Homeowners focused on debt reduction
Most Canadian homeowners want little more than to reduce their debt – and it’s a desire that’s been at the top of their wish lists for four consecutive quarters.
Manulife Bank of Canada surveyed Canadian homeowners and found nearly three in 10 homeowners rated debt freedom as “10″ out of 10 – their top financial priority. More than seven in 10 (71 per cent) rated debt freedom at 8, 9 or 10 out of 10.
However, despite naming ‘debt freedom’ as a top priority, more than four out of 10 say they either lost ground or merely held steady in their fight to reduce household borrowing in the past year, in the online poll of 1,000 homeowners conducted by Research House in mid-February.
Among those who failed to reduce their debt over the past 12 months, the largest group (27 per cent) saw their debts actually increase, while another 15 per cent had the same amount of debt as they did a year ago.
Among the 51 per cent who did reduce their debt over the past year, only eight per cent reduced their debt by more than expected.
Less than a quarter of homeowners (23 per cent) in the survey reported their debt reduction met their expectations, while another 20 per cent reported their debt reduction was less than expected.
Eight per cent of homeowners aged 30-55 had no debt at any time in the past 12 months – relatively unchanged from previous quarters.
When it comes to managing household debt, in a two-adult household 58 per cent said one partner was mainly or entirely responsible for managing household debt. Forty-two per cent of two-adult households said responsibility for managing household debt is equally shared.
In general, it appears that couples are speaking to each other when it comes to household debt. Nearly 60 per cent indicate that they review household debt with their partner at least once per month. A further 16 per cent do so every couple of months. Only 8% indicate that they review household debt with their partner once per year or less.
Despite the communication, debt can be a source of stress, with 30 per cent stating that balancing debt repayment with other financial needs is a significant source of stress.
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