‘I haven’t bought oranges for a long time’: consumer insolvencies on rise

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This article was published 16/10/2024 (358 days ago), so information in it may no longer be current.

Fewer restaurant visits and less takeout, more bill-splitting, carpooling and bulk buying. Manitobans are leaning into common ways to save money as the number of consumer insolvencies ticks upward, a new report by MNP Ltd. says.

Consumer insolvencies in the keystone province climbed 11.7 per cent year-over-year ending Aug. 31, according to the Office of the Superintendent of Bankruptcy.

“It’s taken people a bit of time to feel the negative impacts of … increasing costs,” said Tanya Reynolds, a licensed insolvency trustee with MNP.

Though inflation has cooled nationally, prices across the board haven’t declined since a COVID-19 pandemic-era skyrocketing of costs.

The Bank of Canada’s key inflation rate has been trimmed to 4.25 per cent from a recent high of five per cent; it was 1.75 per cent of February 2020.

Meanwhile, often, people’s wages haven’t kept up with the rising cost of living, Reynolds noted.

MNP Ltd. surveyed 2,000 adult Canadians — including 195 people from Manitoba and Saskatchewan — in September to gauge their feelings on personal finances.

The firm, a division of national accounting giant MNP LLP, found more than a quarter of Manitoba and Saskatchewan respondents said they have resorted to eating less to save money.

Twenty-six per cent have opted for bill-splitting, such as buying in bulk, carpooling and sharing subscriptions.

Katie Whitford, 75, lives with her two adult grandchildren. Rent is expensive, she said: “They’ll make their way, but they need help.”

She’s a pensioner paying taxes on her RRSPs. She looks for sales while grocery shopping.

“I just passed all the fruit,” Whitford said during a recent trip to a No Frills grocery store in Winnipeg. “I haven’t bought oranges for a long time.”

Phil Barnett joins the 56 per cent of people in Manitoba and Saskatchewan to report saving money by grocery shopping strategically. He visits Red River Co-op for its senior discount days and opts for No Frills for “particular foods that I know … I can’t get anywhere else at the same price.”

Nearly half of Manitoba and Saskatchewan respondents — 47 per cent — said they’ve stopped eating in restaurants and ordering takeout.

“I did go out more often for lunch at Subway,” reflected Ian Thomas, who said he now doesn’t buy lunch during the workday.

Almost half of people surveyed in Manitoba and Saskatchewan are avoiding impulse purchases. Ten per cent cited saving money by living with roommates and family or were looking for roommates.

Nearly half believe they’re $200 or less away each month from financial insolvency. Should interest rates reverse course and increase again, 48 per cent of Manitoba and Saskatchewan respondents figure they’d “be in trouble.”

However, there have been three consecutive interest rate cuts. As a result, more people in Manitoba and Saskatchewan — 27 per cent — expect their debt situations to improve over the next year. It’s an increase from MNP’s survey last quarter.

“Cancelling a subscription to something may not provide the biggest impact on one’s budget, but … using a bunch of ideas can have an impact,” Reynolds said.

Still, bill-splitting and other forms of cost-cutting may only provide short-term relief, she added. Reynolds recommended people track their personal finances and use an insolvency trustee, if needed.

Ipsos conducted the survey for MNP Ltd. The survey used an online panel, so no margin of error can be ascribed to the results.

gabrielle.piche@winnipegfreepress.com