Almost half of Canadians are $200 away from insolvency in any given month, meaning even a relatively small unexpected expense could be a tipping point.

Worse still, the situation has been in place for some years, worsening slightly over time as wages stagnate, costs rise and household debt continues to rise.

A quarterly survey of Canadian household released this week shows more Canadians are hovering close to financial insolvency at the end of the month: 48 per cent of Canadians say they are $200 or less each month away from financial insolvency, an increase of two points from the last quarter. This includes one in four (26%) who say they have no wiggle room at month-end, as they already don’t make enough to cover their bills and debt payments.

The numbers indicate deteriorating financial stability for many.

Easy credit and low interest rates have fuelled the borrowing, with total consumer debt now surpassing $2.2 trillion. Our debt outstrips our incomes – there is roughly $1.80 in credit-market debt for every dollar of household disposal income.

Mortgage debt reached nearly $1.44 trillion to end 2018, while consumer credit and non-mortgage loans combined to total $769.4 billion. Canadians on average are paying about 15 per cent of household income to service debt.

Low borrowing costs have made it easier for consumers to service their debts. What happens if rates start to rise, however? Such worries are likely behind the Bank of Canada’s reluctance to raise rates after a series of increases.

It’s our spending habits that have got the better of us: bigger homes, new cars, electronic toys and so on. Our wants are limitless, while ability to pay for them is not.

Worse still, our real incomes and net worth are in decline, meaning we’re borrowing just to maintain the status quo. So, even as household debt climbed relative to our incomes, we had less than we did last year.

The survey, based on polling done by Ipsos, notes the average Canadian estimates it will take seven years to get out of their non-mortgage debt, with about 15 per cent assuming they’ll never get out of debt.

Caught between falling incomes and growing household debt, we’re using borrowed money to finance day-to-day expenses rather than consumer goodies.

Studies have repeatedly indicated a trend, with more than half of indebted Canadians borrowing just to afford daily living expenses such as food, housing and transportation. This is no accident, as our standard of living has been in decline for decades, propped up by massive amounts of borrowing. Long gone are the days when rising productivity in the economy was shared among pretty much everyone – that was when the “rising tide lifts all boats” arguments still held water – replaced by most of the benefits going to the few.

While it’s true we have much more stuff than was the case in the more-prosperous postwar years, that’s an illusion brought on by there simply being more stuff to have. And readily available credit to buy it, and buy it now, patience no longer being a collective virtue.

Clearly debt is a problem at the individual level, just as it is with governments. The key to changing the situation rests not only with cuts and austerity – we should, however, be saving for the future – but with seeing actual economic growth that moves us away from a dependence on consumerism as its fuel.

Polls show we’re concerned about debt, but there’s still far more talk than action.