Albertans Wary And Embarrassed About Seeking Debt

2019-07-29   minute read

Donna Carson

MNP Consumer Debt Index

Albertans are the most likely to say the stigma of Bankruptcy prevents them from seeking help More than half say they would be too embarrassed to seek help, more than any other province More than half say they have difficulty trusting companies to help get them out of debt, a higher proportion than any other province One in three say they don’t know how to get out of debt or where to turn for help           CALGARY, AB – July 29, 2019 – Albertans who find themselves in serious financial trouble could be digging themselves into a deeper hole by not seeking help when they need it. A new survey conducted by Ipsos on behalf of MNP LTD, shows more than half (54%) of Albertans say they would be embarrassed to get help if their financial situation was bad enough to consider Bankruptcy, more than any other province. Albertans are also the most likely to say that the stigma surrounding Bankruptcy prevents them from seeking help (36%).   “Financial hardship in the province has made many feel extremely lonely and isolated. The shame and guilt associated with troublesome debt prevents people from talking about it. Unfortunately, our survey shows those who are most in need of help are the least inclined to ask for it,” says Donna Carson, a Licensed Insolvency Trustee in Calgary with MNP LTD, the country’s largest insolvency firm. More than 60 percent More than 60 percent (61%) of Canadians who rate their personal debt situation as bad and more than half (54%) who are financially insolvent say they would be embarrassed to ask for help if their financial situation was bad enough to consider Bankruptcy. The latest official figures from the Office of the Superintendent of Bankruptcy (OSB) show the number of Calgarians who filed for Bankruptcy or a Consumer Proposal in the second quarter of 2019 was up six per cent compared to the same quarter last year. “While the number of people filing is on the rise, it still doesn’t reflect the magnitude of the consumer debt challenges. Many people delay getting help until they are in an absolutely dire situation,” says Carson. The survey also revealed many just don’t know what to do to get out of debt. One in three (32%) said they don’t know how to get out of debt or where to turn for help. What’s more, there is a lack of trust among Albertans when it comes to debt relief professionals. More than half of Albertans (57%) say they have a hard time trusting professional companies to help them get out of debt, a higher proportion than any other province. “A lack of financial literacy and awareness about debt relief options may contribute to the trust issues in the province,” says Carson. “Those struggling need to know there is a regulated system in place to help them regain financial stability. Licensed Insolvency Trustees are the only professionals authorized to offer relief options such as Consumer Proposals and Bankruptcies,” says Carson, adding Albertans should be wary of any companies that aggressively market quick-fix debt forgiveness. “Our survey consistently tells us nearly half of Albertans are on the brink of insolvency, so those struggling should find relief knowing that they’re not alone. There is absolutely no need to be embarrassed to seek help,” says Carson.  The vast majority of Albertans (88%) believe there is no shame in seeking financial help with one’s debt. There is also a fair amount of sympathy towards those who have to declare Bankruptcy. Only one in three (34%) agree with the statement that those who declare Bankruptcy are looking for the easy way out of their financial problems. MNP Consumer Debt Index – Update The number of Albertans $200 or less away from financial insolvency at month end decreased 4 points to 44 percent. Those in Saskatchewan / Manitoba (40%, -6), Alberta (44%, -4), Ontario (44%, -4), Quebec (43%, -8) and Atlantic Provinces (46%, -9) saw the biggest declines, whereas B.C. (44%, +5) has seen a sharp increase. Albertans are the least likely to envision a better future for themselves in the short term, compared to other provinces, with only one-quarter (25%) saying they think their debt situation will be better a year from now. However net optimism is up 7 points from March to stand at 15 percent. Looking further into the future, almost half (45%) believe their future debt situation will be better in 5 years than it is today, with net optimism up a staggering 15 points to 36 percent.  Still, half of Albertans (49%) don't feel like they will be able to cover their family and living expenses without going into further debt and are still concerned about the impact of rising interest rates on their financial situation (52%, -5 points). Four in ten indicate they regret the amount of debt they've taken on in their life (40%, -11 points) and are concerned about their level of debt (38%, -10 points). After an all-time high in June 2018, the MNP Consumer Debt Index has been on a gradual decline. The latest data, representing the ninth wave, shows the decline has at least been temporarily halted, as the index holds steady at 97.  About MNP LTD MNP LTD, a division of the national accounting firm MNP LLP, is the largest insolvency practice in Canada. For more than 50 years, our experienced team of Licensed Insolvency Trustees and advisors have been working with individuals to help them recover from times of financial distress and regain control of their finances. With more than 230 offices from coast-to-coast, MNP helps thousands of Canadians each year who are struggling with an overwhelming amount of debt. to contact a Licensed Insolvency Trustee or get a free checkup for your debt health using theMNP Debt Scale. MNP LTD is the creator of the MNP Consumer Debt Index, an industry-leading national barometer of financial pressure among Canadians. About the MNP Consumer Debt Index TheMNP Consumer Debt Index measures Canadians' attitudes toward their consumer debt and gauges their ability to pay their bills, endure unexpected expenses, and absorb interest-rate fluctuations without approaching insolvency. Conducted by Ipsos and updated quarterly, the Index is an industry-leading barometer of financial pressure or relief among Canadians. to learn more. The latest data, representing the ninth wave of the MNP Consumer Debt Index, was compiled by Ipsos on behalf of MNP LTD between June 14 and June 17, 2019. For this survey, a sample of 2,111 Canadians aged 18 years and over was interviewed. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll is accurate to within ±2.4 percentage points, 19 times out of 20, had all Canadian adults been polled. The credibility interval will be wider among subsets of the population. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error, and measurement error. CONTACT To learn more about the survey and how MNP can help you manage your debt challenges, contact Donna Carson, CIRP, LIT, Senior Vice-President, MNP Ltd., at 1.877.500.0792 [email protected]    

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