Debt levels are rising across the country, but a new study shows that delinquency rates — debt that is past due — are climbing even faster as financial pressures mount on Canadians.
Average non-mortgage debt rose by 3.8% to $21,810 as of last year’s third quarter, while delinquency rates climbed 19.1% to 1.4%, according to a Money.ca study released Tuesday.
The study was based on data from Equifax, as well as other supplementary economic data. It pointed to stagnant incomes, high interest rates and the rising cost of living as contributors to rising debt and delinquencies.
The average statistics conceal significant regional variances, with Quebec seeing the biggest rise in delinquencies — up 24.2% — despite a modest 2.7% year-over-year increase in average debt. At 1.04%, however, its delinquency rate is the lowest in Canada.
At the top end, Alberta’s delinquency rate reached 1.81% last year, reflecting a 17.4% year-over-year increase. Average non-mortgage debt in the province of $24,555 was second only to Newfoundland, where average debt sat at $24,771 in last year’s third quarter. Even so, Newfoundland was the only province to see a decline in the delinquency rate — down 0.46% to 1.42%.
In addition to variations based on location, there were significant differences in credit and delinquencies by age group. Pre-retirees between 56 and 65 saw their debt levels jump the most, by 6.28% year over year to $28,410. Delinquencies in the group rose by 16.9%. Among 36-to-45 year olds, debt increased 3.2% to $26.984, and delinquencies rose 24.4%. That’s higher than any other age group.
The most indebted group was 46-to-55 year olds, with average non-mortgage debt of $34,317.