Fewer residents in Manitoba and Saskatchewan are close to financial insolvency than they were a few months ago, according to the MNP Consumer Debt index.
The index, which is a quarterly survey conducted by Ipsos on behalf of MNP, measures Canadians’ attitudes toward their consumer debt and gauges their ability to pay their bills.
According to the results, the number of prairie residents who say they are $200 or less each month away from financial insolvency decreased 10 points since December.
Less than half said they are in this position, including 27 per cent of people who said they have no extra money at the end of the month to cover bills and debt payments.
Despite the fact that fewer are hovering close to financial insolvency at the end of the month, more than half are still worried about their ability to repay debts and 46 per cent of people believe they could be in financial trouble if interest rates increase.
“Many people are maxed out without a plan for paying back what they have borrowed. This raises many alarming questions about how and if their debts can be repaid, particularly if conditions deteriorate or interest rates rise,” said Gord Neudorf, a licensed insolvency trustee in Winnipeg with MNP.
Forty per cent of Manitoba and Saskatchewan residents said they won’t be able to cover all living and family expenses in the next year without taking on more debt, which is down seven points since December.
Significantly fewer residents said they are concerned about their current level of debt, down four points.
However, 49 per cent of people said they are concerned about the impact of rising interest rates on their banks (up two points), and just over one-third of people said a rate increase could move them towards bankruptcy.
For this survey, Ipsos polled 2,070 people online. The poll is accurate to within plus or minus 2.5 per cent, 19 times out of 20, had all Canadians been polled.