Debt levels in Canada have been of great concern to officials for some time now. The general perception is that people in financial trouble are wildly irresponsible with their money, deadbeats, or both. While there are certainly people like that out there, the truth of the matter is that a large percentage of honest, hardworking folks are carrying around debt levels that far exceed comfortable levels. Increasingly, people are relying on such sources of easy cash as payday loans, credit cards, and lines of credits just to get by from month-to-month, with no tangible source of financial relief on the horizon to wipe away those debts.
According to Statistics Canada, for every dollar of disposable income they have, Canadians owe about $1.67. That is a substantial amount and leaves many living their lives with very little margin for error. Unfortunately, life constantly throws unexpected things our ways, like repairs, replacements, even lawsuits. Not having money on-hand to deal with such issues can lead to even bigger problems. Those may not only result in financial ruin, but declines in both a person’s health and mental health.
The main takeaway is that we need to return to the days when people’s lives were funded only by their cash flow and credit was something you used solely in times of emergency. Of course, in our consumer culture, we are constantly bombarded with advertising stating how much we need certain things, almost none of which are absolutely necessary for leading a comfortable and successful existence.
One thing that has saved some consumers is the increasing willingness of companies to negotiate proposals where the debtor would only have to pay back a portion of what they owe. This has helped reduce the number of personal bankruptcies from what they might be, though these also remain distressingly high.