Debt, Financial Vulnerability, and Repayment Behaviour in Older Canadian Households

Abstract

Earlier research has documented that debt at older ages has increased significantly in Canada over the period from 1999 to 2016. In this article, I explore the consequences of a growing proportion of older Canadian households experiencing financial vulnerability. After controlling for household characteristics, I find among older households that a high debt-to-asset ratio and very low liquid wealth are significantly and positively associated with skipping or delaying a mortgage or non-mortgage debt payment and with usually paying the minimum amount or less on credit cards in the previous year. The debt-to-income ratio, however, is not an important indicator of financial vulnerability for older households.