Canadian Family Debt is Increasing

Stats Canada published another one of their interesting long term studies about Canadians, and this one is of particular interest to me (and hopefully you), Study: Changes in Debt and Assets of Canadian Families 1999 to 2012 . The actual full report (which is also an interesting, but longer read) can be found on the Stats Canada Web Site, as well.

The full report outlines the following:

This paper examines changes in debt, assets and net worth among Canadian families with debt over the period 1999 to 2012, by selected family characteristics. It also examines the extent to which two key ratios of indebtedness, the debt-to-income ratio and the debt-to-asset ratio, varied over the period.

  • In 2012, the percentage of Canadian families with debt was 71%, up from 67% in 1999. The median debt held by these families was $60,100, up from $36,700 in 1999 (in 2012 constant dollars).
  • Between 1999 and 2012, median debt and median assets increased for most types of families, but not equally for all categories of families. Median debt, for instance, increased faster among those in the 35-to-44 age group, among couples with children under 18, and among mortgagees.
  • Between 1999 and 2012, the median debt-to-income ratio rose from 0.78 to 1.10, while the median debt-to-asset ratio remained stable, at around 0.25. Families in the 35-to-44 age group witnessed significant increases in both their debt-to-income and debt-to-asset ratios.
  • In 2012, 35% of Canadian families had a debt-to-income ratio above 2.0—meaning that their debt was at least twice the level of their annual after-tax income. This compared with 23% of Canadian families in 1999.
  • In 2012, 14% of families had consumer debt (i.e., debt other than mortgage debt) that was larger than their annual after-tax family income. In comparison, 8% were facing the same situation in 1999.

So the long and the short of it is yes Canadians are carrying more debt, their assets are worth more, but as usual you need to look a little closer at some of the data to see the more disturbing findings in the report (that confirm things we all keep suspecting, younger Canadians with young families (with kids) are starting to drown and the ocean continues to rise). I put that last bullet in bold to emphasize the growing consumer debt “balloon” that is inflating without control and when interest rates go up, wait for the big bang.

Debt to asset and Debt to Disposable Income ratio

Debt and Asset as a Ratio

As you can see the value of assets has gone up as much as debt, however comparing it to disposable income is a little more worrisome.

Percentage of families with debt, 1999 and 2012
Table summary
This table displays the results of Percentage of families with debt 1999 and 2012, calculated using percentage units of measure (appearing as column headers).
1999 2012
Families with debt 67.3 71.1
Age of major income earner  
15 to 34 79.6 78.6
35 to 44 80.0 84.7
45 to 54 76.4 80.7
55 to 64 60.9 70.3
65 and over 27.4 42.5

This table has some more worrisome number showing that folks 65 and over “with debt” has increased significantly. Seniors carrying debt loads? Why?

Table 2
Median debt and assets, families with debt, 1999 and 2012
Table summary
This table displays the results of Median debt and assets Median debt, Change, Median assets, 1999, 2012 and 1999 to 2012, calculated using 2012 dollars units of measure (appearing as column headers).
Median debt Change Median assets Change
1999 2012 1999 to 2012 1999 2012 1999 to 2012

2012 dollars








Age of major
15 to 34 24,400 39,300 14,900 63,600 92,700 29,100
35 to 44 63,000 142,600 79,600 234,000 413,800 179,800
45 to 54 50,500 87,800 37,300 355,400 552,700 197,300
55 to 64 26,200 49,300 23,100 404,100 656,800 252,700
65 and over 8,500 18,000 9,500 310,100 484,300 174,200

The age group 35 to 44 has had it’s debt load double, and while it’s assets are up, they have not doubled. Is this a “debt bubble” that is going to go boom if interest rates go up?

So it seems our assets have increased in value (but that does include real estate, which has increased significantly over this period in most Canadian Cities).

Read the report, it is a worrisome read.


Thanks to some badly phrased instructions, all the Tax Procrastinators out there have until May 5th to get their tax returns submitted to the CRA, but you still should be submitting your return (my theme for the week here).

Golf Ball

Off Season Up Close

For the Senators (the hockey ones) it is now Golf season (it was already Golf season for the Blue Team), after an exciting bit of comeback hockey, they finally ran out of gas, but still fun to watch, and no doubt helped the Ottawa economy with folks buying tickets, going to restaurants and the like.

Seems RBC customers are not too happy with the latest bank fee increases they have just received, and well they should be irked, as I always say, it should not cost a fortune to put your money in a bank.

Happy May Day to all my fellow members of the proletariat who control the means of production, we continue to be oppressed under the boot of the rich, but one day we shall rise and live in a Utopian society where all people earn the exact same wage, and everyone gets to ride a Unicorn to work, yeh, I couldn’t keep it together for the full rant. Sorry to tell fellow Ontarians, but this kind of rhetoric is going to be common place very soon when the Provincial Civil Service takes action against the latest Provincial budget.

The Kentucky Derby is tomorrow, for those who want to invest some hard-earned cash on that race. Not fond of the ponies? There is a big boxing match, where tickets are going for $7000 a piece on stub hub.

