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Happy Debt-Free Holiday – Part 1: Help clients get ahead of the holidays


As the holiday season nears, it’s a good time for your clients to take stock of their finances before an expected spike in spending begins. It’s important to encourage clients to be extra diligent to avoid overspending, as more Canadians have relied on credit this year to make it through job losses, unsteady income and other unexpected costs due to the COVID-19 pandemic.


In a new report from debt consultancy MNP, younger Canadians reported that it’s become more difficult to keep up with debt payments during the pandemic, and they’ve accumulated additional liabilities. Take some time over the next few months to remind clients of their financial goals and offer guidance on how to plan and manage their  holiday spending.


Here are a few additional tips that can serve as an important guide, especially after a particularly financially challenging year for everyone.



Prepare early

Remind clients to create a plan of action for holiday spending early. Putting their gift list together well in advance will make it easier to keep an eye out for sales and promotions, and allow more time to compare prices between retailers and do research online. In addition, planning early allows more time to really put thought into gift purchases, instead of leaving things last minute and having limited choice. Preparing ahead of time also gives clients an opportunity to suggest alternative ways to celebrate with family and friends. For example, gift exchanges, a pot luck dinner, homemade gifts or not exchanging gifts at all.


Reach for paper, not plastic

Advise clients to avoid using credit cards wherever possible. Over the pandemic, credit card debt could easily have accumulated, and it’s especially hard to keep track of actual spending and limits during the holiday season. Creating a budget of available funds and setting aside the cash provides a more tangible limit to spending and prevents careless and excessive spending. More importantly, it can save your clients from surprise bills in the new year. Overspending today leads to swelling balances and high interest payments tomorrow.



Clean the slate

Where possible, clients should pay off as much debt as possible before the holiday season. As expenses and spending tend to rack up over the final few months of the year, it’s a good idea to understand how much credit card debt has already accumulated and create a plan to tackle it. While it’s good practice to always pay off at least the minimum payment on credit cards, it’s imperative to do so before the additional spending attached to the holidays to avoid climbing interest.


While these tips are fairly simple, it’s easier said than done. Private lenders like CMI can offer clients who are worried about upcoming expenses with a private mortgage to clear up any existing high-interest debt – and avoid sinking deeper into credit card debt. Your clients can use the equity in their homes to pay off existing credit card debt, as suggested above, to reduce their interest costs and monthly payments. This will also help to improve their credit rating. In addition, remind clients that the only way to keep finances in order after the holiday season is to go into it with a plan and always keep those financial goals top of mind. These tips will not only help your clients get through the season unscathed, but also get their financial house in order for a strong start to the new year.


Next Steps

Whether you are a new broker or a seasoned veteran, it’s always a good idea to take stock of your business and look for ways to improve, continue to drive success, and best serve your clients.

Submit your deals for review in under two minutes. We can get you approved within the hour, and financed fast. Contact your Brokerage Relationship Manager today or fill out the form below to get started.


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