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Personal Finance Survey Finds One in Five Canadians Expect Debt “to Go or Be Forgiven”

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When it comes to their debts, it seems that many Canadians are taking a Leonard Cohen page and waiting for a miracle.

In a pre-holiday financial picture of 1,500 Canadians, more than one in five (21%) said they “expect their personal debts to go away or be canceled.”

Credit Canada, the credit counseling agency that commissioned the Angus Reid study, called this issue “”shocking. “

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Household debt experts say this is not normal; it’s a sign that, amid the stress and uncertainty of the pandemic, many people are simply abandoning any sort of strategy to fix their finances and perhaps hoping for a government bailout instead.

The attitude makes sense given the ongoing pandemic, said Stacy Yanchuk Oleksy, director of education and community outreach at the Credit Counseling Society.

Typically, seizures are time-limited, “while it drags on.” People feel hopeless. People have a lack of control, ”she told HuffPost Canada over the phone.

But “wishing and hoping is not a good financial strategy. We all like to stick our heads in the sand every now and then. And that’s a good strategy, for a day, ”she said.

It’s true that ignoring debts will make them go away over time, Oleksy noted – but not before a lot of bad things happen first.

“There are a lot of consequences. There are appeals and collection letters, possibly legal actions, garnishment of wages if you are employed.

The consequences of a default will follow you for six or seven years. During this time, it may be more difficult, if not impossible, to get a credit card or a car loan, and you may face higher mortgage rates than borrowers with good credit.

People in financial difficulty should “resist the urge to borrow for daily expenses,” Oleksy said, because it is sure to get you in trouble. Try to actively save money, as much as you can, as this develops good spending habits. And don’t be afraid to ask for help, Oleksy said – there are nonprofit credit counseling agencies you can turn to.

Grant Bazian, president of the Licensed Insolvency Trustees group MNP Ltd., is pretty blunt about these survey results. He attributes this attitude to “naivety… There isn’t a lot of financial knowledge out there. Part of it can be wishful thinking.

The government was so proactive in helping households and businesses when the pandemic hit that some might expect “the government to come and save the day,” he told HuffPost Canada.

Do people give up?

This does not mean that Canadians are deliriously optimistic about their future. In fact, the Credit Canada poll shows that respondents appear to be pessimistic on several fronts.

Twenty-one percent say they are unsure of their income in the next six months. One in eight (12%) said they did not expect to fully recover from the pandemic, and – perhaps most telling – 9% said they did not expect to find work and expect to continue receiving government income support.

This level of pessimism is based on sentiment, not an actual budget assessment, Oleksy said.

“It’s based on the current experience of feeling helpless and hopeless, and without proper control,” she said.

Bazian calls it “Covid fatigue”. People are “tired of what’s going on, depressed, alone, unsure. People do not thrive in uncertainty.

He adds, “I would encourage people to see hope again. It will end. Pay a little attention to what you are doing. Life will return to normal, the history of the world shows.

The Angus Reid Poll for Credit Canada was conducted online from October 21 to 23, 2020, among 1,500 Canadian Angus Reid Forum members. Online surveys generally have no margin of error, but a conventional survey of this sample size would have a margin of error of +/- 2.5 percentage points, 19 times out of 20.


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