Chris Motion introduced this week’s guest speaker, Lana Gilbertson from MNP Ltd. Lana is a trustee who assists individuals and businesses facing insolvency.
Household and consumer debt is now trending up after a quiet period following the 2008 financial crisis. Insolvencies peaked in 2009, the held steady, and now, since 2016 has been growing again. Thought to be related to housing costs. As of the 4th quarter in 2018 the figures are staggering with the average household owing 180% of their income. In terms of household debt to income ratio, Canada is growing in relation to the U.S.; nationally > 200%. The worst being Victoria ~240% and Vancouver ~230%. Note: household debt includes mortgages, credit, car and personal loans, etc.
Looking regionally, Alberta has had the highest increase in insolvency/bankruptcy filings (probably due to the decline in the oil sector); then Ontario, and then Newfoundland/Labrador. British Columbia has been relatively stable with approximately 10,000 filing every year.
From the MNP Consumer Debt Index as of March 2019: Canadians are feeling worse about their consumer debt and personal finances than was the case just three months ago. The MNP Consumer Debt Index has fallen four points since December, signalling growing concern and deteriorating financial stability for many.
People facing huge debts are not, for the most part, bad people. There is certainly a spectrum of those who are completely irresponsible through to those who are facing circumstances completely out of their control (e.g., the leaky condo problems). Lana and others trustees are there to help secure an opportunity for these individuals and businesses to deal with their debt in the best way possible and to help them rebuild for the future.
Some more info:
A WORTHY REMINDER
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