BMO Household Debt Report: Half of Canadians Expect to be Debt-Free by 2017
- While Canadians have taken on more debt in the past five years, the majority expect to pay it off in the same amount of time - Report shows average household debt in Canada is $112,329 - 'Good debt' such as mortgages likely outweighing less favourable forms of borrowing - Study shows differences between men and women
(firmenpresse) - TORONTO, ONTARIO -- (Marketwire) -- 06/06/12 -- BMO Bank of Montreal today released its first annual report on household debt in Canada, showing that the majority of Canadians with debt (54 per cent) expect to be debt-free within the next five years. The annual report is designed to measure the amount of debt Canadian households are carrying and how that debt is being managed.
Conducted by Leger Marketing, the findings revealed:
"While debt is a part of life for the majority of Canadians, it doesn't have to be a permanent fixture," said Su McVey, Vice President, BMO Bank of Montreal. "While interest rates have likely kept debt loads manageable for many households, that picture may be poised to change in the coming year. Developing a debt repayment plan that reduces debt but also accounts for other priorities and financial goals such as savings is essential."
The dangers of household debt have been repeatedly reinforced by the Bank of Canada and the Federal Government as levels have hit record highs. However, the latest numbers show that Canadian households seem to be getting the message.
"After the lengthy run-up of the past decade, it's encouraging that many Canadians are planning to rein in their debt, as interest rates won't stay low forever," said Sal Guatieri, Senior Economist, BMO Capital Markets. "Household credit growth has slowed to five per cent in April from a nine per cent clip over the past 10 years."
According to data from Statistics Canada, residential mortgages, typically considered 'good debt' as it is tied to household assets, accounts for 63 per cent of household liabilities, while consumer credit makes up approximately 28 per cent.
The report also showed that while most Canadians (70 per cent) say that they can afford to pay down their debt by paying more than minimum payments, one-third (30 per cent) appear to be treading water by paying only the minimum amounts.
Ms. McVey added that BMO offers a few tools and products Canadians can use to track their household finances and save. For example, BMO MoneyLogic allows Canadians to track and review their spending limits and savings goals in real time. "Once you have a clear idea of where your money is going, it makes it easier to course-correct where you may be over-extending and put a savings plan in place."
Ms. McVey noted that high-interest savings accounts, such as the BMO SmartSaver Account, are an excellent option for Canadians looking to begin saving for long-term goals, or simply to put a 'rainy day' fund in place to prepare for the unexpected.
Demographically, the report revealed:
The BMO Household Debt Report was conducted by Leger Marketing and compiled via on-line survey questions from April 2nd, 2012 to April 5th, 2012 using Leger Marketing's online panel, LegerWeb, with a sample of 1507 Canadians. A probability sample of the same size would yield a margin of error of +/- 2.5 per cent, 19 times out of 20.
About BMO Financial Group
Established in 1817 as Bank of Montreal, BMO Financial Group is a highly-diversified North American financial services organization. With total assets of $525 billion as at April 30, 2012, and more than 46,000 employees, BMO Financial Group provides a broad range of retail banking, wealth management and investment banking products and solutions.
Contacts:
Media Contacts:
Peter Scott, Toronto
(416) 867-3996
Matthew Duffin, Toronto
(416) 867-3996
Ronald Monet, Montreal
(514) 877-1873
Laurie Grant, Vancouver
(604) 665-7596
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Datum: 06.06.2012 - 10:00 Uhr
Sprache: Deutsch
News-ID 153554
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