Canadians comfortable with debt, CIBC poll reveals
Most can manage their debt, with only a third saying they have reached their limit.
TORONTO — Despite household debt in Canada remaining near record highs, a recent CIBC poll finds that two-thirds of Canadians are comfortable with the amount of debt they have.
The poll also found that 31% of those with debt have gone deeper in debt in the past year, citing a mix of necessary and discretionary purchases, which included buying a new car, going on vacation, and repairing or renovating their homes.
Sixty-six per cent of Canadians say they are comfortable with their debt level, comprised of:
- 25% who say they are very comfortable and could take on more debt if needed;
- 41% who say they are fairly comfortable but would prefer not to take on any more debt.
Thirty-four per cent of Canadians say they are uncomfortable with their debt level, comprised of:
- 23 per cent who say they are somewhat uncomfortable – they are making it work but any change to their current situation would present a problem;
- 10 per cent who say they are very uncomfortable – they have more debt than they can handle and are feeling financially squeezed.
“It’s clear that some Canadians feel they are on top of their debt while others are reaching their limit,” says Christina Kramer, executive vice-president, retail and business banking at CIBC. “Managing debt isn’t just about keeping up with your payments, it’s about working towards longer-term goals, such as building savings for retirement, and that’s where seeking financial advice can help.”
A CIBC poll earlier this year found that more than half of all Canadians have struggled with financial decisions and two-thirds agreed that they would benefit from additional advice on financial matters.
The comfort level with debt increases with age, with 81% of Canadians with debt who are 65-plus saying they are comfortable compared to 62% of 18-to-24 year olds.
Those 65 years and over were less likely to hold a mortgage (16%) than other age groups and were more likely to be debt free (56%). Among younger Canadians 18-to-24 years just starting out and with generally lower salaries, the most common type of debt was student loans (37%) and credit card debt (20%).
The poll also looked at how Canadians view debt in general, finding that 67% of Canadians think debt is okay if it is managed carefully, while 28% say debt should be avoided at all costs. Another 5% think debt is a tool to help them get the things they want.