About one-third of Canadians aged 20-69 with a household income of $40,000 or more are spending their money faster than they make it, according to a recent survey by Manulife Bank of Canada.
The pressure to make sure they’re not “missing out” can leave Canadians feeling defeated year-round. In fact, 19 per cent of those with debt feel they can't break the habit, according to the survey. As well, nearly four in 10 (36 per cent) Canadians living with debt say they experience joy from seeing debt paid off.
Debt affects people, including impacting their mental health
There are many ways that debt negatively impacts people, such as limiting what they can do with family and friends (22 per cent), making it impossible to spend money on entertainment (18 per cent), and negatively impacting their mental health (17 per cent) among several other things.
“Millennials are now at the age of purchasing houses and starting families, which are two areas where we are seeing expenses grow. Housing affordability remains at near-historic levels across the country and child-care costs have risen faster than inflation for Canadians,” said Rick Lunny, President and CEO, Manulife Bank.
Most likely to be stressed are those under 55, women, and those with a lot of debt.
Doing away with debt ranks as a top financial achievement
When asked to rate the perceived joy they would receive from various financial achievements, two in three Canadians place escaping debt first or second overall, followed at a distance by having a sufficient nest egg for retirement.
Manulife says adjustments to non-essential spending provide an opportunity for Canadians to cut back on spending. Millennials are much more willing to sacrifice dining out when compared to those over 35 years. Women are about twice as likely as men to say they would stop shopping for non-essential goods and services to reduce their debts. Men and those 35 and up are most willing to give up travelling.