How much debt do you have? Most Canadians have some form of debt from credit cards, student loans, car payments, or mortgages. While debt isn’t always bad, it needs to be properly managed.
Canadians under 35 have an average debt of $69,500 and a median debt of $19,000, according to a 2019 study by Statistics Canada. The highest debt age range is from 45 to 54 years old, with an average debt of $130,100 and a median debt of $55,000.
Below, I’ll break down the median and average Canadian debt by age, explain what qualifies as debt, and outline some of the primary sources of debt within these age groups.
Average And Median Canadian Debt By Age
The Statistics Canada report can be a bit lengthy to read through, especially if you’re not used to analyzing statistical data. For easy reference, here’s a straightforward breakdown of the average and median Canadian debt for those not in an economic family:
| Age Group | Average Debt By Age | Median Debt By Age |
| Under 35 | $69,500 | $19,000 |
| 35 to 44 | $105,100 | $35,200 |
| 45 to 54 | $130,100 | $55,000 |
| 55 to 64 | $80,600 | $30,000 |
| 65 and older | $49,900 | $10,000 |
As you can tell, there’s a significant difference between the average and median debt figures.
Generally speaking, the median debt figures better represent what the “average” Canadian debt looks like.
This is because median figures assess the middle-income group (i.e., the middle class), which is the country’s largest economic class. Conversely, the average figures include outliers (such as millionaires and billionaires) which can heavily skew the numbers to the upside.
Primary Sources Of Debt By Age
In addition to outlining average debt and assets by age, the 2019 Statistics Canada report also highlights the main sources of debt by age. This provides an interesting insight into how each age group spends their money and accumulates debt.
Let’s take a look at the primary debt sources by age, using the median figures from the study. Note that the median figures are only for those that have that type of debt existing (for example, if you don’t have a mortgage, you’re not included in the mortgage debt figures below)
Younger Canadians (Under 35)
Those under 35 tend to have most of their debt tied up in their mortgage, which is closely followed by auto loans and student loan debt.
- Mortgage Debt: $160,000
- Line of Credit: $8,000
- Credit Card Debt: $2,000
- Student Loans: $12,500
- Vehicle Loans: $15,000
- Other Debt: $3,500
Middle-Aged Canadians (35 to 44)
Between 35 and 44, those surveyed tend to owe less on their mortgage, as they’ve paid into it for longer. However, they also appear to accumulate more installment debt in the form of credit lines and credit cards. Vehicle payments appear to stay the same, as many trade their old vehicles in every five to ten years.
- Mortgage Debt: $150,000
- Line of Credit: $13,000
- Credit Card Debt: $3,600
- Student Loans: $10,000
- Vehicle Loans: $15,000
- Other Debt: $2,000
Older Canadians (45 to 64)
Canadians between 45 and 54 appear to have overall lower debt. Again, their mortgage debt is lower, and student loans are often paid off completely by this age.
- Mortgage Debt: $135,000
- Line of Credit: $15,000
- Credit Card Debt: $2,200
- Student Loans: N/A
- Vehicle Loans: $16,000
- Other Debt: $6,000
Between 55 and 65, mortgage debt appears to lessen significantly. However, it also appears that debt from lines of credit increases significantly. This may be due to unexpected emergency/medical costs or loans taken out for costly home repairs.
- Mortgage Debt: $117,000
- Line of Credit: $20,000
- Credit Card Debt: $3,000
- Student Loans: N/A
- Vehicle Loans: $15,000
- Other Debt: $5,000
Seniors (65+)
Seniors 65 and older appear to have the least debt out of all of the age groups. However, it’s also important to understand that today’s seniors are part of an entirely different generation.
When they were in their 20s and 30s, the cost of living was more affordable and buying a home was more accessible. As a result, many of today’s seniors never had to take on the consumer debt that today’s younger generations do.
- Mortgage Debt: $70,000
- Line of Credit: $14,000
- Credit Card Debt: $2,000
- Student Loans: N/A
- Vehicle Loans: $10,000
- Other Debt: $3,000
How Debt Is Measured
Every few years, Statistics Canada performs a country-wide survey to assess the debts and assets of major age groups.
The data below have all been sourced from the latest survey, which was performed in 2019 and released to the public in December 2020.
That said, it’s very likely that many of these numbers have increased due to recent inflation and increasing consumer debt, reported in Q1 of 2023.
These age groups are further classified by whether or not those surveyed are in an economic family or not.
An economic family refers to a group of individuals who live together and are related by blood, marriage, adoption, or a common-law partnership.
For example, a married couple that files their taxes jointly or an adult that lives with a family member would be considered economic families. Conversely, a single adult who lives with a non-related roommate or has their own residence would not be in an economic family.
What Qualifies As Debt?
Now that you’ve had a chance to review the numbers and data let’s take a quick look at what qualifies as debt.
Debt refers to money that is owed by an individual, organization, or government to another party. It results from one party borrowing money, goods, or services from another party with the agreement to repay the amount (typically with interest).
The most common types of consumer debt include:
- Personal loans
- Student loans
- Credit card debt
- Mortgage on a house
- Vehicle loan
- Line of credit (typically with a business)
Debt And Your Credit Score
The amount of debt you have and how you manage it are the building blocks that form your credit report and score.
Those who manage their debt wisely, make payments on time, and build positive relationships with their creditors typically have higher credit scores. As a result, creditors are more trusting and may offer them access to greater capital at lower interest rates.
Conversely, poor debt management is associated with a lower credit score. Creditors are more likely to deny loans and credit applications. Those with low credit typically have to resort to “bad-credit loans,” which typically come with higher interest rates and fees.
Good Debt vs Bad Debt: What’s The Difference?
Debt is a means for individuals and organizations to finance purchases or investments that they may not have sufficient funds for upfront. While some extremists like Gail Vax-Oxlade are quick to claim that all debt is bad debt, this isn’t always the case.
Often, debt can be quite helpful (and sometimes unavoidable in today’s economy).
Some examples of good debt include:
- Education/student loans (education can increase your future income)
- Mortgage debt (mortgage payments may be more affordable than renting)
- Small business loans (gives your SMB a better chance of success)
Some examples of bad debt would be:
- Credit card debt used for a vacation
- Impulsive shopping debt
- Financing the latest $1,000+ smartphone
- High-interest personal loans (such as payday loans)
- Gambling debt
- High-interest auto loans
Unfortunately, bad debt has become increasingly prevalent. Students with low income and limited credit education are given access to lines of credit that they can’t repay, and impulsive spending has been incentivized with buy-now-pay-later programs.
That being said, we also have to consider that the cost of living in Canada has increased disproportionately to wages and income, as revealed in a 2023 Statistics Canada report. As a result, many Canadians have been pressured to take on debt to keep up with everyday living expenses.
Conclusion – The Importance Of Financial Education
Debt is often necessary and isn’t always a bad thing. However, it’s crucial to learn proper financial management so that your debt doesn’t get out of control. Debt can open doors that would otherwise remain closed, but you could also end up buried in it if you’re not careful.
Learning how to create a simple budget is one of the best places to start, and modern technology has made it easier than ever. Check out my list of the best budgeting apps in Canada next!
