Articles & Insights – Spergel

Bankruptcy exemptions by province in 2026

Chris Galea — Tue, 06 Oct 2026 13:18:43 +0000

What you can keep depends on your province, the value of your property, and any loans secured against it. This guide explains bankruptcy exemptions by province in 2026, including the updated Ontario limits and the conditions that apply to homes, vehicles, household belongings, and registered savings.

All dollar amounts are in Canadian dollars. The provincial sections cover Canada’s ten provinces. The territories have separate rules.

What are bankruptcy exemptions?

Bankruptcy exemptions are legal protections that allow you to keep certain property when you file for personal bankruptcy. Canada’s federal Bankruptcy and Insolvency Act recognizes applicable provincial exemptions and also protects certain registered savings.

Depending on where you live, exempt assets may include:

Necessary clothing and household belongings.
Medical and dental aids.
Tools and equipment you need to earn income.
A vehicle, subject to a limit or a needs-based test.
Your interest in your principal residence, where an exemption applies.
Certain registered savings, pension entitlements, and insurance policies.

Property that is not protected may be used to repay creditors through your bankruptcy estate. A Licensed Insolvency Trustee will assess your assets and explain what each exemption means for you before you decide whether to file.

How are the value of your assets and your equity assessed?

An exemption limit is not necessarily based on what you originally paid for an item. Your Trustee will consider its current realizable value, your ownership interest, and any secured claims.

For a home or financed vehicle, equity broadly means the value remaining after the relevant mortgage or secured loan is taken into account. Your ownership share and applicable costs can also affect the assessment.

For example, a car worth $10,000 with a $6,000 loan has approximately $4,000 in equity before any other adjustments. Whether you can keep it depends on the exemption that applies and the lender’s rights.

Exemptions do not automatically remove a lender’s security over a home or car. Keeping a financed asset generally means continuing the required mortgage, loan, or lease payments.

Personal bankruptcy exemptions by province in 2026

The following sections summarize the main property exemptions. Some rules depend on necessity, occupation, ownership, or the type of creditor claim, rather than a single dollar limit.

Limits change when legislation or regulations are amended. They are not automatically updated every year in every province.

Alberta bankruptcy exemptions

Principal residence: up to $40,000 in equity. The exemption is reduced proportionately when the residence is co-owned.
Necessary clothing: up to $4,000.
Household furnishings and appliances: up to $4,000.
One vehicle: up to $5,000.
Tools and other personal property needed to earn income: up to $10,000.
Food: enough for you and your dependents for the next 12 months.
Required medical and dental aids: protected.
Farm property: special protection can apply to up to 160 acres containing the principal residence, and qualifying property needed for farming operations.
Registered plans: Alberta provides additional protections for certain plans, including RESPs. Payments out of a plan can be treated differently.

British Columbia bankruptcy exemptions

Principal residence: up to $12,000 in equity in the Metro Vancouver Regional District or Capital Regional District; $9,000 elsewhere in British Columbia.
Necessary clothing and required medical or dental aids: protected.
Household furnishings and appliances: up to $4,000.
One vehicle: up to $5,000, or $2,000 for a person who is a maintenance debtor under the legislation.
Tools and other personal property used to earn income: up to $10,000.

A maintenance debtor is someone required to pay maintenance under a maintenance order. The lower vehicle limit is not described in the regulation as applying only when payments are overdue.

Manitoba bankruptcy exemptions

Residence: the legislation provides a $2,500 limit for a solely owned home, or $1,500 for the debtor’s interest in a co-owned home, subject to the statutory conditions.
Necessary clothing: protected.
Household furniture, furnishings, and appliances: up to $4,500 for items reasonably necessary for one household.
One vehicle: up to $3,000, where needed for work, business, or transportation to and from work or business.
Tools, professional books, and other work necessities: up to $7,500.
Food and fuel: enough for six months, or the cash equivalent.
Necessary health and mobility aids: protected.
Farm property: separate protections can apply to qualifying land of up to 160 acres, farm buildings, animals, machinery, and seed.

New Brunswick bankruptcy exemptions

New Brunswick’s Enforcement of Money Judgments Act uses a reasonable-needs test for key personal property, rather than setting a universal dollar cap for each category.

Subject to that test, protected property can include:

Household furniture, appliances, and utensils.
Food, clothing, and home heating fuel.
One road vehicle.
Tools and equipment used in your profession or occupation.
Medical and dental aids.
Household pets.

There is no general home-equity exemption in these provisions. Valuable property may also be treated differently if an adequate, lower-value replacement would meet your needs.

Separate rules govern secured collateral. Your Trustee will assess the protections that apply to your circumstances rather than relying on a simple list of fixed allowances.

Newfoundland and Labrador bankruptcy exemptions

Principal residence: up to $10,000 in equity. Co-ownership can reduce the available exemption proportionately.
Necessary clothing: up to $4,000.
Household furnishings and appliances: up to $4,000.
One vehicle: up to $2,000.
Tools or other property necessary to earn income: up to $10,000, including qualifying farming, fishing, or aquaculture property.
Food: enough for you and your dependants for the next 12 months.
Necessary heating, medical and dental aids, and non-business household pets: protected.
Items of sentimental value: up to $500.

Nova Scotia bankruptcy exemptions

Home: no general home-equity exemption under the personal property provisions summarized here.
Clothing, household furnishings, and furniture: protected where reasonably necessary for you and your family. The Judicature Act does not put a fixed dollar cap on these necessary items.
Food, fuel, and medical or health aids: protected where reasonably necessary.
One vehicle: up to $6,500 under the applicable regulation.
Tools and other items used in your main occupation: up to $7,500, including qualifying farm equipment or fishing nets.
Seed and livestock for domestic family use: protected where reasonably necessary.

The protections against enforcement of an unsecured judgment and the separate rules for secured collateral are not identical. Your Trustee will review financed goods and any applicable lender rights.

Ontario bankruptcy exemptions

Ontario increased its prescribed exemption amounts on December 19, 2025. The following limits apply in 2026:

Necessary clothing: protected for you and your dependents.
Household furnishings and appliances: up to $17,091.
Tools and other personal property used to earn income: up to $17,362.
One vehicle: up to $8,578.
Principal residence: exempt under this rule if your equity does not exceed $12,997.
Required medical and dental aids or disability devices: protected.
Qualifying property for a person engaged solely in farming: up to $37,820 under the farming category.

Ontario’s home rule is a threshold. If your equity exceeds $12,997, the residence is not exempt under that rule. You should not assume that the first $12,997 is automatically deducted from higher equity.

Prince Edward Island bankruptcy exemptions

PEI has different protections under its general execution law and its secured-collateral law. These need to be read together when assessing an asset.

Under the Judgment and Execution Act, the main exemptions include:

Necessary clothing: protected.
Vehicle: up to $3,000.
Household furniture, utensils, equipment, food, and fuel: a combined $2,000 limit.
Tools for a trade or business other than farming: up to $2,000.
Farm property: qualifying livestock, machinery, and equipment up to $5,000, plus seed for up to 100 acres under cultivation.
Home: no general home-equity exemption.

The Personal Property Security Act separately provides protections for certain collateral, including household furnishings and appliances up to $5,000, and a qualifying vehicle needed for employment up to $6,500. Conditions and exceptions apply, including for security taken to finance the purchase of the goods themselves.

Your Trustee will identify the exemption that applies to each asset and explain how any secured loan affects it.

Quebec bankruptcy exemptions

Necessary household furniture and belongings: up to $7,000 in market value for items that furnish or decorate the principal residence and are needed by the family.
Necessary clothing, food, fuel, and linens: protected.
Medical or disability-related aids, companion animals, and certain family papers or keepsakes: protected.
Work instruments: necessary instruments for your professional activities may be protected, without a fixed dollar cap in these provisions.
Vehicle: a needs-based exemption may apply where a passenger vehicle is necessary for work, job seeking, basic needs, healthcare, or education. It is not an unlimited exemption for any vehicle; alternative transport or a less expensive vehicle can affect the assessment.
Home: no general fixed home-equity allowance for bankruptcy. The rules restricting seizure of a principal residence for certain individual claims are different from a bankruptcy equity exemption.

Saskatchewan bankruptcy exemptions

Clothing and jewellery: up to $7,500 in total.
Household furnishings, utensils, equipment, and appliances: protected without a fixed dollar cap, subject to rules allowing unusually valuable items to be replaced with adequate alternatives.
One vehicle: up to $10,000. A court may allow additional protection for reasonable health or educational needs.
Tools and other tangible property required to earn income: protected without a fixed dollar cap, subject to the replacement rules for unusually valuable items.
Required medical or dental aids and disability-related devices: protected.
Household pets: up to $2,000 in total.
Residence: a prescribed $50,000 amount applies to a qualifying interest in an active residence. Ownership and continued occupancy affect how the exemption operates.
Farm property: separate farm-specific legislation applies to farmers.

For a jointly owned home, your Trustee needs to assess each person’s ownership interest and entitlement. Joint ownership alone should not be treated as a guarantee that $100,000 is protected.

Are RRSPs, RRIFs, RDSPs, and other savings protected?

Under the federal Bankruptcy and Insolvency Act, property held in an RRSP, RRIF, or RDSP is generally excluded from the assets available to creditors, except for property contributed in the 12 months before bankruptcy. Applicable provincial laws can provide additional protection, so recent contributions need an individual assessment.

An RESP, TFSA, or First Home Savings Account (FHSA) does not automatically receive the same federal protection simply because it is a registered account. Provincial rules and the type of investment or contract may matter. Alberta, for example, has specific protection for property held in an RESP.

Some pension entitlements and insurance policies are also protected under other laws. Withdrawals and payments can be treated differently from funds held inside a protected plan.

Before withdrawing savings to deal with debt, speak to a Trustee about how those funds would be treated in bankruptcy or a consumer proposal.

What happens to assets that are not exempt?

Your Trustee must account for the value of any non-exempt property for the benefit of creditors. Depending on the asset and your circumstances, this may involve selling it or arranging for its value to be paid into the bankruptcy estate so you can retain it.

Examples of property that may need closer assessment include additional vehicles, rental or vacation properties, non-registered investments, valuable collectibles, and business interests.

Having protected belongings does not necessarily mean bankruptcy is free. Administration costs and any surplus income payments are assessed separately from your asset exemptions.

Could a consumer proposal help you keep your assets?

If keeping a home, vehicle, or savings is a priority, a consumer proposal may be worth considering. An accepted proposal generally allows you to retain your assets while making the agreed payments to address eligible unsecured debts.

You must meet the terms of the proposal and continue payments to secured creditors, such as your mortgage or car lender. Your income, assets, and what creditors are likely to accept all affect whether a proposal is workable.

A Spergel Licensed Insolvency Trustee can help you compare a consumer proposal and bankruptcy based on your circumstances.

Bankruptcy exemptions by province in 2026: FAQs

Do you lose all your assets when you file for bankruptcy?

No. Applicable exemptions allow you to keep certain essential property and protected savings. Any property outside those protections must be assessed by your Trustee. What you can retain depends on the asset, its value, and the rules that apply where you live.

