Special Guest Commentary by Douglas Hoyes, BA, CA, CIRP, CBV, Bankruptcy Trustee
The CIBC released a study today saying that residents of Canada over the age of 45 are accumulating debt faster than all other Canadians. To quote their study (which you can download from their website):
A rising share of the highly indebted are over 45 years old, an age where accumulating net assets ahead of retirement should be paramount. There is room for further borrowing across Canada, but we will have to be careful that the distribution of new debt shifts to those with greater financial room to add to their debt burden, and more time to earn the income to pay it off.
Sadly, our data confirms what CIBC is saying. The average person who filed bankruptcy in Canada is now approximately 46 years of age, which isn’t surprising, since the more debt you have, the more likely you are to declare bankruptcy.
So what’s the solution?
If you have debt, take steps immediately to begin reducing your debt. If you are young, you have time to recover. Make a budget, cut your expenses, and pay off your debt.
If you are one of the over 45 year old Canadians discussed in the CIBC study, or if you have more debt than you can handle, it’s time to look at your other debt management options, which may include a consumer proposal or personal bankruptcy.
The time to start dealing with your debt is now, because as you get older, the time available to prepare for retirement is limited.