not be in the public interest to do so. After thorough deliberation, the Court of Appeal sided with the lower court to declare that this case had implications for the public interest. It was determined that the invoicing scheme had been used as a way to fraudulently, obstructively, and detrimentally transfer funds to avoid payment to Bondfield’s and Forma Con’s creditors. The Court seeks to reverse these transactions and recover a total of $11,366,890 on behalf of Forma-Con’s creditors. For Bondfield’s creditors, the amount of $21,807,693, The bottom line of Ernst & Young Inc. v AquinoThe lower court found and the Court of Appeal affirmed that decision that under s. 96 of the BIA, the payments by Bondfield and Forma-Con made in respect of the false invoices during the 12-month review period totalling for Bondfield, $21,807,693, and for Forma-Con, CDN$13,985,743 CAD and US$35,030 Are transfers at undervalue. Those that received these funds were ordered to repay them on a joint and several basis. The Court of Appeal delved into some critical legal matters in their ruling, exploring the responsibilities insolvency practitioners must uphold, how much creditors should be able to expect, as well as the rights of everyone involved in bankruptcy proceedings. They also delved into the interpretation of the BIA and the reality of its application. The Court decided that the BIA has to be implemented in a way that meets the expectations of the Act, and that insolvency professionals are to be held to a high standard of both expertise and responsibility. At the beginning of this Brandon’s Blog, I mentioned this monumental case will be heard in the Supreme Court of Canada. As you can imagine, it will be a highly anticipated event in the insolvency world. And it won’t disappoint! The ruling so far has had major implications for the insolvency industry, including the rights of creditors, officers and directors and insolvency practitioners. All in all, it was a groundbreaking decision that will shape the industry for years to come – and will no doubt be further shaped once the Supreme Court of the land hears the case and issues its decision. Obligations and Responsibilities of the Board of Directors and Officers: ConclusionThe Ernst & Young Inc. v Aquino case was an important one for the insolvency industry and had far-reaching implications for the obligations of insolvency practitioners and the rights of creditors and other stakeholders. The Court of Appeal’s decision in the case was a clear and definitive ruling on a number of key legal issues, and it will likely have a lasting impact on the insolvency industry for many years to come. I hope you enjoyed this officers and directors Brandon’s Blog. Revenue and cash flow shortages are critical issues facing entrepreneurs and their companies and businesses. Are you now worried about just how you or your business are going to survive? Are you worried about what your fiduciary obligations are and not sure if the decisions you are about to make are the correct ones to avoid personal liability? Those concerns are obviously on your mind. Coming out of the pandemic, we are also now worried about its economic effects of inflation and a potential recession. The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious. It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now. We have helped many entrepreneurs and their insolvent companies who thought that consulting with a trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring. We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you. We understand that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel. Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now. Original article: OFFICERS AND DIRECTORS: NAVIGATING THEIR RESPONSIBILITIES IN AN INSOLVENT CANADIAN CORPORATION ©2023 Ira SmithTrustee & Receiver Inc. - Brandon's Blog. All Rights Reserved. Via https://www.irasmithinc.com/blog/officers-and-directors/ THE COMPLETE CORPORATE BANKRUPTCY IN CANADA GUIDE: WHAT EVERY BUSINESS OWNER NEEDS TO KNOW1/30/2023 Corporate bankruptcy in Canada: IntroductionAre you a business owner with company financial difficulties and apprehensive about the possibility of corporate bankruptcy and is it something that you will have to seriously consider? Corporate bankruptcy in Canada process can be complex and overwhelming, but understanding it is necessary for making authoritative decisions about your business. In this Brandon’s Blog, I will analyze the ins and outs of corporate bankruptcy in Canada, including the different types, the steps in filing for corporate bankruptcy, the impact on creditors and shareholders, and alternatives to consider. By the end of this Brandon’s Blog, you will have a better understanding of corporate bankruptcy in Canada and be able to understand how to make the best decision for your business. Explanation of what corporate bankruptcy in Canada isThe corporate bankruptcy process in Canada – otherwise known as commercial bankruptcy or incorporate business bankruptcy – is a legal means by which an incorporated business that is unable to pay its debts can be liquidated, and its liabilities discharged. This process allows the business to liquidate its assets and redistribute the value among its creditors. The process is intended to give an honest, but unfortunate corporate debtor a discharge from most debts while ending the business of that corporation. It is important to note that corporate bankruptcy is different from personal bankruptcy which is a legal process through which an insolvent individual can substantially reduce debt and hopefully restructure. Unlike an individual who files for personal bankruptcy, it is not intended that the bankrupt corporation will come out of bankruptcy through a discharge process. If single individuals are operating businesses and are considering business bankruptcy, then we are talking about the bankruptcies of sole proprietorships. If more than one person is operating a business partnership, then we need to think of the issues in a partnership bankruptcy. Either way, we have insolvent persons, which means personal bankruptcy, which is not the subject of this Brandon’s Blog. It’s important to note that the process of corporate bankruptcy in Canada is complex and can only be handled by a licensed