Canadians who struggle with debt, use credit to manage their expenses

The average Canadian owes $21,348, an almost $600 increase from last year

TORONTO, ON, MAY 18, 2016 – The most vulnerable Canadians struggle with debt so much so the national average debt levels increased by almost three per cent in the first quarter of 2016 according to TransUnion’s latest Canada Industry Insights Report.struggle with debt

National debt levels rose to $21,348, an almost $600 increase from the prior year. Canadians struggle with debt and continue to dig themselves into a deeper hole.

“Once we segment by risk tiers, we find a gradual shift where subprime consumers are increasing their share of the debt load relative to the low-risk population,” says Jason Wang, TransUnion’s director of research and analysis in Canada in a statement.

The TransUnion report noted although the average Canadian credit card balance grew by 1.8 per cent from last year to $3,764, Canadians who are deeply in debt, saw an increase of 5.7 per cent to $6,601.

And for Canadians who are unable to pay their bills (consumers with overdue accounts of 90 days or more), this statistic increased by three per cent in the first quarter of 2016 as well. The provinces most affected are Alberta and Saskatchewan. A trend TransUnion notes will continue to occur in the following quarters as the oil industry continues to suffer.

“The recent findings from the TransUnion report, clearly indicates many consumers are living beyond their means and as a consequence, Canadians are struggling to keep up with their growing debt,” says Jeffrey Schwartz, executive director, Consolidated Credit Counseling Services of Canada.

“This is a troubling trend. The report suggests the most vulnerable Canadians will continue to increase their debt levels,” says Schwartz.

For Canadians who are struggling with debt, Consolidated Credit Counseling Services of Canada offers the following tips to help consumers get by:

  1. Examine your finances and create a budget. Determine your needs and wants and adjust your spending to make it work. Look at your whole financial picture from your grocery list to your cable bill. If you can live without it, remove it from your budget.
  2. Declutter your household to free up some cash. If you are in a serious cash crunch, now is the time to decide which assets you can sell to get some money. If you have more than one vehicle – consider selling one. Hold a garage sale to capitalize on items you no longer use in your home.
  3. Pick up the phone and call the creditors you owe. It is common for some consumers to hide from their creditors however if you are upfront with them about your financial situation, they may be able to work out a payment plan with you.
  4. If you are way over your head in debt, get help. Sometimes it is hard to manage debt on your own. When you are overwhelmed and unable to get your debt under control, seek the guidance of a trained credit counsellor. A credit counsellor will examine your financial picture and help you develop a plan to manage your debt.

 

-30-

 

About Consolidated Credit Counseling Services of Canada, Inc.:
Consolidated Credit Counseling Services of Canada is a national non-profit credit counselling organization that teaches consumers about personal finance.

For more information or to request an interview with Jeffrey Schwartz, please contact:

Natasha Carr, Manager of Community and Public Relations, Consolidated Credit Counseling Services of Canada, Inc., T: 416-915-7283 ext.1041, C: 416-830-4720, F: 416-915-5200, E: ncarr@consolidatedcredit.ca

Press Inquiries

pr@consolidatedcredit.ca
1-800-656-4120 x 1064