Can I keep my home when I file for bankruptcy?

Possibly. Your Trustee will assess your ownership interest, mortgage, and other secured claims, equity, and any provincial residence exemption. Some provinces have no general home-equity allowance. If the home is not fully protected, discuss retaining its value through an arrangement with your Trustee or whether a consumer proposal would be suitable. Read more about bankruptcy and keeping your house.

Can I keep my car if I declare bankruptcy?

Often, it depends on the applicable vehicle exemption, its value and financing, and any requirements about work or other essential needs. You generally need to continue the required loan or lease payments. If the vehicle is not fully protected, your Trustee can explain the available options.

Are RRSPs protected in bankruptcy?

Generally, funds held in an RRSP are protected. Under the federal rule, contributions made in the 12 months before bankruptcy are excluded from that protection, although applicable provincial law may provide more protection. Your Trustee should review the plan and recent transactions before you withdraw or move funds.

Are TFSAs and RESPs exempt from bankruptcy?

They do not have the same automatic federal protection as RRSPs, RRIFs, and RDSPs. Provincial law or the structure of the investment can change the outcome. For example, Alberta provides specific RESP protection. Tell your Trustee about every account, including any savings you hold for your children.

What if I have no non-exempt assets?

You may still be able to file for bankruptcy if you meet the legal requirements. Having no property available for creditors does not remove administration costs or any required income payments. Learn more about filing for bankruptcy with no assets.

Do bankruptcy exemptions change every year?

Not necessarily. Changes depend on provincial legislation and regulations. Ontario’s main prescribed amounts increased in December 2025, while other provinces use different limits or needs-based rules. Confirm the exemptions that apply when you are considering filing.

Find out what you could keep before deciding to file

You do not need to work out every exemption on your own. A Spergel Licensed Insolvency Trustee can review your home, vehicle, savings, and everyday belongings, explain the rules that apply, and help you compare your debt relief options.

Book a free, no-obligation consultation to understand what bankruptcy or a consumer proposal could mean for you.

Filing for bankruptcy with no assets in Canada – what happens?

Spergel — Wed, 23 Sep 2026 18:24:10 +0000

Having no assets does not necessarily mean bankruptcy is free: the cost and any surplus income payments depend on your circumstances.

Not owning a home or car should not stop you from asking for debt help. Bankruptcy can still address eligible debts when there is no property to distribute to creditors. But “no assets” is different from “no money”: your income, household situation, and ability to cover the costs of filing need a separate look.

Can you declare bankruptcy if you have no assets?

Yes. You do not need to own valuable property to file for bankruptcy. The question is whether you meet the legal requirements and whether bankruptcy is the right solution for your circumstances. A Licensed Insolvency Trustee is the only professional authorized to administer a personal bankruptcy in Canada.

Having “no assets” usually means you have no property with value available to creditors after applicable exemptions and secured claims are considered. It does not mean you have to own nothing at all. Everyday belongings may be protected, while the rules for a vehicle, home equity, savings, and other property depend on the asset and where you live. Your trustee will assess your situation and explain the applicable bankruptcy exemptions.

For example, someone who rents, owns ordinary household items, and has credit card and payday loan debt may have no assets available for creditors. They can still discuss bankruptcy with a trustee; their eligibility and costs will depend on the full picture.

What happens when you file for bankruptcy with no assets?

The process is broadly the same whether or not you have assets to sell:

You review your options with a trustee. They look at your debts, income, expenses, and property, including anything you own jointly or have transferred recently.
The trustee files the bankruptcy paperwork. Once you are formally bankrupt, your trustee notifies your creditors. Collection action on debts covered by the bankruptcy is generally stayed, subject to legal exceptions.
You complete your bankruptcy duties. These include disclosing your finances, providing income information and attending two financial counselling sessions. If your income changes during bankruptcy, you need to tell your trustee.
Your trustee checks whether you have surplus income. This can affect how much you pay and when you become eligible for discharge, even if you own no assets.
You receive a discharge if the requirements are met. A discharge releases you from most debts included in the bankruptcy, with important exceptions.

If you have no non-exempt property of value, there may be nothing to sell. You must still disclose all assets and follow the other bankruptcy requirements. The Office of the Superintendent of Bankruptcy explains the steps and duties in detail.

Do you have to pay for bankruptcy if you have no assets?

Usually, there are costs to administer a bankruptcy even when there are no assets to sell. Your trustee will explain the anticipated costs and any payment arrangement before you decide to file. Having no assets does not automatically make the process free, and the amount payable is not the same for everyone.

You may also have to make surplus income payments if your available family income exceeds the applicable standard. These payments are separate from whether you own property. If you cannot afford the proposed payments, tell your trustee plainly so they can assess your options.

If you have spoken to trustees but cannot obtain their services and bankruptcy still appears appropriate, ask about the Office of the Superintendent of Bankruptcy’s Bankruptcy Assistance Program. Do note, however, that it has eligibility conditions and does not promise free bankruptcy.

Does having no income change anything?

Yes, but no income does not automatically rule bankruptcy in or out. If you are unemployed or receiving benefits, a trustee can check whether you have surplus income, whether you can afford the costs of filing, which debts are collectible, and whether filing now would help.

For some people, there may be a reason to wait or consider another approach; for others, immediate protection from collection action may matter. A consumer proposal usually involves an agreed repayment plan, so its affordability also needs to be assessed. Your trustee can compare the options based on your circumstances.

What is surplus income in a bankruptcy with no assets?

Surplus income is based on income, not assets. Your trustee calculates available family income under the Office of the Superintendent of Bankruptcy’s rules, applies permitted adjustments, and compares it with the standard for your family size. The standards are updated annually, so a trustee will use the current figures and explain the calculation for your household.

If the calculation triggers surplus income payments, this can extend a first bankruptcy from nine to 21 months. If you aren’t required to make those payments, a first bankruptcy may be eligible for automatic discharge after nine months, provided you complete your duties and no one opposes the discharge.

A second bankruptcy generally takes longer: 24 months without surplus income payment obligations or 36 months with them. A third or subsequent bankruptcy requires a court discharge. These are general timelines; your trustee can explain what applies to you.

Which debts can bankruptcy clear?

A bankruptcy discharge generally releases you from eligible unsecured debts you owed when you filed, such as credit card debt, payday loans and many CRA tax debts. Certain tax debts can involve additional rules, so ask your trustee to review yours.

Some debts survive discharge. Examples include child or spousal support, certain fines and debts arising from fraud. Government student loans generally are not released unless at least seven years have passed since you ceased to be a student, though a court may shorten that period to five years in qualifying hardship cases.

Secured debts also need separate consideration: bankruptcy does not normally take away a secured creditor’s rights against its collateral. Your trustee can tell you which specific debts would remain and what happens to a joint borrower or co-signer.

Is bankruptcy the right option if you own nothing?

It may be, particularly if eligible debts are unmanageable and collection action is affecting your day-to-day life. It is still worth comparing the total cost, discharge timeline, impact on your credit, and possible alternatives. A consumer proposal may suit someone who can afford a negotiated payment plan; bankruptcy may make more sense in other circumstances.

The next step is a review of your actual finances. Book a free consultation with Spergel to speak with a Licensed Insolvency Trustee about what you owe, what you own, what you earn, and what each option would mean for you.

Frequently asked questions

Can I file for bankruptcy if I have no house or car?

Yes. Owning a house or car is not a requirement for bankruptcy. A trustee will review the assets you do have and whether you meet the requirements to file.

Can I file for bankruptcy if I have no money at all?

Possibly, but the cost of administering a bankruptcy still needs to be addressed. Speak to a Licensed Insolvency Trustee about your income and circumstances. If you cannot obtain trustee services, you can ask the Office of the Superintendent of Bankruptcy whether its Bankruptcy Assistance Program may apply.

Will my creditors get paid if I have no assets?

There may be no proceeds from selling property. Creditors could still receive funds from required payments into the bankruptcy estate. Your discharge from eligible debts is governed by the bankruptcy rules, not by whether creditors recover the full amount owed.

How long does bankruptcy last if I have no assets?

For a first bankruptcy, you may be eligible for automatic discharge after nine months if you have no surplus income payment obligation, complete your duties, and no one opposes the discharge. With a surplus income payment obligation, the usual period is 21 months. Having no assets alone does not determine the timeline.

Frequently Asked Questions (FAQs) About Debt

Spergel — Mon, 21 Sep 2026 19:32:05 +0000

Eligibility and Debt

The rising cost of groceries in Canada: the impact on household finances in 2026

Chris Galea — Tue, 18 Aug 2026 15:06:02 +0000

Food prices are now 27% higher than they were five years ago, while the average family of four is expected to spend up to $17,571.79 on food this year.

For Canadians already balancing housing costs, bills, and debt payments, higher grocery costs can do more than stretch the weekly budget. They can lead to greater reliance on credit, growing balances, and difficult choices between food and other essential expenses.

This article looks at the latest grocery-price figures, how rising food costs affect household finances, and the warning signs that the problem may require more than changes to your shopping habits.

How much are grocery prices increasing in Canada?

Canada’s Food Price Report 2026 forecast that overall food prices would increase by 4% to 6% during 2026. It estimated that a family of four could spend $17,571.79 on food this year – an increase of up to $994.63 from 2025.

The report also found that food prices were already 27% higher than they had been five years earlier.

The latest available Statistics Canada figures show that prices for food purchased from stores increased by 3.9% year over year in June 2026. This was higher than the 2.8% increase in the overall Consumer Price Index.

June also marked the 17th consecutive month in which grocery-price inflation was higher than the overall rate of inflation.

In practical terms, grocery prices are continuing to rise faster than many other everyday expenses—even after the particularly steep food-price increases experienced earlier in the decade.

Key grocery-price figures for 2026

Overall food prices were forecast to rise by 4% to 6% in 2026.
A Canadian family of four could spend up to $17,571.79 on food this year.
That represents an increase of up to $994.63 compared with 2025.
Food prices are 27% higher than they were five years ago.
Grocery prices increased by 3.9% year over year in June 2026.
Grocery inflation exceeded the overall inflation rate for the 17th consecutive month in June.

Sources: Canada’s Food Price Report 2026 and Statistics Canada’s Consumer Price Index, June 2026.

Why are grocery prices still rising?

Several factors influence grocery prices in Canada, including:

Higher transportation and distribution costs
Labour and production costs
Adverse weather and reduced crop yields
Global supply-chain disruption
Currency movements affecting imported products
International trade conditions
Increased costs for packaging, energy, and agricultural inputs

Different factors affect individual food categories in different ways. Weather may increase the price of fresh produce, for example, while feed, processing, and transportation costs may place greater pressure on meat prices.

For a more detailed explanation, read Why are groceries so expensive in Canada?

How are higher grocery costs affecting Canadian households?

Higher grocery prices affect more than the amount households spend at the checkout. When income does not increase at the same rate, families must find the extra money elsewhere in their budget.

