One-third of Canadian seniors still hold some amount of debt after they retire, new data from Statistics Canada reveal.
Some of those retirees are carrying large debts: 17 per cent of retired Canadians 55 years or older who have debt owe more than $100,000, the report found.
But on the other end of the scale, one in four of those with debt owe less than $5,000.
"Debt in this range may simply be related to using credit as a convenience or as promotional financing. For example, some big-ticket items can be purchased on credit with no payments or interest for up to one year," the report authors noted.
Overall, the median amount owed by retired seniors carrying debt was $19,000.
By comparison, among seniors over the age of 55 who have not retired, two-thirds hold mortgage or consumer debt. And their median debt load is $40,000 – that's about double that of retirees.
Couples tend to have less debt than divorced retirees, as one might expect. But those who were never married and widowers have even less debt.
The older Canadians get, the more likely they are to be debt-free. While just under half of retirees aged 55 to 64 had some form of debt, only 20 per cent of retirees over 75 still had debt.
Retirees with a higher education and higher incomes and who owned homes were more likely to owe money. But that may be a reflection of the fact that they are more comfortable servicing debt.
"Other research has shown that higher education is associated with an open or positive attitude towards borrowing," the report authors note.
Retirees with debt had a median annual household income of $42,000 in 2009 and a median net worth of $295,000. So overall, their debt was equivalent to about seven per cent of their total assets.
The report found that almost eight in 10 of retired seniors think their financial situation is as expected or better than before they retired. As well, 86 per cent say their income is sufficient to cover monthly expenses.
