- 42 per cent plan on changing their financial New Year's
resolutions due to cost of living concerns.
- Majority of Canadians do not currently have a financial plan
(69 per cent) and/or a household budget for the year (60 per
cent).
TORONTO, Dec. 11,
2023 /CNW/ - A special report from the BMO Real
Financial Progress Index reveals nearly a third (30 per cent)
of Canadians plan to cut back on spending for 2024 amid growing
concerns about the cost of living and economic uncertainty.
Given concerns about the rising cost of living, 42 per cent of
Canadians plan on changing their financial New Year's resolutions,
including creating financial goals and/or a budget for 2024 (17 per
cent). As many as 44 per cent of Canadians do not make financial
New Year's resolutions.
The special report explores how concerns about spending and
economic conditions have affected Canadians' financial anxieties
and approaches to financial planning ahead of the new year:
- The Background on Holiday Bills:
- Over half (58 per cent) plan on using credit cards to pay for
their holiday gifts.
- On average, Canadians believe it will take three months to pay
back their holiday bills and 24 per cent are not confident they
will be able to pay off their post-holiday bills on time.
- Financial Anxiety Analysis: The leading sources of
financial anxiety are fear of unknown expenses (82 per cent),
concerns about their overall financial situation (81 per cent),
family-related expenses (65 per cent) and keeping up with monthly
bills (61 per cent).
- Framing Financial Goals: The majority (68 per cent)
of Canadians have set financial goals for themselves, including
retirement planning (59 per cent), saving for a vacation (46 per
cent), paying down debt (39 per cent) and saving for a large
purchase such as a car, large appliance, etc. (36 per cent).
- Planning Prognosis: While most Canadians have
financial goals, the majority do not have a financial plan (69 per
cent) and/or a household budget for the year (60 per cent).
"While many Canadians are looking forward to celebrating with
family and loved ones, it is important not to get financially
carried away during the holidays," Gayle
Ramsay, Head, Everyday Banking, Segment & Customer
Growth, BMO. "As many look forward to a fresh start in the new
year, we want to empower Canadians to make real financial progress
by encouraging them to get a head start on defining their financial
goals, take advantage of online banking tools to conveniently set
and monitor budgets, and work with a financial advisor to help
build a plan and establish good financial habits."
Plans to establish good financial habits in 2024 come as
Canadians reevaluate their holiday spending amid concerns about the
high cost of living and the economy. According to BMO Economics,
Canadian real consumer spending was little changed in the spring
and summer of 2023, and will likely remain flat this winter, as
households deal with rising debt payments and ongoing anxiety about
the economic outlook. However, relief may be on the way, with
markets now pricing in interest rate reductions from the Bank of
Canada before the summer of 2024.
Also helping is that inflation is moderating while wage growth
remains strong.
Tips for Keeping Your Financial
New Year's Resolutions
The survey also reveals nearly a third (30 per cent) of
Canadians do not believe they are on track to meet their financials
goals. While many Canadians believe a financial advisor either from
their bank (58 per cent) or investment firm (48 per cent) are
important in helping them reach their financial goals, only 40 per
cent work with a financial advisor.
Customers can build financial literacy, monitor financial plans
and reach financial goals through BMO's innovative digital tools
and resources:
- BMO SmartProgress: This tool helps customers learn more
about important personal finance topics and build financial
literacy anywhere and at any time. It is a free, online financial
education platform featuring customized, interactive content,
including videos and tools, on complex financial planning topics
including budgeting and credit management, homeownership and
investing.
- BMO CreditView: Customers can quickly and
easily check their credit scores and access new tools and advice to
manage their credit profile online and on mobile.
- BMO Insights: Customers get help saving
more, monitoring spending and account values, and spotting unusual
activity with 25 BMO Insights that provide customers free, quick,
and personalized views of their daily spending to help them make
informed decisions. Popular online insights include:
- CashTrack: Using artificial intelligence, these
insights monitor customers' cash flows and let them know if they
will run out of money in the next seven days.
- Spend Categorization: These insights notify customers
when there has been a significant increase in a specific spending
category or if a free trial has expired.
- BMO Savings Amplifier Account: To help make saving easy
and automatic, BMO's new Savings Amplifier Account offers no
monthly fees, a competitive interest rate, and unlimited no-fee
transfers to other BMO accounts. In addition, its digital Savings
Goals feature enables customers to set, track, and manage their
financial goals.
To learn more about how BMO helps customers make financial
progress, visit www.bmo.com/main/personal.
About the BMO Real Financial
Progress Index
Launched in February 2021, the
BMO Real Financial Progress Index is an indicator of how
consumers feel about their personal finances and whether they are
making financial progress. The Index aims to spark dialogue that
will help consumers reach their financial goals and to humanize a
topic that causes anxiety for many – money.
The research detailed in this document was conducted by Ipsos in
Canada from September 11 to October 9, 2023. A sample of
n=2,502 adults ages 18+ in Canada
were collected. Quotas and weighting were used to ensure the
sample's composition reflects that of the Canadian population
according to census parameters. This survey has a credibility
interval of +/- 2.4 per cent 19 times
out of 20, of what the results would have been had all Canadian
adults 18+ been surveyed.
About BMO Financial
Group
BMO Financial Group is the eighth largest bank in North America by assets, with total assets of
$1.3 trillion as of October 31, 2023. Serving customers for 200 years
and counting, BMO is a diverse team of highly engaged employees
providing a broad range of personal and commercial banking, wealth
management, global markets and investment banking products and
services to 13 million customers across Canada, the United
States, and in select markets globally. Driven by a single
purpose, to Boldly Grow the Good in business and life, BMO
is committed to driving positive change in the world, and making
progress for a thriving economy, sustainable future, and inclusive
society.
SOURCE BMO Financial Group