Canadian Families are in A Lot of Debt Coming into the Holiday Season

While the Canadian economy continues to strengthen, Canadians continue to carry record amounts of debt. The CBC recently reported on a Trans Union report on Canadian debt trends and the numbers were revealing to say the least.

As of August 2012, the average overall consumer debt in Canada had risen to its highest level since 2004, with the average consumer debt load sitting at over $26,000. This does not even include mortgage debt. In Ontario in Q2 2011, the average consumer debt load was $24,721, and in Q2 2012 Ontario saw this number increase to $25,447.

These numbers are startling because, while the economy continues to improve, we are not out of the woods yet. Interest rates are still at historic lows and CMHC has gradually implemented changes to their guidelines making it more difficult to obtain high ratio mortgage insurance in Canada. These strides by CMHC have been in conjunction with a consolidated effort by the Ministry of Finance to try to mitigate the effects of a looming housing bubble in Canada.

Eventually mortgage interest rates in Canada will go up, and when they do, families carrying a significant amount of consumer debt will find it increasingly difficult to make ends meet, if they have not found this to be the case already. We surmise that the consumer debt level may be as high as it is because many families are looking to credit to fill budget shortfalls.

The holiday season is a better time than any for you to help your clients look for ways to improve the state of their finances and get their debt under control. Over the years, DebtCare has come to be known as a trusted resource to businesses that provide services to people who struggle with debt, supporting accountants, legal professionals, real estate investors, employee assistance program providers, and more. We help your clients get to a healthier financial state, which in many cases makes your job working with them easier. Debt can lead people to have other problems, such as with personal relationships or with employers, and can lead to additional financial issues. Having the resources to help your clients through the rough times creates a point of distinction that sets you apart from your competition. Whereas debt causes significant stress, generally once a person gets their finances under control they experience physical and emotional relief.

If there is one thing that these reports demonstrate it is that debt continues to be a problem for the average Canadian and many are in need of help.

If you would like more information about the services that DebtCare Canada offers to businesses like yours, please reach out to me at 416-907-2582 ext 258? Or visit www.debtcareserivces.ca

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Karen Goldenberg is the Director of Community Outreach at DebtCare.