The Hidden Crisis: How Debt is Driving Mental Health Decline in Canada

2nd Annual Debt Load & Impact to Psychological WellBeing Report, Spergel: Canadians Are Struggling

TORONTO, ONTARIO, CANADA, October 22, 2025 /EINPresswire.com/ -- Building on the Spergel inaugural debt study from 2024, this year’s report shows that Canadians are facing very real and serious mental health struggles when it comes to debt.

The latest report aims to provide new insights on the impacts of debt on mental health, and why individuals delay seeking professional help for their financial challenges.

Incredibly, Statistics Canada reports a 174.9% rise in debt-service ratio meaning there was $1.75 in credit market debt for every dollar of household disposable income in the second quarter of 2025.

The study, completed by 618 former Spergel clients show:
90% of respondents experienced moderate to extreme stress due to their debt.

Financial stress can manifest in various serious health impacts, from constant worry about debt (83% of respondents) to poor sleep (74%) to depression (54%). 87% of respondents said their mental health improved after filing for insolvency and shockingly, 17% of correspondents entertained suicidal thoughts.

88% of respondents said dealing with debt has had long-term impacts on their mental health.

But debt doesn’t have to weigh so heavily. With a great stigma surrounding debt, many of us aren’t aware that there are ways to overcome this crushing psychological weight that debt can carry.

“Insolvency solutions, from debt relief to consumer proposals, can offer substantial long-term mental health benefits for debt related stress.”, Alan Spergel, President & Founder, msi Spergel Inc.

And debt hits every demographic in equal ways, with:
Single and married individuals each make up a third of all respondents
30% of respondents finished high school and a 30% attained a Bachelor’s degree
Most debtors were aged 55 -64 years old, with the 65+ and 45-54 tied for second, followed by the 35-44 cohort

The Spergel report highlights the sustained financial strain Canadians are facing. Between April and June 2025, 35,114 Canadians filed for consumer insolvency, marking a 2.6% increase from the previous quarter and remaining virtually unchanged year-over-year (+0.1%). Over the 12 months ending June 30, consumer filings were up 4.9% compared to the prior year, with Ontario (13,292) and Quebec (8,372) together representing nearly two-thirds of all cases. The most significant year-over-year increases, however, were seen in smaller provinces — Newfoundland and Labrador (+20.2%), British Columbia (+7.0%), and Manitoba (+5.3%) — underscoring how financial pressures are now reaching households across the country.

Respondents reported experiencing depression, helplessness, shame, and suicidal ideation due to debt stress.
“This is a very real and serious problem that impacts so much on our society. Shame, fear of judgment, and lack of information are some key reasons why people delay seeking professional insolvency help. It doesn’t have to be this way, she added.”, Gillian Goldblatt, Partner, msi Spergel Inc.

Working with debt professionals can have significant positive impacts on the mental health of those struggling with debt. The vast majority (87%) of survey respondents reported some level of improvement in their mental health after filing for insolvency.

“Support, whether it’s emotional or professional, can make a real difference. We’re here to help people navigate how to best deal with their debt, whether it be helping their file for a consumer proposal or bankruptcy if need be. You don’t have to do this alone.” Rob Kilner, partner, msi Spergel Inc.



About msi Spergel
For over 35 years, Spergel, the ‘get rid of debt’ people have been at the forefront of helping Canadians break free from the cycle of debt and regain control of their financial futures. As a leading Canadian insolvency firm, we pride ourselves on offering tailored, compassionate solutions that guide both individuals and businesses through the complexities of debt relief with confidence and clarity.

For Media Inquiries, contact: Joey Gill joey@hiconcept.ca + 1 416 556 0675
For more information about Spergel, visit: www.spergel.ca
For the complete 2nd Annual Report “Debt Load and the Impact to Psychological Wellbeing, visit: https://www.spergel.ca/learning-centre/debt-load-study/

Joey Gill
Hi Concept Publicity and Productions
+1 416-556-0675
email us here
Visit us on social media:
LinkedIn
YouTube

Legal Disclaimer:

EIN Presswire provides this news content "as is" without warranty of any kind. We do not accept any responsibility or liability for the accuracy, content, images, videos, licenses, completeness, legality, or reliability of the information contained in this article. If you have any complaints or copyright issues related to this article, kindly contact the author above.