53% in Canada within $200 of financial insolvency
More than 53% in Canada say that they are $200 or less from being financially insolvent, says the latest survey by MNP Ltd, a firm with the biggest insolvency practice in Canada.
A release by the firm says that as pandemic-related government aid and loan deferral programs begin to wind down, the number of Canadians hovering close to financial insolvency has reached a five-year high.
More than half (53%) say they are $200 or less from not being able to meet all of their bills and debt obligations each month, a whopping 10-point jump from December. This includes three in 10 (30%, +7pts) who report they are already insolvent with no money left at month-end to cover all their payments.
“Pandemic-related financial relief measures provided some breathing room over the last year, but now we’re seeing a reversal. The number of Canadians with virtually no wiggle room in their household budgets has reached a five-year high. The anxiety Canadians are feeling about making ends meet — or already being unable to do so — tells us we may see an avalanche of households falling behind on payments or defaulting on loans, mortgages, car payments, or credit cards,” says Grant Bazian, president of MNP LTD.
The survey is part of the MNP Consumer Debt Index, which measures Canadians’ attitudes toward their consumer debt and gauges their ability to pay their bills, endure unexpected expenses, and absorb interest-rate fluctuations without approaching insolvency. Conducted by Ipsos and updated quarterly, the Index is an industry-leading barometer of financial pressure or relief among Canadians.
Now in its sixteenth wave, the Index currently stands at 96 points, up seven points compared to the last wave conducted in December 2020.
The latest data, representing the sixteenth wave of the MNP Consumer Debt Index, was compiled by Ipsos on behalf of MNP Ltd from 4-9 March 2021. For this survey, a sample of 2,001 Canadians aged 18 years and over was interviewed. Weighting was then employed to balance demographics to ensure that the sample’s composition reflects that of the adult population according to Census data and to provide results intended to approximate the sample universe.
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