Non Taxable Disability Payments
March 13th, 2010Question: Terminal Illness and Debt?
My father (53) has a terminal illness (he’s almost a year into a 3 months to a year prognosis). While he thinks he still has years, the reality is that it’s more likely less than a year.
Over the years, he has manage to get himself into at least $75K of consumer debt and $9K of CRA debt. He is single and rents. The only assets he has is approximately $55K in lock-in RSPs. His income is approx. $5K/month (Disability CPP and non-taxable disability insurance). The debt is really weighing him down, and he has been paying approx. $3K/month towards it (well over minimum payments). However, he also wants to be able to live the best life he can. He’s thinking of bankruptcy and wanted to find out what other options he has. Any suggestions?
Answer: Rebecca…talk to him about seeing a Debt Councellor…they can help him restructure his debt, and possibly even have his debtors forgive some of the debt. Even if it is only the accumulated interest on the original debt(s), that can be a significant chunk out of the debt. They can also help to see if bankruptcy is a valid option for him … although, at this stage, the 7 year black mark on his Credit Rating is a moot point. But, if he’s looking to leave you and your siblings (if any) an inheritance, clearing his debts is the only way to do so.
As someone else pointed out…your Father’s debts die with him. If there is still money owing after the estate is cleaned out, they can NOT come after you unless you co-signed on the debt.
Incidentally…there are many Debt Councilors that work for free. You can look them up in the Yellow Pages.
Good Luck!
VA to automate Agent Orange claims process
WASHINGTON — The Veterans Affairs Department plans to announce Tuesday that it will fully automate how it pays claims for illnesses related to exposure to the chemical Agent Orange to keep an overburdened system from collapse. It is the VA’s first effort at automating claims processing in its 80-year history, VA chief technology officer Peter Levin said. It comes as the agency struggles to cut a …
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