You can consult our guide for seniors, Your Finances Safely, which gives you information on how to better manage your finances and protect yourself from financial abuse.
In Quebec, the number of people aged 55 and over facing financial difficulties has been growing steadily over the past five years. Many of them are already heavily in debt before they retire. The decline in their income compounds their financial problems. For others, retirement is synonymous with debt. The decrease in their income and the increase in the cost of living push them into debt.
You are still responsible for paying off your debts, regardless of your financial situation, your level of autonomy or your living arrangements.
Do you feel like you are drowning in debt? The following questions will help you diagnose the state of your personal finances.
- Are you having trouble paying your bills on time?
- Are you using credit to meet your basic needs (food, medicine, etc.)?
- Do you pay only the minimum amount on your credit cards?
- Do you use multiple credit cards at the same time?
- Are you behind on your rent or mortgage payments?
- Have you received a notice of interruption or are you experiencing an interruption of utilities such as electricity or telephone?
- Are you receiving calls from creditors or a collection agency?
If you answered “yes” to one or more of these questions, you are probably over-indebted. Don’t hesitate to contact the cooperative home economics association in your area. It can offer you a budget consultation.
If you live in the Option consommateurs territory, please contact us now.
Are there ways to avoid overindebtedness? Of course there are! You will have to draw up a new budget, if you haven’t already done so. It will have to take into account your income, which may be lower in retirement, the expenses that will increase (for example, leisure activities) and those that may decrease (for example, work-related transportation). You’ll need to adopt a lifestyle that fits your new situation. Barring exceptional circumstances, you should be able to live a healthy financial life.
This budgeting chart (in french) can help you get a handle on your income and expenses.
As such, credit is neither good nor bad. However, if you can’t pay off your credit card balance or can’t always make the monthly payments on your personal loan, credit may seem threatening. Here are some tips to help you avoid getting into debt:
- Before you apply for a loan, prepare a budget to find out your true ability to repay. Don’t just rely on the lending institution’s assessment. They may offer you more money than you need.
- When you get a new loan, read the contract carefully before you sign it and make sure you understand everything.
- Be sure to get all the relevant information: the interest rate of the loan, the number of payments to be made before the debt is paid off, the frequency of those payments and any fees other than interest (such as currency changes). Most importantly, be aware of the consequences of missing one or more payments. In some cases, non-payment may require you to pay the entire loan immediately.
- If you don’t understand all the terms of the loan, ask for an explanation. This is your right.
- Try to pay off your credit cards as much as possible each month.
- Avoid making only the minimum payment.
- If you always carry a balance on your credit card, consider a low-rate card. With an annual payment for the service, you can save on interest charges.
- The faster you pay it off, the more you’ll save in interest. With the exception of mortgages, you can usually pay off a loan faster than expected without penalty.
Some credit cards or store cards allow you to earn reward points like airline miles. They can save you money on certain goods, but only if you use them! Few consumers actually redeem their reward points for goods or travel discounts. In addition, there is a risk that in order to accumulate points, you may make impulse purchases that you would not normally make.
The saying “nothing is free” is also true here. In reality, the gifts and discounts offered by points programs are paid for with personal information. In fact, even though the data collected is not linked to your contact information, your purchase behaviours with your points card can be recorded and sold to marketing firms who will use it as a market analysis…
Heating alone accounts for 50% of a household’s energy consumption. Every time you turn down the thermostat by one degree, you save 2% on your energy bill. The recommended temperature is 21°C during the day and 18°C at night. In cold weather, consider putting on a sweater instead of turning up the thermostat.
To maintain a constant temperature and save money, you can replace your old thermostats with electronic ones. Hydro-Quebec offers several tools on its website to improve the energy efficiency of your home.
Is your fridge more than 10 years old and in need of replacement? You can use the Freez ponsible program.
Telecommunications (phone, Internet, cable, etc.) can cost you a lot of money every month. If you’ve been with the same service provider for a long time, you may want to check out what competitors can offer you. This could result in a significant reduction in your telecommunications package.
If you have voice mail, consider buying an answering machine. You could save a hundred dollars a year. Of course, you’ll have to pay for the machine, but since it will last for several years, the expense will pay for itself.
With Bell and Videotron, people 65 years and older can use directory assistance (411) free of charge. Bell and Videotron offer this discount for home phones and cell phones. To register for this service, call Bell Canada at 1-866-301-1942 or Videotron at 1-888-433-6876.
At age 65, you are automatically enrolled in the public drug insurance plan of the Régie de l’assurance maladie du Québec. You do not need to register. If, however, you continue to be eligible for a private insurance plan, you will have the following options
- be covered only by the public plan ;
- be covered under both the public plan and a private plan that provides supplemental coverage;
- be covered only by a private plan.
If you are enrolled in the public plan, you will be required to pay a premium. The premium payment is collected each year by Revenu Québec when you file your income tax return. Each month, when you make your first drug purchase, you will also have to pay the monthly deductible of $16.25 and 32% of the cost of the prescription from which the deductible amount is subtracted (2012 data).
