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Laurie Campbell for Lunch by Rachel Idzerda.

RACHEL IDZERDA/The Globe and Mail

Years of counselling people burdened by too much debt have left a mark on Laurie Campbell. The long-time chief executive officer of Credit Canada Debt Solutions has become cautious with her own money, owning just one personal credit card that she pays off monthly, and paying cash for major purchases such as her vehicle.

She realized how affected she was by people's financial difficulties when her children were small and she insisted on teaching them good financial habits from a very young age – too young an age. Her wake-up call came when her now-teenaged son was just three years old, and she suggested they go outside to play in the falling snow.

"He said, 'No Mommy, it's way too expensive out there,'" she recalls with a laugh. "That's what happens when you're in my field, because you get paranoid."

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After 25 years at Credit Canada – nine as CEO – Ms. Campbell has seen too many people who have been thrown into crisis because of a lack of financial discipline. Her non-profit agency, a registered charity, provides free financial counselling and education to 14,000 people a year, a number that has grown by 20 per cent over the past five years as Canadians' debt levels continue to rise.

Ms. Campbell says it is a myth that highly indebted people are poor and uneducated. Many of her firm's clients are educated and articulate professionals who are simply bad at managing their money. But the clients who stick in her memory are the ones with sad stories about losing their jobs at an older age and not being able to land new ones, or who have suffered personal tragedies like the death of a child that left them shattered and unable to continue working.

It taught her everyone is potentially vulnerable – including herself.

"When I was counselling, I used to go home at night thinking, 'Oh my god, that man or woman I saw today could easily be me,'" she says. "Because they are everyday people with everyday problems. Many have good educations, but something bad has happened in their life."

Over a lunch of grilled salmon at a Bâton Rouge steakhouse near her office in suburban North York, Ms. Campbell, 51, outlines her own theory about the state of Canada's credit crisis. At first glance, she says, it appears illogical that credit card defaults are low and insolvencies are falling while Canadians have record-high levels of debt.

Some argue the dichotomy shows people are managing their debt well and there is no significant problem. But Ms. Campbell disagrees.

She believes the apparent disconnect is due in part to home equity lines of credit, which have become a huge source of new borrowing over the past decade as house prices climb and lenders make credit lines more easily available. With growing credit lines to draw from, many people are cushioned from hitting a final debt wall that leads to insolvency, she says, but it doesn't mean they are managing their finances well.

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She believes that Canadians are far too indebted, and she rejects economists' arguments that there is no debt problem because debt levels are being outstripped by the value of people's assets. Ms. Campbell says many people's asset values are climbing because their house values are growing, but houses are not liquid assets that people can readily use to meet monthly payments.

"People don't want to just sell their house – I can tell you, our experience at Credit Canada is that they'll do anything but sell their house, that's the last thing they ever want to do," she says. "So I don't know that it's realizable assets that are increasing."

Credit Canada was set up in 1966 as Canada's first credit counselling organization, formed by a coalition of social service agencies and major lenders. Its mission was to work directly with people to teach basic household finance and budgeting skills, and provide general education programs to the public. Ms. Campbell says the agency's mandate is still the same – and in more demand than ever – 50 years later.

With 17 locations across Ontario, Credit Canada offers free counselling to individuals with financial problems. If necessary, counsellors will also help clients with a more formal debt-management program, in which the counsellors contact creditors, ask them to halt interest from accruing and create a repayment schedule.

It is one of Canada's largest not-for-profit credit counselling firms, along with Credit Counselling Society, which has 21 offices in Western Canada and Ontario, and other more localized counselling firms, such as Money Mentors in Alberta.

The agency is funded primarily by lenders, which have agreements in place to pay Credit Canada a proportion of the funds they recoup from clients under debt-management programs. If a major bank, for example, is paid $100 by a customer under a debt-management program organized by Credit Canada, it will donate $22 of it back to the agency and keep the remaining $78.

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Not all creditors have such agreements with the agency, including the Canada Revenue Agency, which donates nothing back. Ms. Campbell said her group will work with any clients on any debt problems, whether or not the agency is eligible to recoup anything in return.

