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A new report suggests Canadians’ worries about debt are rising amid higher interest rates and persistent inflation. Bankruptcy trustee firm MNP says its quarterly consumer debt index fell 15 points since its last survey to an all-time low of 77 points.

Canadians’ anxiety over their debt situation has significantly intensified amid rising interest rates hikes, persistent inflation, and heightened affordability concerns, according to a new survey by MNP LTD.

Nearly half of Canadians are concerned about their current level of debt — a record high — amid rising interest rates, persistent inflation and heightened affordability worries, according to a report released by Canadian insolvency practice MNP Ltd.

The quarterly MNP Consumer Debt Index has taken a drastic plunge to 77 points, down 15 points from the last quarter and marking an all-time low since the Index was created over five years ago.

Though both terms deal with excessive debts, insolvency is a state that can lead to declaring bankruptcy. In very simple terms, an individual becomes insolvent when he or she is unable to pay back lenders on time. Although filing for bankruptcy is a possible resolution for insolvency, this type of situation does not automatically lead to bankruptcy. Depending on your circumstances, you may be able to address your insolvency by other means,...

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In very simple terms, you are insolvent if your debts exceed your assets in value. To calculate this, make a list of every debt you owe including loans and credit cards. Add up these debts to get your total in liabilities. Then make a list of assets including savings accounts, stocks, property, and more—using their fair market value rather than what you paid for them. Compare these two values to see if you are insolvent.

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People often get the terms bankruptcy and insolvency mixed up. Insolvency is a financial condition, not a legal declaration like bankruptcy. However, if you are insolvent, there are other ways to take care of your debts before you consider declaring bankruptcy. You can first see if there is anything you can do in your current situation to get out of debt, such as going on a strict budget or getting an extra job for more income. If your situation...

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