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The share of insolvencies increased among Canadian debtors aged 50 and older in 2020, according to a study from Toronto-based licensed insolvency trustee Hoyes, Michalos & Associates Inc.

The firm found that the share of insolvencies among the 50-plus demographic reached 29.8% in 2020, up from 28.3% in 2019. Post-pandemic, that share rose to 31.4%.

Despite high consumer debt before the pandemic and severe job losses from economic lockdowns, overall consumer insolvencies fell to 20-year lows last year. However, older Canadians were more affected.

The share of insolvencies increased by 4% among debtors aged 50–59 and by 7% among debtors aged 60 and older, reversing a trend of younger debtors filing for insolvency at increasing rates.

“CERB softened the financial impact of Covid-19 job losses for younger debtors but provided less cushion for older debtors whose income tends to be higher,” the firm’s co-founder, Ted Michalos, said in a release. “Combine this with a significantly higher debt load among older debtors, and you still have a debt repayment problem.”

The unemployment rate among insolvent debtors doubled to 12% in 2020. Non-retired seniors aged 60 and over saw their income decline more than any other demographic, by 10.7%.

The average insolvent debtor owed $58,555 in consumer credit last year, including $16,548 in credit card debt — the highest level since 2014.

Credit card payment deferrals likely contributed to the 11.2% spike in credit card debt, as well as a higher unemployment rate among insolvent debtors, the study said.

“Despite pandemic supports, older debtors found themselves facing a race against time,” firm co-founder Doug Hoyes said in the release. “Payment deferrals and a closed court system certainly helped reduce the pressure to make payments. Unfortunately, pre-retirement debtors were looking at a shrinking window of opportunity to get out of debt.”