Young man renovating his house.
Kyle Campbell was 23 years old when a banker told him he might want to consider filing for bankruptcy.
"It was like a slap in the face," said Mr. Campbell of that conversation from nine years ago.
At the time, he had $30,000 on a line of credit, about $10,000 left on a new car loan and $12,000 in credit-card debt. He had just moved back to his hometown of Guelph, Ont., after spending a few years going to school and working at a bar in Calgary.
"I never looked at myself as being in that bad of shape. Everybody else had debt too," says Mr. Campbell, now 32.
Still, he refused to go bankrupt. Instead, Mr. Campbell forced himself to get smarter about money, including spending way less of it, and earning more.
He cut back on fun with friends, moved in with his parents and started working multiple jobs in areas such as sales and marketing, as well as coaching hockey. At the same time, he began devouring articles and information about saving and investing.
It took time, but Mr. Campbell kept aggressively paying down his debt, and within a few years, he was able to start setting aside money for a house. He also began contributing to a tax-free savings account and a registered retirement savings plan.
Wade Stayzer, vice-president of sales and service at Meridian Credit Union in St. Catharines, Ont., said avoiding bankruptcy was Mr. Campbell's best move. "I applaud that he recognized that he got himself into trouble, financially, and it was up to him to get himself out."
Plus, he added, declaring bankruptcy could have hurt his chances of getting a loan later in life.
Showing good character is something that lenders look at when assessing loan applications, Mr. Stayzer says. "He made getting out of debt a priority … and he learned about money."
By 2014, Mr. Campbell was able to buy a house in Guelph, but it needed a lot of work, so he persuaded a friend to move in while he renovated.
Along the way, Mr. Campbell met a women who owns her home, and eventually moved in with her. The couple are saving for a wedding this summer. Meantime, his own house has been fixed up and is being rented by a family.
As of April, Mr. Campbell is debt free, excluding the mortgage, and has about $5,000 in an RRSP, $5,000 in a TFSA and about $1,000 in an emergency fund.
It was a long, slow grind to get to this point, financially, with a lot of hard lessons learned. The biggest, he says, is the realization that it takes a lot longer to get out of debt than to get into it.
"I thought debt was a normal situation. It didn't bother me, and it should've," he says in hindsight.
Now if he has $500 on his credit card, he says, "I feel like I'm struggling, where before that was me thinking I had lots of cash because I had lots of room left on the credit!"
Mr. Stayzer says millennials often fall into the debt trap because credit is so much easier to come by today. Low interest rates also make it seem less daunting.
His advice to parents today is to teach their kids about saving and spending, and how to live within a budget.
"You can't prioritize your spending if you don't know where it's going," Mr. Stayzer says. "You need to have realistic expectations about what's achievable and what your priorities are."
Mr. Campbell's advice to others in debt is to deal with it as soon as possible, and don't be afraid to seek help.
"A lot of people don't want to talk about money," he says. "They feel uncomfortable asking for advice and help with money. They shouldn't."