“How can I effectively manage my debt? I feel like I’m floundering.”

This is an all too common feeling for many individuals in today’s financial environment. But what can you do to improve your debt management?

One solution is an all-in-one account, which allows you to offset your debts against your assets and reduce your interest payments.

How do you know if an all-in-one account is best for you? Before you decide to go with an all-in-one account, ask yourself if it has the following features:

• “Holistic” approach: Does the product allow you to see your overall financial situation by incorporating all your income, savings, loans, and debt into one account?
• Faster debt reduction: Does the account allow you to consolidate your debts at a lower interest rate, combine your loans with savings, and effectively reduce overall debt and compound interest?
• Sub-account structure: Does the account allow you to organize your saving and spending projects into several different sub-accounts to help you track and manage your overall situation?
• Consolidated statement: Is a monthly consolidated statement issued, showing your income, savings, debt, and expenses all in one place?
• Flexibility: Does the account allow you to both deposit and withdraw funds against the loan?
• Diverse interest rate types: Are a combination of fixed and variable rates offered for sub-accounts?
• Service fees: Is it a no-fee bank account?

The National Bank All-In-One account is a great example. “It allows you to manage all of your banking through one account, and if you have savings or disposable income, you can reduce your debt while keeping instant access to your money,” said Vic Kazazian, Senior Vice-President, Career Sales Force, Sun Life Financial Canada.

Keep in mind that this type of account is not for everyone. You must be organized and aware of your spending habits.

Here are a few ways you can start improving your debt management:

• Minimize the number of credit cards you have and how often you use them
• Pay off your debt first, then contribute to other savings and investment vehicles
• Budget and plan what to do with your money before you get it
• Talk to a financial advisor to help put your big-picture financial situation into perspective
• Create a financial plan to address your overall financial needs and goals

More information is available online at www.sunlife.ca.