The COVID-19 pandemic brought financial hardship to thousands of Canadians. Middle-income Canadians felt a profound effect on their finances, with many of their financial positions worsening in the last year.
Investment firm Primerica Canada conducted a study that demonstrated the harsh effects of the pandemic on middle-income Canadians. 75% felt their income wasn’t matching living costs, while 71% felt they weren’t saving enough to retire comfortably.
Despite the clear threat to financial stability, Primerica’s study showed that many Canadians have a positive outlook on their future.
Canadians reported feeling better financially than their neighbours, with 48% rating their personal finances positively and 30% feeling positive about the economic health of their community.
Families demonstrated a desire to save for the future but experienced challenges to achieving their financial goals. The majority reported having a savings account (69%) while 26% said they have a retirement account.
However, most of those surveyed struggled to contribute to their financial goals; some even had to use savings because of the pandemic. Only 26% of Canadians added to a savings account while 19% created or followed a budget. Even worse, 29% had to use money meant for retirement early.
Speaking to a Financial Advisory Service Helps
A positive highlight from Primerica’s report is the link between financial confidence and consulting with a financial professional. Families who consulted with a financial professional reported feeling more confident doing a variety of financial activities. These activities include:
- Building savings (short-term or long-term)
- Creating and following a budget
- Paying down credit card debt
- Setting up Registered Retirement Savings Accounts (RRSPs) or Tax-Free Savings Accounts (TFSAs)
- Investing in stocks, mutual funds or bonds
- Buying life insurance
Are you curious how a financial advisor can help with your money matters?
Out of the above financial activities, the increase in confidence was especially notable for saving and setting up RRSPs and TFSAs. In both areas, Canadians were 20% more confident handling these financial matters after consulting a professional.
Finally, those who consulted with a financial professional felt more prepared to handle the pandemic’s financial effects.
Economic downturn causes stress and financial hardship across the country. However, there’s a way to overcome it. Contact trained counsellors for a free debt analysis, practical tips in creating a budget, and to feel more confident in dealing with your financial matters.