Canadians are on the brink of financial insolvency, according to a new national survey.
The survey, conducted by Ipsos on behalf MNP Ltd., found that almost half of Canadians (46%) have pushed their finances to the edge – saying they're within $200 of insolvency each month, compared with 40% who said the same in the last survey conducted in September 2018.
Furthermore, 39% of respondents to the latest survey conducted in December said they're worried they'll be pushed into bankruptcy if interest rates rise any higher. The Bank of Canada raised its benchmark lending rate three times last year, taking it to 1.75%. The central bank left the rate unchanged at its most recent meeting on January 9, but reiterated that rates will "need to rise over time."
Based on the most recent data available from Statistics Canada, a closely-monitored gauge of household debt showed that, on average, Canadians owed almost $1.74 for every dollar of disposable income in the third quarter of 2018. As interest rates rise, some borrowers are second-guessing their financial decisions: the MNP survey shows 43% of respondents regret how much debt they've accumulated.