insolvency trustee. The Trustee will help you understand the process and the options available to your corporation and then prepare the documents required to submit the bankruptcy filing. In Canada, if a corporation is bankrupt, it is subject to both the federal Bankruptcy and Insolvency Act (Canada) (“BIA”) and relevant provincial regulations. The BIA outlines the procedure for managing a corporate bankruptcy, while provincial law governs other aspects of the business such as labour laws. A brief overview of how the process of corporate bankruptcy in Canada beginsNavigating corporate bankruptcy in Canada can be complicated, as there are numerous steps that need to be taken. To begin, it is important to consult with a licensed insolvency trustee to review the financial details of the company, including income, profits, liabilities, and any personal guarantees. From there, the next step is to determine the misogynist options. The board of directors needs to hold a meeting, in order to pass a resolution permitting the corporation to file for bankruptcy. This process is initiated by a director, or the single director, who will then execute the necessary bankruptcy paperwork. Types of corporate bankruptcy in CanadaThere are two types of corporate bankruptcy in Canada: liquidations and reorganizations. Although a reorganization is not an actual bankruptcy, the phrase “bankruptcy protection” is used to describe a formal reorganization. So for the purposes of this Brandon’s Blog, we will consider both as types of bamkruptcy. The type of corporate bankruptcy in Canada proceedings can often provide a good indication as to whether the unsecured creditors will get all, a portion, or none of what they are owed. An overview of the 2 types of bankruptcy proceedings available to Canadian businessesLiquidationThe process of corporate bankruptcy involves a business ceasing operations as it is unable to fulfill its financial obligations and the demand for its goods and services has become obsolete. This form of corporate bankruptcy is commonly referred to as liquidation. Canadian bankruptcy proceedings must adhere to Canadian bankruptcy law under the BIA. This law contains similar liquidations to Chapter 7 of the U.S. Bankruptcy Code. Commencing the process of bankruptcy liquidation in Canada is the initial step. It all starts with the board of directors of the corporation getting together and deciding to file for bankruptcy. One of the directors, or a single director, will then have to sign the official documents for the bankruptcy process. Once the liquidation process has been initiated, the corporation’s assets, subject to the rights of any creditor having security over all or some of the assets, are taken over by the Trustee. The Trustee will sell the corporate assets and the proceeds will be distributed among the creditors according to the priority established by law. The corporation will then be laid to rest, as it will no longer operate as a legal entity. ReorganizationCorporate reorganization is one of the alternatives to bankruptcy. It is a process in which a process for a company that is facing financial difficulties is able to restructure its outstanding debt and its operations in order to improve its financial situation. In Canada, the primary statutes for corporate reorganization are the Companies’ Creditors Arrangement Act (CCAA) and the BIA. These laws are similar reorganizations under Chapter 11 of the U.S. Bankruptcy Code. The CCAA provides a thoroughfare of debt reorganization for corporations on a larger scale, as the amount owed by the company must exceed $5 million. Through this federal legislation, the debtor corporation can still operate while reaching an approved plan of arrangement with its creditors. For corporations that do not reach this $5 million threshold, the Division I Proposal under the BIA can be utilized. The BIA provides for the restructuring of insolvent corporations and individuals. The CCAA is a federal statute that allows for the sale of an insolvent business, with a reach that transcends the wideness of the whole Canadian nation and even extends beyond its borders. The process of corporate reorganization under either the CCAA or BIA begins with the corporation filing for protection under the appropriate Act. In the case of the CCAA, the filing is with the court. Under the BIA, the filing is with the Office of the Superintendent of Bankruptcy Canada. The debtor will then be safeguarded with all its possessions. Then, the corporation will be allotted a specified value of time – typically 30 to 45 days – to present a plan of arrangement. This plan must be approved by the creditors and the court in order to move forward. When the plan of arrangement is given the thumbs up, it can be set into motion. So corporate reorganization in Canada is a process in which a company that is viable but is facing financial difficulties is allowed to restructure its business debts and operations in order to modernize its financial situation. The CCAA is mainly used for larger corporations and the BIA for smaller ones. Both legislations provide a process to restructure a company while under the protection of the court and it’s intended to be a way to save a company while protecting the rights of the creditors. Advantages and disadvantages of corporate bankruptcy in CanadaLiquidationAdvantages of corporate liquidation using corporate bankruptcy in Canada:
Disadvantages to bankruptcy and corporate liquidation using corporate bankruptcy in Canada:
ReorganizationAdvantages of reorganization under corporate bankruptcy in Canada:
Disadvantages of reorganization under corporate bankruptcy in Canada:
Filing a voluntary assignment into bankruptcy for corporate bankruptcy in CanadaOverview of steps involved in filing for Corporate Bankruptcy in Canada
Note: The above steps are a general outline and the specific process may vary depending on the case. It’s advisable to seek guidance from a licensed insolvency trustee and a legal professional to ensure compliance with the laws and regulations. Essential paperwork and informationIn order to file a voluntary assignment for corporate bankruptcy in Canada, and get to the point of holding the First Meeting of Creditors, the following documentation and information are typically required:
