This financial gender gap is closing but it's not good news

More women in Canada are becoming insolvent

This financial gender gap is closing but it's not good news
Steve Randall

A rising number of women filing for bankruptcy or consumer proposals is narrowing the gender gap for insolvencies.

A new report from licensed insolvency trustees Hoyes, Michalos & Associates Inc. shows that the share of insolvencies filed by women has increased from 42% in 2012 to 49% today.

And the level at which women find themselves unable to make ends meet is significantly lower than male counterparts: the average female debtor files insolvency on $43,414 in unsecured debt, 21% less than male debtors.

Women file insolvency with an unsecured debt-to-income ratio of 147%, much lower than the 177% for male debtors in the study.

"Women face specific financial challenges that increase their reliance on debt yet make that same debt harder to manage" says Doug Hoyes. "When reviewing the risk profile of our average client, we found that women are more likely to be single parents, more likely to carry student debt, more likely to be divorced or separated and more likely to be widowed seniors than males filing insolvency."

Single parents

Being a single parent can be tough on finances and this group accounts for 26% of women filing for insolvency, but just 8% of men.

Student debt appears to be a greater burden on women with 22% carrying this debt compared to 13% of men.

More than a quarter of women debtors (26%) were divorced or separated compared to 20% of men and, among older debtors, 25% of women are widowed compared to 8% of men.

Women filing insolvency earn 4.5% less, on average, than male debtors. This gap widens to 32% when comparing single women raising a family to the household income for two-parent families filing insolvency.


"It is important for women to avoid high cost debt like credit card debt and payday loans" says Doug Hoyes. "The added interest expense only reduces any money they have available to cover living costs in the future. If you are struggling with debt repayment, talk with a professional like a Licensed Insolvency Trustee early to keep your options open."