That can mean:

Cutting discretionary spending
Reducing or stopping savings
Postponing dental care, healthcare or necessary repairs
Paying only the minimum amount on debts
Using credit to cover ordinary purchases
Delaying bills or debt payments
Buying less food or choosing lower-cost alternatives
Working additional hours or taking on a second job

For households with existing debt, the effect can be particularly difficult. Minimum payments and interest charges may already consume a significant share of monthly income, leaving less available for food, housing, and utilities.

As grocery bills increase, credit can begin to fill the gap.

When do grocery costs become a debt problem?

A higher grocery bill does not automatically mean a household has unmanageable debt. Regularly borrowing to pay for food, however, can indicate that income is no longer sufficient to cover both essential expenses and existing financial obligations.

Warning signs include:

Regularly using a credit card to buy groceries because there is not enough money available
Carrying the balance from grocery purchases into the following month
Making only minimum payments on credit cards
Using an overdraft or line of credit for food and other essentials
Taking out payday loans or cash advances
Delaying another bill to afford groceries
Using one form of credit to repay another
Depleting savings to cover ordinary monthly expenses
Falling behind despite having already reduced spending
Receiving calls or letters from creditors
Feeling unable to see a realistic way of repaying what you owe

If several of these warning signs feel familiar, the problem may not be how you shop. Existing debt may be taking up too much of your income.

Are you still paying for groceries after they have been eaten?

Credit cards can be a convenient way to pay for groceries when the balance is cleared before interest is charged. The situation becomes more concerning when food purchases remain on the balance from one month to the next.

Groceries are consumed quickly, but the debt used to buy them can remain for months. Interest is then added to the cost, meaning a household ultimately pays more for the same food.

If new grocery purchases are added before previous ones have been repaid, the balance can continue growing even when no large or unnecessary purchases have been made.

This is one reason everyday living costs can contribute to serious debt. A household does not have to be spending recklessly to experience financial difficulty. Sometimes regular income simply cannot accommodate necessities, minimum payments and accumulating interest at the same time.

The connection between grocery costs and food insecurity

Food insecurity means being unable to access enough food – or food of adequate quality – because of financial constraints. It can include worrying that food will run out, compromising the quality or variety of food, reducing portion sizes or skipping meals. (Health Canada)

Higher grocery prices can intensify this pressure, particularly when housing, utilities, and debt payments already take up a large share of household income. Some households may also postpone other essential expenses – including dental treatment, vehicle repairs, medication or utility bills – to protect their food budget.

These choices can create further costs later. A delayed repair may become more expensive, while a missed payment may result in interest, penalties or damage to the person’s credit.

How can Canadians manage rising grocery costs?

Meal planning, buying products on sale, comparing unit prices, using loyalty programs, and reducing food waste can all help make a grocery budget go further.

You can find detailed strategies in our guide to saving money on groceries in Canada. You can also use our free Groceries Budget Tracker to monitor your spending over time.

These steps can provide useful savings, but there is a limit to how much any household can cut.

If you have already changed where you shop, switched brands, and reduced unnecessary spending but still need credit to buy food, budgeting alone may not address the underlying problem.

Budgeting cannot solve unmanageable debt

A budget helps you understand where your money goes and make informed decisions about spending. It cannot create enough money to repay debts that have become unaffordable.

Suppose most of your income is already committed to:

Rent or mortgage payments
Utilities
Transportation
Insurance
Childcare
Minimum debt payments
Interest charges

In that situation, even careful grocery shopping may not leave enough room in the budget.

Constantly reducing food spending can also affect nutrition, health, and wellbeing. The aim should not be to cut essential spending indefinitely. It should be to understand whether existing debts can be addressed in a more sustainable way.

What should you do if debt is making groceries harder to afford?

Start by reviewing your income, essential expenses, minimum payments, and total unsecured debt. This can help identify whether you are facing a temporary shortfall or a more persistent debt problem.

You may benefit from professional guidance if:

Debt payments leave too little for food and other essentials
You cannot pay more than the minimum
Your balances continue to grow
You use credit for groceries every month
You have fallen behind on bills
Creditors or collection agencies are contacting you
You do not believe you can repay your debts in full

Speaking to a Licensed Insolvency Trustee does not mean you must file for bankruptcy or make a consumer proposal. It gives you an opportunity to understand your financial position and the options available.

How can Spergel help?

Our Licensed Insolvency Trustees can review your income, household expenses, and debts with you. They will explain the available options and help you determine which approach is appropriate for your circumstances.

Depending on your situation, those options may include:

Changes to your household budget
Negotiating or restructuring payments
A consumer proposal
Bankruptcy, where appropriate
Another approach based on your income, assets and debts

Licensed Insolvency Trustees are federally regulated professionals and are the only professionals in Canada legally authorized to administer consumer proposals and bankruptcies.

Spergel has helped more than 100,000 Canadians understand their options and find a way forward from overwhelming debt.

Are debt payments making groceries harder to afford?

If you are relying on credit for food, falling behind on bills or finding that minimum payments leave too little for everyday necessities, you do not have to wait until the situation becomes a crisis.

Speak confidentially with a Spergel Licensed Insolvency Trustee. We will review your financial situation, explain your options and help you understand the next step – without judgement or obligation.

Book a free consultation today.

The rising cost of groceries: FAQs

How much are grocery prices expected to rise in Canada in 2026?

Canada’s Food Price Report forecast an overall increase of 4% to 6% in food prices during 2026. Increases vary between categories, however, and some foods may rise by more or less than the overall forecast.

How much will a Canadian family spend on food in 2026?

Canada’s Food Price Report estimated that a family of four could spend $17,571.79 on food in 2026. This represents an increase of up to $994.63 compared with the previous year.

Actual spending varies according to household size, location, dietary needs, and shopping habits.

What was the grocery inflation rate in Canada in June 2026?

Statistics Canada reported that prices for food purchased from stores increased by 3.9% year over year in June 2026. By comparison, the overall Consumer Price Index increased by 2.8%.

Is it normal to use a credit card for groceries?

Many Canadians use credit cards for groceries and repay the full balance before interest is charged. The warning sign is regularly carrying grocery purchases from one billing period into the next because there is not enough money to clear the balance.

What should I do if I need credit to buy groceries?

Review your income, essential expenses, and minimum debt payments to identify where the shortfall is occurring. If you regularly use credit for food or other necessities, speak with a Licensed Insolvency Trustee before the balance becomes harder to manage.

Can a consumer proposal help with credit card debt from groceries?

A consumer proposal can include eligible unsecured debts, such as credit cards, payday loans, unsecured lines of credit, and certain tax debts. It does not distinguish between individual purchases made on a credit card.

A Licensed Insolvency Trustee can assess your circumstances and explain whether a consumer proposal or another option may be suitable.

Does speaking with Spergel mean I have to declare bankruptcy?

No. A consultation allows you to understand your options and does not commit you to bankruptcy, a consumer proposal or any other formal process.

Consumer proposal vs debt consolidation: which is better?

Graeme Hamilton — Tue, 18 Aug 2026 13:16:49 +0000

A debt consolidation loan replaces your existing debts with a new loan, which you repay in full with interest. A consumer proposal is a federally regulated debt relief process that can reduce the amount of eligible unsecured debt you repay, stop interest, and provide legal protection from creditors.

The right option depends on your income, credit history, total debt, and ability to repay what you owe. This guide explains the key differences between a consumer proposal and debt consolidation in Canada.

Feature	Consumer proposal	Debt consolidation loan
How it works	Settles eligible unsecured debts through a formal agreement with creditors	Replaces several debts with one new loan
Amount repaid	A negotiated portion of your eligible debt, reduced by up to 80%	The full amount borrowed
Interest	Interest stops when the proposal is filed	Interest applies to the new loan
Monthly payments	Based on the accepted proposal terms	Based on the loan amount, interest rate, and repayment term
Credit requirement	No minimum credit score is required to file	Approval generally depends on credit, income, and affordability
Creditor protection	Legal protection applies to included unsecured debts	No legal protection from creditors
Assets	You retain control of your assets	Collateral or a co-signer may sometimes be required
Maximum term	Five years	Depends on the loan agreement
Administered by	A Licensed Insolvency Trustee	A bank, credit union or other lender
Typically suited to	People unable to repay their unsecured debts in full	People able to repay in full who qualify for a suitable loan

In simple terms, debt consolidation may be suitable if you can afford to repay everything you owe but want to simplify your payments or reduce your interest rate. A consumer proposal may be more appropriate if you cannot repay your unsecured debts in full or need protection from creditor action.

What is debt consolidation?

Debt consolidation means combining several debts into one new form of credit. Instead of managing multiple balances, interest rates, and payment dates, you make one payment towards the consolidated debt.

One of the most common ways to do this is through a debt consolidation loan. The money borrowed through the new loan is used to repay existing debts, such as credit cards, personal loans and lines of credit. You then repay the consolidation loan over an agreed period.

Debt consolidation does not reduce the principal amount you owe. If the new loan has a lower interest rate than your existing debts, however, it may reduce the amount of interest you pay.

When deciding whether to approve your application, a lender may consider:

Your income and employment
Your credit history and credit score
Your existing debts and expenses
The amount you want to borrow
Whether security or a co-signer is required

Approval is not guaranteed. If you have already missed payments or your debt is high in relation to your income, you may not qualify for an affordable interest rate or a loan large enough to cover your balances.

Learn more about debt consolidation options in Canada, including how consolidation works and when it may be suitable.

What are the pros and cons of debt consolidation?

Advantages of debt consolidation

A debt consolidation loan may offer several benefits:

One monthly payment: combining several debts can make your finances easier to manage.
A potentially lower interest rate: you may pay less interest if the new rate is lower than the rates on your existing debts.
No formal insolvency filing: a consolidation loan is a lending product rather than a formal insolvency proceeding.
A defined repayment schedule: your loan agreement establishes how much you pay and when the balance should be repaid.

Disadvantages of debt consolidation

There are also limitations to consider:

You repay the full amount: consolidation reorganizes your debt but does not reduce the principal borrowed.
Interest continues: you must pay the interest and fees set out in the new loan agreement.
You may not qualify: approval and the interest rate offered will usually depend on your credit, income, and affordability.
A longer term could cost more: a smaller monthly payment may result in more interest being paid overall if the repayment period is extended.
Security may be required: some lenders may ask for an asset as collateral or require a co-signer.
There is no legal creditor protection: consolidating debt does not prevent collection or legal action if you fall behind.
You could accumulate more debt: using credit cards again after consolidating their balances could leave you owing both the new loan and additional credit card debt.

Before accepting a consolidation loan, compare its interest rate, fees, repayment term, and total cost – not only the monthly payment.

What is a consumer proposal?

A consumer proposal is a formal, legally binding process under Canada’s Bankruptcy and Insolvency Act. It allows an eligible individual to offer to repay creditors a portion of their unsecured debt, extend the time available to pay, or both.

Only a Licensed Insolvency Trustee can prepare, file, and administer a consumer proposal.

Unlike debt consolidation, a consumer proposal does not require you to apply for a new loan. Your Licensed Insolvency Trustee reviews your income, expenses, assets, and debts before developing an offer for your creditors.

