There has been a historic shift in the debt load in Canada according to the latest, quarterly consumer survey by TransUnion.
Millennials Now #1
The credit tracking company says Millennials are now the biggest debt holders in this country, surpassing Baby Boomers. Twenty-nine to 44 year-olds collectively hold $911-billion in debt; about 38% of the national total.
Gen X Feeling the Pinch
In general, Canadian households continue to report a deterioration in their finances with the “high cost of living” being the main factor. But Millennials and Generation X – the key household formation and homebuying demographics – report feeling acute financial pressures. More than half of Gen-Xers (51%) say their finances are worse than planned, making them the largest group in this category. Millennials have the highest percentage (35%) of consumers who say they will not be able to pay their current bills and loans in full.
Cost of Money, A Key Concern
Over the short-term (the next 6 months) three of the top financial concerns for Canadian households are inflation (82%), mortgage and rent costs (57%), and interest rates (45%). More than three-quarters (76%) say they are not considering purchasing a new home in the next year. Among those who said they do plan to buy a new home in the next year, rising home prices (59%) and high interest rates (44%) were the top two reasons for potentially changing their minds.
Almost half (49%) of all respondents indicated they are concerned about interest rate increases and how they will affect the ability to pay off loans, mortgage or credit. Of those who were considering applying for credit, but decided not to, 30% say the top reason was the high cost of new credit or refinancing.