She said lenders benefit when clients work out payments and avoid bankruptcy, but they also see credit counselling as a worthy public service.

"They have a social responsibility to help people avoid bankruptcy. … It's a goodwill gesture, and it makes them look good."

Ms. Campbell was raised in Sault Ste. Marie, Ont., where her father taught accounting at a local college and her mother worked as a registered nurse. She says both were good with money, although she had no formal knowledge of debt issues when she first arrived at Credit Canada in 1990 as an administrative assistant.

Her university degree in psychology combined with a minor in business turned out to be an ideal background for her new job, where she trained as a counsellor and began working with clients. She loved the job, she says, but it was also stressful, and it was common for people to cry in her office as they revealed their financial problems.

"The first year I counselled, there were many nights I couldn't sleep. I'd think, 'I hope I didn't tell them to do something that was the wrong decision.'"

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Although she later moved into management and put her counselling days behind her, Ms. Campbell says she misses the hands-on work, and still reads files out of interest to keep up with client issues.

It's easy to see how Ms. Campbell would be an effective debt counsellor, combining a down-to-earth pragmatism with a warm communication style. She readily shares stories about her life and her family, and asks me several questions about mine. The same traits appear to extend to her management style, where she values connections with many of her 43 employees who have tended to stay a long time.

"People don't leave because it's a good group of people – we're like a family – and there's something about the service that makes us feel like we're really making a difference in people's lives," she says.

Ms. Campbell has come to strongly believe the root cause of Canada's debt problems lies in consumerism – the compulsion that makes people want the latest electronic gadgets, bigger houses and pricier cars.

Her only debt is the mortgage on her house in Toronto's Scarborough Bluffs neighbourhood, and she says she was content to buy her kids' clothes at Wal-Mart or Value Village when they were younger. Her indulgences? It's not an extravagant list – she says she likes travelling, and she happily pays for pedicures.

For many people, however, debt is a habit, and helping people reduce their debt is a process Ms. Campbell likens to dieting, with most people finding it hard to stick at it.

"You're talking about lifestyle changes," she says. "You can't change your money habits for six months, until you get out of debt, and then go back to your old habits. It has to be a lifestyle, over a lifetime."

Ms. Campbell has lobbied hard for regulatory reforms to help consumers, including changes to rules governing credit card companies and payday lenders. She is currently championing reforms to halt to the practice of increasing already-high interest rates on credit cards to even higher levels after payments reach 90 days of default, saying it just makes it harder for people to manage problem debts.

But she also tells clients they cannot blame their problems on lending policies and overeasy access to credit, saying finger-pointing will do nothing to fix their predicament.

"Clients get offended, and say, 'Don't blame me.' But my feeling is that lenders are not going to change their policies, but you can change your practices," she says. "People need to take personal responsibility because if you're waiting for the banks to take responsibility, you're going to be waiting a long time."

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Laurie Campbell, CEO of Credit Canada Debt Solutions Inc.

Age: 51

Place of birth: Sault Ste. Marie, Ont.

Education: BA with a major in psychology and minor in business, University of Ottawa

Family: Divorced, with two children, a 19-year-old son and a 17-year-old daughter. Both have part-time jobs, which Ms. Campbell is "very proud of."

Her passions: Running, in "rain, sleet and snow," and animals – she currently has two dogs and a cat, and has rescued several animals over the years.

Her hobby: Ms. Campbell has been collecting rare coins since childhood. "I remember going to coin shops and events, and being the only kid there."

Why a psychology degree was the perfect background: "The way we treat money, the way we talk about money, the way we don't talk about money, the way it's a big taboo, is fascinating. That's what has kept me there as long as it has. I'm astounded at how people have such different emotional feelings when it comes to money."

Why credit counselling is effective: "We are very solution-focused. Within an hour or two, we can come up with a plan many times to have people resolve their debt situation, or at least have some answers about how they can move forward. That to me was really gratifying."

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