One-in-five Canadians with debt say they expect they will need to liquidate assets (e.g. cash in their RRSPs, get a second mortgage, sell a vehicle, etc.) to help pay off (or pay down) their debt. The need to liquidate is reported as significantly higher among males (24%) vs. females (14%) and those with children under 18 (23%) vs. without children (16%).

The Household Debt Survey, a Leger poll of 1,515 Canadians, was conducted for non-profit organizations FP Canada and Credit Canada as part of their series to uncover financial concerns that confront Canadians on a daily basis, such as budgeting, bill payments, debt, cost of living and job security.

New forms of debt

The survey also found that almost two-thirds of Canadians with debt (62%) anticipate taking on new forms of debt in the year ahead. Within this group, those under 55 years of age are significantly more likely to anticipate new forms of debt (67%) compared to those who are 55 and older (50%). Below are the anticipated new forms of debt:

  • New/increased credit card balance (23%)

  • New/increased line of credit (15%)

  • New/increased vehicle loan or lease (13%)

  • New/increased mortgage (12%)

Kelley Keehn’s 30-Day Anti-Budget – an exercise in awareness and behavioural change

Each year, Kelley Keehn, author, educator and Consumer Advocate for FP Canada, encourages her readers, family and friends to account for every single dollar spent in a 30-day period. She urges them not to do anything different, just write down every expenditure. Awareness kicks in by the end of week one and many people effortlessly cut back on purchases.

“Many Canadians lack awareness of their spending habits and patterns,” said Kelley Keehn. “There are several ways to create awareness, such as paying only with cash for a month which accesses a different part of the brain that is associated with loss aversion. A good person to take this journey with is a CFP® professional who can help create a holistic financial plan.”

The psychology of debt

Credit Canada’s Snowball vs Avalanche Debt Calculator is designed to help Canadians with debt figure out the best repayment method, which in many cases comes down to an individual’s personality. Despite traditional economic theory, not all financial decision-making is rational—much is based on behavioral, emotional, cultural and social factors. The snowball method involves paying the smallest debts first regardless of the interest rate; it can achieve quick upfront wins which helps motivate people to stay on track. Meanwhile, the avalanche method focuses on the debts with the highest interest rates first, which can save money in the long run.

“Budgeting and debt are inexorably linked,” says Laurie Campbell, Credit Canada CEO. “There’s no better time than ‘budget month’ for people to take a step back and holistically review their finances, housing costs and expenses—essentially, how much money is coming in versus how much is going out.”

The full results of the survey can be found on the FP Canada website.

About the Household Debt Survey

The survey of 1,515 Canadians was completed between January 4 and January 7, 2019, for Credit Canada and FP Canada using Leger’s online panel. The margin of error for this study was +/-2.5%, 19 times out of 20. Leger’s online panel has approximately 400,000 members nationally and has a retention rate of 90%.


Managing debt gets much easier if you work with a CFP professional. To get started, use our Find Your Planner tool to find a CFP professional near you.

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