Poll: Most Canadians worried about rising interest rates

It is being reported that the Bank of Canada (BOC) is getting ready to raise interest rates. Years after artificially slashing rates to historic lows, the Canadian central bank may finally pull the trigger on a rate hike at July’s policy meeting.

With Canadians suffering from record levels of debt – credit cards, auto loans, mortgages, etc. – could the average consumer survive? A new poll says no.

According to MNP LTD, one of Canada’s largest personal insolvency practices, 45 percent of Canadians are worried about rising interest rates and how they will affect their personal finances.

Nearly three-quarters (72 percent) say their ability to service their debt with a one percent interest rate is “less than optimal.” Just close to one-quarter (23 percent) reported that they could handle a $130 monthly hike in interest payments on debt.

“We’ve been living with this ‘minimum payment mentality’ for so long because of low interest rates. Many have taken on debt without considering the affordability if and when interest rates rise,” said Grant Bazian, President at MNP LDT, in a statement.

Rate hikes are likely going to be far more prevalent moving forward to handle rising inflation.

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