Once a consumer proposal is filed:

Interest stops on the unsecured debts included in the proposal
Most collection calls relating to those debts must stop
Most wage garnishments and legal action relating to the included debts are stopped
You make the agreed payments through your Licensed Insolvency Trustee
You retain control of your assets
The proposal can last for up to five years

Creditors have 45 days to accept the proposal or request a meeting to consider it. Once the proposal is accepted and approved, it legally binds the included unsecured creditors.

At Spergel, consumer proposals can often reduce eligible debt by up to 80%, although the result depends on your individual circumstances and creditor approval.

What debts can be included in a consumer proposal?

A consumer proposal can generally include unsecured debts such as:

Credit card balances
Personal loans
Unsecured lines of credit
Payday loans
Income tax debt
Certain student loan debt
Outstanding bills and accounts in collection

Secured debts, such as mortgages and secured car loans, are not normally reduced through a consumer proposal. You must continue making the required payments if you want to retain an asset attached to a secured debt.

Some other debts also cannot be discharged. A Licensed Insolvency Trustee can review your debts and explain how each would be treated.

What are the pros and cons of a consumer proposal?

Advantages of a consumer proposal

A consumer proposal may provide the following benefits:

Reduced unsecured debt: you may repay only an agreed portion of the eligible debt you owe, sometimes as little as 20%.
No further interest: interest stops on the included debts when the proposal is filed.
Legal protection from creditors: most collection calls, wage garnishments, and legal action relating to included debts must stop.
One affordable payment: you make one agreed payment through your Licensed Insolvency Trustee.
You retain your assets: you keep control of assets such as your home and vehicle, although their value is considered when your offer is calculated.
An alternative to bankruptcy: a proposal can provide a structured way out of debt without filing for bankruptcy.

Disadvantages of a consumer proposal

A consumer proposal also has consequences:

It affects your credit: the proposal is recorded on your credit report.
Creditors must accept the offer: creditors can accept, reject or request changes to your proposal.
Only eligible debts are included: secured debts and certain other obligations cannot be discharged.
You must maintain the payments: a proposal can be annulled if you fall three monthly payments behind.
It becomes part of the public insolvency record: a consumer proposal is a formal insolvency proceeding recorded by the Office of the Superintendent of Bankruptcy.

Equifax and TransUnion generally remove a consumer proposal from a credit report three years after it is completed or six years after it is signed, whichever comes first.

What is the difference between a consumer proposal and debt consolidation?

The main difference is the amount you repay. A debt consolidation loan requires you to repay the full amount borrowed, plus applicable interest. A consumer proposal may allow you to settle eligible unsecured debts for less than the full amount owed.

Other important differences include:

Interest

A debt consolidation loan charges interest at the rate stated in the loan agreement. Interest on debts included in a consumer proposal stops when the proposal is filed.

Eligibility

Debt consolidation requires approval from a lender, normally based on your income, credit, and ability to repay the loan.

A consumer proposal does not require a minimum credit score, but you must meet the legal eligibility requirements and make an offer your creditors are likely to accept.

Protection from creditors

Debt consolidation does not provide legal protection from creditors. If you fall behind, creditors may continue collection or legal action.

Filing a consumer proposal creates a stay of proceedings. This generally stops creditors from continuing collection calls, most wage garnishments, and legal action.

Effect on credit

A consolidation loan may affect your credit through the application, new account, and payment history. It is not recorded, however, as a formal insolvency.

A consumer proposal has a more significant and defined effect on your credit report because it is a formal insolvency proceeding.

Who administers it

A bank, credit union or other lender provides a debt consolidation loan. Only a Licensed Insolvency Trustee can file and administer a consumer proposal.

Consumer proposal or debt consolidation: which is right for you?

Neither option is right for everyone. The key question is whether you can realistically afford to repay your debts in full.

Debt consolidation may be suitable if:

You have a stable income
You can afford to repay everything you owe
You qualify for a lower interest rate
The new payment fits comfortably within your budget
You are not facing serious collection or legal action
You are confident you will not accumulate further debt

A consumer proposal may be suitable if:

You cannot afford to repay your unsecured debts in full
Interest is preventing you from reducing your balances
You cannot qualify for an affordable consolidation loan
You are missing or struggling to make minimum payments
Collection agencies are contacting you
Your wages are being garnished
You want to avoid bankruptcy while retaining your assets

A Licensed Insolvency Trustee can compare the costs and consequences of each option using your actual income, assets, expenses, and debts. They are required to explain all suitable debt relief options, not only consumer proposals.

Consumer proposal vs debt consolidation: FAQs

Is a consumer proposal the same as debt consolidation?

No. Both can result in one monthly payment, but they are different processes. Debt consolidation replaces several debts with a new loan that must be repaid in full. A consumer proposal is a formal agreement that may reduce the amount of eligible unsecured debt you repay.

Does debt consolidation reduce how much you owe?

A standard debt consolidation loan does not reduce the principal amount owed. It may reduce your interest rate, but you must repay the full amount borrowed, plus applicable interest and fees.

Does a consumer proposal reduce your debt?

A consumer proposal can reduce the amount of eligible unsecured debt you repay by up to 80%. The amount depends on your income, assets, and debts, as well as what your creditors are prepared to accept.

Which option affects your credit more?

A consumer proposal is a formal insolvency proceeding and has a more significant, defined effect on your credit report. A debt consolidation loan can also affect your credit, but its impact depends on your credit profile and how you manage the loan.

Can you pay off a consumer proposal early?

Yes. You can generally pay off a consumer proposal early without a penalty. Completing it sooner may also result in it being removed from your credit report earlier, subject to the credit bureaus’ reporting rules.

Do you lose your house in a consumer proposal?

A consumer proposal allows you to retain control of your assets, including your home. Home equity, however, is considered when calculating an acceptable offer, and you must continue making your mortgage and other secured payments.

Get help comparing your debt relief options

Choosing between a consumer proposal and debt consolidation can be difficult when you are already under financial pressure. The right option should provide a realistic and sustainable route out of debt – not simply a lower monthly payment.

At Spergel, a Licensed Insolvency Trustee will review your debts, income, assets, and expenses and explain every suitable option. Your initial consultation is free, confidential, and without judgment or pressure.

Book a free consultation with Spergel today to find out whether debt consolidation, a consumer proposal or another debt solution may be right for you.

Talk to us now.

407 ETR debt in Ontario: what happens if you can’t pay? (2026 guide)

Chris Galea — Mon, 27 Jul 2026 15:20:22 +0000

Ignoring 407 ETR debt can lead to additional fees, collection activity and, in some cases, difficulties renewing your licence plate. However, depending on your financial situation, there are several ways to resolve the debt – including payment arrangements and formal debt relief solutions such as a consumer proposal or bankruptcy.

In this guide, we’ll explain how 407 ETR debt works, what happens if you don’t pay, and the options available if you’re finding it difficult to keep up with payments.

What is 407 ETR debt?

The 407 Express Toll Route (407 ETR) is Ontario’s electronic toll highway that runs across much of the Greater Toronto Area.

Unlike traditional toll roads, there are no toll booths. Instead, cameras and electronic sensors record when your vehicle enters and exits the highway, with charges automatically billed to the vehicle’s registered owner.

Most drivers receive and pay their invoices without issue. Unpaid tolls, however, can quickly become more expensive if invoices are missed or left outstanding.

Common reasons people accumulate 407 ETR debt include:

forgetting to pay an invoice
moving house without updating their vehicle registration
financial hardship
business vehicles generating unexpected tolls
billing or transponder issues.

If the balance remains unpaid, additional fees and interest may increase the amount owed over time.

What happens if you don’t pay your 407 ETR bill?

If you don’t pay your 407 ETR bill, the debt doesn’t simply disappear.

Depending on your circumstances, unpaid tolls may lead to:

additional fees and interest
collection activity
damage to your credit history
legal action
licence plate denial when renewing your vehicle permit.

Not every unpaid account follows the same collection process, but resolving the issue early is usually the best way to avoid additional costs and stress.

Collection activity

If your account remains unpaid, 407 ETR may attempt to collect the balance directly or refer the debt to a collection agency.

Collection agencies may contact you by phone or letter to request payment. Ignoring these communications rarely improves the situation and may result in further collection efforts.

Legal action

Like many unsecured creditors, 407 ETR may pursue legal action to recover unpaid debts.

If a creditor successfully obtains a court judgment, they may be able to use enforcement measures such as wage garnishment or seizing funds from a bank account, where permitted by law.

Legal action can be costly, however, and not every unpaid account results in court proceedings.

Credit score

Unpaid 407 ETR debt may also affect your credit score if the account is reported to Canada’s credit bureaus.

A lower credit score can make it more difficult to:

qualify for a mortgage
obtain a loan or line of credit
access competitive interest rates
borrow money in the future.

Can 407 ETR stop you renewing your licence plate?

One of the unique aspects of 407 ETR debt is that it may affect your ability to renew your licence plate.

Unlike most unsecured creditors, 407 ETR has additional collection powers under Ontario legislation.

If qualifying toll charges remain unpaid, the company may notify the Ministry of Transportation, which can result in licence plate denial until the outstanding matter has been resolved or otherwise addressed according to applicable law.

For many people, this is the point at which they first discover they have accumulated significant unpaid toll charges.

How long can 407 ETR collect a debt?

Many people believe debts automatically disappear after a certain number of years, but this isn’t entirely accurate.

Ontario generally has a two-year limitation period for starting legal action to recover many unsecured debts. Yet the debt itself does not disappear once this period has passed.

Depending on the circumstances, collection activity may continue even if starting a lawsuit is no longer possible. Making a payment or acknowledging the debt may also affect limitation periods.

Because limitation rules can be complex, it’s worth seeking professional advice if you’re unsure about your specific situation.

Can 407 ETR debt be included in a consumer proposal?

Yes.

In most cases, 407 ETR debt is considered unsecured debt, meaning it can generally be included in a consumer proposal alongside other eligible unsecured debts such as:

credit card debt
personal loans
lines of credit
payday loans
certain tax debts.

A consumer proposal is a legally binding agreement between you and your unsecured creditors that is administered by a Licensed Insolvency Trustee.

Instead of repaying everything you owe, you agree to repay an affordable portion of your debt through fixed monthly payments over a period of up to five years.

Once your proposal has been filed, collection action on included debts stops, and interest no longer accumulates on those debts.

For many Canadians, this provides a practical alternative to bankruptcy while making debt repayments significantly more manageable.

Can bankruptcy eliminate 407 ETR debt?

Yes, in many cases 407 ETR debt can be discharged through bankruptcy.

There was once uncertainty over whether 407 ETR debts could survive bankruptcy because of Ontario’s Highway 407 Act. The issue was ultimately decided by the Supreme Court of Canada, which confirmed that the federal Bankruptcy and Insolvency Act takes precedence. As a result, 407 ETR debt is generally treated as unsecured debt and can be addressed through formal insolvency proceedings.

