Indeed, the 60-somethings surveyed who still had a mortgage owed about $256,000, while their total debt load was still about $436,000.
Typical debt for 70+-year-old Canadians
Even Canadians aged 70 and older are carrying mortgage and line of credit debt. Of the 70-year-olds who responded to the survey, 11% still carried a mortgage balance and that average balance was still about $217,500.
Furthermore, 15% of those aged 70 and up carried a HELOC, with an average balance exceeding $124,000.
Debt in your 70s may be explained by the fact that retirees want to remain in their homes as long as possible. So, they are accessing funds through a line of credit or reverse mortgage may allow retirees to stay in their homes and enjoy a preferred standard of living.
How to get out of debt
Debt is on Canadians minds, but so is getting out of debt. A 2023 BDO survey shows: 56% of Canadians polled plan to cut back on non-essential spends (vacations, eating) to pay debt, 43% to hold back on essential spends (cloths, food, utilities), 26% to work more and 30% are overwhelmed and don’t know what to do.
But, ideally, Canadians will reach their peak debt years in their 30s when competing financial priorities are at their highest.
Prioritize getting out of debt by tackling the highest interest rate balances first to get the biggest bang for your buck—this is called the avalanche method. That means treating credit card debt and other high interest consumer loan debt like a “hair-on-fire” emergency and paying it off quickly.
After making a solemn vow to never pay another cent of credit card debt again, focus on lower interest debt such as your line of credit and mortgage.
Robb Engen
Source link