TigerDirect (CA)

My Writings for Week Ending May 1st

My time to write has increased thanks to the Senators and the Raptors exiting the playoffs,  I suppose I could start watching the Jays play, but the Kentucky Derby is this weekend (speaking of sure things):

  • The new austerity budget for the Province of Ontario underwhelmed me as I wrote in Ontario Budget 2015, M’eh…
  • Given the tax deadline is coming soon, a helpful list of the Best Excuses for NOT Submitting Your Taxes, and yes, some of them are real (maybe not the dog ones though).
  • As I did mention the Tax Deadline for 2015 has been extended to May 5th, but that doesn’t really give you any more excuses not to submit your taxes on time.

Click here for many more great financial stories


Tax Deadline

Tax Deadline is not today (for 2015) thanks to a badly phrased set of instructions, the CRA has extended the deadline for 2015 to May 5th, so you have a whole weekend to finish, and thus many less reasons to not do your taxes (i.e. I don’t have the time).

You need help with your taxes you say? Well, here is a veritable treasure trove of useful articles by me to help you out with your tax preparation this year (don’t say I didn’t try to help):

Hour Glass

Just a Little More Time for Your Taxes

You have the whole weekend to finish this, go get Turbotax, H&R Blocks Software, Ufile or whatever program you wish and get it done!



Best Excuses for NOT Doing Taxes on Time

For all of those who have not finished their taxes (in Canada) yet (April 30th deadline looms large), I would like to give you some of the excellent (what is the font for sarcasm) excuses that I have heard over the past years from friends and co-workers. (maybe you should read Myths About Your Taxes before you read this great list, just to make sure you are sure you don’t want to do your taxes):

Bad Dog eats taxes

Really, that is your excuse?
Photo courtesy Forbes

  • I don’t owe money, so I just couldn’t be bothered.
    Question: How do you know that you don’t owe any tax if you haven’t done your return?
  • My taxes are simple, so I am sure I don’t owe any money, so why bother ?
    Question: What if they owe you money? Don’t care? Want to send money to the “Send Big Cajun Man on Vacation fund”, if money means so little to you?
  • If I owe money, the CRA will tell me, soon enough
    Statement: WTF? Yes, and the CRA will also impose their penalties starting May 1st (or earlier) if you owe them money.
  • I might do it wrong, then the CRA will get mad at me
    Comment: The CRA might get mad at you, but my guess is their penalties won’t come into play, if you submitted your forms on time (although they may make you redo it, correctly)
  • I am on a worldwide cruise and can’t submit my taxes until I get back in September
    Comment: CRA’s answer might be, “Maybe you should have thought about this before you went away?”
  • The CRA always extends the deadline, so I don’t have to rush
    Comment: What if they don’t? (see penalties comment previously)
  • The dog ate my tax receipts!
    Comment: Get a new dog?
  • The dog at my computer?
    Comment: Umm…. next?
  • I didn’t submit my taxes last year, and they didn’t bother me, why should I bother this year? (repeat that excuse for 6 years)
    Question: You enjoy loaning money to the Government? You most likely are owed money, but the CRA doesn’t need to tell you that, do they?

Any other great excuses out there about not doing your taxes on time, that I might have missed? I guess with these great excuses you won’t need to Search For a Good Tax Preparer either?

Disclaimer: This article neither condones, nor espouses any of these lame excuses, do your taxes on time!


Ontario Budget 2015 M’eh…

The Ontario Provincial budget appeared last week to little fan fare, even though it looks to me like an austerity budget ( the media has dubbed it a Tory budget) and a long-term austerity plan, trying to balance the ever mercurial Ontario Budget (i.e. Ontario’s economy has been up and down like a dory in 20 foot swells).

If you use public transit (as you should (but I don’t)) there is money there for new programs (in Toronto) but not much for other areas. I suppose they could have cut Ottawa’s Light Rail money, but there doesn’t seem to be money there for the inevitable “expansion” of the light rail program here (but then again, is Ottawa actually in Ontario? Lots of folks in Toronto don’t seem to think so).

The major selling point of this budget is the attempt to balance Ontario’s Provincial Spending:

The deficit for 2014–15 is now projected to be $10.9 billion — a $1.6 billion improvement compared to the 2014 Budget forecast. Together with prudent fiscal management and actions to find smarter and better ways to deliver programs and vital public services that people rely on, Ontario remains committed to eliminating the deficit by 2017–18.

That is a very aggressive goal, and they are going to try to do it on the back of their major allies, the Provincial Public Service and Teachers’ Unions, and that is where they may end up with some problems (given the strikes already being called by the teachers). Could be some very unsettled labor issues for the next little while (given the assumption is no pay increases until the budget is balanced (effectively)).

Lots of other fixes that don’t cost much on Social Spending areas, but not a lot, given the austere plans the government has for its future. Some more help for post-secondary education grants (not a bad idea to slow down the creation of a Generation of Debtors, whose major lender is the government).

Where does Ontario borrow its money from?

Borrowing, Ontario Style

Who does Ontario Borrow from ?

And how much is Ontario paying in Debt financing charges?

Ontario Debt finance charges

Interest Expenditures for the Ontario Debt