Ontarians grapple with inflation isolation: rising costs impacting mental health, increasing loneliness, isolation, stress, and anxiety

• More than half are staying home more often (52%), and about three in 10 are spending less time socializing (33%) and with friends (26%) to save money.
• Nearly one in five are experiencing a sense of social isolation (16%) or loneliness (18%).
• About two in five are feeling stress (39%) and anxiety (37%) due to inflation and high interest rates.
• A third (35%) report paying more per month on debt compared to a year ago.
• One in five (17%) don’t have a solid understanding of how interest rate increases impact their financial situation.

TORONTO, ON – November 27, 2023 – Inflationary pressures aren’t just impacting Ontarians’ personal finances. It’s also taking a toll on their mental health. A recent Ipsos poll conducted on behalf of MNP LTD reveals higher costs and interest rates appear to be causing an isolation phenomenon, with more than half of Ontarians saying they’re staying home more often (52%) to save money. About three in 10 say they’re spending less time socializing (33%) or with friends (26%) to cut spending. Nearly one in five are feeling a sense of social isolation (16%) or loneliness (18%) because of higher interest rates and inflation. Burdened with the constant worry of making ends meet, two in five Ontarians say that the current economic conditions have made them feel more stressed (39%) and anxious (37%).

“High inflation and interest rates are not only impacting Ontarians’ personal finances; they are significantly affecting their mental health as well. Anxiety and stress are increasing with the pressure to try to manage the rising costs of necessities and mounting debt,” says Caryl Newbery-Mitchell, a Licensed Insolvency Trustee with MNP LTD in Toronto. “Ontarians are pulling back from social activities and giving up time with friends and family to cope with the effects of inflation, resulting in increased isolation.”

A third of Ontarians (35%) report their monthly debt payments have increased compared to a year ago. Nearly one in five Ontarians (15%) are paying an additional $200 toward their debt each month compared to a year ago. Nearly half (46%) don’t believe they can cover all their living and family expenses in the next 12 months without going further into debt, up two points from the previous quarter.

“We find that debt tends to isolate individuals, both emotionally and socially. Debt creates an overwhelming burden that distances us from our loved ones,” explains Newbery-Mitchell. “It’s not uncommon for those grappling with debt to take a step back from social activities and relationships out of shame or fear of judgement. Financial challenges can affect anyone, and there is no shame in seeking help. Licensed Insolvency Trustees provide unbiased advice and support to help individuals tackle their debt challenges.”

Affordability anxiety, debt, and a lack of financial literacy are all amplifying Ontarians’ financial stress. Nearly one in five (17%, +1 pt) don’t completely understand how interest rate increases impact their financial situation. Three in five (63%, -3 pts) are concerned about the impact of rising interest rates on their financial situation. Yet, despite the vast majority (82%, -6 pts) saying they will be more careful with how they spend their money because of rising interest rates, significantly fewer this quarter agree they will be careful with their spending.

“Having a good grasp of the complexities of personal finance and how to manage debt is crucial for making well-informed financial decisions, which is why seeking professional advice is so important,” says Newbery-Mitchell. “Bankruptcy is not the only option for individuals who are saddled with debt. Licensed Insolvency Trustees can provide guidance on options such as budgeting, debt consolidation, Consumer Proposals, and debt management plans.”

Ontarians also feel pessimistic about their ability to cope financially with unexpected expenses. About three in 10 are not confident that they could cope with the following:

• an unexpected auto repair or purchase (27%, -4 pts)
• a change in their relationship status, such as a divorce or separation (26%, -5 pts)
• the death of an immediate family member (32%, -4 pts)
• paying for their own or someone else’s education (36%, -3 pts)
• a loss of employment or change in their wage or seasonal work (32%, -4 pts)
• having an illness and being unable to work for three months (29%, -5 pts)

Harassing phone calls from collection agencies can be an additional source of stress for many Ontarians. Upon filing a Bankruptcy or Consumer Proposal, Newbery-Mitchell says Licensed Insolvency Trustees can communicate directly with creditors on the individual’s behalf. Both options also put a halt to wage garnishments and calls from creditors.

Licensed Insolvency Trustees are the only federally regulated debt professionals who can assist with all the debt relief options, including Consumer Proposals and Bankruptcy, stop harassment from debt collectors, and discharge people from debt.

“People often delay seeking professional assistance with their debt for up to a decade. All that does is cause needless stress trying to make ends meet and manage calls from creditors. People should know that they’re not alone. Help is available, and navigating out of financial hardship is possible.”

To support those in need of financial assistance, MNP provides free consultations across the country.

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 Survey

The data was compiled by Ipsos on behalf of MNP LTD between September 5 and September 8, 2023. For this survey, a sample of 2,000 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.