Be aware that there is a maximum monthly and annual contribution. This limit varies depending on your situation. If you receive the Guaranteed Income Supplement (GIS), you may be eligible for certain exemptions. To verify your eligibility or obtain more information, contact the Régie de l’assurance maladie du Québec at 1 800 561-9749.
When you file your annual income tax return, you may also have to pay a health contribution. This contribution (not to be confused with the annual premium for the Prescription Drug Insurance Plan) is intended to finance the public health care system. It depends on your income. Some people (those whose income was less than $18,000 for the 2013 tax year) are exempt from paying this contribution. For more information, visit the Revenu Québec website or call 1-800-267-6299.
If you are having trouble paying for your prescription drugs, Sun Youth may be able to help you, after an assessment of your financial situation. This service is for low-income people covered by the public drug insurance plan. This assistance is offered once a year. To verify your eligibility and apply for assistance, call 514 842-6822.
You can also save money by asking your pharmacist to replace your medication with a generic drug if possible. Generic drugs are just as effective as brand name drugs, but their price is much lower.
Need to buy acetaminophen? Compare the prices of different brands and sizes. House brands are often more affordable than the most popular brands.
Some pharmacies, such as Familiprix, Brunet and Jean Coutu, offer seniors privilege cards that give them 10% off their purchases. There are exceptions. Ask your pharmacist to find out if you are eligible.
If you are 65 years of age or older, you are entitled to a free comprehensive eye examination each year. Simply present your health insurance card to your optometrist.
You can also visit the University Vision Clinic at the Université de Montréal. In addition to offering personalized optometry services, it sometimes offers glasses and contacts at below-market prices. Ask about it or make an appointment by phone at 514 343-6082. That said, consider asking for an estimate and comparing offers from several retailers.
The FADOQ Network and its partner Greiche & Scaff could help you save money on your prescription glasses. For more information, you can contact the FADOQ Network at 1 800 828-3344.
Dental care is often expensive. It is important to get information and compare the prices charged by different dental clinics. This can save you a lot of money. If you prefer, you can hire students. Dental schools, including the University of Montreal, offer low-cost treatments to the general public. To make an appointment at the University of Montreal Dental Clinic, call 514-343-6750 and have your health insurance number ready.
For dental hygiene care, dental students also offer their services at low cost. CEGEPs that offer this training, such as Collège de Maisonneuve in Montreal and Collège Édouard-Montpetit in Longueuil, offer the following services: examination with X-rays, scaling and polishing, fluoride application, etc. You can reach the Collège de Maisonneuve at 514 254-7131 and the Collège Édouard-Montpetit at 450 679-2631, extension 2523.
Do you find that food is getting more and more expensive? It’s true! Over the past 10 years, the cost of the grocery basket has increased by 30%.
Before you go shopping, plan your menu for the week using the discounts offered in the advertising booklets. Then take the time to compare prices at different supermarkets. At the store, compare prices for different sizes and brands. It may be more advantageous to buy the house brands; they are often from the manufacturers of the big brands and are less expensive than the big brands.
On certain days of the week, many supermarkets offer free delivery to seniors. Ask about it!
Also, Monday through Wednesday, people 60 and over get 10% off at Tau Natural Food Markets.
There may also be community organizations in your neighbourhood that offer Meals on Wheels. For more information or to find out about these organizations, contact the Seniors’ Reference Line at 514 527-0007. This is an information line on services available to Montreal seniors that was set up by the Table de concertation des aînés de l’île de Montréal.
Are you concerned about gas prices? The following tips from CAA-Quebec can help you limit your gas consumption:
– Keep your vehicle in good condition;
– Keep your tire pressure at the level recommended by your vehicle’s manufacturer;
– Equip your vehicle with a block heater;
– Use the air conditioner only when necessary;
– Drive at 100 km/h on the highway.
The Société de transport de Montréal offers a discount for people 65 years of age and older. You could save up to 50% on the price of a transit ticket. Contact the Société de transport de Montréal at 514 786-4636 for more information. A discount is offered to riders 65 and over in many other Quebec public transit systems such as Longueuil, Laval, Quebec City and Sherbrooke.
In some neighbourhoods, a shuttle service is available to seniors’ homes. Sometimes, volunteers drive seniors to the hospital, to the grocery store, etc. For more information or to find out which organizations offer this service in your neighbourhood, contact the Ligne Référence-Aînés 514 527-0007.
You can claim an amount for the cost of certain public transit fares in Canada. Remember to keep your receipts and claim the tax credit when filing your federal income tax return.
Special rates are often offered to seniors at theatres and museums. To take advantage of the discounts, you must have an ID card that proves your age.
For $30 for one year or $50 for two years, you can become a member of the FADOQ Network. Being a member will entitle you to various discounts for your leisure activities. Contact the Réseau FADOQ at 1 800 828-3344 or at www.fadoq.ca to register.
Do you like music and reading? You should know that some retailers offer discounts to seniors. On Mondays, Archambault Record Store offers a 10% discount to people 60 years and older. On Wednesdays, the Renaud-Bray bookstore offers a 10% discount to people 65 years and older.