In a voluntary assignment, the LIT is picked by the debtor. In an involuntary assignment, the LIt is suggested to and chosen by the court. In issuing the Certificate, the LIT choice is confirmed by the Office of the Superintendent of Bankruptcy. However, it is ultimately up to the creditors attending and voting at the First Meeting of Creditors to either confirm the appointment of the LIT or substitute the LIT with another one (don’t worry about the mechanics for now!). The LIT will be responsible for overseeing the administration of the debtor’s estate and distributing the proceeds to creditors. It’s important to note that the above list is not exhaustive and additional documentation and information may be required by the Office of the Superintendent of Bankruptcy(OSB) or the appointed Trustee. It’s recommended to seek professional advice from a LIT, a lawyer or both, before filing for a voluntary assignment in bankruptcy. The OSB plays an important part in the area of insolvencyThe OSB is tasked with keeping orderly standards for the supervisory oversight of stakeholders within the insolvency process, creating an accessible archive of public records, compiling and analyzing data, and enforcing the BIA and CCAA regulations. Furthermore, the OSB is devoted to facilitating an effective and efficient insolvency framework in Canada. The OSB in Canada is responsible for the supervision and regulation of the Canadian insolvency system, and overseeing the administration of all insolvency proceedings described as bankruptcies, commercial reorganizations, Division I commercial proposals, consumer proposals and receiverships. The effects of corporate bankruptcy in Canada on creditors and stockholdersHow corporate bankruptcy affects the distribution of assets among creditorsDivvying up resources among those owed money in a corporate bankruptcy in Canada can be quite intricate and can be affected by various elements, such as the kind of bankruptcy declared and the company’s ownership and organizational setup. When a company files for bankruptcy, its day-to-day operations will typically come to a halt. All of the corporation’s assets will be sold off and the proceeds will be divided among its creditors. In Canada, this process can have a major impact on how the assets are divided up among those who are owed money. The BIA requires the LIT to take control of all the unencumbered assets, sell them and assigns orders of importance to the many claims against the debtor. The net sale proceeds are then doled out to creditors depending on the priority of the claims. In a nutshell, the types of creditors and the order of priority is:
In Canada, though the assets of a company are distinct from the owners’ individual wealth, banks will always take security on the company’s assets when loaning funds and anticipate the entrepreneur to provide some kind of collateral. It bears mentioning that this is a standard requirement. Should the proceeds of the company assets fail to cover the bank debt in the event of a Canadian bankruptcy, the owners will be called upon to make good on their personal liability and may be faced with the liquidation of some or all of their personal belongings to make up the difference. What sort of ramifications does corporate bankruptcy in Canada have on the equity holders and their privileges?Generally, when it comes to bankruptcy proceedings, it’s usually shareholders who are left holding the shorter end of the stick. Most often, they don’t get anything back after all other creditors have been taken care of– leaving them with nothing but the realization that their investments have gone down the drain. Furthermore, they forfeit any rights they once held with the company. If any of the shareholders are also in a director position, then they will have the added worry about whether there are any debts that are also a director liability. Legal advice is always required by directors of an insolvent company. In next week’s Bradon’s Blog, I will talk about recent developents arising from an Ontario court decision about the directing mind of a bankrupt corporation. The one small solace they may have is that Canada Revenue Agency will acknowledge the corporate bankruptcy in Canada as a legitimate means of allowing shareholders to deduct the value of their shares as a loss on their tax return. Alternatives to Corporate Bankruptcy in CanadaFor a business that is viable yet unable to pay off its debts, there are 5 alternatives to corporate bankruptcy in Canada that must be explored:
Rather than going through the effort of reorganizing debt under the CCAA or BIA, a corporate workout is an amicable arrangement between the company and its creditors that allows them to come to a mutually-satisfactory resolution without resorting to legal proceedings and a reorganization court case. This is seen as an advantageous alternative to a formal filing. If all other solutions fail to prevent a company in Canada from going bankrupt, then the CCAA or BIA’s restructuring provisions should be carefully considered to potentially save the company, its jobs and business assets. If the company is not viable or profitable and is in a state of financial distress, then a secured lender can exercise their rights through a receivership process. This could be used in conjunction with a corporate bankruptcy in Canada if the situation calls for that. Corporate bankruptcy in Canada: ConclusionI hope you enjoyed this corporate bankruptcy in Canada Brandon’s Blog. Revenue and cash flow shortages are critical issues facing entrepreneurs and their companies and businesses. Are you now worried about just how you or your business are going to survive? Those concerns are obviously on your mind. Coming out of the pandemic, we are now worried about its economic effects of inflation and a potential recession. The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious. It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now. We have helped many entrepreneurs and their insolvent companies who thought that consulting with a trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring. We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you. We understand that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel. Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now.
