debt-freedom-at-50

The amount Canadians owe relative to their incomes hit another new high in the third quarter.

Statistics Canada says household credit market debt as a proportion of household disposable income increased to 171.1%, up from 170.1% in the second quarter.

That means there was $1.71 in credit market debt, which includes consumer credit and mortgage and non-mortgage loans, for every dollar of household disposable income.

The household debt service ratio, measured as total obligated payments of principal and interest as a proportion of household disposable income, was relatively flat at 13.9%, while the interest-only debt service ratio was 6.3%, down from 6.4% in the previous quarter.

Meanwhile, the total net worth of the household sector edged down 0.1% to $10.61 trillion in the third quarter.

The move lower was due to a drop in home values as housing resale prices weakened.

Read: Mortgage stress test to temper home prices: report

However, the value of household financial assets edged up 0.1%, which means individual net worth is increasing.

Also read:

Clients equate budgets with stress

As spending season begins, Canadians have a debt problem

Originally published on Advisor.ca
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