Seniors – A Small Group Carrying High Risk Debt

The Growing Concern: Why Seniors Carry High Risk Debts

In a perfect world, the golden years of one’s life, often synonymous with retirement, should be marked by financial stability and freedom from debt. However, reality paints a different picture. A significant number of seniors are not only carrying debt into their retirement, but also witnessing a growth in this trend. This article delves into this rising concern of Seniors – A Small Group Carrying High Risk Debt.

The Reality of Debt and Retirement

Contrary to popular belief, seniors are not necessarily debt-free by the time they retire. The 2017 Joe Debtor study reveals that the proportion of seniors carrying debt into their retirement is on the rise. This alarming trend can be attributed to a myriad of factors including an increased cost of living, and an escalating average household debt-to-income ratio.

A Shift in Attitude Towards Debt

Over the years, society’s perception of debt has undergone a significant transformation. Credit cards, once a rarity particularly amongst seniors, are now commonplace. This shift in attitude towards debt reflects the changing dynamics of our economic system.

The Numbers That Matter

A survey by Statistics Canada found that one in four retirees with debt owed less than $5,000, a figure that doesn’t necessarily ring alarm bells. However, the same study showed nearly 60% owed less than $25,000, indicating the persistence of debt even into retirement.

The Debt-to-Income Conundrum

The Joe Debtor study highlights that seniors have the highest debt-to-income levels amongst insolvent debtors. This increased level of debt does not necessarily reflect affluence. Rather, it highlights the struggles of the middle-income group, who neither have low income nor high net worth, and are most likely to carry significant debt into retirement.

The Need for Financial Prudence

As income invariably decreases post-retirement, it becomes imperative for seniors to revaluate their financial habits. A lifestyle that seems manageable today may not be sustainable post-retirement, especially if it is financed through debt.

The Rising Trend of Bankruptcy Among Seniors

Insolvency is a growing concern among seniors. The Joe Debtor report indicates a rise in the number of insolvent seniors from 9% to 12% over a span of six years. Alarmingly, nearly half of these insolvent seniors held tax debts, further highlighting the financial vulnerabilities of this demographic.

The Importance of Financial Planning

It is essential for seniors to understand their financial options prior to retirement. Many seniors exhaust their savings trying to recover from debts, a situation that can be mitigated with timely financial planning.


While the trend of seniors carrying high risk debt into retirement is concerning, it is not insurmountable. With proactive financial planning and a shift in attitude towards debt, seniors can ensure a financially secure retirement.


Don’t let your golden years be overshadowed by the cloud of debt. Plan ahead and retire debt-free.

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