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An online poll conducted for Manulife Bank of Canada indicates that 81 per cent of respondents said being debt-free at retirement is a top goal, but just over half were confident of reaching that goal.

Nastco/Getty Images/iStockphoto

This is part of a Globe series that explores our growing dependence on credit — from the average household to massive institutions — and the looming risks for a nation addicted to cheap money. Join the conversation on Twitter with the hashtag #DebtBinge

As a Vancouver-area software developer married to an engineer, Dorothy Booher is the kind of young professional who might be expected to take on a huge mortgage just to get a foothold the region's skyrocketing housing market.

Instead, her family is living debt free while renting a modest $900-a-month apartment. Forgoing home ownership has also allowed Ms. Booher, 30, the financial flexibility to stay home and raise her daughter full-time, while still ensuring the family can save and invest.

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Still, her lifestyle doesn't sit well with Ms. Booher's traditional Chinese parents, who believe strongly that owning real estate is both a rite of passage into adulthood and a wise financial investment.

"To my parents, renting is a sign of refusing to grow up and shoulder responsibilities and to provide a stable environment for my child," she says. "Their attitude on debt is: what's wrong with debt? You just work hard and pay it off eventually."

As the rising level of household debt in Canada shows, Ms. Booher's parents certainly aren't alone in that opinion. But national debt figures obscure another trend: the growing numbers of people who are opting to live debt-free.

Nearly a third of Canadians have no debt, according to market research firm Ipsos Reid. They tend to be older than the average Canadian, reflecting the fact seniors are the demographic most likely to have paid down their debts. But those trends are shifting as more Canadians retire in debt, while younger Canadians are taking longer to get established, meaning they are more likely to forgo debt-fuelled expensive purchases, like cars and houses.

Between 2009 and 2014, the proportion of debt-free Canadians under age 35 rose from 11 per cent to 15 per cent, Ipsos Reid found, while the proportion who were age 65 and older fell from 39 to 33 per cent.

Roughly a quarter of Canadians age 35 to 44 had no debt, up from about 17 per cent a decade ago, says Royal Bank of Canada economist Laura Cooper. "This age cohort does tend to have the highest outstanding balances, they are the highest percentage of households who carry a mortgage," she said. "So the fact that a quarter of them do not have any debt is somewhat surprising."

For Ms. Booher, it's not so much debt that she fears, but how to pay for it in today's increasingly unstable job market. She points out that her generation came of age in the shadow of the Sept. 11, 2001, terrorist attacks and the dot-com bust and entered the work force in the midst of the global financial crisis.

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In Vancouver's competitive economy, where even highly educated workers compete with each other for unpaid internships and contract employment, getting laid off is a constant fear. "Stability has never been our game," she says. "It just doesn't make any sense to promise to pay a large amount of money for the next 20 years when no one has promised us any sort of good income for even the next month."

For 41-year-old computer software professional Andy Knott, it was the memory of his parents fretting over double-digit interest rates in the 1980s that helped persuade him to get out of debt as quickly as possible.

By scrimping and saving, Mr. Knott paid down the mortgage on his $300,000 home near Windsor, Ont., in just five years. For years he was house poor, forgoing expensive vacations and home renovations to pay an extra 20 per cent toward his mortgage every month.

Unlike his parents, Mr. Knott is living in an era when interest rates are at historical lows. But he doesn't buy the argument that today's cheap money means now is the best time for Canadians to dig themselves into debt.

"Everyone keeps saying rates are going to be low, but if anyone knew for certain they could be a multimillionaire by timing the market," he says. "The reality is we don't know what the future holds and being beholden to other people for a certain amount of money is generally not a good thing."

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