CALGARY, ALBERTA--(Marketwire - Feb. 22, 2013) - Consumer debt in Canada has reached an all time-high. According to the latest calculation from Statistics Canada, families now owe about $1.65 for every dollar of after-tax income; about the same level reached in the United States before the financial crisis. Canada's housing market is also showing increasing signs of weakness, with housing starts plummeting nearly 19 per cent in January.
David Smith, President of Personal Bankruptcy Canada, a nationwide network of independent trustee practices that help people deal with debt, warns Canadians to stop borrowing now.
"The appeal of rock-bottom interest rates has led many to over borrow. Now debt trouble is about to sneak up on them," says Smith.
For now, total consumer insolvencies appear to be decreasing and delinquency rates remain low across all major debt categories. But Smith argues that these are signs that Canadians are "kicking the can down the road".
"Many Canadians have entered a danger zone. The reality is that any sort of financial hiccup at this point may make it impossible for them to meet their debt repayment obligations," says Smith.
Those pushing their financial limits are advised to speak with a bankruptcy trustee to help understand the options available to honestly deal with their debt realities.
"Trustees are the only debt professionals that can offer a full range of debt relief services. We can help consolidate and restructure debt, but more importantly, we work to inform our clients. Financial literacy is the key to changing damaging spending behaviours," adds Smith.
About Personal Bankruptcy Canada
Personal Bankruptcy Canada is a free website that provides consumers with general debt and bankruptcy resources, including access to highly qualified bankruptcy trustees across the Canadian provinces and valuable education information on bankruptcy and debt management.
Personal Bankruptcy Canada member trustees from across the country are available for local media interviews regarding bankruptcy, debt and financial literacy. To schedule an interview please contact Angela Joyce.