close

Average Canadian net worth shrinks for first time in almost a decade

The average Canadian household net worth fell by $7,594 (1.1%) to $678,792.

This article was published more than 1 year ago, information might not be accurate.

Wyatt Claypool Montreal, QC

The net worth of the average Canadian household has fallen for the first time in nearly a decade in part due to growing debt, declines in liquid assets, and shrinking pensions which commulatively have begun to cause negative effects.

The average Canadian household net worth fell by $7,594 (1.1%) to $678,792.

The gains in the housing market last year were more than negated by the late 2018 stock market corrections, fall in pension values, and mounting debt, Toronto-based Environics said in a report.

The report showed that the issue is despite the average gains of $6,336 (1.6%), in-home equity, the stock market lost an average $10,045 in value, while average debt rose $3,309 (2.3%), and pensions lost on average $576 (0.4%).

This all doesn’t exactly come as a shock as the Bank of Canada has hiked interest rates five times from 2017 to last October.

By the end of 2019, we are predicted to improve from the slump due to an improvement in slow rebounds in all the areas negatively affected, with the added help of mortgage-curbing rules and a steady 1.75% interest rate having been maintained by the Central Bank.

Peter Miron, senior vice president of Environics Analytics’ research and development, gave reassuring news by highlighting how Canadians have been adapting their spending to rein in debts and save more for the future.

“Canadians are actively taking steps to rein in their debts and build up their savings,” he said. “[Canadians were] relatively prudent in terms of their debt acquisition and repayment in 2018…four provinces saw the average debt per household decline.”

This would put current controversies over Ontario Premier Doug Ford’s government’s spending cuts into perspective. Although Ford’s popularity hovers around 26% he was elected ostensibly to rollback deficit spending and reduce Ontario’s debt which sits at 40.7% of the province’s GDP as of 2019.

Environics said that Ontario has been the best performing province for the year for bank deposits over-investment in stocks which helps protect against current market volatility. Although that is on an individual level it demonstrates the need for households as well as governments to save.

Most economic analyses of Canada show slow growth, barely outpacing standard inflation, so like many western developed economies, Canada is in a good but precarious position going forward.

Join us!

We’re independent and can’t be cancelled. The establishment media is increasingly dedicated to divisive cancel culture, corporate wokeism, and political correctness, all while covering up corruption from the corridors of power. The need for fact-based journalism and thoughtful analysis has never been greater. When you support The Post Millennial, you support freedom of the press at a time when it's under direct attack. Join the ranks of independent, free thinkers by supporting us today for as little as $1.

Thank You!

Support The Post Millennial
Accepted payment methods: Visa, Mastercard, American Express  and Paypal
Wyatt Claypool
0
Join The Discussion