A Third of Canadians Have Borrowed Money to Pay for Food, Other Necessities in 2024

A man shops for food at a store in Toronto in a file photo. Federal research dated December 2024 indicates that a third of Canadians had to borrow money or run up credit card debt in order to buy food or pay other monthly expenses in the past 12 months. Reuters/Carlos Osorio

A third of Canadians have borrowed money to cover basic necessities like food and shelter in the last year, according to in-house federal research.

The report by the Financial Consumer Agency of Canada, dated Dec. 4, indicated that 33 percent of Canadians surveyed had to use a credit card, go into overdraft, or borrow money to buy food or pay monthly expenses in the past 12 months, while that number was 43 percent for those under 44, as first reported by Blacklock’s Reporter on Dec. 24.

Asked if they would be able to come up with $2,000 if an unexpected need arises within the next month, 21 percent said they “definitely” could not and 10 percent said they “probably” could not, with just 25 percent saying they “probably could,” said the report titled “Data Collection for the 2024 Monthly Financial Well-Being Monitor” released Dec. 23.

A quarter of those surveyed, 25 percent, said they did not earn enough money to cover their monthly expenses. Over a third, 38 percent, told pollsters that although they are keeping up with bills and other financial obligations, “it is sometimes a struggle.” Meanwhile, 15 percent said they were ”falling behind” with paying bills.

Most Canadians, 51 percent, said they keep a household budget, and 49 percent said they had withdrawn thousands of dollars from their savings over the past 12 months in order to cover their needs.

Asked about the kind of debt they owed, 19 percent of respondents said they had an outstanding student loan, 23 percent had a home equity line of credit, 24 percent were making car payments, 31 percent had a personal loan or line of credit, and 37 percent carried a credit card balance.

When asked, “Are you currently behind two [or] more consecutive months in paying a bill, loan, rent or mortgage payment?” 6 percent of those surveyed said yes. For Canadians under age 35, that rate was 11 percent.

The report said the research supports the federal agency’s mandate of “monitoring how Canadians are managing their finances and the effects on their financial well-being.” The agency is responsible for protecting the rights and interests of Canadian consumers by supervising financial entities like banks.

Many Canadians have been facing growing financial stress due to COVID-19 pandemic-era inflation, the researchers wrote.

Inflation first began rising around June 2021, going from 3.1 percent to 7.6 percent by July 2022, leading the Bank of Canada to raise interest rates from 0.25 percent to 2.5 percent over the same period. Interest rates eventually topped at 5 percent in July 2023. The central bank began lowering interest rates halfway through 2024, bringing them down to 3.25 percent in December.