“We are seeing a modest improvement in the number of Canadians who are at risk of insolvency since last quarter, however, it is important to note that nearly half of Canadians are still just $200 away from not being able to cover their bills and debt obligations. With less room in their budgets, any future increases to interest rates or the prices of everyday items could push individuals closer to insolvency,” said Bazian.
He added that younger Canadians are feeling the squeeze of inflation more than the rest, making them more vulnerable to economic changes.
Read more: Younger Canadians are concerned about rising living costs
Renters and households with lower incomes may also be more financially exposed to the effects of rising interest rates and cost of living. Renters are significantly more likely than homeowners to be worried about how rising interest rates will affect their financial situation (34% of renters vs. 29% of owners).
Renters are much more likely to be worried about their ability to pay back their debts (63% of renters vs. 48% of owners); the chances that rising interest rates will put them in financial trouble (59% of renters vs. 41% of owners); or the idea that they may file for bankruptcy (45% of renters vs. 27% of owners).
