Ever get that sinking feeling?
According to insolvency trustees MNP, Ltd., you’re not alone.
That’s because a new report shows that half of Canadians are $200 or less away from financial insolvency — an alarming eight-point increase from the previous quarter and the second-lowest level since it began.
According to MNP’s latest Consumer Debt Index (CDI), one-third of Canadians already consider themselves insolvent — a nine-point jump since the previous quarter.
The survey said the strain is particularly evident in Alberta, where a heavy reliance on volatile industries like oil and gas leaves many residents vulnerable to job losses and wage cuts.
The report also highlights a stark gender divide. Women are more likely than men to be living on the financial edge, but men saw a shocking 13-point spike in insolvency risk over the last quarter — a sign that financial pressures are affecting broader segments of the population.
“Many Albertans have been tightening their budgets for years due to economic instability,” said MNP president Grant Bazian. “But even substantial sacrifices aren’t enough to keep up with rising living costs. The affordability crisis is hitting harder than ever.”
The crisis is especially severe in Alberta’s housing market, MNP said. While Alberta remains more affordable than BC or Ontario, rents in Calgary and Edmonton have skyrocketed, with double-digit percentage increases over the past year. Meanwhile, inflation continues to erode household budgets. Everyday essentials — groceries, gasoline and utilities — have become harder to afford, leaving many Albertans living paycheque to paycheque.
“Affordability isn’t just about housing costs anymore,” Bazian added. “People are struggling to afford basic living expenses, let alone save for the future. This is creating a sense of hopelessness as more Canadians realize they’re unable to dig themselves out of debt.”
"For many Canadians, it’s about surviving another year of rising costs and shrinking incomes."
MNP president Grant Bazian
Adding to financial woes, job anxiety has reached an all-time high. The report found that two in five Canadians fear someone in their household will lose their job in the next year. This anxiety is particularly pronounced in Alberta, where economic reliance on oil and gas leaves workers vulnerable to market fluctuations.
In Alberta, seasonal work and fluctuating wages add further uncertainty for many households. The fear of unexpected expenses or sudden job loss compounds financial stress, leaving many residents feeling trapped in an endless cycle of debt.
As economic pressures mount, the financial cushion that once helped people weather unexpected expenses is shrinking. On average, Canadians now have $147 less disposable income at the end of the month, with Alberta households seeing even more pronounced declines.
Heading into 2025, economists warn that Canada’s affordability crisis shows no signs of easing.
For Alberta, where economic recovery has lagged behind other provinces, the outlook is “particularly concerning” the report says. The province’s residents are more likely to face insolvency, and job security remains fragile, further intensifying the affordability crisis.
Bazian urges those struggling with debt to seek help early.
“The New Year should be a time to set financial goals, but for many Canadians, it’s about surviving another year of rising costs and shrinking incomes. Seeking expert advice now can help avoid more severe consequences down the line.”
