More than half of Canadians are on the brink of insolvency, according to a new survey.
The report by MNP Consumer Debt Index found that 53 percent of Canadians are $200 or less away from not being able to make ends meet each month. This includes three out of 10 people who say they have no money left at the end of each month to cover their payments.
The survey also states that 25 percent of Canadians have taken on more debt due to the pandemic. As government pandemic payments are running out for some, the number of those approaching debt insolvency has increased by 10 percent since December 2020.
“The number of Canadians with virtually no wiggle room in their household budgets has reached a five-year high,” says MNP Ltd. President Grant Bazian. “The anxiety Canadians are feeling about making ends meet—or already being unable to do so—tells us we may eventually see an avalanche of households falling behind on payments or defaulting on loans, mortgages, car payments, or credit cards.”
Fifty-one percent of Canadians are worried about paying off debts in the future if interest rates rise. That said, six in ten people believe now is a good time to splurge a little while interest rates are so low.
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