Whether bankruptcy is the right solution depends on your overall financial situation. While bankruptcy can provide a fresh start, it may affect certain assets and your credit history.

For many people, a consumer proposal is a more suitable alternative, allowing them to settle their debts without filing for bankruptcy.

How to deal with 407 ETR debt

If you’re struggling to pay your 407 ETR bill, taking action early can help prevent the debt from becoming more difficult to manage.

1. Check your invoice

Review your statement carefully to ensure all charges are accurate. If you believe there has been an error, contact 407 ETR promptly to discuss your account.

2. Don’t ignore the debt

Unpaid tolls can lead to additional fees, collection activity and, in some cases, licence plate denial. The sooner you address the issue, the more options you’re likely to have.

3. Ask about payment arrangements

If your financial difficulties are temporary, it may be possible to arrange a payment plan directly with 407 ETR. Before agreeing to any arrangement, make sure the monthly payments fit comfortably within your budget.

4. Look at your overall financial situation

If your 407 ETR debt is only one of several debts you’re struggling to manage, simply making another payment arrangement may not solve the underlying problem.

Many Canadians dealing with 407 debt are also carrying:

credit card debt
personal loans
lines of credit
payday loans
CRA tax debt.

If you’re juggling multiple debts, it’s worth exploring all of your options rather than focusing on just one account.

5. Speak to a Licensed Insolvency Trustee

Licensed Insolvency Trustees are the only professionals in Canada authorised to administer consumer proposals and bankruptcies.

A free consultation can help you understand:

whether a consumer proposal is right for you
whether bankruptcy is necessary
what debts can be included
how much you may be able to save
which solution best fits your circumstances.

At Spergel, we’ve helped more than 100,000 Canadians become debt free over the past 35+ years. A consultation is confidential, with no obligation to proceed.

Frequently Asked Questions

Does 407 ETR debt affect your credit score?

Yes. If your account remains unpaid and is reported to the credit bureaus or sent to collections, it may negatively affect your credit score.

Can 407 ETR garnish wages?

Potentially. Like other unsecured creditors, 407 ETR generally needs to obtain a court judgment before wage garnishment can occur.

Can 407 ETR freeze my bank account?

A creditor generally requires a court judgment before taking enforcement action against a bank account.

Is 407 ETR debt secured?

No. 407 ETR debt is generally considered unsecured debt, which is why it can typically be included in a consumer proposal or bankruptcy.

Can I negotiate with 407 ETR?

Depending on your circumstances, 407 ETR may discuss payment arrangements or other options to help resolve the debt.

Should I use a credit card to pay my 407 bill?

If you’re already relying on credit to cover everyday expenses, transferring your 407 debt to a credit card may simply replace one debt with another – often at a higher interest rate. If you’re struggling with multiple debts, it’s worth exploring longer-term debt relief options instead.

The bottom line

Receiving a large 407 ETR bill can feel overwhelming, but you don’t have to face it alone.

Whether you’ve fallen behind on payments, received an unexpected bill or are dealing with multiple debts, taking action early can help prevent additional fees, collection activity and unnecessary financial stress.

If your 407 ETR debt has become part of a larger debt problem, a Licensed Insolvency Trustee can help you understand your options. Depending on your circumstances, a consumer proposal or bankruptcy may allow you to reduce or eliminate your eligible unsecured debts and regain control of your finances.

Book a free, confidential consultation with Spergel today to speak with a Licensed Insolvency Trustee. We’ll review your financial situation, explain your options in plain language, and help you choose the debt solution that’s right for you.

Received a CERB repayment notice? Here’s what to do if you can’t afford it

Ashvin Sharma — Mon, 27 Jul 2026 15:15:25 +0000

If you’ve recently received a CERB repayment notice and can’t afford to pay it back, you’re not alone. The good news is that you have options. Whether you can repay the balance over time or you’re struggling with multiple debts, understanding your choices is the first step towards regaining control of your finances.

Key takeaways

If you can’t afford to repay CERB, don’t ignore the CRA.
You may be able to arrange a payment plan based on your financial circumstances.
If you’re struggling with multiple debts, a consumer proposal may include eligible CERB debt.
Bankruptcy may also be an option in some situations.
A Licensed Insolvency Trustee can explain all of your debt relief options during a free consultation.

Why am I being asked to repay CERB?

During the COVID-19 pandemic, CERB provided temporary financial support to millions of Canadians whose income had been affected.

Since then, the CRA has reviewed many applications to confirm recipients met the eligibility requirements. As a result, some Canadians have received notices asking them to repay all or part of the benefit.

You may be asked to repay CERB if:

You didn’t meet the eligibility criteria.
Your income didn’t qualify.
You received duplicate payments.
You received benefits you weren’t entitled to.

If you’ve received a repayment notice, review it carefully so you understand why the CRA believes you owe money.

Do I have to repay CERB?

If the CRA determines you received CERB that you weren’t entitled to, you will generally be required to repay it.

However, if you’re unable to pay the full amount immediately, that doesn’t mean you’re out of options. There are several ways to address the debt depending on your financial situation.

What happens if I can’t afford to repay CERB?

If you can’t afford your CERB repayment, try not to panic – but don’t ignore the situation.

The sooner you deal with the repayment notice, the more options you’re likely to have.

Depending on your circumstances, you may be able to:

Arrange a payment plan with the CRA.
Repay the balance over time.
Explore debt relief options if you’re struggling with multiple debts.
Speak with a Licensed Insolvency Trustee about your financial situation.

Can I set up a payment arrangement with the CRA?

In many cases, yes.

If you’re experiencing financial hardship, the CRA may be willing to discuss a payment arrangement based on your ability to pay.

Before contacting the CRA, it helps to understand:

Your monthly income.
Your essential living expenses.
Your existing debts.
What you can realistically afford each month.

A payment arrangement won’t reduce the amount you owe, but it may make repayment more manageable.

Can the CRA collect CERB debt?

Yes.

If a CERB repayment remains unresolved, the CRA has legal collection powers. Depending on your circumstances, it may recover the debt by applying future tax refunds or certain government benefit payments against what you owe. In some cases, the CRA may also take further collection action.

That’s why it’s important to address the situation as early as possible, even if you can’t pay the balance in full today.

What if I have other debts as well?

For many Canadians, CERB repayment isn’t the only financial challenge they’re facing.

You may also be dealing with:

Credit card debt
Personal loans
Lines of credit
Tax debt
Payday loans
Missed bill payments

If you’re struggling with several debts, focusing solely on CERB may not solve the underlying problem.

Looking at your overall financial situation can help you identify the most effective long-term solution.

Can CERB debt be included in a consumer proposal?

In many cases, yes.

If your CERB debt is owed to the CRA and you’re unable to repay it alongside your other unsecured debts, it may be possible to include it in a consumer proposal.

A consumer proposal is a legally binding debt solution administered by a Licensed Insolvency Trustee. It allows eligible Canadians to negotiate with their unsecured creditors – including, in many cases, the CRA – to repay a portion of what they owe through affordable monthly payments while stopping most collection action.

A Licensed Insolvency Trustee can review your circumstances and explain whether a consumer proposal is the right option for you.

Can bankruptcy eliminate CERB debt?

Depending on your financial circumstances, bankruptcy may also be an option.

Bankruptcy is designed for people who are unable to repay their debts and have no realistic way of becoming debt-free.

Whether bankruptcy is appropriate depends on your overall financial situation, the types of debt you have, and your long-term goals.

A Licensed Insolvency Trustee can explain how bankruptcy works, how it compares with a consumer proposal, and which option best fits your circumstances.

Should I ignore a CERB repayment notice?

No.

Ignoring a repayment notice won’t make the debt disappear and may limit your options later.

Even if you can’t afford to repay CERB today, taking action early can help you avoid additional financial stress and better understand the solutions available to you.

CERB repayment FAQs

Can I make monthly CERB repayments?

In many situations, yes. If you’re unable to repay the balance in full, you may be able to arrange a payment plan with the CRA based on your financial circumstances.

Can the CRA take my tax refund for CERB debt?

The CRA may apply future tax refunds or certain government benefit payments towards eligible amounts you owe. If you’re concerned about collection action, it’s best to address the debt as early as possible.

Does CERB debt affect my credit score?

A CERB repayment itself doesn’t automatically appear on your credit report. However, broader financial difficulties associated with unpaid debt can have long-term financial consequences.

Can CERB debt be included in a consumer proposal?

In many cases, yes. A Licensed Insolvency Trustee can determine whether your CERB debt is eligible and explain how a consumer proposal works.

What if CERB isn’t my only debt?

If you’re struggling with CERB repayment alongside credit cards, loans, tax debt, or other financial obligations, speaking with a Licensed Insolvency Trustee can help you understand all of your available debt relief options.

Speak to a Licensed Insolvency Trustee

If you’re worried about repaying CERB, you don’t have to face it alone.

At Spergel, our Licensed Insolvency Trustees offer free, confidential consultations to help you understand your options. Whether a CRA payment arrangement, consumer proposal, or bankruptcy is the right solution depends on your individual circumstances.

We’ll take the time to review your financial situation, answer your questions, and help you choose the path that’s right for you.

Book your free consultation today and take the first step towards becoming debt free.

How to remove collections from your credit report in Canada (2026)

Gillian Goldblatt — Wed, 17 Jun 2026 18:05:15 +0000

Unfortunately, missed payments can eventually lead to your account being sent to a collection agency, resulting in a collection account appearing on your credit report. This can impact your credit score and make it harder to qualify for loans, mortgages, or other forms of credit.

If you’re wondering how to remove collections from your credit report in Canada, you’re not alone. At Spergel, we regularly help Canadians understand their credit reports, deal with collection agencies, and create a plan to improve their financial situation.

In this guide, we’ll explain how collections affect your credit score, whether collection accounts can be removed, and what steps you can take to rebuild your credit.

What is a collection account?

A collection account appears on your credit report when a creditor believes a debt is unlikely to be repaid and transfers or sells the account to a collection agency.

Collection accounts can arise from many types of debt, including:

Credit cards
Personal loans
Lines of credit
Utility bills
Cell phone contracts
Auto loans
Unpaid medical expenses
Mortgage shortfalls

Once an account enters collections, it is typically reported to Canada’s major credit bureaus, Equifax and TransUnion.

How does a collection entry affect your credit score?

A collection account is considered a serious negative item on your credit report.

Having an account in collections may:

Lower your credit score
Make it more difficult to qualify for new credit
Impact mortgage approvals
Result in higher interest rates from lenders
Raise concerns for landlords or other organizations that review credit reports

While the impact lessens over time, collection accounts can continue affecting your ability to borrow money for several years.

Can you remove collections from your credit report in Canada?

The answer depends on the circumstances.

You may be able to remove a collection account if:

The information is incorrect
The debt does not belong to you
The account is being reported inaccurately
The collection entry should have already been removed
The credit bureau determines the information cannot be verified

If, however, the collection account is accurate, it may remain on your credit report for the period allowed by the credit bureau’s reporting rules.

Step 1: Review your credit report carefully

The first step is obtaining a copy of your credit report from both Equifax and TransUnion.