Original article: THE COMPLETE CORPORATE BANKRUPTCY IN CANADA GUIDE: WHAT EVERY BUSINESS OWNER NEEDS TO KNOW ©2023 Ira SmithTrustee & Receiver Inc. - Brandon's Blog. All Rights Reserved. Via https://www.irasmithinc.com/blog/corporate-bankruptcy-in-canada-2/ consumer debt proposals Consumer debt proposals eliminate your debt stressAre you stressed out and overwhelmed by debt and don’t know how to begin to eliminate it? We know your pain and can help you because this Brandon’s Blog “Consumer Debt Proposals: The Ultimate Solution for Managing Debt” has got you covered! I provide realistic advice on how to manage and even get rid of debt through a binding debt settlement agreement. I describe what consumer debt proposals are all about and also look at other debt-relief options like debt consolidation and credit counselling. I will also talk about the recent Canadian government’s warning about taking on high-interest debt from certain companies. Consumer debt proposals: How Does a Consumer Proposal Work?If you’re in a tough spot financially, in Canada you can submit a consumer proposal if you owe $250,000 or less (not including any debt registered against your home is one of the types of secured debts that must be paid according to your secured loan repayment terms). It’s an official way to get some debt relief, and it’s all legit according to the Bankruptcy and Insolvency Act. Basically, you work with a Licensed Insolvency Trustee who helps you come up with a plan for paying off what you owe. Then you negotiate with your creditors and hopefully, they accept the proposal. Making a consumer proposal that unsecured creditors will accept is one of the debt solution alternatives to bankruptcy that requires a few steps to get it done:
Once you’ve submitted your consumer proposal, your creditors will look it over and then decide if they want to accept it as is or negotiate an adjustment (higher) to your periodic payments to eliminate the amount you owe. They have the option to do either one. Your creditors can decide to:
Your consumer proposal is automatically approved unless more than 25% of the dollar value of the claims of your creditors indicates that they would like to have a meeting of creditors. In that case, that is what will happen. Once you’ve taken the step of filing for a consumer proposal, you’ll be able to rest easy knowing that you have immediate legal protection from creditors and debt collectors through this financial and legal process. This is called a stay of proceedings where your creditors cannot chase you for the money you owe. Filing under the bankruptcy process in Canada isn’t your only option! You can work out a legally binding agreement with your creditors through the popular alternative and powerful alternative of consumer debt proposals. With a consumer proposal, you and your creditors can come to an agreement on what portion of the debt you can pay off- and the rest will be written off! Consumer debt proposals: The voting processWhen it comes to a consumer proposal, it’s important to understand the process of how creditors come to a decision to accept or reject the plan. This section will provide insight into how the voting process works. Once a consumer proposal is submitted, creditors are allowed 45 days to express their decision. They can either accept the proposal or reject it in one of the following ways: replying to the Licensed Insolvency Trustee with their acceptance, not responding at all (which is seen as approval), communicating their rejection or requesting a meeting of creditors. At the creditors’ meeting, creditors will have the opportunity to decide whether to accept the consumer proposal as is or to make adjustments to it. Consumer debt proposals: What happens if your offer is approved?If your proposal gets the green light, you’ll need to abide by what you promised – whether that’s a single payment or regular installments to the Licensed Insolvency Trustee. Plus, you must meet any other conditions that were laid out in the proposal. In a successful proposal, you can keep your assets (as long as you keep paying what you owe to creditors who have a lien on your assets), and go to the two financial counselling sessions held by the Licensed Bankruptcy Trustee. Of course, you’ve got to pay the Licensed Bankruptcy Trustee on time over the entire period of time your proposal is for. Failure to do so could result in the revocation of the proposal, the accrual of interest and fees, and even legal action. It’s important to remember that while a consumer proposal can provide much-needed relief, it’s ultimately up to you to stay current with the payments you promised to make. Consumer debt proposals: What happens should your consumer proposal be declined?If 50% or more of the creditors vote to reject the consumer proposal, then the Licensed Insolvency Trustee must issue a notice and the consumer proposal dies. In this situation, creditors are free again to pursue collection actions against the debtor. If 25% or more of the creditors request a meeting, that meeting is referred to as the Meeting of Creditors. At this meeting, an agreement will try to be reached by a majority of the creditors. If the agreement can not be reached, the debtor may need to amend the proposal and resubmit it or look for other ways to solve their financial issues. If a consumer proposal is declined, it means that the creditors do not agree with the terms of the proposal put forth by the debtor. The main reasons for rejection may be that the debtor is not offering enough money or has proposed an unsuitable repayment schedule. It is important to note that if you fail to fulfill the requirements of your consumer proposal, it will be deemed null and void. However, it does not free you from your existing