Debt hits record level as Canadians borrow more than they earn, says StatsCan

Interest rates have fallen throughout 2015, making borrowing more attractive, and Canadian households have responded by increasing debt levels to an all-time high.

Statistics Canada says household debt in the third quarter hit record highs rising to 163.7 percent. Put in real terms the average household has about $1.64 in debt for every dollar of disposable income.

We know low interest rates have enticed people to take on bigger mortgages or buy newer vehicles but you only have to scratch below the numbers to see that a lot of people are going into debt to maintain their day to day living. Job losses and dwindling savings accounts mean many have had to rack up credit card debt.

Unlike a government where it can go into debt for its operational budgets most Canadians are at the mercy of credit cards and high interest rates to stay above water.

Consolidating debt and paying it off with a lower interest rate is a better solution. For those Canadians who are struggling it’s important to note that not all debt is frivolous.

Agencies/Canadajournal