Sands & Associates, British Columbia’s largest firm of Licensed Insolvency Trustees recently released the findings of its sixth annual BC Consumer Debt Study, based on survey responses from over 1,600 British Columbians who had either filed for personal bankruptcy or made a Consumer Proposal to creditors. This year’s study aimed to dig deep into the events and behaviours that cause debt problems, as well as comparing the habits and attitudes of individuals before and after filing personal bankruptcy or a Consumer Proposal.
Key findings from the 2018 BC Consumer Debt Study include:
- Before dealing with their debt, over 48% of respondents said they used credit for necessary expenses that they didn’t have enough income to cover.
- The majority of those surveyed had between $25,000 and $49,999 worth of debt (excluding car loans and mortgages) when they contacted or met with a Licensed Insolvency Trustee.
- The number one cause of debt cited by respondents was overextension of credit and financial mismanagement (26.8%) followed by triggering events such as job loss (15.7%), illness, injury or health-related problems (12.1%) and marital or relationship breakdown (11.6%).
- The top four debt warning signs were overwhelming stress, only making minimum payments, accumulating more debt and collection calls.
- Pressures of “fitting in” are causing an alarming rate of debt among younger demographics.
Vancouver-based Licensed Insolvency Trustee and Senior Vice-President of Sands & Associates Blair Mantin comments: “We’re seeing an alarming emerging issue in the 18 to 39 age group. This demographic is giving in to increased societal pressure to fit in including spending on things to impress others,” he says, adding the debt is often the result of too much credit too young.
Mantin says while the debt level of this group is still relatively small in comparison to other demographics, it raises a red flag because this age group should be saving to build for the future. He’s also concerned that this group worries about being judged and that over 40% delay getting debt help because they don’t know where to turn, as compared to 22.5% of the 40 plus age group. “Too many people wait and suffer a reduced quality of life for years under crushing stress because they’re embarrassed or they don’t know there are laws in place to protect them when they need help.”
Mantin further notes that although debt has become a way of meeting day-to-day financial obligations for many Canadians, consumers are urged to become educated about the warning signs of debt problems, to not wait to get debt help, and to know where to turn for advice.
Click here to learn more about other debt studies conducted by Sands & Associates.
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Sands & Associates has been helping individuals and small businesses become debt-free since 1990. Their qualified, reputable professionals take an empathetic and compassionate approach to helping consumers understand and access their legal debt solutions.
A leader in the debt help and legal debt solutions sector, Licensed Insolvency Trustees Sands & Associates have a network of 16 office locations throughout BC.
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