Debt among Canadian millennials at record levels, while earnings haven’t kept up: RBC report

; the rate stood at 5.2 per cent in May before it rose to 5.5 per cent in July, according to Statistic Canada.

The data, based on changing average mortgage rates between January 2019 and January 2023, found older millennials between the ages of 35 and 44 had an average debt-to-income ratio of 250 per cent in 2019. Approximately half of what Canadians in the same age group reported having in 1999 reported, which was 150 per cent.

Younger millennials are also reporting above that nearly 25-year statistic, as their debt-to-income ratio is at 165 per cent.Additionally, millennials who own a home are likely to see a 25 per cent increase in monthly mortgage payments by 2024 amid interest rate hikes, significantly affecting millennials who’s earnings haven’t kept up with the pace of their increasing debt.

In turn, boomers, who account for those aged 65 and older, are less vulnerable to interest rate hikes since the majority no longer have mortgage debt. As for the 14 per cent that still do, the average balance is half the size of a millennial mortgage.

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Millennials set to face most economic pain in months ahead, RBC says. Here’s whyMillennials who are saddled with debt such as costly mortgages might well bear the brunt of higher interest rates in the months to come, a new RBC report argues.
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