Albertans have Canada’s highest average household debt, including mortgages, in the country, eclipsing the national average by nearly $50,000, according to BMO’s annual debt report.
The report, released Friday, said the average household debt was $140,763. That’s higher than the four-year average of $124,701.
The average monthly debt servicing costs for Alberta are $1,506 compared with the national average of $1,165.
Lesley-Anne Scorgie, president of Rich By Inc., and a best-selling author, said many Albertans these days are facing a high debt-to-income ratio where what they owe has significantly increased relative to their income.
“So, when your debt is high and your household isn’t making as much money, it becomes more challenging to make payments, let alone make much progress towards retirement savings goals. A simple one or two per cent increase in interest rates can translate into a few hundred dollars extra in every month’s mortgage payment. When a household is already cash-strapped, a rate hike can push them to the brink of bankruptcy.”