Half Of Canadians Take On Debt To Cover Living Expenses: Survey

The debt picture for Canadians continues to be worrisome.

A new survey conducted by accounting firm MNP found that nearly half of Canadians (47%) said they don’t expect to be able to cover basic living expenses over the next year without taking on additional debt.

A slightly greater proportion (48%) of survey respondents said they have less than $200 remaining at the end of the month after covering living expenses and debt payments. That figure was up four percentage points compared to a previous survey conducted in June.

MNP concluded that the lack of financial buffer is leaving certain Canadians particularly vulnerable to the unexpected. Indeed, the survey showed seven out of every 10 respondents (70%) were not confident about being able to handle an abrupt setback like unemployment or a death in the family.

The new survey of tight household finances comes ahead of a policy announcement by the Bank of Canada on October 30th. In its most recent official speech by a member of the Bank’s governing council on September 5th, Deputy Bank of Canada Governor Lawrence Schembri said that elevated household debt levels "remain the main risk to Canadian financial stability."