It’s no secret that the amount of debt Canadians are taking on is reaching high numbers, and analysts are divided on whether or not this amount of debt is going to send us into another recession. However, it’s not as though we’re just spending and spending, not giving it another thought. It turns out, that many of us regret our debt – almost as soon as we slip into it. This comes from RateSupermarket.ca, which surveyed 2,929 Canadians this month, asking them about their current level of debt, and how comfortable they are with it. Turns out, a lot of us suffer from debt regret.
The survey shows that 60% of Canadians think that they currently have far too much debt. And while Canadian and Toronto mortgages are generally the biggest chunk of debt that someone holds, 38.8% of respondents said that it was actually credit card debt that kept them up at night with worry. This doesn’t mean that those in this percentage didn’t have a mortgage, simply that it didn’t concern them as much as their credit card debt does. One of the reasons for this, is because you can’t impulsively buy something with your home – while the case is not true for those little pieces of plastic. And even with the “ATM-style” of home equity lines of credit in Canada, we’re still likely to pull out those high-interest credit cards instead of borrowing at lower rates – at least when we’re talking about making small purchases.
Kelvin Mangaroo, President of RateSupermarket.ca says, “We found that one of the largest contributors to credit card debt seems to be impulse purchases of small items or food and entertainment, which, left to accumulate interest, can ultimately lead to a huge mountain of debt.” And, while homebuyers are usually very happy with their home purchases, it’s these little impulse buys that over one-third of survey respondents say that they regret the most.
The other two-thirds still don’t cite mortgage debt as one of their big regrets (probably because this is one of the only forms of “good debt” that there is.) Individuals who fall under that category say that bad investments, or buying cars was the debt that brought them the most regret.
In addition to showing how many Canadians are living with debt regret, it also asked Canadians where they thought their debt stood when compared with the debt of other Canadians. 53% thought that they held less debt than others in the country, 30.7% of Canadians thought that their debt was about average with debt others held in the country, and only 16.3% admit to probably having higher amounts of debt than other Canadians.
