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A new study shows that 41% of Canadians believe bankruptcy is a moral failing, at a time when insolvencies are at their highest level since the financial crisis of 2008.
If you’re finding it harder to make ends meet, you’re not alone. According to the Office of the Superintendent of Bankruptcy, the number of Canadians filing for insolvency just reached the highest level since 2009 (the aftermath of the 2008 financial crisis). As costs go up, so does the amount of debt that people are carrying.
Shawn Stack, a Licensed Insolvency Trustee, wanted to see how Canadians view debt—particularly, how they view bankruptcy. That’s why he commissioned Angus Reid to conduct the 2026 Debt & Moral Perception in Canada study. As we dig into the findings of the study, we see a clear pattern: Canadians tend to judge bankruptcy harshly—until someone they know personally goes through it.
The recent online study asked over 1,500 Canadians to agree or disagree with statements about bankruptcy and financial responsibility. Given that so many people are struggling with high costs of living and that 44% of Canadians agreed that declaring bankruptcy is a legitimate way to eliminate debt, you might assume that respondents were more empathetic.
The results showed a very different prevailing attitude. 41% said bankruptcy was a result of poor personal choices and 41% agreed that declaring bankruptcy breaks financial promises. Over a third of respondents also agreed that people who declare bankruptcy are untrustworthy (37%) and should face consequences before having their debts discharged (40%).
More than half (51%) of respondents said that people who had declared bankruptcy should have limited access to credit going forward. Given that more people view bankruptcy as a legitimate financial decision compared to those who think it’s a loophole, these results are surprising.
“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
Asking for abstract attitudes provides very different responses than asking about people they know. Looking back on the abstract attitudes shows that 41% of respondents believed bankruptcy to be a moral failure, a sign of untrustworthiness, and a broken promise.
But, when asked whether they would view a close friend or family member differently after a bankruptcy, only 23% said they would. That’s an almost 20-point gap solely based on empathy and understanding of what someone is going through.
Generational attitudes are even clearer, with around half of Boomers (47%) saying bankruptcy is a loophole and a broken financial promise (51%). It’s also telling that 52% of Boomers would support financial consequences before granting debt elimination through bankruptcy.
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On the other hand, only 21% or 33% of Gen Z (those ages 14 to 29), see bankruptcy as a loophole or broken financial promise, respectively.
These financial attitudes are the result of growing up in very different economies. Gen Z is coming into adulthood during a time of high overall costs and low stability. Naturally, this environment encourages borrowing.
As Stack says, “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.”
Although not as big as the generational divide, the gender divide is still noticeable. Men were more likely to view bankruptcy as a personal failing (45%) compared to women (37%). Men were also more likely to agree that people should experience consequences before debt is eliminated through bankruptcy (43%, compared with 37% of women).
That said, there was little difference in attitudes when asked whether they would view a close friend or family member differently after that person filed for bankruptcy. Only 24% of men and 22% of women said they would.
Public perception of bankruptcy shifts when people think about someone they know. They tend to be more empathetic and understanding, likely because they see the day-to-day financial pressures that their friends or family are facing.
What stands out is how quickly that empathy fades when bankruptcy is viewed in the abstract. The findings point to a need to frame insolvency as a tool for financial recovery, not a moral judgment.
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