Most can manage their debt, with only a third saying they have reached their limit.
June 19, 2015
by PLANT Staff
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:
Thirty-four per cent of Canadians say they are uncomfortable with their debt level, comprised of:
“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.