Canadians face ‘heat or eat’ decisions as financial strain deepens
MNP Consumer Debt Index falls to 86 points, reflecting Canadians’ growing financial vulnerability
- Three in 10 (29%, +5 pts YoY) Canadians say they have reduced their utility consumption, while a quarter (24%, -4 pts YoY) report eating less to save money.
- Nearly half are within $200 of insolvency each month (48%, +6 pts QoQ), with the average amount left after monthly expenses decreasing to $744 from $916.
- Fewer than half report having six months of emergency savings (46%), leaving many households highly exposed to disruption.
- More than two in five Canadians (44%) worry that AI could negatively affect their job or income.
CALGARY, Alberta, Oct. 06, 2025 (GLOBE NEWSWIRE) -- According to the latest MNP Consumer Debt Index data, Canadians’ financial vulnerability is intensifying as persistent economic uncertainty, concerns about borrowing costs, and employment anxiety weigh on household confidence. Faced with mounting financial pressure, many indebted Canadians are being forced into difficult “heat or eat” decisions — choosing between necessities such as heating their homes and putting food on the table. Three in ten (29%, +5 pts YoY) Canadians say they have reduced their utility consumption, while a quarter (24%, -4 pts) report eating less to save money. These stark trade-offs reflect the deepening strain on household budgets, particularly as winter heating costs loom.
The Index dropped two points to 86 this quarter — its lowest September reading since 2023, underscoring how fragile Canadians’ financial situations have become.
“Some households are stretched so thin that even basic expenses feel overwhelming,” says Grant Bazian, president of MNP LTD, the country’s largest insolvency firm. “When people are cutting back on food, heat, or medical care, it’s not just about budgeting anymore — it’s about day-to-day survival. That level of strain takes a huge emotional toll.”
Beyond heating and food, Canadians are cutting back in other ways. More than half (51%, unchanged YoY) say they are grocery shopping strategically by using meal plans, bulk buying, coupons, and price matching. More than two in five are avoiding impulse purchases (45%, -1 pt) and have stopped dining out or ordering takeout (41%, -3 pts). One in five (19%) are also delaying or skipping medical, dental, or prescription care, highlighting how financial strain is affecting households’ well-being.
Even with these sacrifices, financial cushions are shrinking. Nearly half (48%) of Canadians report they are within $200 of being unable to pay their bills each month, climbing six points since last quarter. At the same time, the average amount left over after monthly expenses has fallen to $744 from $916. Younger Canadians and middle-income earners ($60K to <$100K) experienced the steepest declines, with those aged 18–34 left with only $651 (-$269) and middle-income earners averaging $727 (-$397).
“Canadian households are now left with so little at the end of the month that even a small, unexpected expense can push them into relying on high-interest credit,” says Bazian. “That’s when debt can quickly spiral and become unmanageable. We’re hearing from people who feel they’ve run out of options — and letting things go too long only makes finding relief harder.”
Job insecurity and AI concerns add to financial strain
A softening job market is eroding Canadians’ confidence in their ability to cope with income disruption, with confidence in handling a job loss falling by four points this quarter. Against this backdrop, more than two in five (44%) worry that artificial intelligence (AI) could negatively affect their job or income. This concern is particularly pronounced among younger and lower-income Canadians. A majority of those aged 18–34 (56%) and nearly half of those 35–54 (49%) say they are worried about the impact of AI on their job or income, compared to just a third (34%) of those 55 and older. Canadians with household incomes under $40K (49%) are far more likely to be concerned than those earning $100K or more (36%).
“It’s concerning that so many Canadians see their jobs and income at risk from AI, especially when most already feel financially vulnerable and lack the safety nets to withstand a disruption,” says Bazian. “For younger Canadians and those earning less, the anxiety is even greater — many already have limited savings to fall back on, which means AI isn’t just a future threat, it feels like a very real risk to their livelihoods today.”
Additionally, fewer than half (46%) of Canadians report having six months of emergency savings to withstand a disruption, highlighting just how exposed many households would be if their income were reduced or lost.
