Financial stress is leaving Canadian borrowers with no room to brake

Nearly half of working Canadians are now financially stressed. For mortgage brokers, that means a growing share of clients may be one late paycheque away from trouble.

The National Payroll Institute's 2026 Annual Survey of Working Canadians placed 44% of employed Canadians in its financially stressed category. That is up from 36% in the 2025 edition, and the group is now more than double the size of the financially comfortable segment.

The findings land as household leverage keeps climbing. TransUnion recently reported a record $2.64 trillion in consumer debt in the second quarter, reinforcing the survey's picture of stretched household budgets.

Bank of Canada governor Tiff Macklem issued a stark warning Monday that a fresh round of US tariffs and elevated global oil prices risk undoing Canada's hard-won economic recovery.https://t.co/k19n8NXNPd

— Canadian Mortgage Professional Magazine (@CMPmagazine) September 22, 2026

Paycheque-to-paycheque borrowers are multiplying

Some 28% of workers said they would struggle to meet their obligations if their pay arrived a week late. That is a five-year high, up from 24% in 2025. Half now spend all or more of their net pay, compared with 41% a year earlier.

Savings intent is fading as well. The share of workers trying to save more fell to 43% from 51%, and only 31% reported progress. Meanwhile, 37% are carrying more debt than in previous years, and 42% say debt is limiting their ability to save.

Groceries and household products topped the list of stressors at 55%, followed by personal debt at 46%. The survey also estimates financial stress costs employers $74.3 billion in lost productivity.

"When people are spending everything they earn, relying on debt to bridge the gap and unable to build or maintain savings, even a small disruption can leave them feeling as though they are losing control," Peter Tzanetakis, president and CEO of the National Payroll Institute, said in the release.

What thin buffers mean for mortgage renewals

For brokers, the data points to clients who may look serviceable on paper but hold little liquidity to absorb a payment shock. That strain is already visible in Canadian consumer insolvencies hitting a 17-year high in the first quarter of 2026.

Some brokers are responding by restructuring debt. Sarah Albert, a New Brunswick-based broker with Premiere Mortgage Centre, told Canadian Mortgage Professional in last month that refinances were helping clients offset rising costs.

"To mitigate the increase in the cost of living, groceries, insurance costs – everything's more expensive – we're resetting mortgages and actually saving them some money each month," she said.

Chuck Grace, professor emeritus and co-founder of Canada's Financial Wellness Lab at Western University, said in the release that without emergency savings, Canadians have "fewer ways to protect themselves from external pressures such as inflation, rising interest rates and tariffs."

Sentiment offers little relief. Only 26% of respondents said they felt optimistic about the future, and 49% ranked tariffs among their top economic worries. The results echo the Bank of Canada's warnings about rising household vulnerabilities earlier this year.

Framework Analytics conducted the online survey of 2,196 working Canadians between June 22 and June 30.

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