Canadians have been facing significant financial challenges, including declining economic freedom, lower living standards, and rising stress over debt and everyday expenses. However, improving financial literacy and adopting smart habits can help people manage these hardships more effectively, even with the current state of the Canadian economy.
Key trends
Many Canadians report financial stress due to debt, managing day-to-day bills, and navigating a complex financial system. This is a tough reality for many Canadians, with daily struggles to make ends meet.
Financial wellness
After years of decline, there is an early sign of improvement in the financial health of Canadian workers, with the proportion considered “financially stressed” dropping from 41% in 2024 to 36% in 2025. Simultaneously, the share of those “financially comfortable” rose from 28% to 30%. However, financial stress remains widespread. Factors such as overreliance on debt and surging housing costs drive stress: 77% of financially stressed respondents feel overwhelmed by debt, 89% in that group worry about housing.
FCAC’s National Financial Literacy Strategy results show that as of 2024-2025, 72.5% of Canadians demonstrated positive financial knowledge, attitudes, and behaviours. This is an encouraging result that shows Canadians are confident about their financial literacy, though there is certainly some way to go. The most recent Organization for Economic Cooperation and Development (OECD) survey of Adult Financial Literacy Competencies found that Canada ranks 3rd (tied with Norway) for financial literacy. According to this survey, 85% of adult Canadians consider themselves to have average or above average financial knowledge. However, only 61% were able to correctly answer five of seven financial knowledge questions.
Surveys show that simple financial habits, like automated savings, budgeting, and seeking payroll or professional advice, can help ease stress and move individuals from the “stressed” to “coping” or “comfortable” clusters, often within just one year.
Saving and spending in the current Canadian economy
Many are responding to the uncertainty of the Canadian economy by proactively saving more. 51% reported trying to increase savings in 2025, up from 42% a year earlier. The number of Canadians who saved $10,000 or more in the past year also climbed to 29% from 23% previously. That’s a big shift in the span of a year. This could very well be an indicator of how things may change in the years to come, a shift towards an emphasis on saving over spending. Earning more can help, but spending less, reducing debt, and using good financial habits are more closely linked with improved financial well-being.
Recent surveys have found that Gen Z workers are saving an average of 11% per paycheque, higher than any other generation. This is more than older generations, who are arguably earning higher salaries. In fact, 30% of Gen Z survey respondents reported saving $10,000 or more in the past year alone. In another illuminating statistic, Gen Z has the second-highest share of workers who identify as financially comfortable, putting them ahead of both Millennials and Gen X.
Financial stress
Despite these positive trends, financial stress remains a major challenge, costing Canadian businesses $69.5 billion annually in lost productivity. This is a dramatic increase from $26.9 billion in 2021. Over half of workers (51%) spend at least 15 minutes a day thinking about money at work, and 6% spend over 90 minutes each day worrying about their finances.
Over half of younger adults feel financially insecure, citing high living costs and stagnant incomes as major challenges. Newcomers, especially, struggle to understand the financial landscape, with 55% finding it hard to manage their finances and 76% fearing mistakes due to a lack of education.
A recent survey found that over 55% of people living in Canada feel anxious about their personal finances. About 41% mentioned physical stress symptoms even when just talking about money. The most worrying of all – 42% say they would only be able to cover less than a month’s worth of basic expenses if they lost their main source of income. This shows how deep the economic uncertainty and affordability crisis truly is. It extends beyond surface-level financial metrics to real problems, ranging from daily life functioning to mental health.
Major drivers of stress include debt, housing affordability, and persistent uncertainty about the economy. Top coping strategies among Canadians include saving more (48%), paying down debt (40%), and building emergency funds (37%), demonstrating a general awareness of good financial habits.
Notes
Some of the statistics above do seem to conflict with each other. We believe this provides a more nuanced view of the situation and showcases information neutrally. Putting all this data together leads us to believe that there are slow pockets of improvement in certain areas, for certain demographics. It would not be feasible to use those statistics to then make a blanket statement about Canadians as a whole. It is, however, illuminating to understand the general state of financial comfort for Canadians, as well as the broader Canadian economy.
In a way, it can also help Canadians understand the larger picture, where they stand, and in turn, what they can do to make their financial situation better. For example, despite overall economic growth, living standards for the average Canadian have declined from 2020–2024. This is reflected by persistent inflation, slow wage growth, and increased cost of essential goods, making financial resilience even more important.
Financial literacy and good habits
Key trends indicate a modest improvement in financial wellness. However, large segments of Canadian society remain vulnerable. This is especially true for Canadians who are younger, lower income, or lack access to financial advice. No doubt, there is an urgent need for support systems and legitimate advice. Focus on financial literacy and build good money habits – two great steps to start building a financially stable life.
- Strong financial literacy makes it easier for people to navigate financial products and decisions, reducing the risk of costly errors or debt.
- Budgeting and having a financial plan correlate with greater well-being: Canadians who track spending and save are more likely to pay bills on time, reduce debt, and feel confident about retirement.
- Financial education, whether through reading, using online tools, or workplace and community programs, empowers Canadians to adapt amidst economic uncertainty and increased digitalization of services.
- Building financial resilience helps households respond to sudden changes (such as job loss or health issues) and creates a buffer against future uncertainty.
Practical tips to boost financial wellness
- Use spreadsheets, apps, or even online tools – whatever you’re comfortable with – to budget, estimate mortgage costs, and plan for debt repayment. These are just tools to support your goal of financial freedom and security. Use what suits your purposes.
- Access financial education programs that are available to you for up-to-date guidance on saving, investing, and debt management. There are also many free online resources from subject experts that you can access from anywhere.
- Prioritize emergency savings and debt reduction: even small, regular contributions improve resilience. Set up autotransfers to an emergency fund; even $15 per paycheque adds up.
- Seek trustworthy financial advice for major decisions, like getting out of debt, home purchases, or retirement planning.
Key takeaways
The Canadian economy has been through some ups and downs in recent years. Adopting strong financial literacy and habits is one of the most effective ways Canadians can navigate current economic challenges and build long-term financial security. While tensions remain high, there are some encouraging improvements in financial wellness and saving patterns, particularly among the younger generation. Employers and policymakers certainly play a role in providing education and tools.
However, every Canadian should take the opportunity to empower themselves with the skills, tools, and resources readily available online, for free. Building your financial literacy can boost your finances in the long term, where you can be your own safety net. If you’re trying to make a change in your finances, the first step is to get out of debt. If you’re currently dealing with debt, you can contact one of our trained Credit Counsellors for advice – they can help you figure out which debt solution could be the right fit for your specific situation.
