Why Have Personal Debt Levels Risen So High in Canada?
The level of personal debt among Canadians has been rising sharply over the last several years.
It’s the ideal situation for lenders, who will continue to profit from Canadians who are struggling to make repayments or need to continue to borrow to survive.
There are many factors behind this, and things could continue to get worse over the coming years if individuals fail to take action.
Explore some of the reasons why personal debt levels have risen so high in Canada and find out more about where you can get help with your debts.
Why have personal debt levels risen so high in Canada?
The rising debt levels among Canadians can be put down to a number of factors.
For many people, it’s a combination of these factors that have led them to where they are, and they are now unable to see a way out.
More ‘affordable’ borrowing
Interest rates are much lower compared to just a few years ago, meaning Canadians pay less to borrow.
But as interest rates increase, that’s when affordability becomes an issue.
Higher cost of living in comparison to wage increases
Many high-paying job losses have taken place in recent years, while the cost of living has continued to increase.
With people moving into lower-paid jobs, this has left people struggling to pay their essentials, let alone put money into savings.
Higher property values across the country
Property prices have been rising steadily, which is great if you’re a seller, but not-so-great if you’re getting on the ladder for the first time.
Increased prices mean higher mortgage repayments, making it difficult to pay other expenses or pay off debts.
Society and advertising
Many people feel pressure to keep up with their friends and families, leading to a rise in the number of ‘buy now, pay later’ agreements that are popular with retailers.
Consumers are getting into the habit of buying what they want now, instead of saving for something.
Having poor credit means people are only left with high-interest rates and lenders who lend irresponsibly.
This can put people into a debt cycle that can be difficult to break out of.
Getting help with your debts
If your debts are out of control, there are some things you can do.
While you might be asking why personal debt levels have risen so high in Canada, it’s your own debts you need to worry about.
A Licensed Insolvency Trustee will be able to advise you on solutions for your debt, and recommend a debt management plan or a consumer proposal to help you turn things around.
Getting help and advice is the first step to overcoming serious debts.
For more information or to speak to someone today, contact (877) 879-4770.