Introduction: A Growing Debt Challenge for Canada’s Young Adults
For years, debt has been a common part of adult life in Canada. But recent trends show a sharp tilt toward younger generations. Credit counsellors report a rising share of clients under 35 seeking help, and many say the issue is compounded by the rapid spread of buy now, pay later (BNPL) services. This isn’t just a budgeting hiccup; it’s a structural shift in how young Canadians access goods and manage payments.
BNPL: Convenience That Comes with a Hidden Cost
BNPL services offer the appeal of immediate purchases with delayed payments, often with little to no upfront interest. In theory, this can help with cash flow during tight months. In practice, however, it can encourage overspending, especially among those who are still building savings or navigating student loans and entry-level salaries. A growing number of young Canadians find themselves juggling multiple BNPL plans, failing to track due dates, and facing late fees that compound their debt load.
Why this matters for under-35 households
Younger adults are frequently balancing student debt, rising rents, and stagnant wages in many markets. When BNPL options normalize ongoing monthly obligations without a clear repayment plan, it can create a subtle but persistent debt spiral. The risk is not only the debt amount but the stress and mental toll of keeping track of numerous due dates and punctuated cycles of payments.
Real-World Impacts: From Budgets to Credit Counselling
Credit counsellors report that a quarter or more of their clients in some cities are under 35. These clients often share common patterns: they overestimate how much they can afford, underestimate the total monthly obligations, and underestimate the cost of delayed payments. Without a solid plan, small monthly deficits can become recurring shortfalls that force difficult choices—cutting essentials, delaying savings, or missing work due to financial stress.
Smart Strategies for Reclaiming Financial Control
Getting ahead of debt stress requires a practical, disciplined approach. Here are steps that can help:
- Consolidate and map obligations: List all debts and payment dates, including BNPL plans. Visualizing the total monthly obligation helps prevent missed payments.
- Prioritize high-interest and essential obligations: Focus on credit cards or loans with the highest rates first, while ensuring basics like rent, utilities, and groceries are covered.
- Create a realistic budget: Track income and fixed costs for at least two months, then build a plan that allocates money toward debt payoff while maintaining a reasonable quality of life.
- Limit new BNPL use: Consider pausing new BNPL enrollments until your current obligations are under control. If you use BNPL, treat each repayment as a debt payment with a fixed payoff date.
- Build an emergency fund: Even a small cushion reduces the chance of falling back on credit when unexpected expenses arise.
- Seek professional guidance: A certified credit counsellor can tailor a plan, negotiate with creditors if necessary, and provide ongoing support.
Long-Term Outlook: Financial Wellness as a Shared Responsibility
Addressing debt stress among Canadians under 35 requires a combination of personal discipline and systemic changes. Financial education, clearer BNPL disclosures, and responsible lending practices can help. Employers can support financial wellness by offering budgeting resources or employee assistance programs, while fintech providers should emphasize transparency and repayment flexibility that respects consumers’ long-term health.
Conclusion: Small Steps, Lasting Impact
Debt stress among younger Canadians is not inevitable. With a clear plan, disciplined budgeting, and the right support, individuals can regain control of their finances and reduce the anxiety that comes with debt. The BNPL trend doesn’t have to be a trap—when used judiciously, it can be a tool for smoother cash flow rather than a gateway to ongoing financial strain.
