COVID wins his job, forcing him to retire

Jean-Claude, 65, has worked in the same textile production company for years. His job pays well and he is able to work overtime to make ends meet. COVID will destroy his financial balance.

As of March 2020, Jean-Claude was making $3500-$4000 monthly. He lives in an apartment with his wife Jeanine, who is retired and receives $1,215 in state pensions.

Financially, the couple navigates on sight and lives from wage to wage.

Since he hasn’t put any money aside, Jean-Claude has also gradually increased the balance on his cards and credit line, which totals around $20,000.

Having never missed a payment, he thinks he’s in good financial shape, but something unexpected is about to turn everything upside down.

Fired then fired

When Quebec goes into lockdown for the first time in March 2020, the company where Jean-Claude works will have to close its doors for three months. When the company starts up again in the summer, there will be no overtime, which will severely reduce the income of the sixty-year-old.

His employer ceased operations again in December 2020 due to supply issues caused by the health crisis. When it reopened a few months later, several jobs were cut because production could no longer be maintained at a sufficient level. Jean-Claude’s falls by the wayside.

The man can expect a few months of unemployment insurance benefits, but they won’t be enough to meet his needs, and he’s in debt with an additional $10,000 on his credit cards. If services are suspended, Jean-Claude now owes more than $29,000, to which must be added the balance of his car rental ($9,000), for a total of $38,000.

However, since he is 65 years old, he decides not to look for a new job but to retire.

He now receives the QPP and Old Age Security for a total of $1,350 per month.

Together with Jeanine’s retirement income, this equates to $2,565. Spending more than $2,470 a month, the couple is struggling to make ends meet. Also, Jean-Claude is unable to make the minimum payments on his cards and line of credit, and creditors are becoming more and more adamant.

Best option: bankruptcy

The situation quickly becomes untenable. Not knowing what to do to restore financial stability, he decided to contact an authorized bankruptcy trustee firm.

After making a balance sheet of his assets and debts, Maxime Morin, head of the group for financial recovery (consumer), recovery and bankruptcy at Raymond Chabot, quickly realized that Jean-Claude would not succeed unless a more drastic step was taken, either consumer filing or bankruptcy, two choices in the event of bankruptcy.

“Given his age, income, poor health and the fact that he had no intention of applying for additional credit, the best solution in his case is bankruptcy,” explains Maxime Morin.

This allows him to pay off his credit card and loan debt and is released from bankruptcy after nine months of paying a predetermined amount to the trustee. Since he is up to date when paying for the rent of his vehicle, he can also keep it.

“In this case, if Jean-Claude’s income increases because he returns to the labor market, the time required to be exempted from his bankruptcy could increase to 21 months,” specifies the director of financial recovery. The monthly amount to be paid to the trustee is also likely to be revised upwards.

His financial situation


  • MSRP $15,000
  • Honda Civic for rent


  • Credit cards at 19.99% interest $14,000
  • Line of Credit $15,000
  • Car Rental Credit $9,000

Total debt $38,000


  • QPP and Jean-Claude’s retirement benefit $1,350
  • QPP and Jeanine’s retirement pension $1,215

Total income $2565


  • $2,471 (includes rent, phone, electricity, insurance, rental car, groceries, Jeanine’s credit card payment)

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