debt, and the failure to adequately repay your loans or pay off debts within the terms of the agreement could affect your credit score. Collectors for debts are within their right to renew collection calls and seek legal action for retrieving the debts that they owe. They can sue you and if they get a judgment, they can then get a wage garnishment against you. It is never recommended to default on a consumer proposal. Consumer debt proposals: If you fulfill the requirements of your consumer proposalIf you fulfill the requirements of your consumer proposal, you will have successfully completed the agreement between yourself and your creditors. This means that you will have made the agreed-upon payments and met all other terms of the proposal. The balance of your unsecured debts that you did not pay off is also eliminated if you fulfill the requirements of your consumer proposal. One of the benefits of fulfilling a consumer proposal is that you will have lower regular payments monthly, which are based on what you can afford, rather than high monthly payments regardless of your income. Additionally, you will have protection from creditors, as they will not be able to contact you or take money directly from your wages. After fulfilling a consumer proposal, it will come off your credit report maintained by the Canadian credit bureaus three years after the completion. This report will show that the consumer proposal has been successfully completed and you can rebuild your credit rating and credit score simultaneously. You will also receive from the Licensed Insolvency Trustee (LIT) acting as the Administrator in your consumer proposal a “Notice of Successful Completion of Consumer Proposal”. This is a very important document, as you will be able to provide it to current or future credit grantors to prove that you successfully completed your consumer proposal and avoided personal bankruptcy. It is important to note that if you fail to fulfill the requirements of your consumer proposal, it will be deemed null and void. However, it does not free you from your existing debt, and the failure to adequately repay your personal loans, lines of credit or pay off debts within the terms of the agreement could negatively affect your credit score. Creditors are within their right to use collection activity and use legal action for retrieving the debts that you owe. It is never recommended to default on a consumer proposal. Advice for Consumers: Considerations for Debt Relief and Credit Repair ServicesImproving your credit score or credit rating will take time, and requires showing creditors that your habits have improved and that you are paying back your debt on time. Be cautious when seeking help to pay off debt or repair your credit, as some companies may offer misleading solutions. I have been warning about the dangers of such “for-profit” debt settlement companies for years now. One option for getting help with debt is a debt management plan, which is an informal proposal made by a non-profit community credit counselling agency credit counsellor to your creditors on your behalf. This plan consolidates your debts into one affordable monthly payment and in some cases, you may not have to continue to pay interest on your debt. However, consumers should be aware that the “for-profit” debt settlement companies may charge high fees, including upfront or advance fees, and may not be able to get creditors to reduce your debt. Additionally, it is important to note that even while using a debt management plan, you are still required to keep making payments on any other debts you owe, which may result in no change to your credit score. Overall, it is important to be cautious when seeking help to pay off debt or repair your credit and to thoroughly research any company or solution before proceeding. It is also important to consider the potential consequences, fees and overall effectiveness of the solution. A LIT during an initial no-cost consultation will provide many of the services that a “for-profit” debt management company charges for. Consumer debt proposals: Organizations or firms cannot guarantee the resolution of your financial obligationsBe aware of companies or agencies that claim they can quickly resolve your debt problems by negotiating a deal with the companies you owe money to and letting you only pay back a fraction of your debt. These promises may not be reliable, so it’s best to be wary. It’s important to remember that if certain creditors don’t agree to your payment plan, you may need to work out a different agreement with them directly. Alternatively, you can consult a LIT about doing a consumer proposal. It’s also worth keeping in mind that anyone can call themselves a debt consultant, but that doesn’t mean they have the proper training or they’ll be able to help you with your finances. Consumer debt proposals: No company or agency can give you a fast and easy boost to your credit ratingNo Canadian debt consultant, company, or agency can promise a fast solution to your credit score. Improving your credit rating takes time and commitment; you have to show a history of paying your debts punctually. If you’re looking to boost your credit score, one option to consider is a non-profit credit counselling agency. A credit counsellor can offer a variety of services like one-on-one advice, group sessions, and tips on how to better manage your debt. Just keep in mind that simply talking to a credit counsellor won’t do the trick. If you’re looking to give your credit score a boost, try paying off some of what you owe. Bringing down your debt-to-credit ratio to under 75% of your credit limit will help. You could also ask your credit card companies or financial institution lenders to raise your credit limit