Review your report carefully and look for:

Collection accounts
Incorrect balances
Duplicate accounts
Accounts that do not belong to you
Incorrect dates
Outdated information

Errors on credit reports are more common than many people realize. If you identify any inaccuracies, gather supporting documentation and prepare to dispute them.

Step 2: Dispute incorrect collection accounts

If you believe a collection account is inaccurate, you can file a dispute directly with the credit bureau reporting the information.

You may need to provide:

Government-issued identification
Proof of payment
Account statements
Correspondence from creditors
Supporting financial records

The credit bureau will investigate the dispute and contact the creditor or collection agency to verify the information.

If the information cannot be verified or is determined to be inaccurate, it may be removed or corrected.

Step 3: Check whether the collection account should have expired

Collection accounts do not remain on your credit report forever.

In most provinces, collection accounts generally remain on your credit report for up to six years, although reporting periods can vary depending on the province and credit bureau.

If you discover a collection account that should no longer appear on your report, you can contact the credit bureau and request an investigation.

Be sure to keep copies of all correspondence and documentation.

Step 4: Resolve outstanding debts

Paying or settling a collection account will not automatically remove it from your credit report.

However, resolving the debt may:

Stop collection activity
Prevent further legal action
Improve your overall financial profile
Demonstrate responsible financial behaviour to future lenders

Even after a debt is paid, the collection entry may continue to appear on your credit report until the reporting period expires.

Can you pay to remove a collection account?

Some Canadians ask whether they can negotiate with a collection agency to remove a collection account after payment.

While you may hear this referred to as “pay for delete,” it is not a common or guaranteed practice in Canada.

Collection agencies and creditors are generally expected to report accurate information. As a result, they are under no obligation to remove a legitimate collection account simply because the debt has been paid.

How to rebuild your credit after collections

If you’ve had an account in collections, rebuilding your credit should become a priority.

Some of the most effective ways to improve your credit score include:

Paying bills on time

Payment history is one of the most important factors affecting your credit score.

Keeping credit utilization low

Aim to use less than 30% of your available credit limit whenever possible.

Consider a secured credit card

A secured credit card can help you rebuild positive credit history while reducing risk to lenders.

Avoid multiple credit applications

Submitting several credit applications in a short period may negatively impact your score.

Monitor your credit report

Review your credit report regularly to ensure all information remains accurate.

A real client story: How Samantha stopped collection calls

Samantha, a working mother from British Columbia, found herself overwhelmed by credit card debt, a personal loan, and a growing line of credit. As her debt increased, collection calls became a constant source of stress and her financial situation felt increasingly difficult to manage.

After speaking with Spergel, Samantha filed a consumer proposal that reduced her debt, stopped collection activity, froze interest charges, and allowed her to keep her home. While rebuilding her credit would take time, resolving the debt behind the collection accounts gave her the fresh start she needed.

Samantha’s story highlights an important lesson: improving your credit often starts with addressing the underlying debt problem.

Read Samantha’s full story here.

Can a Licensed Insolvency Trustee remove collections from your credit report?

A Licensed Insolvency Trustee cannot directly remove accurate collection accounts from your credit report.

However, a Licensed Insolvency Trustee can:

Review your credit report
Identify reporting errors
Explain your rights
Help you deal with collection agencies
Provide guidance on rebuilding your credit
Explore debt relief solutions such as a consumer proposal or bankruptcy if needed

If collection accounts are the result of larger debt problems, addressing the underlying financial situation is often the most important step.

Frequently Asked Questions

How long do collections stay on your credit report in Canada?

In most cases, collection accounts can remain on your credit report for approximately six years, although reporting periods may vary by province and credit bureau.

Will paying a collection account improve my credit score?

Paying a collection account may help your overall financial profile and prevent further collection activity, but the collection entry may still remain on your credit report for the applicable reporting period.

Can I remove a paid collection from my credit report?

A paid collection may only be removed if it is inaccurate, outdated, or cannot be verified. Paying a debt does not automatically remove the collection entry.

What happens if a collection account isn’t mine?

You should immediately dispute the account with the credit bureau and provide supporting documentation. If the information is incorrect, it may be removed.

Can a collection agency sue me?

Collection agencies may pursue legal action in certain circumstances, subject to provincial laws and limitation periods. If you have concerns about collection activity, speaking with a Licensed Insolvency Trustee can help you understand your options.

Need help with collection accounts or debt problems?

If a collection account is affecting your credit score, mortgage approval, or financial goals, you don’t have to navigate it alone.

At Spergel, our Licensed Insolvency Trustees have helped more than 100,000 Canadians understand their debt, improve their financial situation, and move toward a brighter financial future.

Book a free, confidential consultation today and learn about the options available to you.

How to save money on groceries in Canada: 10 practical tips

Alan Spergel — Thu, 11 Jun 2026 15:49:44 +0000

With grocery prices remaining one of the biggest financial pressures facing Canadian households, many families are looking for ways to make their food budget go further.

According to the Canada Food Price Report, the average family of four is expected to spend more than $17,571.79 annually on food, making groceries one of the largest household expenses after housing and transportation.

The good news is that you don’t need to make drastic lifestyle changes to reduce your grocery bill. Small changes to how you shop, plan meals, and take advantage of discounts can add up to hundreds – or even thousands – of dollars in savings each year.

Whether you’re trying to stretch your budget, pay down debt, or simply get more value from your weekly shop, these practical grocery-saving tips can help.

Quick ways to save money on groceries

If you’re looking for the fastest ways to reduce your grocery bill, start with:

Planning meals before shopping
Buying items that are on sale
Using cashback apps
Joining loyalty programs
Reducing food waste
Tracking your grocery spending

Why are groceries so expensive in Canada?

Food prices have risen significantly in recent years due to inflation, supply chain disruptions, labour shortages, and increased transportation costs. New data from Statistics Canada shows that food prices rose by 3.5% year-over-year in April 2026, although many grocery staples saw their prices increase by significantly more than that.

For many Canadians, groceries now represent one of the largest monthly household expenses after housing and transportation. According to a 2024 Leger survey, nearly half of Canadians report living paycheque to paycheque, making everyday savings opportunities more important than ever.

While some price increases are outside your control, how you shop can make a meaningful difference to your overall spending.

1. Plan your meals before you shop

One of the simplest ways to save money on groceries is to plan your meals before heading to the store.

Meal planning helps you:

Buy only what you need
Reduce impulse purchases
Avoid food waste
Use ingredients more efficiently

Before shopping, check what you already have in your fridge, freezer, and pantry and build your meal plan around those items.

Meal planning can also reduce food waste and limit expensive last-minute takeout orders. Even planning just four or five dinners in advance can help reduce unnecessary spending throughout the week.

2. Build your grocery list around flyer specials

Instead of deciding what you want to eat and then shopping for ingredients, start with the sales.

Apps such as Flipp allow you to compare grocery flyers from multiple stores in one place.

If chicken is on sale this week, consider building meals around chicken. If seasonal produce is heavily discounted, adjust your menu accordingly.

Shopping based on sales can significantly reduce your grocery costs over time.

3. Use cashback apps

Cashback apps provide money back on items you’re already purchasing.

Popular Canadian options include:

Checkout 51
Caddle
Eclipsa
Rakuten Canada

While individual savings may seem small, they can add up over the course of a year.

4. Join grocery store loyalty programs

Many Canadian grocery chains offer loyalty programs that provide discounts, rewards, and personalized offers.

Popular programs include:

PC Optimum
Scene+
Air Miles

These programs can help reduce your grocery costs while rewarding purchases you would have made anyway.

5. Try couponing

Couponing in Canada may not be as extreme as what you see on television, but it can still provide meaningful savings.

Digital coupons, cashback offers, store promotions, and manufacturer discounts can often be combined with existing sales.

Even saving just $20 per week through loyalty programs, coupons, cashback apps, and shopping sales can add up to more than $1,000 per year.

6. Compare unit prices

Larger packages aren’t always cheaper.

Compare the price per 100g, kilogram, litre, or item to determine which product offers the best value.

Many stores display unit pricing directly on shelf labels, making comparisons easier.

7. Reduce food waste

Throwing away food is essentially throwing away money. According to the National Zero Waste Council, $49 billion worth of food is sent to landfill or composted each year in Canada.

Simple ways to reduce food waste include:

Freezing leftovers
Properly storing produce
Planning meals around ingredients you already own
Using older items before buying new ones

Reducing food waste can have a surprisingly large impact on your grocery budget.

8. Buy generic or store brands

Many store-brand products offer similar quality to national brands at a lower price.

Products such as pasta, canned goods, dairy products, frozen vegetables, and pantry staples are often significantly cheaper when purchased under a store brand.

9. Take advantage of price matching

Some Canadian retailers allow customers to match competitors’ advertised prices.

Price matching can help you access the lowest prices without visiting multiple stores.

Before shopping, check your store’s current policy and keep flyers or screenshots readily available.

10. Track your grocery spending

You can’t improve what you don’t measure.

Tracking your grocery spending helps you:

Identify spending patterns
Set realistic grocery budgets
Measure progress over time
Spot opportunities to save

Using our free Groceries Budget Tracker can also help you determine whether your spending is increasing faster than expected.

A real client story: small changes can add up

When Mia went on maternity leave, her household income dropped significantly. Like many Canadians, she found herself looking for ways to reduce spending without sacrificing the things that mattered most.

One of her biggest expenses was regular nights out with friends. After speaking with a counsellor at Spergel, Mia and her friends swapped expensive restaurant outings for affordable dinners and gatherings at home. The change helped reduce costs while allowing everyone to stay connected.

Mia’s experience highlights an important lesson: small changes to everyday spending habits can add up over time and create more room in your budget.

Read Mia’s full story.

When saving on groceries isn’t enough

Finding ways to reduce your grocery bill can provide valuable financial relief, but sometimes the challenge goes beyond budgeting.

If you’re:

Using credit cards to buy groceries
Falling behind on bills
Struggling with debt payments
Receiving collection calls
Living paycheque to paycheque

it may be time to explore additional support.

At Spergel, our Licensed Insolvency Trustees have helped more than 100,000 Canadians understand their options, reduce overwhelming debt, and regain financial stability.

Frequently Asked Questions

How much should a Canadian spend on groceries each month?

The answer depends on household size, location, and dietary needs. However, groceries are one of the largest household expenses for many Canadians, making budgeting and meal planning increasingly important.

What is the easiest way to save money on groceries?

Meal planning, shopping sales, using loyalty programs, and reducing food waste are among the simplest and most effective ways to lower grocery costs.

Is couponing worth it in Canada?

Yes. While Canadian couponing opportunities are more limited than in the United States, coupons, cashback apps, and loyalty programs can still generate meaningful savings over time.

What are the best grocery savings apps in Canada?

Popular options include Flipp, Checkout 51, Caddle, Rakuten Canada, and store-specific loyalty apps such as PC Optimum and Scene+.

How can I cut my grocery bill in half?

