Borrowing has apparently become a way of life in Canada. A recent Transunion Insight report shows Canadian debt has been increasing at a rapid rate – with no signs of slowing down. Transunion sites a spike in total money owed, rising 4.3 per cent since the same time last year. While millennial debt has risen by 12.3 per cent to a total of $515.9 billion, Gen Xer’s are still the biggest debt-holders with a whopping $767.4 billion owed.

With a total sum of $1.88 trillion of money owed nation-wide – the bulk of the debt is held by young people who are struggling with the sheer cost of living. It’s probably not surprising that Toronto millennials are racking up the debt at a higher rate. A report by examined Toronto specifically and showed it costs the average millennial approximately $3,214 a month simply to survive in 2019. That’s sans avocado toast.

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The Toronto figure is a staggering $475 more than it cost in 2018. The numbers reflected the life of a single (re: dependent free), non-home-owning, employed adult. Throw daycare into the mix and you really begin to understand how even high-earners are surviving paycheck to paycheck. In fact, Toronto parents pay more than anywhere else in the country.

The dramatic increase in consumer debt, however, isn’t being blamed on homeownership. Strangely enough, the Transunion report noted that the number of new home loans issued in Canada actually dropped by 8.9 per cent compared to 2018. Breaking the figure down further by demographics, the rate of home loans fell by a single per cent for millennials, but by 12 per cent among Gen-Xers who may have just given up on homeownership altogether, given how increasingly impossible in today’s real estate market. This is despite the fact that, according to CBC News, Canadian mortgage rates have fallen to their lowest levels within the past two years as has the dollar value of mortgages issued to Gen-Z (aged 25 and under) borrowers which fell by 13 per cent.

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Some say the high cost of getting an education is part of the debt equation. With the burden of student loans – and Canadian students owing upwards of $28 billion – young people are struggling to put pennies away. This is in addition to covering their rent, car bills, groceries, credit card payments, and well, vacations to escape the stress of day-to-day living. As it turns out, many millennials are burning out, in large part because of their accumulating financial stress.

Perhaps part of the problem is reliance on credit cards. A study by Equifax Canada showed that the 90-day delinquency rate on payments rose this year to 3.6 per cent.

While 1.6 per cent fewer car loans were issued, the number of young people borrowing from their line of credit rose by 13.9 per cent this year, as did average mortgage debt which grew by 3.56 per cent to an average of $269, 274.

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For the first time ever, millennial debt has surged past that of baby boomers, most of which own their own homes. Money owed by millennials alone has risen by 12.3 per cent within the past year to a whopping $515.9 billion.

That’s even more significant for those living in Toronto. reports that the debt-to-income ratio in Toronto increased from 88 per cent to a mind-boggling 150 per cent over the past 10 years. Check out the cost of living in Toronto currently, here.

The breakdown itself is fairly modest with $283 a month going to groceries and $127 to transportation.

Matt Fabian, the Director of Research and Industry Analysis at TransUnion Canada told the Huffington Post, “When you think about this age group [millennials], one of the things they’re looking at is…how do I just manage? They’re not thinking long term…They’ve never seen a high-interest environment.”

With Quebec attempting to reduce debt levels by requiring a higher minimum payment of credit card balances, Fabian says that Ontario could soon follow suit.

Personal Finance