If you’re struggling to make ends meet, you’re far from alone. The Office of the Superintendent of Bankruptcy reports that insolvency filings in Canada have reached their highest level since 2009, reflecting the lasting pressure of rising costs and mounting household debt. As everyday expenses increase, more Canadians are finding themselves weighed down by obligations they can no longer comfortably manage.
Licensed Insolvency Trustee Shawn Stack commissioned an Angus Reid survey, the 2026 Debt & Moral Perception in Canada study, to explore how Canadians think about debt—especially bankruptcy. The study reveals a striking contrast: while many accept bankruptcy as a legal tool to eliminate debt, public opinion often treats it as a moral failing—until it affects someone they know personally.
The harsh public view of insolvency
The online survey asked more than 1,500 Canadians whether they agreed or disagreed with statements about bankruptcy and financial responsibility. Although 44% agreed that declaring bankruptcy can be a legitimate way to eliminate debt, the broader tone of responses was surprisingly judgmental.
About 41% of respondents said they see bankruptcy as the result of poor personal choices. The same share—41%—felt that declaring bankruptcy breaks a financial promise. Over a third (37%) believed people who declare bankruptcy are untrustworthy, and 40% thought debtors should face penalties before having debts discharged. More than half (51%) said individuals who have declared bankruptcy should have restricted access to credit afterwards.
“We have built an economy that runs on credit—on using tomorrow’s potential to sustain today’s appearances. And then we shame the people who fall through the cracks of a system we all participate in. The data shows that Canadians know something is off.”
—Shawn Stack, Licensed Insolvency Trustee
What the empathy gap reveals: Abstract vs. personal judgment
The survey highlights a clear empathy gap. When asked about bankruptcy in the abstract, many Canadians responded with moral judgments: 41% saw it as a moral failing, an indication of untrustworthiness, or a broken promise. Yet when questioned about a close friend or family member filing for bankruptcy, only 23% said they would view that person differently.
That nearly 20-point difference shows how attitudes soften when bankruptcy becomes personal and people consider the real-life pressures behind someone’s financial struggles. The contrast suggests that abstract beliefs—shaped by stigma and assumptions—don’t always reflect how people respond to actual situations among their own social circles.
Generational divides
Generational differences are pronounced. Roughly half of Baby Boomers view bankruptcy as a loophole (47%) and a broken financial promise (51%), and a majority in that group support imposing financial consequences before debt is discharged (52%). These views likely reflect the economic context in which Boomers came of age, with different expectations around credit and fiscal responsibility.
By contrast, younger Canadians—Gen Z, ages roughly 14 to 29—are far less likely to see bankruptcy as a loophole (21%) or a broken promise (33%). Growing up amid high living costs, precarious job markets, and more precarious housing, many in Gen Z face a reality where borrowing is often a necessity rather than a choice. This environment helps explain why younger people are more accepting of insolvency as a practical tool.
As Stack points out, “The generational divide alone tells you the story is changing. But empathy alone isn’t a policy. Until we separate the legal process of insolvency from the moral verdict we’ve attached to it, we will keep punishing people for doing exactly what the law allows them to do.”
Gender divides
Differences by gender are noticeable but smaller than generational gaps. Men were somewhat more likely than women to view bankruptcy as a personal failing—45% versus 37%—and men were more inclined to favour consequences before debt relief (43% compared with 37% of women). Despite these differences, both men and women reported similar levels of empathy when the question concerned close friends or family: 24% of men and 22% of women said they would view someone they know differently after a bankruptcy.
The bottom line
The study shows that public perception of bankruptcy shifts substantially when the issue moves from abstract judgment to personal experience. People are more understanding and compassionate toward friends and family who face insolvency, recognizing the day-to-day stresses that can lead to financial distress. Yet that empathy often vanishes when bankruptcy is discussed in general terms.
These findings suggest a need to reframe insolvency in public discourse. Bankruptcy is a legal mechanism designed to allow people a fresh start—not a moral sentence. Treating it as a tool for financial recovery, and separating it from moral stigma, could reduce unnecessary shame and improve access to relief for those struggling under heavy debt burdens.
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