While cutting your grocery bill in half may not be realistic for every household, strategies such as meal planning, reducing food waste, shopping sales, buying store brands, and using loyalty programs can significantly lower costs.

What is the cheapest grocery store in Canada?

Prices vary by location, but discount chains such as No Frills, FreshCo, Food Basics, and Giant Tiger are often considered among the most affordable grocery retailers in Canada.

Final thoughts

Learning how to save money on groceries in Canada isn’t about deprivation – it’s about shopping more strategically.

By combining meal planning, flyer shopping, loyalty programs, cashback apps, and smarter spending habits, you can reduce your grocery bill and free up room in your budget for the things that matter most.And if rising grocery costs are only part of a larger financial challenge, Spergel is here to help. Book a free consultation today to explore your options and take the next step toward financial stability.

How to leave a marriage with no money in Canada: a step-by-step guide to financial independence

Samantha Galea — Thu, 04 Jun 2026 13:45:26 +0000

Many Canadians stay in unhappy or unhealthy relationships longer than they want to because they’re worried about how they’ll afford housing, support their children, pay their bills, or manage existing debt on a single income.

Research shows that financial hardship after separation is common, particularly for lower-income households and individuals who were financially dependent on their partner.

While anyone can face financial challenges after a breakup, studies have found that women are more likely to experience a significant drop in income following separation. According to the Government of Canada, 5% of women report that a partner has prevented them from accessing a job, money, or other financial resources, while many others experience forms of economic abuse that make it difficult to leave a relationship safely.

The good news is that leaving a marriage with no money is possible. There are legal protections, government benefits, community resources, and financial support programs designed to help people rebuild their lives after separation or divorce.

Whether you’re financially dependent on your spouse, dealing with joint debt, experiencing financial abuse, or simply unsure where to start, this guide will help you understand your options and take practical steps toward financial independence.

Key Takeaways

You can leave a marriage even if you have little or no money.
You may be entitled to spousal support, child support, or a share of marital assets.
Government assistance and community support may be available.
Joint debt can continue to affect you after separation.
Financial abuse is a common barrier to leaving a relationship.
Building a financial plan early can make the transition easier.

How to leave a marriage with no money

Here are some recommended steps to take if you’re planning to leave a marriage while in a compromising financial situation.

1. Take stock of your financial situation

Before making any decisions, it’s crucial to get a clear picture of your finances. This step involves gathering information about your income, debts, assets, and monthly expenses. While it may feel overwhelming, understanding your financial situation will help you make more informed decisions about how to proceed.

List all sources of income: whether from your job, government benefits, or spousal support.
Assess your debts: include any personal loans, credit card debt, or joint financial obligations.
Identify joint assets: consider properties, savings, pensions, or investments shared with your spouse.

Having this information will help you figure out what you’ll need financially to make the transition.

2. Understand your legal rights

Many people delay leaving a marriage because they assume they cannot afford legal help. However, free consultations, legal aid programs, and family law clinics may be available depending on your situation.

You may be entitled to:

Spousal support (alimony)
Child support
A share of marital assets
Pension entitlements
Equalization payments

Understanding your rights can significantly improve your financial position after separation.

3. Open a personal bank account

If you don’t already have one, open a bank account in your own name.

Having a separate account can help you:

Build financial independence
Receive income or benefits
Create an emergency fund
Track your own expenses

Even small savings can make a meaningful difference during a transition period.

4. Create a financial plan

A realistic financial plan can help reduce uncertainty and stress.

Consider:

Housing costs
Utilities
Groceries
Transportation
Childcare
Insurance
Debt payments

Building an emergency fund may feel difficult, but it is important. According to the Financial Consumer Agency of Canada, more than half of Canadians do not regularly save for unexpected expenses.

What if your spouse controls all the money?

Financial abuse is one of the most overlooked barriers to leaving a marriage.

Financial abuse can include:

Restricting access to bank accounts
Monitoring spending
Preventing a spouse from working
Withholding financial information
Controlling household finances
Accumulating debt in a partner’s name

If any of these situations sound familiar, know that support is available.

Family lawyers, shelters, domestic violence organizations, and community agencies can help you develop a safe plan to leave.

What happens to debt during a separation or divorce?

Debt is often one of the biggest concerns for people leaving a marriage.

Many Canadians assume that debt is automatically divided when a marriage ends. Unfortunately, it is not always that simple.

Joint debts such as:

Credit cards
Lines of credit
Car loans
Personal loans
Mortgages

may remain the responsibility of both borrowers, regardless of what a separation agreement says.

If your name remains attached to a debt, a lender may still pursue you for repayment.

Expert insight from a Licensed Insolvency Trustee

“Many people assume debt is automatically divided when a marriage ends, but creditors don’t necessarily follow separation agreements. If your name remains on a joint debt, you may still be legally responsible for repayment.”

– Samantha Galea, Licensed Insolvency Trustee

If debt is becoming overwhelming, speaking with a Licensed Insolvency Trustee can help you understand your options.

Financial help available after separation in Canada

Depending on your circumstances, you may qualify for financial support.

Potential sources of assistance include:

Canada Child Benefit (CCB)
GST/HST Credit
Employment Insurance (EI)
Provincial income assistance programs
Housing support programs
Child support payments
Spousal support payments

Community resources such as food banks, shelters, counselling services, and employment programs may also provide valuable support.

Secure your important documents

Before leaving, gather copies of important documents whenever possible.

These may include:

Passport
Driver’s licence
Birth certificate
Social Insurance Number (SIN)
Tax returns
Bank statements
Mortgage documents
Insurance policies
Pension statements
Marriage certificate

Having these documents readily available can simplify legal and financial processes later.

Build a support network

Separation affects more than just your finances.

Friends, family members, counsellors, support groups, and financial professionals can all play an important role in helping you navigate this transition.

Research shows that many Canadians experience a significant decline in household income following a separation or divorce, making practical and emotional support especially valuable during the transition.

Consider employment and income opportunities

If you don’t currently have an income, finding employment or increasing your earning potential may become an important part of rebuilding financial independence.

Options may include:

Part-time employment
Remote work
Freelance opportunities
Skills training programs
Government employment services

The Financial Consumer Agency of Canada (FCAC) reports that one in seven Canadians often use credit to pay for basic necessities when they run short of money, underscoring the importance of creating stable income and a realistic budget after a separation or divorce.

Rebuilding your finances after divorce

Starting over financially can feel overwhelming, but many Canadians successfully rebuild after separation.

Focus on:

Rebuilding your credit

Pay bills on time, reduce debt balances, and regularly review your credit report.

Building emergency savings

Even small contributions can help improve financial security over time.

Updating financial documents

Review your:

Will
Life insurance beneficiaries
Pension beneficiaries
Powers of attorney

Setting new financial goals

Whether your goal is paying off debt, buying a home, or saving for retirement, creating a plan can help you move forward with confidence.

Real client story: Finding financial stability after divorce

Following a difficult divorce, Larissa found herself struggling with debt and financial uncertainty. By working with a Licensed Insolvency Trustee, she was able to reduce her debt, regain control of her finances, and move forward with confidence.

Read Larissa’s story.

Prioritize your safety

If your relationship involves abuse or you fear for your safety, leaving safely should be your first priority.

Resources that may be able to help include:

Canadian Women’s Shelter Crisis Line: 1-866-863-0511
Seniors Safety Line: 1-866-299-1011
Compass Community Services LGBTQ+ Support Line: 226-669-3760
Yellow Brick House Crisis Line: 1-800-263-3247

If you are in immediate danger, call 911.

FAQs

Can I leave my spouse if I have no job?

Yes. Many people leave marriages while unemployed. Depending on your circumstances, you may qualify for spousal support, government benefits, housing assistance, or employment programs.

What if my spouse controls all the money?

If your spouse controls your access to money, bank accounts, employment, or financial information, you may be experiencing financial abuse. Financial abuse can make it more difficult to leave a relationship, but support is available. Family lawyers, shelters, domestic violence organizations, and community agencies can help you understand your rights and develop a safe plan to leave.

Can I get government assistance after a divorce?

Potentially. Programs such as the Canada Child Benefit, GST/HST Credit, housing supports, and provincial assistance programs may help depending on your circumstances.

Am I responsible for my spouse’s debt after separation?

It depends on whether the debt is joint or individual. If your name is attached to a joint debt, lenders may still hold you responsible for repayment.

What happens if one spouse doesn’t want a divorce in Canada?

Canada has a no-fault divorce system. In most situations, a divorce can proceed even if one spouse does not agree.

How do I leave a marriage with children and no money?

Seek legal advice as early as possible. Child support, government benefits, housing assistance, and community support programs may help provide financial stability during the transition.

Can I leave a marriage if I have no savings?

Yes. While having savings can make the transition easier, many people leave marriages without a financial safety net. If you’re planning to separate, focus on understanding your finances, creating a realistic budget, and exploring available support such as government benefits, legal aid, housing assistance, family support, or spousal support where applicable.

If possible, start setting aside small amounts of money before leaving and gather important financial documents. Even if you have no savings today, creating a financial plan can help you take practical steps toward independence and long-term stability.

Struggling with debt during separation or divorce?

Separation often creates new financial challenges, including higher living costs, credit card debt, and housing expenses.

At Spergel, we’ve helped thousands of Canadians navigate financial difficulties following major life events, including divorce and separation.

If debt is making it harder to move forward, our Licensed Insolvency Trustees can help you understand your options and create a path toward financial stability.

Book your free, confidential consultation today.

Surplus income limits in Canada – updated for 2026

Colin Boulton — Wed, 03 Jun 2026 17:47:18 +0000

bankruptcy payments. These limits help ensure individuals and families filing bankruptcy can maintain a reasonable standard of living while still contributing fairly to their creditors. Below are the most recent surplus income limits for 2026.

Current surplus income limits – monthly thresholds (2026)

Household size	Threshold (CAD)
1	$2,716
2	$3,381
3	$4,157
4	$5,047
5	$5,724
6	$6,456
7	$7,188

The Office of the Superintendent of Bankruptcy typically updates surplus income limits annually. These limits apply across Canada, regardless of province.

When will the 2027 surplus income limits be released?

The Office of the Superintendent of Bankruptcy usually updates surplus income limits once per year to reflect changes in income levels and the cost of living in Canada. New limits are typically announced in early April. Once the 2027 thresholds are released, we will update this page with the latest figures.

How surplus income limits have changed in recent years

Household Size	2024	2025
1	$2,610	$2,666
2	$3,249	$3,318
3	$3,995	$4,080
4	$4,850	$4,953
5	$5,501	$5,618
6	$6,204	$6,336
7	$6,907	$7,054

These numbers match the official surplus income standards used by Licensed Insolvency Trustees across Canada. The increase reflects adjustments made by the Office of the Superintendent of Bankruptcy to account for inflation and changes in the cost of living.

Surplus income limits: key facts

- Surplus income is based on household net income after taxes.
- Payments equal 50% of income above the threshold.
- Calculations are based on average monthly income during bankruptcy.
- Higher surplus income can extend the length of bankruptcy.

