How Much Debt Is “Normal”?

Understanding the Norms of Debt

In the contemporary economic landscape, incurring some level of debt is an almost inevitable part of life. Whether it’s credit card debt, mortgages, student loans, or car payments, most individuals find themselves navigating through some form of financial obligation. But when does this debt transgress from being a normal part of life into a burdensome load? This article will shed light on the concept of what constitutes “normal” debt and provide insights on effective ways to manage it.

The Norms of Debt by Age

One way to understand if your debt is typical for your age is to compare it with data compiled by Statistics Canada, which regularly collects comprehensive data on various types of debt. It’s crucial to use median figures when analyzing this data as the numbers can be distorted by the wealthiest and the poorest segments of the population.

Typical Debt Figures per Age Group

Based on the 2022 median data, here is a rough breakdown of debt per person according to age groups:


18-25 years: $8,129

26-35 years: $16,832

36-45 years: $25,084

46-55 years: $31,442

56-65 years: $26,165

65+ years: $14,386

These figures show a consistent rise in debt with age, influenced by factors like inflation and increasing interest rates, which have led to higher costs for everyday commodities and larger monthly loan payments. This trend often results in a greater reliance on credit cards, thereby contributing to an overall increase in debt.

Determining an Excessive Debt Load

Understanding when your debt is becoming excessive requires a calculation of your debt-to-income ratio. This ratio, which compares your monthly debt obligations to your net income post-tax, can offer a clear picture of whether your debt is becoming unmanageable. Ideally, a debt-to-income ratio should fall at or below 35 percent. Any figure exceeding 43 percent is a signal that it’s time to start considering strategies to decrease your debt. To gain a clearer understanding of how to calculate your debt ratio, you can refer to this guide.

Available Solutions to High Debt Load

If you find your debt load is above the recommended threshold, there are several options available to help you regain control of your financial situation. An experienced licensed insolvency trustee (LIT) can assess your situation and suggest appropriate strategies to reduce your debt. Here are the two most common solutions:


A Consumer Proposal: This is a legally binding agreement between you and your creditors where you agree to pay back a portion of your debts. This method also protects your assets.

Personal Bankruptcy: This involves filing for bankruptcy where certain assets may be considered non-exempt while others may be exempt. It’s advisable to consult with a licensed insolvency trustee to understand the implications better.


An LIT can help you decide the best course of action based on your unique circumstances.

Seeking Debt Assistance Across Canada

At Bankruptcy Canada, we are dedicated to helping Canadians manage their debt effectively and steer them towards financial freedom. Our licensed insolvency trustees offer debt assistance services and can provide help with tax debt or student loan debt concerns.

We offer both in-person consultations at our Ontario locations and virtual meetings for clients across Canada. Feel free to contact us today to schedule a free, confidential consultation.

In conclusion, understanding what constitutes a “normal” debt load is crucial to maintaining a healthy financial life. By comparing your debt to median figures, calculating your debt-to-income ratio, and seeking professional advice, you can ensure your debt remains manageable and does not hinder your financial growth.

Find Your Personal Debt Relief Solution

Licensed Insolvency Trustees are here to help. Get a free assessment of your options.

Discuss options to get out of debt with a trained & licensed debt relief professional.