Canadians among the world's richest citizens, but also most in debt

Canadians are among the top 10 wealthiest citizens in the world, but our household debt levels are a concern, says a new international study.

Allianz’s fifth annual Global Wealth Report ranks Canada in 8th place based on per-capita financial assets, up one spot from last year.

Canadians are worth approximately $93,000, the survey shows, which is up 10.6 per cent from last year’s survey.

Canada’s position is behind first-place Switzerland (with per-capita financial assets at an impressive $207,000), the U.S. in second, followed by Belgium, the Netherlands, Japan, Sweden and Taiwan.

The survey also notes that Canadians’ gross asset base expanded 24 per cent since the end of 2007, which was just before the global financial crisis hit.

Rising stock markets have helped Canadians bulk up their bank accounts in recent years. The report says assets in securities increased by 12.6 per cent in 2013, versus a year earlier, thanks to surging North America stock markets.

Canada’s showing in the global survey will give little comfort to those struggling to make ends meet. Younger Canadians may be the most put off by the results after a Conference Board of Canada released this week shows gender is becoming the new income divide in the country.

The Conference Board shows the income gap between older and younger workers has widened over the past three decades, with the average disposable income of Canadians between ages 50 and 54 now 64 per cent higher than that of 25-to-29 year olds. That compares to a 47 per cent gap in the mid-1980s.

"Age rather than gender is becoming the new divide in our society," the Conference Board said.

Another recent study from the Canadian Payroll Association also shows more Canadians are living paycheque to paycheque, while piling up debt and saving less.

The Allianz report cited household debt as an issue in Canada.

“Although financial assets made a relatively speedy recovery in the aftermath of the crisis, achieving annual growth averaging 8.1 per cent per annum over the past five years, the financial situation of Canadian households is anything but sustainable,” the report notes.

It cites the potential for rising interest rates and a housing crash as economic threats.

The report notes that Canadians borrowed 4.4 more in 2013 versus 2012, reaching a historic per capita debt level of just over $50,000 Canadian.

That’s not news to policymakers, who for years have been warning about Canada’s growing debt, even though the pace of accumulation appears to have slowed.

Canadians’ household debt hit a near record between April and June this year,according to Statistics Canada. Household debt to disposable income rose to 163.6 per cent in the second quarter, which was slightly below the record 164.1 per cent reached in the third quarter of 2013.

Earlier this month, Bank of Canada Governor Stephen Poloz said “risks associated with household imbalances have not diminished” and remain a concern for the Canada’s economy.