Debt is an ongoing and growing “top-of-mind” issue for most Canadians.
A couple of recent surveys suggest most Canadians are concerned about their own debt, and also about high consumer debt in the broader economy. At the same time many appear to be resigned to never getting out of the red.
Personal and public concern
The latest survey for Manulife Bank suggests that an astounding 94% of Canadians believe that the average household owes far too much money. Most of that concern appears to be focused on non-mortgage debt with 60% of respondents reporting they are carrying balances on their credit cards. That is a 12% increase over the previous survey conducted in the spring of this year.
Spending is deemed to be the key culprit with 45% of those surveyed saying their spending is increasing faster than their income. That is up significantly from 33% in the previous survey. And now two in five Canadians do not expect to ever be debt-free in their lifetime.
It is a nagging concern for a lot of people. A survey by the Canadian Payroll Association suggests up to a quarter of employees feel that worries about personal finances have had an effect on their job performance. The vast majority of respondents say they spend up to 30 minutes a day dealing with personal financial matters at work. The majority also identify the rising cost of living and overwhelming debt as the biggest sources of their financial stress.
Not surprisingly, Baby Boomers feel better off than their younger, Generation X and Millennial counterparts according to the Manulife survey. Gen-Xers tend to see themselves as the worst off of the three groups: deepest debt, least savings, most likely to feel spending is outpacing income and most sceptical about ever being debt-free.
Millennials point to employment challenges as their biggest struggle. But they also report that, once they get a job, their incomes are rising faster than their spending.
Saved by technology
Millennials also report looking to technology to help them manage their finances. More than half of indebted Millennials who feel in control of their situation say that technology has helped them manage their debts. Just one in three Gen-Xers and Boomers say the same thing.