More Canadians are struggling to keep up with rising living costs, with new federal data showing consumer insolvencies have climbed to their highest quarterly level since the 2009 global financial crisis.
According to figures released by the Office of the Superintendent of Bankruptcy Canada, a total of 37,121 Canadians filed for insolvency during the first three months of 2026 — an increase of 8.5 per cent compared to the same period last year.
The sharp rise reflects growing financial pressure on households already dealing with high food prices, rising fuel costs, housing expenses, debt payments and economic uncertainty.
Rising Costs Pushing Canadians Into Debt
Doug Hoyes said many Canadians are finding it increasingly difficult to balance household expenses with stagnant income growth.
“Our expenses, for the most part, are rising a lot faster than what our incomes are,” Hoyes explained. “How do you bridge that gap? Well, you do it with debt.”
Hoyes noted that while many families can survive short-term financial stress, prolonged economic pressure is now pushing more Canadians toward a “breaking point.”
“A lot of people are now reaching the breaking point; they just cannot do it,” he said.
Although Canada’s population is significantly larger today than it was in 2009 — meaning insolvency rates are proportionally lower than during the financial crisis — experts say the trend remains deeply concerning.
Ontario, B.C. Among Hardest Hit Provinces
British Columbia recorded the largest increase in insolvencies at 16.2 per cent, followed closely by Prince Edward Island at 15.3 per cent and Ontario at 14.7 per cent.
Across Canada, about 80 per cent of insolvency filings were consumer proposals, which allow individuals to repay debt over several years while keeping some assets.
The remaining 20 per cent were bankruptcies, which generally involve surrendering assets such as vehicles or homes to eliminate debt obligations.
Experts say the faster rise in bankruptcies in provinces like Ontario and Alberta may indicate Canadians are facing even more severe financial distress.
Bankruptcy Growth Raises Concerns
Anna Lund said the increase in bankruptcies suggests many Canadians no longer feel capable of committing to long-term repayment plans.
“The trend toward bankruptcies suggests that people are in a deeper insolvency position,” Lund said, explaining that some individuals simply cannot manage another three to five years of repayment obligations.
Financial experts also point to growing use of credit cards, personal loans and “buy now, pay later” financing programs as contributing factors increasing household debt levels.
Economic Uncertainty Expected to Continue
With ongoing trade tensions, global conflicts, inflationary pressures and a softer labour market affecting Canadians, experts believe insolvency numbers could continue rising throughout 2026.
Hoyes recommends Canadians focus on reducing discretionary spending and building emergency savings wherever possible.
“Keep your expenses as low as you can to free up as much cash as you can to ride out these tough times,” he advised.
As affordability pressures continue across the country, the latest insolvency figures highlight growing concern that more Canadian households may soon face serious financial hardship.