Put simply: if you earn more, you pay more during bankruptcy.

What is surplus income in bankruptcy?

Surplus income is calculated by comparing your household’s net monthly income to the government threshold for your family size.

Surplus income formula

Monthly household net income − OSB surplus income threshold = Surplus income You must then pay half of that surplus into your bankruptcy estate.

Example: How surplus income is calculated

Imagine you live with your partner and your household size is two people. Household net income: $3,800 2026 threshold for two people: $3,381 Step 1 $3,800 − $3,381 = $419 surplus Step 2 50% × $419 = $209.50 monthly surplus payment This payment would continue during the bankruptcy period.

How surplus income affects the length of bankruptcy

Surplus income can also affect how long your bankruptcy lasts. For first-time bankruptcies:

Situation	Bankruptcy Length
No surplus income	9 months
Surplus under $200/month (average)	9 months
Surplus over $200/month (average)	21 months

For second bankruptcies:

Situation	Bankruptcy Length
No surplus income	24 months
Surplus over $200/month	36 months

At Spergel, many clients are surprised to learn that even moderate income increases can extend bankruptcy by an additional 12 months.

Why surplus income limits increase each year

The OSB adjusts surplus income thresholds annually to reflect:

- Inflation
- Changes in average Canadian income
- Rising living costs

These updates ensure bankruptcy rules continue to allow individuals and families to maintain a reasonable standard of living.

What if your income changes during bankruptcy?

Surplus income payments are based on average income throughout your bankruptcy, not just one month. If your income increases: surplus income payments will increase. If your income decreases: surplus income payments may decrease. This is particularly relevant for people who are:

- Self-employed
- Commission-based
- Receiving bonuses or overtime
- Working irregular hours

Even temporary increases in income can affect your average surplus income calculation and may extend your bankruptcy.

Why surplus income can make bankruptcy more expensive

Many people assume bankruptcy is the lowest-cost debt solution. However, if your income is above the surplus threshold, bankruptcy payments can increase significantly – and the bankruptcy period may also be extended. For individuals whose income is close to the threshold, even small income increases can make bankruptcy more expensive than alternative debt solutions.

Consumer proposal vs bankruptcy: why surplus income matters

A consumer proposal is a common alternative to bankruptcy. One key difference is that consumer proposal payments are fixed. This means:

- Your payment amount is negotiated upfront with creditors
- Increases in income do not increase your monthly payment
- Your payment schedule does not extend due to income increases

Consumer proposals can also reduce debt by up to 80%, depending on the circumstances. At Spergel, 99% of consumer proposals we file are accepted by creditors.

How to estimate your bankruptcy payment

To estimate whether surplus income may apply:

Determine your household size
Calculate your average monthly net income
Subtract the OSB surplus income threshold
Divide the result by two

If your average surplus exceeds $200 per month, your bankruptcy may be extended by an additional year. Because calculations can vary depending on allowable expenses and household income structure, it’s important to review your situation with a Licensed Insolvency Trustee.

Struggling with bankruptcy payments or surplus income?

Surplus income rules can make bankruptcy more expensive than many Canadians expect. If you’re unsure whether bankruptcy or a consumer proposal is the better option, Spergel’s Licensed Insolvency Trustees offer free, confidential consultations to review your income, household size, and debt. We’ve been helping Canadians find debt relief for over 35 years, and we’ll help you understand your options clearly before you make a decision.

FAQs

Do surplus income rules apply in every province?

Is Spergel legit? What you need to know before choosing a debt help company

Spergel — Fri, 24 Apr 2026 15:03:00 +0000

Spergel is a Licensed Insolvency Trustee firm in Canada, regulated by the federal government.

This means that Spergel is legally authorized to help Canadians reduce or eliminate debt through formal solutions like consumer proposals and bankruptcies – and is required to follow strict federal rules designed to protect you. If you’re asking this question, you’re not alone. When it comes to your finances, taking time to check who you can trust is not only normal – it’s the right thing to do.

Why people ask “Is Spergel legit?”

Searching for phrases like “is this company legit” is often part of making a careful, informed decision.

That’s especially true in the debt space, where:

Some companies charge high fees without delivering real solutions
Others are not licensed or regulated
The process can feel overwhelming or unfamiliar

Being cautious doesn’t mean something is wrong. It simply means you’re protecting yourself.

What makes Spergel a legitimate debt help provider?

Spergel is a Licensed Insolvency Trustee (LIT) firm.

Licensed Insolvency Trustees are the only professionals in Canada legally authorised to administer consumer proposals and bankruptcies.

Spergel is regulated by the Office of the Superintendent of Bankruptcy Canada (OSB), which oversees all insolvency proceedings in the country.

This means:

We are licensed and monitored by the federal government of Canada
We must follow strict legal and ethical standards
We are required to act in your best interest
Our fees are regulated and built into formal programs

For more than 35 years, Spergel has helped over 100,000 Canadians navigate debt safely, with clear, structured solutions designed to give people a fresh financial start.

Expert support you can trust

At Spergel, you’ll be supported by experienced Licensed Insolvency Trustees who are recognised leaders in their field.

Alan Spergel, Founder and Licensed Insolvency Trustee, has over 30 years of experience and has helped shape the industry as a former Chair of the Canadian Association of Insolvency and Restructuring Professionals (CAIRP) and member of the Superintendent of Bankruptcy’s advisory board.
Gillian Goldblatt, Licensed Insolvency Trustee and Partner, is an award-winning industry leader and a trusted media voice, featured in outlets including BNN Bloomberg and The Globe and Mail.

“Our role is to provide clear, honest advice so people can move forward with confidence.”
— Alan Spergel, Licensed Insolvency Trustee

Learn more about our team and their experience.

Licensed Insolvency Trustee vs debt consultant: what’s the difference?

Not all debt help services are the same – and this is where many people get caught out.

Licensed Insolvency Trustee (LIT)	Unlicensed debt consultant
Government regulated	Not government regulated
Legally authorised to reduce or eliminate debt	Cannot legally file insolvency solutions
Can file consumer proposals and bankruptcies	Cannot file formal debt solutions
Fees are structured and controlled	May charge high upfront fees

If a company isn’t a Licensed Insolvency Trustee, they cannot legally provide the solutions many people are actually looking for.

How to tell if a debt company is legit

Before working with any debt help provider, it’s important to ask the right questions.

Look for:

Are they a Licensed Insolvency Trustee?

Are they regulated by the Canadian government?

- Are fees clearly explained? A legitimate provider will always be transparent about how fees work. With a Licensed Insolvency Trustee, fees are regulated by the Canadian government and built into formal solutions like consumer proposals – meaning no large upfront costs and no hidden charges. If anything feels unclear – especially around fees – it’s always worth asking for a full explanation before moving forward.

Do they offer a free consultation?

Watch out for:

Pressure to sign quickly
Large upfront fees
Vague or unclear explanations
Claims that sound too good to be true

A legitimate provider will always:

Be transparent
Take time to explain your options
Give you space to make the right decision

What real clients say about Spergel

Spergel has helped thousands of Canadians navigate debt with confidence – and that’s reflected in the feedback we receive every day.

4,000+ reviews across platforms including Google and Trustpilot
Real client success stories from people across Canada
A long track record of helping individuals and families regain financial stability

“I would like to express my sincere thanks to the Spergel team for their excellent service, professionalism, and strong ethical standards throughout the process.”

Read real client stories and experiences.

What you can expect from Spergel

At Spergel, the approach is simple:

No judgment
No pressure
Clear, honest advice

We take the time to understand your situation and walk you through your options so you can make the right decision for you.

Still unsure? That’s completely okay

You don’t need to have all the answers before reaching out.

Spergel offers a free, confidential consultation where you can:

Ask questions
Understand your options
Get clarity without obligation

You’re in control the entire time.

Book your free consultation today

FAQs

Is Spergel a government company?

Articles & Insights – Spergel

Bankruptcy exemptions by province in 2026

What are bankruptcy exemptions?

How are the value of your assets and your equity assessed?

Personal bankruptcy exemptions by province in 2026

Alberta bankruptcy exemptions

British Columbia bankruptcy exemptions

Manitoba bankruptcy exemptions

New Brunswick bankruptcy exemptions

Newfoundland and Labrador bankruptcy exemptions

Nova Scotia bankruptcy exemptions

Ontario bankruptcy exemptions

Prince Edward Island bankruptcy exemptions

Quebec bankruptcy exemptions

Saskatchewan bankruptcy exemptions

Are RRSPs, RRIFs, RDSPs, and other savings protected?

What happens to assets that are not exempt?

Could a consumer proposal help you keep your assets?

Bankruptcy exemptions by province in 2026: FAQs

Do you lose all your assets when you file for bankruptcy?

Can I keep my home when I file for bankruptcy?

Can I keep my car if I declare bankruptcy?

Are RRSPs protected in bankruptcy?

Are TFSAs and RESPs exempt from bankruptcy?

What if I have no non-exempt assets?

Do bankruptcy exemptions change every year?

Find out what you could keep before deciding to file

What to read next

Filing for bankruptcy with no assets in Canada – what happens?

Can you declare bankruptcy if you have no assets?

What happens when you file for bankruptcy with no assets?

Do you have to pay for bankruptcy if you have no assets?

Does having no income change anything?

What is surplus income in a bankruptcy with no assets?

Which debts can bankruptcy clear?

Is bankruptcy the right option if you own nothing?

Frequently asked questions

Can I file for bankruptcy if I have no house or car?

Can I file for bankruptcy if I have no money at all?

Will my creditors get paid if I have no assets?

How long does bankruptcy last if I have no assets?

Frequently Asked Questions (FAQs) About Debt

The rising cost of groceries in Canada: the impact on household finances in 2026

How much are grocery prices increasing in Canada?

Key grocery-price figures for 2026

Why are grocery prices still rising?

How are higher grocery costs affecting Canadian households?

When do grocery costs become a debt problem?

Are you still paying for groceries after they have been eaten?

The connection between grocery costs and food insecurity

How can Canadians manage rising grocery costs?

Budgeting cannot solve unmanageable debt

What should you do if debt is making groceries harder to afford?

How can Spergel help?

Are debt payments making groceries harder to afford?

The rising cost of groceries: FAQs

How much are grocery prices expected to rise in Canada in 2026?

How much will a Canadian family spend on food in 2026?

What was the grocery inflation rate in Canada in June 2026?

Is it normal to use a credit card for groceries?

What should I do if I need credit to buy groceries?

Can a consumer proposal help with credit card debt from groceries?

Does speaking with Spergel mean I have to declare bankruptcy?

What to read next

Consumer proposal vs debt consolidation: which is better?

What is debt consolidation?

What are the pros and cons of debt consolidation?

Advantages of debt consolidation

Disadvantages of debt consolidation

What is a consumer proposal?

What debts can be included in a consumer proposal?

What are the pros and cons of a consumer proposal?

Advantages of a consumer proposal

Disadvantages of a consumer proposal

What is the difference between a consumer proposal and debt consolidation?

Interest

Eligibility

Protection from creditors

Effect on credit

Who administers it