Middle-income Canadians face heftier debt burdens than either high-earning households, or the lowest earners, according to Statistics Canada (StatsCan) provisional estimates on the distribution of wealth and debt burden by income level, province, age and household type.
“Household wealth, or net worth, is not distributed equally by income quintile,” StatsCan says, noting that households in the top income quintile held more than 45% of total household net worth compared with about 9% for the bottom income quintile. These shares have remained relatively stable from 2012 to 2015.
The data also show that real estate represents a higher share of assets, and mortgages make up the largest share of liabilities for all but the lowest income group. For households in the bottom income quintile, life insurance and pensions represent a higher share of household assets.
Although the distribution of wealth by age remained relatively stable from 2012 to 2015, those 55 years of age or older increased their share of net worth by 1.6 percentage points over that period, StatsCan reports.
Furthermore, households with older major income earners have a lower debt burden than those headed by a younger earner, StatsCan reports, “suggesting they tend to accumulate assets and pay down debt over their lifetimes.”
In terms of asset mix, households with a major earner over age 45 hold a higher share of their assets in life insurance and pensions than other age groups, whereas younger households have a higher share of their assets in real estate and a greater share of their liabilities in mortgages.
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