The bitter sting of post-holiday spending is adding considerable anxiety to Canadians, a large segment of which is already labouring under debt to begin with, according to insolvency practice MNP Ltd.
In its recent poll, MNP found that around 43% of Canadians are dreading the arrival of holiday spending bills this month, while 41% expressed regret over how much they spent over the past year, on top of their existing debt loads. Meanwhile, 16% admitted to being enticed by sales during occasions like Black Friday or Boxing Day.
“We’re bombarded by a flurry of sales and ‘buy now, pay later’ offers but what might seem like a small purchase or look like a great deal on Boxing Day isn’t really a bargain if you end up carrying them on credit,” MNP Ltd. president Grant Bazian said.
Read more: Insolvency increasingly weighing upon Canadian households
Other concerning financial habits that a significant number of Canadians are cultivating include paying only the minimum balance on credit cards (21%) or lines of credit (15%), borrowing money that they are unable to pay back quickly (14%), and purchasing on credit without paying it off right away (12%).
“Pressure mounts right before the holidays and that’s when people are more likely to borrow money from a payday lender or really overextend themselves on credit cards. The extremely high interest rates on these types of credit can trap them in a cycle of debt that will be impossible to get out of,” Bazian noted.