Fewer than half of homeowners are happy with how they've managed their
debt in the past year.
Many do not take advantage of easy strategies to manage debt.
Homeowners who work with an advisor are less likely to carry a credit
C$ unless otherwise stated
WATERLOO, ON, Nov. 19, 2013 /CNW/ - Only 51 per cent of homeowners are
confident they will be debt-free at retirement, even though 83 per cent
feel it's important to meet that goal by then, according to a new
survey by Manulife Bank of Canada.
"If you're not confident that you'll reach your debt-freedom goal,
whether it's by retirement or sooner, it's in your interest to seek out
professional advice and put a personalized plan in place," says Doug
Conick, President and Chief Executive Officer, Manulife Bank of Canada.
In a sign that a growing number of Canadians are concerned about rising
household indebtedness, only 43 per cent of homeowners say they are
happy with how they've managed their debt and day-to-day finances over
the past year. That's down slightly from two years ago, when 46 per
cent expressed satisfaction. Younger homeowners appear to be worst off,
with fewer than four in 10 aged 30-39 indicating satisfaction with
their debt management over the past year, compared to nearly five in 10
for those aged 50-59.
The survey also found that nearly one in three respondents are "very
unhappy" with how they've managed their debt and day to day finances
over the past year, up slightly from the third quarter of 2011.
Consistent with past surveys, more than three quarters of homeowners
rate debt-freedom as being among their top financial priorities.
"Debt is a tool that Canadians can use to improve their standard of
living and purchase assets over the long-term," says Mr. Conick.
"Still, people need a strategy to manage debt. The key is to determine
what your financial priorities are - and then put a plan in place to
focus on your most important goals."
When asked to indicate what strategies they use to manage their debt
effectively, two-thirds of respondents say that they always pay their
credit card balance in full - an increase of 9 per cent from two years
ago. Among the third who carry a balance from time to time, a large
majority intend to start paying their balance in full in the coming
year. Interestingly, this finding is very similar to that from the
2011 survey - suggesting that good intentions may not always translate
into action. Other commonly used strategies include "make extra
payments on my debts" (61 per cent) and "create a written budget to
track and manage my spending" (43 per cent). In each case, a quarter to
a third of people indicated they don't use the strategy but plan to do
so in the coming year.
Among the debt management strategies less frequently used - just one in
three have consolidated their debt at a single low rate and fewer than
one in four get debt management advice from a financial advisor.
Interestingly, those who do get debt management advice from a financial
advisor are more likely to take advantage of these strategies. In
fact, 80 per cent of homeowners who work with an advisor pay their
credit card balance in full each month, compared to 64 per cent of
those who don't seek advice. Similarly, those who work with an advisor
are more likely to make extra payments on their debts and create a
"For anyone who struggles to find time to spend on debt management or
who could benefit from objective, professional advice - it's certainly
worthwhile to seek out a financial advisor," says Mr. Conick. "It never
hurts to learn about the strategies and tools that work for others -
and getting personalized advice could help you remain focused on your
goal of becoming debt-free."
About the Manulife Bank of Canada Debt Survey
The Manulife Bank of Canada poll surveyed 2,132 Canadian homeowners in
all provinces between ages 30 to 59 with household income of more than
$50,000. The survey was conducted online by Research House between
September 10-20, 2013. National results were weighted by province and
About Manulife Bank
Established in 1993, Manulife Bank was the first federally regulated
bank opened by an insurance company in Canada. It is a Schedule l
federally chartered bank and a wholly-owned subsidiary of Manulife
Financial. As Canada's first advisor-based bank, it has successfully
grown to more than $22 billion in assets and serves clients across
About Manulife Financial
Manulife Financial is a leading Canada-based financial services group
with principal operations in Asia, Canada and the United States.
Clients look to Manulife for strong, reliable, trustworthy and
forward-thinking solutions for their most significant financial
decisions. Our international network of employees, agents and
distribution partners offers financial protection and wealth management
products and services to millions of clients. We also provide asset
management services to institutional customers. Funds under management
by Manulife Financial and its subsidiaries were C$574.6 billion
(US$558.7 billion) as at September 30, 2013. The Company operates as
Manulife Financial in Canada and Asia and primarily as John Hancock in
the United States.
Manulife Financial Corporation trades as 'MFC' on the TSX, NYSE and PSE,
and under '945' on the SEHK. Manulife Financial can be found on the
Internet at manulife.com.
SOURCE: Manulife Financial Corporation
For further information:
Sean B. Pasternak