Excerpt: With the availability of debt management services, many Canadians are finding ways to reduce their debt and save money. Learn more about the different debt levels in BC, Alberta, and Ontario here.

In this article, we will compare the debt levels of Ontario, Alberta, and British Columbia, examine factors that influence debt, and explore the management solutions available.

Comparing BC, Alberta, and Ontario Debt Levels

To compare the debt levels, we’ll explore a breakdown of British Columbia, Alberta, and Ontario’s average debt totals and the percentage of the total for each type of debt. The statistics explored in this section are from Statistics Canada, which collected data from its 2023 Survey of Financial Security. 

Alberta

The average amount of debt an individual has in Alberta is $220,600. Their debt percentage breakdown is as follows:

• Mortgage Debt: Makes up 80.1% of an individual’s total debt with an average of $267,900.
• Lines of Credit: Make up 6.6% with an average of $49,600.
• Credit Card and Installment Debt: Make up 2.8% with an average of $11,500.
• Student Loans: Make up 2.6% with an average of $26,700.
• Vehicle Loans: Make up 6.1% with an average of $31,300.
• Other debt: Make up 1.8% with an average of $29,000.

Consider Alberta credit counseling with Debt Relief Canada to help manage your debt. They report an average debt level of $39,184 for their Alberta 2024 clients.  

British Columbia

The average debt for an individual in British Columbia is $261,600. This high level reflects the high cost of owning a house in the province. Here is their breakdown.

• Mortgage Debt: Makes up 84.7% of an individual’s total debt with an average of $411,400.
• Lines of Credit: Make up 6.9% with an average of $71,100.
• Credit Card and Installment Debt: Makes up 2% with an average of $10,300.
• Student Loans: Make up 1.1% with an average of $21,500.
• Vehicle Loans: Make up 3.1% with an average of $27,600.
• Other debt: Makes up 2.3% of debt with an average of $47,200.

Debt Relief Canada is available in BC. They report an average debt level of $37,971 for their BC clients.

Ontario

The average amount of debt an individual has in Ontario was reported as $253,600. The breakdown of their debt analysis is as follows:

• Mortgage Debt: Makes up 83.4% of total debt with an average of $383,300.
• Lines of Credit: Makes up 7.4% with an average of $63,000.
• Credit Card and Installment Debt: Makes up 2.1% with an average of $10,000
• Student Loans: Make up 1.7% with an average of $21,400.
• Vehicle Loans: Make up 3.9% with an average of $28,000,
• Other Debt: Make up 1.5% with an average of $33,800.

Debt Relief Canada has helped numerous Ontario residents and reported average debt levels of $36,349 for their Ontario clients.

Debt Analysis

Causes of Debt

The economic factors that influence debt include

• High Costs of Living: This includes expenses such as housing, transportation, food, and healthcare.
• Interest Rates: Lower interest rates encourage borrowing and can be dangerous if improperly managed. Higher interest rates contribute to financial stress and can be damaging if payments aren’t made frequently and consistently.
• Easy Access to Credit: The availability and promotion of credit cards make it easy for consumers to overspend and reach unsustainable debt levels.
• Inflation: The increasing costs of goods and services can be challenging to keep up with, leading more people to borrow money to adapt to inflation.

The behavioral factors that cause debt include:

• Lack of Financial Literacy: A lack of understanding of personal finance, budgeting, and debt management leads to overspending and mismanagement of capital, which accumulates debt.
• Unexpected Expenses: Events such as job loss, medical emergencies, and car repairs happen unexpectedly and can increase debt levels if you’re not adequately prepared.

Solutions

Many resources are available to assist you if you are struggling with managing debt. For example, Debt Relief Canada offers services such as consumer proposals, declaring bankruptcy, consolidation, settlement, and credit counseling. Here is a brief overview of the solutions to help address your debt.

• Consumer Proposals involve a formal, legally binding agreement between an individual and their creditors, stating your intent to repay your balance over a period of time.
• Declaring Bankruptcy involves completely clearing your debt at the cost of your assets.
• Consolidation involves taking out a large loan to pay off many smaller loans. It benefits debt relief by reducing interest charges and keeping one manageable bill.
• Settlement involves paying off your debt in one payment with the creditor’s approval. The lump sum payment is typically less than the balance you owe, but the creditor’s benefit by not having to pursue legal action for repayment.
• Credit Counseling involves discussing with an advisor your options to reduce your debt, including cutting spending and restructuring payment plans.

Key Takeaways

If you are short on time, here are a few key takeaways.

• Types of debt include mortgages, lines of credit, credit cards, student loans, and auto loans.
• Alberta reports an average debt level of $220,600. With assistance from Debt Relief Canada, client reports show a reduced debt level of $39,184.
• BC reports an average debt level of $261,600. With assistance from Debt Relief Canada, client reports show a reduced debt level of $37,791.
• Ontario reports an average debt level of $253,600. With assistance from Debt Relief Canada, client reports show a reduced debt level of $36,449.
• Causes of debt are related to high costs of living, interest rates, easy access to credit, and inflation.
• Debt relief solutions include consumer proposals, declaring bankruptcy, consolidation, settlement, and credit counseling.

Explore the different solutions Debt Relief Canada offers to see which plan will help you reduce your debt today.