14 per cent believe they will be into their 70s before debt is paid off
VANCOUVER, Aug. 29, 2011 /CNW/ - A CIBC (CM: TSX) (CM: NYSE) Poll conducted by Harris-Decima reveals that, on average, B.C. residents holding some form of debt today feel they will be debt-free by age 58. However, the poll also found that less than one-third (32 per cent) of British Columbians in the 45 -64 age group today actually are debt-free.
"Being debt-free is a long term financial goal for many Canadians, and this poll suggests British Columbians are actively looking ahead to the stage of life they will be in when they successfully pay off all of their debt," commented Christina Kramer, Executive Vice President, Retail Distribution and Channel Strategy, CIBC.
She notes, however, that this disparity suggests that many residents of British Columbia need to remain focused on a debt repayment strategy to ensure they meet their target for being debt free at the age they have chosen for themselves.
In the same survey, Alberta residents felt they would be 52 by the time they had paid off all of their debt while Ontario respondents projected they would be 54.
More broadly, respondents across Canada projected they would be
debt-free by 55, on average.
A key finding of the poll shows that across all age groups, Canadians tend to believe they will be debt-free within approximately 10 to 15 years of their current age. The poll found:
- Canadians aged 18-24 believe they will be debt-free by age 32, on average
- Canadians aged 25-34 believe they will be debt-free by age 44, on average
- Canadians aged 35-44 believe they will be debt-free by age 54, on average
- Canadians aged 45-54 believe they will be debt-free by age 60, on average
- Canadians aged 55-64 believe they will be debt-free by age 65, on average
However, in every age bracket, many Canadians still hold debt beyond the average age identified within their age group. For example, Canadians 25-34 believe they will be debt-free, on average, by age 44. However, the poll shows that among today's 45-54 years old, only 18 per cent report being debt-free, suggesting many Canadians aged 25-34 may not be debt-free as soon as they hope.
"A key finding in this poll is that the passage of time alone is not enough to achieve the goal of paying down your debt," added Ms. Kramer. "B.C. residents with a goal of being debt-free would benefit from having a realistic plan in place that included extra payments towards their debt and a strategy to minimize their interest costs."
The poll also revealed that a percentage of residents from British Columbia see themselves as having debt long-term. 14 per cent of poll respondents from B.C. believe they will be into their 70s before their debt is paid off, and 11 per cent of respondents say they will never be debt free. Only 4 per cent of Alberta respondents believe they will be into their 70s before their debt is paid.
"It can be tempting to believe that ten years from now, you will be better off financially and will have paid down your debt considerably, but the reality is that it takes a slow and steady approach to both debt management and savings to make progress towards your goals," said Ms. Kramer. "Paying down your debt is no different from having to put money away for retirement - you need a goal and a plan to get you there, and a conversation with an advisor can help you build a strategy and start making progress towards being debt-free."
Some British Columbians do see themselves as making progress towards debt repayment, with 48 per cent saying they have made progress in this area so far in 2011.
Past CIBC consumer poll data released earlier this month showed that B.C. residents are taking extra steps to pay down their debt faster, including making lump sum payments (49 per cent), and making sacrifices in order to make progress on debt management (44 per cent). "Seeing British Columbians take these steps is encouraging and suggests that some B.C. residents do have a plan in place to achieve their goal of being debt free before they turn 60," added Ms. Kramer.
Among Canadians with debt, the average age at which Canadians expect to be debt-free (rounded to the nearest year) by region:
National Average - Age 55
BC - Age 58
Alberta - Age 52
Man/Sask - Age 56
Ontario - Age 54
Quebec - Age 54
Atlantic Canada - Age 58
Each week, Harris/Decima interviews just over 1000 Canadians through teleVox, the company's national telephone omnibus survey. These data were gathered in a sample of 2,008 Canadians between June 30, 2011 and July 10, 2011. A sample of this size has a margin of error of +/-2.2%, 19 times out of 20.
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