Study: Debt and family type

Warning View the most recent version.

Archived Content

Information identified as archived is provided for reference, research or recordkeeping purposes. It is not subject to the Government of Canada Web Standards and has not been altered or updated since it was archived. Please "contact us" to request a format other than those available.

Related subjects

    [an error occurred while processing this directive]

Data from the Canadian Financial Capabilities Survey indicate that in 2009, 76% of Canadians aged 19 to 64 lived in a household that carried debt. Among those with debt, the average debt load was about $119,000.

This study uses indicators such as ratios of debt to income and ratios of debts to assets to examine the types of families most likely to face financial instability as a result of their debt. Young families were most often in this situation.

For example, among couple families with debt in 2009, those in the 19-to-34 age group had a ratio of debt to pre-tax income of 180%. This means that for every $1,000 in pre-tax income, these families owed $1,800.

In contrast, the ratio of debt to income for couple families in the 50-to-64 group was 125%. For every $1,000 in pre-tax income, they owed $1,250.

Survey data also indicated that 4.2% of all households had annual debt repayments equal to 40% or more of their income. In general, the Bank of Canada considers households to be at greater financial risk if their total debt payments are equivalent to 40% or more of their income.

Income was a key factor in determining high debt ratios. For example, households with incomes of less than $50,000 had more than six times the odds of having debt payments of 40% or more of pre-tax income and 1.6 times the odds of having a debt-to-asset ratio of 80% or greater, compared with those with incomes between $50,000 and $79,999. These results held irrespective of the family type.

People born in Canada had 60% lower odds of having debt payments of 40% or more of pre-tax income compared with those born outside Canada. Living in a census metropolitan area with high housing prices was also associated with having high debt ratios.

Definitions, data sources and methods: survey number 5159.

The article "Debt and family type in Canada" is now available in the April 2011 online issue of Canadian Social Trends, no. 91 (11-008-X, free), from the Key resource module of our website under Publications.

Also in this issue of Canadian Social Trends is the article "How does bankruptcy affect retirement plans?" Using the 2007 General Social Survey, this article identifies pre-retirees aged 45 to 64 who have experienced a bankruptcy and examines how they are preparing for retirement.

For more information, or to enquire about the concepts, methods or data quality of this release, contact Client Services (613-951-5979;, Social and Aboriginal Statistics Division.