We enjoy being optimistic here at LowestRates.ca.

But from time to time, we all need a reality check. That's particularly the case in Canada when it comes to our finances. There are plenty of scary numbers available. We're carrying an excessive amount of debt. Housing has got too costly. We don't have enough to retire.

While it's not all doom and gloom (we have a handy money-saving guide right here!) you need to know of the issues we just mentioned.

Below, we've put together the main scary financial facts that you ought to know this Halloween. We asked five experts about the numbers are extremely frightening.

Houshold debt

Why's it scary? Debt – it might be more Canadian than maple syrup. Canada is among the most indebted countries in the world, with the average debt-to-disposable income ratio within this country sitting at 177.6% as of the very first quarter of 2021. That means for every $1 of disposable income someone has, they owe about $1.77 in debt.

The problem is, despite efforts by governments to understand this down – whether instituting new housing rules or attempting to regulate credit cards and pay day loans – this stubborn stat just won't budge. Canadians are carrying more debt than ever and we're still sitting at historically low interest rates. If rates of interest were to rise, or maybe a recession hit, resulting in job losses, all this debt could spell lots of difficulties for the nation.

Why it scares the expert: “The average Canadian owes $1.77 in debt for every $1 of disposable income earned. It's an all-time record, says the Bank of Canada, and mortgages constitute almost three-quarters of this debt. Even when interest rates stay flat or decline, high debt is bad for your financial health. When you stretch to create mortgage repayments, you're more likely to use credit cards to pay for expenses and carry a balance at double-digit rates. You're not as likely to satisfy long-term goals, for example saving for retirement or perhaps your children's education. In the worst of all scenario, you're living from paycheque to paycheque, with nothing to select from in desperate situations. A 2021 survey by insolvency firm MNP Ltd. found that 54% of Canadians be worried about remarkable ability to repay debts, 48% are $200 or less away from insolvency every month and 40% won't be able to cover their expenses in the next 12 months without taking on more debt. Now that's blood-curdling.”

Student loans

Why's it scary? The average scholar in Canada graduates using more than $26,000 of debt. In the 2021 -2021 fiscal year alone, the government doled out $2.6 billion in loans to students. For many, it can take between nine and Fifteen years to pay for that debt back. The average price of an undergraduate degree (when examining all fields of study) has increased by 3.3% since the 2021/18 school year.

Student debt led to almost 18% of Ontario insolvencies filed in 2021. Also it can hit women the toughest thanks in no small part to the gender pay gap. Women owe an average of 8.2% more in student debt than their male counterparts and are filing for insolvency for that reason debt in a higher rate than men.

Why it scares the expert: “These figures scare me because we may convey more than one generation of Canadians who may not be debt-free. Think of the knock-on results of that. Fewer contributions to the tax base, towards the economy, and also to wealth building and savings. Many students will begin off and grow debt slaves for that bulk of their adult working lives. N't i longer just requires a good summer job to pay for your education.”

Retirement savings

Why's it scary? Fewer than the usual third of Canadians actually have a financial plan in place for retirement, based on a CIBC poll. And 80% of Canadians are involved they don't have enough money saved for your stage of their life. Millennials are in a particularly precarious situation. They're now being cautioned that to be able to possess a comfortable retirement, they'll have to save twice as much every week than their baby boomer parents had to.

Why it scares the expert: “The scary point about this statement is the fact that it's probably true. Boomers happen to be told for a long time that Canada includes a retirement crisis but it is really the millennials who will feel the brunt of it.”

Insurance

Why's it scary: $2.1-billion: That's how much claims caused by environmental catastrophes cost Canadian property and casualty insurers in 2021, according to the Insurance Bureau of Canada (IBC). There have been 12 catastrophic events this past year; all of them caused major flooding. Which storms triggered the biggest payouts? A wind and rainstorm that pummeled Hamilton, Toronto, the GTA, and areas of Quebec at the begining of May ($680-million) and a September wind and rainstorm that pounded the Ottawa-Gatineau region ($334-million). The amount insurers shell out annually for catastrophic losses has doubled since 2009.

Why it scares the expert: “It's suggestive of the outcome of our changing climate,” said Aaron Sutherland, a vice-president at Insurance Bureau of Canada. “It's also suggestive of the human toll. While insurers will help you rebuild, there are certain stuff that you are able to lose – memories, photographs – that people can't replace. They're irreplaceable.” Sutherland also says the popularity in claims costs “is putting a large amount of pressure around the industry to locate new methods to keep insurance affordable.”

Housing

Why's it scary? Across the country, but particularly in Canada's major cities, the crisis of unaffordable housing only has gotten worse in the last couple of years. Today, it requires a typical person between 25 and 34 years of age 13 years to save for a 20% deposit with an averaged priced home in Canada – compared to the five years it took when today's aging population started out as young adults in 1976. The issue is even worse in Canada's biggest cities – it requires between 15 and 21 years in order to save for any home in Toronto, while in the Greater Vancouver area, it requires between 23 and 29 years. Renters are facing an identical squeeze, as a recent study states that low-income workers cannot afford to book in 91% of Canadian cities. Large financial company and housing expert Shawn Stillman says the lack of affordability across both regions of the housing market is really one vicious cycle.

Why it scares the expert: “People are in an enormous disadvantage financially if they do not buy their own homes because the housing market has gone up so much even in the final 12 months … Individuals have this mentality when I don't purchase a house now, I'm never gonna purchase a house. They think they're forced to purchase one because they're likely to be in a disadvantage if they don't. But, that's probably because we don't have affordable housing and affordable rentals that make renting a good option. It was once $900 to book a one-bedroom in Toronto and now a one-bedroom is over $2,500. It is simply really gotten out of whack and wages haven't kept pace with this. So individuals are feeling squished, and they feel that the only way to get free from it is to buy their very own house. Lacking enough rental properties causes that issue.

“It simply comes down to demand and supply and there is more supply and demand. So really, somebody has to move forward to improve the housing stock – with the addition of more density, more buildings – but Toronto's only answer has become increasingly more like Ny where you can find skyscrapers on every corner. The economics by themselves are not going to solve this issue. There needs to be some form of intervention to help first time home buyers if that's the function government wants to take.”