If you are over 60, the YMCA offers a discount of approximately 15% when you subscribe to their sports center for one year. Call 514 849-5331 for more information.
Are you one of those people who remain loyal to their broker or insurer for years, believing that their loyalty will be rewarded? Think again! To get the best home and auto insurance policy at the best price, you have to store around every year. The insurance market is very competitive. The cost of the same home and auto insurance policy can vary by as much as three times. To save money, you could also combine your home and auto insurance or install an alarm system in your home and car.
The FADOQ Network (formerly Fédération de l’âge d’or du Québec), with its partner Intact, offers certain discounts to its members. The Association québécoise des droits des personnes retraitées et préretraitées, with La Capitale, offers a similar service. For more information, contact the FADOQ Network at 1-800-828-3344 or the AQDR at 514-935-1551.
If you have any questions about your insurance contract, you can either ask your insurer for advice or consult this Web site.
Are you paying for assistance services? People aged 70 and over who live in their own home are entitled to a tax credit for the services they receive at home. Apply for the credit when you file your annual return with Revenu Québec. You will then receive a reimbursement of eligible expenses incurred in the last year.
You may even be eligible if you live in a serviced community housing or private residence. When you sign the lease in a private residence, a schedule is filled out to this effect. You may receive this refund annually with your tax return, or in monthly installments.
For more information on tax credits, contact Revenu Québec at 1 800 267-6299.
Many financial institutions offer low-cost or even no-fee accounts to people 59 years of age and older. So why not take advantage of it? To find out more, contact your financial institution. You can also contact the Financial Consumer Agency of Canada at 1-866-461-3222 or visit their website. Depending on your profile, you will find a tool that will help you choose a banking package.
CAUTION: A no-fee account will not save you the amount you pay when you use an ATM at another financial institution.
Fraud and abuse
Financial abuse is the illegal or unauthorized use of another person’s financial resources or property.
For example, if someone cashes your pension check and keeps all or part of the money without your permission, or misuses a power of attorney to withdraw money from your bank account, this is not only financial abuse, but also theft.
It can be difficult to detect. It is often a matter of small actions repeated over long periods of time rather than an isolated event. People who are alone or in poor health are usually the most vulnerable.
How can you protect yourself?
- Keep your financial and personal information safe.
- Never give out your bank card and credit card personal identification number (PIN).
- Reduce withdrawal limits on your bank accounts.
- Keep track of how much money you give or lend.
- If you lend a large amount of money, write a witnessed IOU.
- For important decisions about your home or other property, contact legal counsel yourself so that you are better informed before signing any documents.
- Designate, through a mandate in case of incapacity, a reliable person to make decisions on your behalf if you become incapable of managing your affairs.
- Above all, be on your guard if someone close to you asks you for money or offers to manage all your finances for your benefit.
The Elder Mistreatment Help Line is a listening, support and information service that aims to break the silence of elder abuse. You can call every day of the week between 8 a.m. and 8 p.m. at 1-888-489-2287.
The Crime Victims Assistance Centre (CAVAC) is a service for victims of physical violence, threats, fraud, theft or any other type of crime.
Credit card fraud can also occur when you make purchases over the Internet.
To better protect yourself from this, you may want to take computer security training. Ask at your local library or community center.
Also be careful about joint credit applications. For example, if you agree to have a credit card with someone else, you will be responsible for all spending on that account and the monthly payments on it. So, if the person you share the credit card with doesn’t make the monthly payments, you will be responsible for the charges.
Change your mind about having a joint credit card? You must notify your co-borrower in writing as well as your credit card issuer.
A financial advisor offers you to invest your savings in a financial product that will allow you to earn a lot of money quickly? Beware!
Financial fraudsters use a technique called the Ponzi scheme, which consists of taking money from one investor to pay false returns to others.
When they run out of investors to bring in new money, the deception is exposed. The investors then realize that the fund is empty.
How can you protect yourself?
Here are some tips to avoid these scams:
- Make sure the person offering the investment is registered with the Autorité des marchés financiers. Consult their online registry.
- Ask questions about the financial product and seek advice from another professional.
- Never give the person offering the investment cash or a cheque made out to them.
- Be extra careful if you are asked to keep an investment secret.
- Never buy under pressure.
If you believe you are a victim of fraud by a financial advisor or have any questions about financial products, contact the Autorité des marchés financiers at 1-877-525-0337.
So called by the Canadian Anti-Fraud Centre, this scheme is having a huge impact on seniors.
A grandparent receives a call from a scammer claiming to be one of his grandchildren. The grandparent says that he or she needs money immediately because he or she is in trouble (car accident, jail, hospitalization, etc.). The victim does not check if what the scammer says is true before sending the money, because the scammer is careful to ask the victim not to talk about it with other family members.
How to protect yourself?
Knowing that this type of fraud is very common, and that scammers do not lack imagination to bribe you, always make sure of the identity of the person who calls you to ask for money.
If you are a victim of this type of scam, call the police. Then report the fraud by contacting the Canadian Anti-Fraud Centre.