and perhaps even amend your terms of repayment (though the latter will be very difficult) – that’ll help increase your credit score. Ideally, try to use less than a third of your available credit and keep it low, ideally below 30%. Remember, there’s no shortcut when it comes to improving your credit score. Anyone promising you the fast and easy way is not looking out for your best interests. It takes determination and effort to get your credit back on track. Do your research and make sure you understand any associated fees or consequences before you commit. Consumer debt proposals: Paying off a consumer proposal earlySure, you can settle your consumer proposal early, but that might not be the best choice for everyone. If you’ve got the funds, paying off your consumer proposal earlier could help kickstart your credit repair – but don’t expect it to save you money or guarantee a good credit rating. So think carefully before you commit to paying it off early. In the following section, I describe a very troublesome issue which has now attracted the attention of the Office of the Superintendent of Bankruptcy Canada (OSB). Paying off your consumer proposal early will do wonders for your mental health – and it’s perfectly acceptable! It’s no secret that financial hardship is incredibly stressful, and five years seems like a lifetime. So treating yourself to an early payoff will help you feel a huge weight being lifted off your shoulders. If you want to shorten how long your consumer proposal lasts, you can change how often you make your proposal payments. Usually, they’re monthly, but if you switch to making extra payments by paying bi-weekly, you can pay off your proposal faster. Once you’re done paying off your consumer proposal, the unsecured debts you’ve been worrying about will be marked as taken care of on your credit report. Consumer debt proposals: LITs cannot talk you into getting a loan with a high-interest rate to pay off your consumer proposal earlyOn January 11, 2023, the OSB issued its position paper titled “LITs Promoting and Facilitating Loans to Debtors“. The problem is that some lenders are offering high-interest loans to people who are about to or are going through a consumer proposal. It looks like they’re giving loans to help people pay off their consumer proposals early, but it’s really just taking advantage of people’s tough financial situations. The OSB has noticed that some LITs are promoting and encouraging people to take out loans without mentioning the potential drawbacks. They do this by talking up the positives and downplaying the negatives, and they may even pressure people into taking out a loan. The OSB has come to the conclusion that it’s not in line with the Code of Ethics for Trustees or a LIT’s duties under the Bankruptcy and Insolvency Act and General Rules for LITs to promote or facilitate such loans. Furthermore, such actions are not allowed. There is also evidence that LITs who receive engagements directly from “for-profit” debt consultants, may be entering into inappropriate arrangements with them. No trustees should ever accept a commission, payment, or any other type of reward from a third party for recommending work concerning a professional engagement, nor should they give out any commission, compensation, or another type of benefit to a third party for obtaining a professional engagement. For the record, my Firm does not have any arrangements with any party regarding the referral of files and we neither accept nor pay a referral fee Paying off your consumer proposal early isn’t really an issue. In fact, it can be great if you can afford it thanks to a financial windfall or change in circumstances. Everybody benefits in that scenario. But if you don’t have the means to pay off your consumer proposal quickly, don’t worry. Don’t take out an interest-bearing loan to pay off a consumer proposal. The consumer proposal itself should be considered an interest-free loan. Look, if a debtor is trying to rebuild their credit with a loan after insolvency, there’s nothing wrong with that. They’re making the choice themselves, so it’s all good. In this case, LITs should explain the pros and cons of these loan products to the debtor. And, it’s important that they don’t push any company or product in particular. The OSB believes that LITs should not be promoting or facilitating loans since it contravenes the Bankruptcy and Insolvency Act and its Rules. This practice has a negative impact on the LIT profession and the insolvency system. The OSB will be keeping an eye on this issue and taking appropriate action. You Have Outstanding Financial Obligations — Consumer Debt ProposalsI hope you enjoyed our consumer debt proposals Brandon’s Blog. There are many financial blogs. Ours focuses mainly on issues of importance to those individuals and businesses with financial challenges or worse, financial hardship, caused by debt problems. Income and cash flow shortages are critical issues facing Canadians, be they employees, entrepreneurs or companies and businesses with debt problems. Are you now worried about just how you or your business are going to survive? Those concerns are obviously on your mind. Coming out of the pandemic, we are now worried about its economic effects of inflation and a potential recession. The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious. It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now. We have helped many entrepreneurs and their insolvent companies who thought that consulting with a trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring. We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you. We understand that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel. Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now.
