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Is household debt cracking Canada’s financial foundation?


November 22, 2019


Two-in-five do not expect to escape debt in their lifetime and the spending-to-income ratio is trending negatively in Canada according to Manulife Bank Debt Survey.

  • Ninety-four per cent of Canadians say the average household is in too much debt. 
  • The spending-to-income ratio is trending negatively as 45 per cent report that their spending is increasing faster than their income versus 33 per cent from the spring. 
  • Sixty-seven per cent of Canadians who are in debt assume everyone else is as well. Two in five doubt they will ever be debt-free in their lifetime.


TORONTO – An overwhelming majority of Canadians agree the average household is in too much debt according to the latest findings from Manulife Bank Debt Survey. Likewise, two-in-five indebted Canadians do not expect to escape it in their lifetime and the incidence of Canadians with considerable non-mortgage related debt is climbing.

Household debt becoming overwhelming

Virtually all Canadians (94 per cent) surveyed agree the average household is in too much debt. Since Spring 2019, there has been a nine-point increase (55 per cent vs. Spring 2019 at 46 per cent) in the incidence of Canadians who report having considerable non-mortgage related debts. Sixty per cent of them report that they have non-mortgage related debt on credit card(s) that carry a balance, a twelve per cent increase over what was observed in Spring 2019 (48 per cent).

“There is a financial wellness crisis, and it’s affecting Canadians of all demographics,” said Rick Lunny, President and CEO, Manulife Bank. “The good news is that there are intuitive, helpful tools out there to make people’s financial decisions easier and lives better.”

Spending continues to affect Canadians with the spending-to-income ratio trending negatively from 33 per cent in Spring 2019 to 45 per cent this fall. In fact, only 12 per cent of respondents noted their income is increasing faster than their spending.

Financial outlook by generation

Are Canadians living in Generation Debt? Baby Boomers are in much better financial shape than their Generation X and Millennial counterparts, both of which are struggling. Three-in-five Baby Boomers surveyed noted they are better off financially than their parents were at the same age, compared to just under half (49 per cent) for Generation X and Millennials.

Generation X, which perceives itself as being in the most debt, saves the least of its after-tax income and is most likely to report that spending is outpacing income, and is the most skeptical about ever being debt-free in its lifetime according to the survey.

Millennials are struggling too, as they have experienced the most difficulty when trying to enter the workforce (14 per cent stated they struggle a lot versus nine per cent for those aged 41-69 years old). However, things are not entirely bleak for this group as they are among the most likely to indicate that their income is increasing faster than their spending (14 per cent versus 10 per cent for those 41-69 years old). Technology may also help them get into better shape financially than their predecessors. Three in four millennials feel it is important to have access to financial plans online, preferably through an app.

Over half of indebted Millennials who feel in control of the situation indicate that technology has helped them manage their debts compared to just one in three Generation X & Baby Boomer Canadians.

“We know Canadians are looking for straightforward digital options to monitor and manage financial goals. That is why we built our new app experience from the ground up and centred it on what our customers need. We are dedicated to continuously developing and delivering digital, customer-centric tools – like our Savings Sweeps which automatically moves excess money into your savings account each night – helping Canadians save and manage their money better,” said Rick Lunny, President and CEO, Manulife Bank.

Relationships and finance

Approximately nine-in-ten Canadians feel comfortable sharing their complete financial picture with their spouse.

While many share financial responsibilities with their partner, of the 21 per cent of people who do not combine finances and are not considering it, 41 per cent cite ideology and more specifically a mutual belief that financial autonomy is important (23 per cent). In addition, nine per cent cited their partner’s shopping addiction and another three per cent noted their partner’s addiction to drugs and/or alcohol as reason to keep finances separate.

Competing financial priorities can make it hard to manage finances while in a relationship. Should you focus on paying off debt, maxing out your retirement contributions, budgeting for a down payment on a house, or saving up for that big trip abroad? Sorting out financial goals and identifying what matters most is a smart way to create an actionable financial plan.

Learn more about the Manulife Bank of Canada Debt Survey and ways to manage finances by visiting:


About the Manulife Bank of Canada Debt Survey
The Manulife Bank of Canada poll surveyed 2,001 Canadians in all provinces between ages 20 and 69 with household income of more than $40,000. The survey was conducted online by Ipsos between September 20 to September 26, 2019. National results were weighted by gender, age, region and education. This survey has a credibility interval of +/- 2.5 per cent 19 times out of 20, of what the results would have been had all Canadian adults between the ages of 20 and 69 been surveyed.


About Manulife Bank

Established in 1993, Manulife Bank was the first federally regulated bank opened by an insurance company in Canada. It is a Schedule l federally chartered bank and a wholly-owned subsidiary of Manulife. As Canada’s first advisor-based bank, it has successfully grown to more than $22 billion in assets and serves clients across Canada.


About Manulife
Manulife Financial Corporation is a leading international financial services group that helps people make their decisions easier and lives better. With our global headquarters in Toronto, we operate as Manulife across our offices in Canada, Asia, and Europe, and primarily as John Hancock in the United States. We provide financial advice, insurance, as well as wealth and asset management solutions for individuals, groups and institutions. At the end of 2018, we had more than 34,000 employees, over 82,000 agents, and thousands of distribution partners, serving almost 28 million customers. As of September 30, 2019, we had over $1.2 trillion (US$881 billion) in assets under management and administration, and in the previous 12 months we made $29.8 billion in payments to our customers. Our principal operations in Asia, Canada and the United States are where we have served customers for more than 100 years. We trade as 'MFC' on the Toronto, New York, and the Philippine stock exchanges and under '945' in Hong Kong.


Media Contact:                              

Shabeen Hanifa