Manitobans' consumer debt jumps by 8%

Manitobans are falling deeper into debt, according to a newly released report.

Manitoba's consumer debt levels jump

CBC News: Winnipeg at 6:00

8 years agoVideo
A new report has found Manitobans are among those Canadians spending more money they don't yet have. CBC's Jillian Taylor reports. 2:04

Manitobans are among a large number of Canadians who are taking on more consumer debt, according to a newly released report by TransUnion.

The report found the average Canadian’s consumer debt-load hit a new high over the past year, rising to almost $27,500.

In Manitoba, the average consumer debt-load sits at about $21,500.

The report took into account debt from credit cards, lines of credit and personal loans but didn’t include money owed on mortgages, which means many Manitobans owe much more than that.

Winnipegger Susan Bruce said she tries to keep her credit card balance below the $1,000 mark and pay it off as quickly as she can.

"When I was younger, I had a bad experience with it once, and it’s taken me awhile to build up my credit," said Bruce.

But many Canadians aren’t keeping their debt in check.

The report found on average, Canadians carry about $3,500 worth of credit card debt alone.

Tom Higgins of TransUnion Canada said low interest rates are owed part of the blame for Canadians’ high debt-loads.

"You know all the interest rates are lower, so you can carry more debt but pay the same interest payments," said Higgins.

In Manitoba, consumer debt jumped by eight per cent over the last year.

"We should be worried about the same things and maybe not to the same extent," said Winnipeg investment advisor David Christianson. "It’s a concern for Manitobans as well as people in the rest of Canada."

Low interest rates, loose credit to blame

Christianson believes low interest rates and loose credit are to blame.

He said too many Manitobans are using their homes like ATMs — borrowing against it to make new purchases.

"They’re loans taken out usually to buy consumer goods — either things that disappear immediately like trips or things that depreciate over time like stereos and electronics and cars," said Christianson.

Scott Hannah is the head of the Credit Counselling Society. He said the number of Manitobans seeking help with their debt increased last year.

Hannah blames Manitobans' changing views on what sort of debt is acceptable to take on.

"It says that the traditional values of delayed gratification have been replaced with immediate gratification," said Hannah.

"People in Manitoba want the same things that everyone else wants in Canada — more things and in many cases, living beyond their means."

Financial planner Aurele Courcelles said to get debt under control, Manitobans need to look at their spending.

Courcelles advises rethinking big impulse purchases like televisions or cars.

"If you’re in a situation where you have a lot of debt — credit card debt, high-interest debt — you can get a personal loan or line of credit, which typically carries a lower interest rate," said Courcelles.

He said Manitobans should also look at consolidating their debt and making a budget and sticking to it.