Original article: CONSUMER DEBT PROPOSALS: UNLEASH THE MANY PROFOUND BENEFITS OF ELIMINATING DEBT ©2023 Ira SmithTrustee & Receiver Inc. - Brandon's Blog. All Rights Reserved. Via https://www.irasmithinc.com/blog/consumer-debt-proposals/ <h2> Canadians want to pay off debt in 2023: CIBC survey overviewThe latest Canadian Imperial Bank of Commerce (CIBC) analysis shows that Canadians aim to pay off debt in 2023. This is good news, as being in debt can lead to banking aches and pains for individuals and families and places everybody in a difficult financial situation. The COVID-19 pandemic has resulted in big changes and has motivated Canadians to place more importance on debt repayment. To ensure debt reduction and lowered stress levels in 2023, individuals should actualize a plan to pay off debt through a smart planning process. Canadians want to pay off debt in 2023: CIBC survey specificsAccording to the CIBC Financial Priorities poll, Canadians articulate debt reduction as their primary banking goal for the year followed carefully by staying current with bills and growing investments. The study results, with its integrated margin of error, disclosed that the majority of participants (73%) expressed issues over the prospective threat of the present financial atmosphere of a possible economic recession. Nonetheless, a majority likewise felt safe in their financial situation, with 62% asserting to be prepared for the unanticipated and 59% thinking their financial stability would certainly remain intact despite an economic downturn. 25% of those questioned identified saving cash as another objective. This was followed by avoiding brand-new debt, saving for a getaway, and also cutting optional spending. The key source of newly added debt was cited as the higher cost of living, which was followed by unforeseen expenditures. Recently, Canadian workers have had more anxiety about their job security, with six in ten, saying that this ambiguity makes it problematic to plan for the future. This is additionally complicated by the uncertainty of a recession. With this overhanging job insecurity, 60% of respondents point to this ambiguity as adverse to their ability to plan. Canadians need to amend their financial goals, lower their expenses, and if able, contribute to an emergency fund for emergencies. Canadians want to pay off debt in 2023: Are recessionary fears justified?It is difficult to forecast the potential of an economic recession in Canada in 2023, owing to the fact that economic conditions can fluctuate quickly and are subject to a multitude of influences. An economic recession is usually defined by a sharp decrease in economic performance, such as a decline. Economic recessions are typically characterized by a substantial drop in economic activity, such as a cutback in Gross Domestic Product (GDP) or an upswing in unemployment. While it is imperative that individuals and companies are prepared for potential economic downturns, it is not feasible to predict them with any certainty. The performance of key industries within Canada is a key factor to consider, particularly with regard to the oil and gas sector. A decrease in these industries could have a marked effect on the nation’s economy. The elevated levels of domestic debt coupled with the deceleration in the housing market is another cause for alarm. Another essential element to bear in mind is the current condition of the international market. A contraction in primary trading countries, such as the USA, could considerably influence Canada’s export-oriented economy. Furthermore, lingering doubts about trade conflicts and the COVID-19 outbreak remain. It is paramount for individuals and businesses to remain apprised of economic conditions and to be ready for any eventuality. Strategies for doing this may include diversifying investments, preserving an emergency fund, and keeping abreast of economic news and developments. Canadians want to pay off debt in 2023: A Step-by-Step PlanThe financial burden of debt is no mystery to Canadians, according to the CIBC survey. Not only do debt repayment concerns take the lead – with an average of $1.78 owed for every dollar of disposable income – but saving for the future is also a priority for many (29%). It is clear that Canadians are feeling the strain of debt, and are at least seriously talking about making a plan for the future. The survey revealed that Canadians aged 18-34 are more likely to prioritize establishing financial security and accumulating wealth, whereas that aged 55+ focus more on debt reduction. This can be attributed to younger Canadians being at the start of their working lives while older Canadians can see retirement coming up. Canadians of all ages are feeling the pressure of debt. If you are seeking to address your debt issues in the coming year, here are a few strategies to assist you in beginning your journey toward financial health: Make a budget: To effectively manage your debt, you must have a complete understanding of your financial obligations. Prepare a comprehensive list of all debts, including credit cards, student loans, and mortgage payments. Subsequently, formulate a budget that incorporates your income and expenditure to