'People are still having a very hard time': Survey shows Albertans deepest in debt, despite highest incomes

Albertansmake more money than Canadians in any other provinceand yet, according to a new survey, nearly three out of 10 of us findit financially challenging to put food on our tables.

The problem, for many, isn't a lack of income.

It's overwhelming debt.

"Even high-income earners and people that are right in the middle, they're still having problems," says Craig Fryzuk, a licensed insolvency trustee with BDO Canada, which commissioned the survey.

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This probably doesn't come as a surprise, if you've been following the news. There have been numerous reports recently about how Albertanscarry the most consumer debt, how insolvency rates are up, and how we have the highest debt-to-asset ratio.

But consider the findings from this latest poll, which sheds new light on just how heavy debt loads weigh on so many of us.

The results suggest just 22 per cent of Albertans are debt-free (compared with 26 per cent of Canadians, as a whole).

For the other 78 per cent of us, credit-card debt is the most common kind of borrowing.

And, when you add up all the non-mortgage debt including car loans, lines of credit and student loans Albertansowe the most: about $24,700, on average. (Compared with about $20,000, nationwide.)

"What I'm seeing is that people are still having a very hard time," says Fryzuk.

Part of the issue, he says, is that people have tended to live beyond their means borrowing to buy things they want but don't really need.

"We saw a lot of that in Alberta over the last two or three years," Fryzuk says.

"Especially in the last year, with the interest rates creeping up, it makes paying off those debts a little bit tougher."

Couple that with ajob loss or a reduction in income, and suddenly a household can find itself in a lot of trouble.

"Here's a key indicator that came out of this poll that really struck me," says Fryzuk."Thirty-seven per cent of Albertans have more debt than they had last year."

And that's one area where he saysAlbertans' trademark sense of optimism can actually be a hindrance.

Waiting for things to get better

Fryzukbelieves people are "more likely to go into debt" when they're optimistic about their future prospects for getting a raise, finding a better job or seeing their investments increase in value.

"Albertansare optimistic, which is great," he says.

"We've had it good. We've had it really good, for so long. And we've seen the ups and downs, if you've been around this province for a while. And there's just that thought that belief that things are going to come around."

As a result, there tends to bea sense of "we're going to do just fine and we're going to pay off all this debt."

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"But, in the meantime, we're not advancing," he says. "We're not putting away to retirement savings. We're not building an emergency fund, in case something comes up."

According to the survey, 69 per cent ofAlbertanssaid they either have "too little in the way of retirement savings" or "no retirement savings at all." That was higher than any other region in the country, other than Atlantic Canada.

Of course, saving for the future is especially tough if you're struggling with day-to-day expenses.

Andit's not at all uncommon for people in this province to find themselves in that boat.

Struggles to pay for food, shelter

Forty-seven per cent ofAlbertans surveyed said they find it "somewhat challenging" or "very challenging" to pay for their monthly housing costs.

And 28 per cent said the same about their food costs.

This,despite amedianincomethat's 33-per-cent higher than the national average. A typical Albertan household brings in about $23,500 more, per year, compared with the typical Canadian household.

In his work as an insolvency trustee,Fryzuk says it often comes down to a question of spending priorities.

"Our wants and our needs are often muddled. We've got a lot of wants that seem to creep in there. And I think that's why we see that [struggle] in the higher income levels, as well," he says.

"It's that lifestyle creep where, as soon as we start making more, we're not putting that away, we're not paying off debt as effectively as we could be. We're just spending more money."

The survey was conducted by Ipsoson behalf of BDO Canada via on online panel of 2,000 Canadian adults. For comparison purposes only, a probability sample of the same size would yield a margin of error of plus or minus 2.1 percentage points, 19 times out 20. Alberta sub-samples would carry a larger margin of error, of roughly seven percentage points. The survey was conducted fromJuly 3 to July 6.

Calgary: The Road Aheadis CBC Calgary's special focus on our city as it passes through the crucible of the downturn: the challenges we face, and the possible solutions as we explore what kind of Calgary we want to create. Have an idea? Email us at:calgarytheroadahead@cbc.ca

More from the series:

• ANALYSIS |Alberta's income tax 'advantage' exists for the poor and the rich, but not those in between
• ANALYSIS |How Alberta built enough roads to reach the moon
• OPINION |Alberta's aging population is a fiscal time bomb