A new report released today by digital life insurance innovator PolicyMe, the Canadians + Money 2022 Survey, reveals Canadians’ current and future financial outlook. The survey asked Canadians to rank their financial priorities, stressors, and expenses they expect to see increase in 2022. The findings paint a picture of a country concerned about the rising cost of living while at the same time focused on contributing to savings and paying down debt.
As we enter 2022, buying groceries (59%) and paying for gas (48%) are putting the most financial strain on Canadians, while top financial priorities for 2022 include building a sufficient emergency fund (54%) and paying down debt (48%).
“As we enter a new year, we wanted to take a pulse on how Canadian families are feeling about their financial situations, and our findings paint a very mixed picture,” says Andrew Ostro, CEO, PolicyMe. “While concerns around inflation, rising interest rates, and housing affordability are causing stress for many families, Canadians have a positive outlook for 2022: they feel in control of their finances, they are saving a high percentage of their income, and they have a strong sense of financial resilience.”
Financial Stress is High — But Canadians Feel Resilient
The study revealed 42 per cent of Canadians felt more financially stressed in 2021 compared to the previous year. Households with children felt more financial stress (47%) than those without children (39%). Albertans were most financially stressed (50%), followed by Saskatoon/Manitoba (49%). Last year, half of Canadians (51%) had to pull money from their savings or investments in order to afford unforeseen expenses. Albertans were also most likely to have pulled from their savings or investments (56%), followed by the Prairies (55%).
Despite the financial hardships of recent years, two out of three Canadians (67%) reported feeling in control of their finances with 65 per cent referring to themselves as financially resilient. Forty-five per cent said they regularly contribute to savings/investments, and on average, Canadians put 21 per cent of their household income toward savings and investments.
Those who took the following financial actions in 2021 were more likely than the national average to consider themselves financially resilient:
- Paid off mortgage (89%)
- Made regular contributions to a RESP (84%)
- Made regular contributions to an RRSP or TFSA (78%)
- Consulted with a financial advisor (75%)
- Made a will or updated end-of-life plans (72%)
Taking Steps Towards Financial Resiliency in 2022
The past two years have been extremely challenging, so the fact that many Canadians still feel in control of their finances (67%) and are putting 21 per cent of their income into savings and investments is worth celebrating. Additionally, many Canadians are making regular contributions to their savings (45%), are planning to add to their emergency fund (54%), will continue to pay down debt (48%), and are saving for retirement (40%). Lastly, 47 per cent of Canadian parents are saving for their children’s education.
Despite doing a lot to remain financially resilient, 44 per cent of Canadian parents are overlooking one of the most affordable and impactful financial tools at their disposal: life insurance. The survey found that most Canadians (70%) would only have six months or less of a cushion to fall back on if they were to lose their primary source of income, with one in three (32%) having one month or less. Having adequate coverage through life insurance is a key way Canadian families can remain financially resilient in the event of an unexpected passing.
To help ensure that more Canadians are financially resilient, PolicyMe is introducing two new features to their life insurance product:
- Couples Coverage. A five per cent discount on policies when partners apply for PolicyMe’s Couples Coverage together.
- Child Coverage. A complimentary $10K policy for the children of PolicyMe customers. PolicyMe is the first and only Canadian Life Insurance provider to offer this feature.
For more details on the survey, view the full 2022 Canadians & Money Survey.
SOURCE PolicyMe