identify areas of potential savings and available funds to pay off debt. Consider consolidating your debts: If you owe multiple creditors with high-interest rates, consolidating these debts into a single loan with a lower rate of interest could help you save money on interest payments and make repaying your debts simpler. This may be possible through a balance transfer credit card, personal loan, or a home equity loan. Pay more than the minimum: When considering credit card debt, it is advantageous to make payments greater than the minimum requirement on a monthly basis. This action will minimize the amount of interest payable and expedite your ability to pay off debt. Look into balance transfer credit cards: If you are burdened with a credit card debt with a high APR, you can save money by transferring the balance to a credit card with an introductory zero or a lower interest rate. It is essential to ensure you pay off the balance before the introductory rate period expires. Create a plan: Formulating a debt repayment plan can help maintain motivation levels and keep one on the path to success. This can involve establishing monetary objectives and assessing progress toward their fruition. Be patient: Eliminating debt can be a protracted and arduous journey, yet remaining patient and devoted to one’s objective is of immense importance. Although it may take some time, the rewards of being debt-free will prove to be a satisfactory conclusion. Seek professional help: If you are struggling to make payments on your existing debts and do not know where to turn, you may wish to consider obtaining the services of a licensed insolvency trustee financial professional. This professional is able to assist you in formulating a financial plan to restructure your debt, eventually leading to its elimination, and restoring financial stability to your life. Ultimately, the CIBC survey revealed that most Canadians are aiming to pay off their debt in 2023. This is likely attributable to the economic effects of the COVID-19 pandemic and low-interest rates. To successfully achieve this goal, Canadians can devise a budget, pay more than the minimum, and contemplate debt consolidation. If you are not able to pay off debt on your own to a satisfactory low amount, seek a no-cost consultation with a licensed insolvency trustee. Do you need help to pay off debt in 2023?Debt repayment can be difficult, but it is achievable with strategic planning and commitment. If debt reduction is a priority for 2023, it is prudent to access the appropriate resources and assistance necessary to make it a reality. I hope you enjoyed my Canadians want to pay off debt in 2023 Income and cash flow shortages are critical issues facing Canadians, be they employees, entrepreneurs or companies and businesses. Are you now worried about just how you or your business are going to survive? Those concerns are obviously on your mind. Coming out of the pandemic, we are now worried about its economic effects of inflation and a potential recession. The Ira Smith Team understands these concerns. More significantly, we know the requirements of the business owner or the individual that has way too much financial debt. You are trying to manage these difficult financial problems and you are understandably anxious. It is not your fault you can’t fix this problem on your own. The pandemic has thrown everyone a curveball. We have not been trained to deal with this. You have only been taught the old ways. The old ways do not work anymore. The Ira Smith Team makes use of new contemporary ways to get you out of your debt problems while avoiding bankruptcy. We can get you debt relief now. We have helped many entrepreneurs and their insolvent companies who thought that consulting with a trustee and receiver meant their company would go bankrupt. On the contrary. We helped turn their companies around through financial restructuring. We look at your whole circumstance and design a strategy that is as distinct as you are. We take the load off of your shoulders as part of the debt settlement strategy we will draft just for you. We understand that people facing money problems require a lifeline. That is why we can establish a restructuring procedure for you and end the discomfort you feel. Call us now for a no-cost consultation. We will listen to the unique issues facing you and provide you with practical and actionable ideas you can implement right away to end the pain points in your life, Starting Over, Starting Now. Original article: POLL SAYS CANADIANS WANT TO PAY OFF DEBT IN 2023: A STEP-BY-STEP PLAN ©2023 Ira SmithTrustee & Receiver Inc. - Brandon's Blog. All Rights Reserved. Via https://www.irasmithinc.com/blog/to-pay-off-debt-2/
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ABOUT USIra Smith Trustee & Receiver Inc. is a full service insolvency and financial restructuring practice serving companies and individuals throughout the Greater Toronto Area (GTA) facing financial crisis or bankruptcy that need a plan for Starting Over, Starting Now. We approach every file with the attitude that corporate or personal financial problems can be solved given immediate action and the right plan. ArchivesNo Archives Categories |