Survey shows generational gap in Canadians’ understanding of debt causes

Survey shows generational gap in Canadians’ understanding of debt causes

Tracking the causes of Debt

Vice-President of Insolvency Practice, Shawn Stack and Co-founder, President David Smith, have a safe hallway conversation in the head offices of Bromwich + Smith. The company just released the Debt Cause Tracker, a survey that examines people’s perceptions on the origins of debt.

TORONTO, March 03, 2021 (News) — As COVID-19 continues to heighten financial hardships for many Canadians, a new national survey by Licenced Insolvency Trustees, Bromwich+Smith examines how the country perceives debt and the factors that cause it. The Debt Cause Tracker, reveals a generational gap in perception on debt causes from wants vs needs, job loss and cost of living increases, to substance addiction, mental health and gambling.

When asked what people think are the key causes of people going into debt, the top response (at 52% of Canadians) was “a difficulty distinguishing between wants vs needs” (essential purchases vs instant gratification such as impulse buys).

Other top responses include a lack of financial literacy (42%), costs of living increases (41%), unexpected financial emergencies such as a car accident, divorce, major health problem, a lawsuit or a natural disaster (40%), and job loss (36%).

Rounding out the list were:

  • Social acceptance – spending in order to fit in at 27%
  • Marketing and the media at 15%
  • Substance addiction at 10%
  • Mental health problems at 8%
  • Lastly, gambling at 7%

“These findings are very telling of how people view debt causes in Canada,” said Shawn Stack, Vice-President of Insolvency Practice at Bromwich and Smith. “Often people assume debt is caused by poor money management. However, what we see with our clients is many get into this situation due to factors outside of their control. Unexpected life events like dealing with critical illness, death in the family, divorce or job loss are commonly the reasons people find themselves struggling.”

Generational gulfWhen discussing causes of debt, there are differing beliefs amongst the different age groups. Specifically, while the older cohort (55+) strongly believes wants vs needs is the main cause of debt (58%), only 44 per cent of younger respondents (18-34) agree. For the younger cohort, a lack of financial literacy and budget planning skills is the main cause of going into debt at 50 per cent. This is in contrast to 34 per cent for the 35-54 age cohort and 43 per cent for those 55+.

“There is a stigma associated with debt that leads people to feel a sense of shame for not being able to repay it,” said Stack. “In the K-shaped recovery, where different parts of the economy recover at different rates, the most vulnerable cohort is being pushed even further down. Younger Canadians and women have felt a stronger impact amid the pandemic and tend to have a different understanding of the factors leading to debt, because they are living it.”

Women are much more likely than men to believe that cost of living increases (44% to 38%) and unexpected financial emergencies (55% to 45%) are the top causes of going into debt.

“Everybody’s journey is different,” said Stack. “But in order to overcome debt, there needs to be an internal journey and a measure of self-forgiveness. Once that takes place, it’s important to know that every Canadian has the right to restructure their debt. Our Debt Relief Specialists at Bromwich+Smith are just a call away to help Canadians navigate through this process and rebuild their worth.”

The Debt Cause Tracker is the latest in a survey series from Bromwich+Smith designed to create a benchmark of attitudes around stigma, money and debt.

Canadians’ understanding of debt causes

Causes of debtNational18 – 3435 – 5455+
Wants vs needs – difficulty distinguishing between essential purchases and instant gratification/“impulse buys”52%44%50%58%
Lack of financial literacy/budget planning skills42%50%34%43%
Cost of living increases41%46%44%34%
Unexpected financial emergencies (car accident, divorce, major health problem, a lawsuit, natural disaster)40%43%41%38%
Job loss36%37%34%36%
Social acceptance – spending beyond one’s means in order to fit in27%26%30%26%
Marketing and the media – ads for credit cards, goods, services and lifestyles15%12%13%18%
Substance addictions9%9%9%7%
Mental health problems8%10%9%7%

Bromwich+Smith understands the many reasons why Canadians go into debt and will continue to provide support to those who are seeking effective debt relief solutions.

The full results of the survey are available through the contacts below.

About The Debt Cause Tracker by Bromwich+Smith From December 18 to December 20, 2020 an online survey was conducted among a representative sample of 1,520 Canadians who are members of the Angus Reid Forum. The sample was balanced and weighted on age, gender, region and education. For comparison purposes, the sample plan would carry a margin of error of +/- 2.5 percentage points, 19 times out of 20. Discrepancies in or between totals are due to rounding.

About Bromwich+Smith Bromwich+Smith, our dedicated team of Licensed Insolvency Trustees and Debt Relief Specialists are committed to rebuilding our clients’ worth, while helping relieve the overwhelming financial and emotional burden they are experiencing. Beyond our clients’ financial wellbeing, Bromwich+Smith strives to restore the personal wellbeing and self-confidence of every client. Whether it’s through a consumer proposal, bankruptcy, counselling or budgeting, our clients trust us to work with them to find customized solutions to make them whole again. With offices in BC, Alberta, Saskatchewan and Ontario, Bromwich+Smith helps thousands of Canadians each year rebuild their worth. Bromwich+Smith’s Debt Relief Specialists are available for an initial consultation by phone at 1-855-884-9243 or via

For further information: To arrange an interview with Shawn Stack, Vice President at Bromwich+Smith, please contact:

Dana Sharman MAVERICK Public Relations   1-705-878-6493

Natasha B. RussellSenior Communications SpecialistBromwich+Smith   1-587-329-6947

A photo accompanying this announcement is available at

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