Ontarians Wary And Embarrassed About Seeking Debt Relief

• One-third say the stigma of Bankruptcy prevents them from seeking help
• Nearly half say they would be too embarrassed to seek help
• Three in ten say they don’t know how to get out of debt or where to turn for help
• More than half say they have difficulty trusting companies to help get them out of debt
                   

TORONTO, ON – July 29, 2019 – Ontarians who find themselves in serious financial trouble could be digging themselves into a deeper hole by not seeking help when they need it. A new survey conducted by Ipsos on behalf of MNP LTD, shows almost half of Ontarians (45%) say they would be embarrassed to get help if their financial situation was bad enough to consider Bankruptcy. One-third (32%) of survey respondents say the stigma surrounding Bankruptcy prevents them from seeking help.

"Unmanageable consumer debt or financial hardship is extremely lonely and isolating because the guilt prevents people from talking about it. Unfortunately, our survey shows that those who are most in need of help are the least inclined to ask for it," says David Gowling, a Licensed Insolvency Trustee with MNP LTD, the country's largest insolvency firm.

While sixty per cent (60%) of Ontarians rate their personal debt situation as bad, the survey revealed that many don't know how to improve it. Three in ten (31%) said they don't know how to get out of debt or where to turn for help. What's more, is that there is a lack of trust among Ontarians when it comes to debt relief professionals. More than half of Ontarians (55%) say that they have a hard time trusting professional companies to help them get out of debt.

"Many people — particularly young people — don't know that there is a regulated system in place to help severely indebted individuals regain financial stability," says Gowling, adding that Ontarians should be wary of any companies that aggressively market quick-fix debt forgiveness. "Licensed Insolvency Trustees are the only regulated professionals who can offer relief options such as consumer proposals and bankruptcies," he says.

The latest official figures from the Office of the Superintendent of Bankruptcy (OSB) show that the number of Ontarians who filed for bankruptcy or a consumer proposal in the first quarter of 2019 was up almost 10 per cent compared to the same quarter of last year.

"The increase in filings may not reflect the magnitude of the consumer debt challenges in the province because so many people delay getting help until their situation is dire. Our survey consistently tells us that nearly half of Ontarians are $200 or less away from financial insolvency at month-end. So if you are struggling with debt, it's important to know that you are not alone and there is absolutely no need to be embarrassed to seek help," says Gowling.

An overwhelming majority of Ontarians (87%) believe that there is no shame in seeking financial help with one's debt. There is also a fair amount of sympathy towards those who have to declare bankruptcy. Only four in ten (40%) agree with the statement that those who declare bankruptcy are looking for the easy way out of their financial problems.

MNP Consumer Debt Index – Update

The latest wave of the MNP Debt Index shows that Ontarians' overall attitudes towards their personal financial situation have improved slightly since March. The number of Ontarians $200 or less away from financial insolvency at month-end decreased four points to 44 per cent. Those in Ontario (44%, -4 points), Alberta (44%, -4 points), Saskatchewan/Manitoba (40%, -6 points), Quebec (43%, -8 points), Atlantic Provinces (46%, -9 points) saw the biggest declines, whereas British Columbia (44%, +5 points) has seen a sharp increase.

However, optimism among Ontarians wanes when they envision their financial futures. One-third (35%) think their debt situation will be better a year from now, yet net optimism is down 3 points from March to stand at 23 per cent. Looking five years into the future, almost half (45%) believe that their future debt situation will be better than it is today, although net optimism is down two points to 35 per cent.

More than four in ten Ontarians (44%, +3 points) don't feel like they will be able to cover their family and living expenses without going into further debt and roughly half (54%, unchanged) Four in ten indicate they regret the amount of debt they've taken on in their life (46%, - 8 points) and are concerned about their level of debt (40%, +2 points).

After an all-time high in June 2018, the MNP Consumer Debt Index has been on a gradual decline. The latest data, representing the ninth wave, shows the decline has at least been temporarily halted as the index holds steady at 97. 

About MNP LTD

MNP LTD, a division of the national accounting firm MNP LLP, is the largest insolvency practice in Canada. For more than 50 years, our experienced team of Licensed Insolvency Trustees and advisors have been working with individuals to help them recover from times of financial distress and regain control of their finances. With more than 230 offices from coast-to-coast, MNP helps thousands of Canadians each year who are struggling with an overwhelming amount of debt. Visit MNPdebt.ca to contact a Licensed Insolvency Trustee or get a free checkup for your debt health using the MNP Debt Scale.

MNP LTD is the creator of the MNP Consumer Debt Index, an industry-leading national barometer of financial pressure among Canadians.

About the MNP Consumer Debt Index

The MNP Consumer Debt Index measures Canadians' attitudes toward their consumer debt and gauges their ability to pay their bills, endure unexpected expenses, and absorb interest-rate fluctuations without approaching insolvency. Conducted by Ipsos and updated quarterly, the Index is an industry-leading barometer of financial pressure or relief among Canadians. Visit www.MNPdebt.ca/CDI to learn more.

The latest data, representing the ninth wave of the MNP Consumer Debt Index, was compiled by Ipsos on behalf of MNP LTD between June 14 and June 17, 2019. For this survey, a sample of 2,111 Canadians aged 18 years and over was interviewed. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll is accurate to within ±2.4 percentage points, 19 times out of 20, had all Canadian adults been polled. The credibility interval will be wider among subsets of the population. All sample surveys and polls may be subject to other sources of error, including, but not limited to coverage error, and measurement error.