Case Study – Single Parent Family

Being a single parent is one of the hardest jobs in the world. Balancing a budget is daunting enough, never mind when you have little ones to worry about. It’s not surprising that lone parent families are more than twice as likely to use payday loans than couples with children. The focus of this case study is a single mother who was drowning in debt and how she was able to turn it around.


When the client came to us, she was near the end of her rope. Although she was working two jobs, she was struggling to make ends meet for her and her young daughter. She had maxed out two credit cards to $5000 each trying to support her family. When she was no longer able to get credit from the banks, she went to pay day loan company. This is when she got stuck in the pay day loan cycle. Unable to pay back the original loan within two weeks, she was left going to another pay day loan company to cover the bills. The interest rates on these loans were over 23% and the associated fees kept piling up. With so many debt payments, necessities like rent and groceries were getting harder and harder to pay for. The original debts of $6000 total to pay day loan companies quickly ballooned into over $9000, and this is in addition to the $10,000 she already had on credit cards. She knew her finances were in serious trouble and she needed help.


Debt can be a symptom of any number of problems and life circumstances. However, it is important to understand that YOU ARE NOT YOUR DEBT.

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Our Plan

After listening to her story, it became clear that she had reached the upper limits of her credit and that a consolidation loans from the bank was out of the question. Learning more, it became apparent that she would not likely be able to pay back the debt in full without cutting into her daily living expenses. This left her with two options: bankruptcy or a consumer proposal.

At this time, she was being considered for a promotion at one of her jobs. If she were to file for bankruptcy, her income would be tracked during the term of the bankruptcy and her payments would increase if she began to make more money. Because monthly cash flow was already a problem for her, this would not be an ideal situation. Alternatively, a consumer proposal involves a fixed payment over a longer period of time. This client was much more intrigued by a consumer proposal as it would leave more money in her pocket now and let her keep extra earnings going forward.


This client was very happy with her decision to file a consumer proposal. Her proposal was accepted by her creditors to pay back $6400, down from $18,000. Her monthly payment was $107 over 60 months – that’s how much she was paying each creditor in minimum payments before! After getting the promotion she desired, she was able to keep the extra cash flow in her monthly budget. The consumer proposal helped her finally get out of the pay day loan cycle and she was able to set up an emergency fund to ensure she’d never have to use them again. In addition to her monthly bills and proposal payments, she was able to set aside some money every month in a RESP for her daughter. This was something she never thought she’d be able to do.


Balancing a budget for any family is a challenge, and it’s even more challenging for a single parent. Children are expensive! If you ever find yourself in a debt situation that you just can’t break free from, give 4 Pillars a call. That call could be the first step in a process that changes your life.

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Debt Relief SpecialistThis article was written by David Moffatt. A Senior Debt Relief Specialist with 4 Pillars Halifax. 4 Pillars has assisted in creating plans that have helped save Canadians over $1 Billion dollars of consumer and tax debt since 2002. We believe that no consumer should have to struggle with the stress of overwhelming debt. Our debt restructuring plans can help you cut your debt by up to 80% with less than 3% of our clients ever getting into deep financial difficulties again. If you are struggling with debt please reach out. It hurts to continue to suffer financially.

4 Pillars Halifax services Halifax, Dartmouth, Bedford, Sackville and the entirety of HRM.