Too few households paying off debts: report

Many Canadians aren’t threatened by today’s unsettled economy, but they’re still vulnerable due to high debt levels, says a 2015 report by CPA Canada.

Most of the households surveyed say they’re financially comfortable, and they rate themselves highly in terms of financial discipline. But, problem is, more than half (53%) aren’t saving on a regular basis, and only 60% are servicing their debts habitually.

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Even so, only 16% expect a negative change in their financial situations due to volatile economies and markets—that percentage changes when you look at provincial breakdowns, however, with more than a quarter of households in Alberta (34%) feeling their situations will worsen due to oil price weakness.

Kevin Dancey, president and CEO of CPA Canada, says, “Factors such as lower interest rates, cheaper gas and a strengthening U.S. economy may have some people thinking things are just fine, but it may be a matter of perception. No matter what happens with the economy over the coming months, the lingering issue of high debt levels cannot be ignored.”

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What’s also distressing, he finds, is more than half (51%) of non-retired households lack funds set aside for emergencies.

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