Nearly half of Nova Scotians are starting 2025 just $200 or less away from insolvency

• Three in 10 Atlantic Canadians say they are already insolvent, unable to cover their bills and debt obligations (29%, +5 pts).
• Half of Atlantic Canadians believe they won’t be able to cover all living expenses in the next 12 months without going further into debt (51%, +2 pts).
• A third of Atlantic Canadians are worried someone in their household could lose their job (33%, +5 pts).

HALIFAX, NS – January 13, 2025 – Nearly half of Atlantic Canadians are teetering on the edge of financial insolvency heading into 2025, despite declining interest rates. According to the latest MNP Consumer Debt Index, the proportion of Atlantic Canadians (49%) indicating they are $200 or less away from insolvency has sharply increased, jumping a significant nine points and reversing the improvements made last quarter. Three in 10 Atlantic Canadians say they are already insolvent (29%), increasing five points this quarter.

“Although the interest rate cuts last year initially eased some financial pressures, many Atlantic Canadians are starting 2025 in a difficult financial position,” says Tina Powell, a local Licensed Insolvency Trustee with MNP LTD. “Holiday bills are coming due, stretching household budgets. Broader economic uncertainties, including concerns over potential U.S. tariffs, may further compound financial anxieties in Atlantic Canadian households.”

This economic uncertainty is reflected in Atlantic Canadians’ growing concerns about job loss and indebtedness. The proportion of individuals worried that they or someone in their household could lose their job (33%) increased a notable five points this quarter. Additionally, half of Atlantic Canadians (51%, +2 pts) believe they will not be able to cover all their living and family expenses in the next 12 months without going further into debt.

While more Atlantic Canadians are now close to insolvency or already insolvent, their attitudes toward their finances and interest rates have softened this quarter following consecutive interest rate cuts in 2024. Two in five (43%, -5 pts) are still concerned about their ability to repay their debts, even if interest rates decline. Three in 10 (30%) are concerned that rising interest rates could move them towards Bankruptcy, down nine points from the previous quarter. While fewer this quarter say they desperately need interest rates to go down, three in five (63%, -9 pts) are still desperate for interest rates to decline.

Atlantic Canadians’ ability to absorb an extra $130 in interest rate increases has improved this quarter. Significantly more (21%, +7 pts) feel much better equipped to handle such an increase. However, Atlantic Canadians are the most likely among those in all provinces (41%, unchanged) to report their ability to handle such an increase has worsened.

“Many Atlantic Canadians have already begun tightening their budgets and cutting expenses due to high living costs or the pressures of debt repayment,” says Powell. “However, these efforts might not be enough for some to achieve the relief they need. It’s important to remember that support is available, and seeking help can have a significant impact on overcoming financial challenges.”

Powell says the convergence of post-holiday bills, economic pressures, and unexpected expenses can exacerbate financial challenges. While the new year is traditionally a time for setting financial goals, some Atlantic Canadians will find themselves grappling with the financial fallout of holiday spending. Seeking support can help address debt concerns early in 2025.

Reaching out for advice from a Licensed Insolvency Trustee is a critical first step for those feeling overwhelmed by debt. Licensed Insolvency Trustees provide free consultations to help individuals assess their financial situation, understand their options, and create customized plans to regain control of their finances.

“Consulting with a Licensed Insolvency Trustee is essential to regain control of your finances and prevent more serious consequences, such as interest charges, accumulating late fees, collection calls, or even wage garnishments,” explains Powell. “This initial conversation can provide Atlantic Canadians with guidance on tailored solutions such as budgeting strategies, debt consolidation, debt management plans, Consumer Proposals, and Bankruptcy in some cases.”

MNP’s national team of Licensed Insolvency Trustees offers free consultations across the country to help severely indebted Atlantic Canadians get unbiased debt advice, understand their rights, and determine the best path forward. Licensed Insolvency Trustees are the only federally regulated debt professionals who can assist with all the debt relief options, including Consumer Proposals and Bankruptcy, stop harassment from debt collectors, and discharge people from debt.

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 240 offices from coast to coast, MNP helps thousands of Canadians each year who are struggling with an overwhelming amount of debt. Visit MNPdebt.ca to contact a Licensed Insolvency Trustee or use our free Do-it-Yourself (DIY) debt assessment tools. For regular, bite-sized insights about debt and personal finances, subscribe to the MNP 3-Minute Debt Break Podcast.

About the MNP Consumer Debt Index

The MNP 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.

Now in its thirty-first wave, the Index has decreased to 79 points, down 10 points since last quarter to reach the second-lowest score recorded since its inception. Visit MNPdebt.ca/CDI to learn more.

The data was compiled by Ipsos on behalf of MNP LTD between December 6 and December 17, 2024. For this survey, a sample of 2,003 Canadians aged 18 years and over was interviewed. Weighting was then employed to balance demographics to ensure that the sample's composition reflects that of the adult population according to Census data and to provide results intended to approximate the sample universe. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll is accurate to within ±2.5 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.