Canadians face new financial hurdles: Debt fatigue and complacency
Recent US election results rank as second largest financial concern behind increases in costs for essentials – the unending flow of tariff news intensifies the tension
NEW WESTMINSTER, BC, Feb. 20, 2025 /CNW/ - Consumers with rising debt are grappling with critical financial obstacles when it comes to addressing their financial obligations. Amidst the persistence of high living costs and uncertainties stemming from recent US election results, many are struggling according to findings from the 2025 Consumer Debt Report by the Credit Counselling Society (CCS), who surveyed members of the Angus Reid Forum.
The overwhelming concern for seven-in-ten Canadians (71 percent) is the increase in cost-of-living expenses, where more than half (54 percent) – the highest number since the inception of the survey five years ago – report economic factors outside of their control. "Consumers were already feeling the strain of increased day to day expenses," explains Peta Wales, President & CEO of the Credit Counselling Society. "Then, as additional information about potential tariffs emerged in the weeks leading up to President Trump's inauguration, the likelihood of price increases and even the potential for job losses, only heightened feelings of anxiety and stress."
Over half of all Canadians report feeling worried or concerned (54 percent) about their debt, and the number of Canadians feeling increasingly anxious surged to a staggering four-in-five (84 percent) among those who experienced an increase in debt this past year.
In fact, more than one-in-four (27 percent) who are anxious about their financial situation, revealed that they have screamed in frustration about their debt. Surprisingly however, an astonishing 57 percent of survey participants were complacent towards their debt by not reacting at all to what they owe.
"Unfortunately, we continue to see a trend of Canadians normalizing debt with a focus on only addressing their minimum payments," states Wales. " With record-high debt levels, consumers are grappling with the rising cost of living, and credit cards - which were once used primarily for emergencies - are now being used to carry month over month balances. Add on the prospect of tariff induced price increases or reduced income from layoffs, and many are left feeling numb and overwhelmed."
Among respondents who reported experiencing an increase in debt over the past year, 54 percent revealed that it affects their mental wellbeing and for those who are uncomfortable with the amount of debt they are carrying, a full 60 percent indicated that it affects their outlook on life.
Exacerbating the situation and hindering their ability to find debt relief, those who are anxious about their circumstances are almost three times as likely to be falling further behind on their debts (16 percent vs 6 percent) and are less likely to reach out for help.
Ignoring bills, delaying or deferring payments, and avoiding creditor communication are all symptoms of debt fatigue. This condition, characterized by mental and emotional exhaustion due to the constant worry over debt payments and the high cost of essentials, can lead to feelings of hopelessness, complacency, and a lack of motivation to regain financial control.
Debt fatigue was confirmed by survey respondents who reported being four times more likely (19 percent) to cry about their debt than communicate with their creditors (5 percent), and seven times more likely (57 percent) to have taken no action regarding their debt than to have consulted with a credit counsellor (8 percent).
"The danger with becoming complacent about your obligations is that a small shift in your circumstances – such as reduced hours at work or an increase in the cost of an essential, like gas, can suddenly make your financial situation extremely difficult to manage," explains Isaiah Chan, VP of Programs & Services at CCS.
According to the survey, half of Canadians with increased debt have recently cut back on their savings (48 percent), used credit instead of cash (50 percent), or drawn from their savings / investments (51 percent) while also cutting back on essentials like food (77 percent) and recreation (72 percent) to make ends meet.
"It's always very concerning when someone struggles to pay for their day-to-day expenses and, with savings exhausted, risks undermining any of their remaining financial stability through high levels of consumer debt," reveals Chan. "There comes a time when cutting back is no longer possible."
"Waiting to take action until debts become unmanageable, can result in higher interest rates, more drastic solutions, and ultimately more stress and sleepless nights," adds Anne Arbour, Director of Partnerships & Education at CCS. "Taking steps early on is when someone can make the biggest impact on improving their finances and overall wellbeing."
Survey results reveal that many Canadians are actively attempting to avoid increasing debt and the resulting debt fatigue with proactive measures instead of complacency. An overwhelming 70 percent of Canadians (with increased debt this past year) cut back on essentials, 34 percent sold personal items, 12 percent changed their living arrangements, and 44 percent versus the previous high of 10 percent, reached out to a financial advisor for assistance.
"Surprisingly, of Canadians who had an increase in debt this past year," explains Wales, "we also saw that 44 percent took on a second job as they worked to proactively manage their higher debt load. While this was almost three times higher than the prior year, (at 16 percent), it may not remain a viable option if the economy contracts due to geopolitical circumstances."
As Canadians continue to navigate their financial challenges, amongst a backdrop of increasing economic strain, the need for timely and effective debt management solutions has never been more critical. "When it comes to what Canadians worry about most, problems with money tops the list," explains Arbour. "However, consumers often suffer in silence because they are more uncomfortable talking about their debt than they are personal relationships or even struggles with physical and mental health."
"We can't predict what the next four years will hold for us economically, politically, or financially," concludes Arbour. "But tariffs or no tariffs, don't let anxiety or embarrassment deter you from reaching out for the help you need. Debt fatigue is a genuine concern, and complacency is not an effective solution. Focus on what you can control to ensure financial stability and wellbeing for yourself and your family."
About The Credit Counselling Society (CCS): The Credit Counselling Society is a non-profit organization dedicated to helping consumers manage their money and debt better. CCS provides free, confidential credit counselling, debt repayment options, budgeting assistance and financial education.
About Angus Reid Forum surveys: These findings are from a survey conducted by Credit Counselling Society from January 6th to 10th, 2025 among a sample of 1200 online Canadians who are members of the Angus Reid Forum. The survey was conducted in English and French. For comparison purposes only, a probability sample of this size would carry a margin of error of +/-4.4 percentage points, 19 times out of 20.
SOURCE Credit Counselling Society of BC
Media Inquiries: The Credit Counselling Society has spokespeople from across Canada available for interviews to discuss this topic as well as any other relevant financial topics. Please feel free to reach out to the number below: John Lock, Director of Marketing, Direct: 604.636.0277, Email: [email protected]
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