Debt outlook darkens as Canadians run out of options
Canadians’ net personal debt rating fell three points this quarter to +18 points, the lowest September score since 2023. Only a third (37%, -2 pts) rate their debt situation as “excellent,” while one in five (19%, +1 pt) describe it as “terrible.” Although the Bank of Canada held interest rates at 2.75 percent during the survey period and cut to 2.5 percent shortly after, nearly two-thirds (63%, -1 pt) of Canadians said they desperately need rates to go down, and more than two in five (44%, -1 pt) said even if rates decline, they remain concerned about their ability to repay debt. Two in five (42%, +1 pt) worry that rising rates in the future could push them toward Bankruptcy. Significantly fewer this quarter (26%, -7 pts) expect their debt situation to improve in the next year, and just a third (36%, -4 pts) expect improvement over the next five years.
“For Canadians who are already carrying significant debt, lower rates aren’t enough to turn things around,” explains Bazian. “The reality is that relief from interest rates can be temporary, but financial stress lingers if the underlying debt is still there. Seeking help from a Licensed Insolvency Trustee isn’t a last resort — it’s a smart step that can help people regain control sooner and avoid long-term damage.”
The report findings suggest households have exhausted their options. Three in ten (30%, unchanged YoY) report having no plans to save more in the next 12 months, and only 15 percent (+1 pt) intend to create or revise a household budget. A further one in ten (10%, unchanged) say they are considering relocating to more affordable housing or even eating less (10%, +3 pts). Additionally, 12 percent (-1 pt) say they plan to reduce utility consumption over the next year — a concerning sign as households head into the winter months, underscoring how entrenched these “heat or eat” trade-offs have become.
“When everyday costs start forcing people to choose between keeping the heat on or putting food on the table, it’s not just finances that suffer — it’s peace of mind,” says Bazian. “Licensed Insolvency Trustees don’t just solve debt — they listen, help protect what you still have, and map out the options you maybe didn’t even know exist. Even in overwhelming moments, there’s a path forward.”
Licensed Insolvency Trustees provide free, confidential consultations and are the only federally regulated debt professionals authorized to administer Consumer Proposals and Bankruptcies. With more than 200 offices across the country, MNP LTD’s team of Licensed Insolvency Trustees deliver local, personalized and non-judgmental guidance to help Canadians understand their options and take the first step toward lasting financial stability.
About MNP LTD
MNP LTD, a division of the national accounting firm MNP LLP, is the largest insolvency practice in Canada. For more than 50 years, our experienced team of Licensed Insolvency Trustees and advisors have been working with individuals to help them recover from times of financial distress and regain control of their finances. With more than 240 offices from coast-to-coast, MNP helps thousands of Canadians each year who are struggling with an overwhelming amount of debt. Visit MNPdebt.ca to contact a Licensed Insolvency Trustee or use our free Do-it-Yourself (DIY) debt assessment tools. For regular, bite-sized insights about debt and personal finances, subscribe to the MNP 3-Minute Debt Break Podcast.
About the MNP Consumer Debt Index
The MNP Consumer Debt Index measures Canadians’ attitudes toward their consumer debt and gauges their ability to pay their bills, endure unexpected expenses, and absorb interest-rate fluctuations without approaching insolvency. Conducted by Ipsos and updated quarterly, the Index is an industry-leading barometer of financial pressure or relief among Canadians.
Now in its thirty-fourth wave, the Index has fallen by two points from last quarter to 86 points. Visit MNPdebt.ca/CDI to learn more.
The data was compiled by Ipsos on behalf of MNP LTD between September 4 and September 9, 2025. For this survey, a sample of 2,001 Canadians aged 18 years and over was interviewed. Weighting was then employed to balance demographics to ensure that the sample's composition reflects that of the adult population according to Census data and to provide results intended to approximate the sample universe. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll is accurate to within ±2.5 percentage points, 19 times out of 20, had all Canadian adults been polled. The credibility interval will be wider among subsets of the population. All sample surveys and polls may be subject to other sources of error, including, but not limited to, coverage error and measurement error.
Provincial data is available upon request.
CONTACT
Angela Joyce, Media Relations
p. 1.403.681.9286
e. angela.joyce@mnp.ca
A photo accompanying this announcement is available at https://www.globenewswire.com/NewsRoom/AttachmentNg/b684aecd-48b1-4852-8f66-c15b7cca07fb
MNP Consumer Debt Index - October 2025
MNP Consumer Debt Index falls to 86 points, reflecting Canadians’ growing financial vulnerability.
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