Over 50% of Canadians live paycheque to paycheque
More than half of Canadians live paycheque to paycheque and more than a third have no retirement savings.
With these stats, it boosts the pressure to work longer, according to a new poll by accounting firm BDO Canada Ltd.
“Affordability and debt challenges continue to weigh on Canadians, and what our Affordability Index reveals is that, over time, the cumulative effects have a significant impact on financial goals,” says Doug Jones, president of BDO Canada’s Financial Recovery Services practice.
Many Canadians are not prepared for financial emergencies. Almost 49% have no savings for an emergency, with 53% relying on their next paycheque. More than 35% would take out a small loan or use a credit card to deal with an emergency.
One-fifth of respondents struggling to get by, with 14% reporting a dire financial situation such as filing for bankruptcy or having something sent to collections.
For people with unmanageable debt, a Licensed Insolvency Trustee can help them understand their options and become more financially prepared for the future. Gen-Xers are the most indebted when compared to millennials and baby boomers, with 44 per cent of indebted gen-Xers owing more than $20,000. That may not come as much of a surprise because the 35-to 54-year-olds are in the prime of their house-owning years with heavy mortgage burdens. Baby boomers may have paid off their mortgages while millennials have yet to buy into the expensive housing market in large cities
Making ends meet
A rising number of Canadians believe that younger generations will have to work longer than their older cohorts to make ends meet and are faced with the fact that they won’t have enough for their retirement.
Research also found that women suffer more than men and their challenges are mounting. Lack of income increases debt for 35 per cent of women compared with 28 per cent of men. Three quarters of women also struggle to save for major purchases compared to 70 per cent of men, and a third battle to pay for groceries versus 24 per cent of men, the poll found.
A growing number of women are living paycheque to paycheque and more said they have no retirement savings – 43 per cent versus 35 per cent in 2018.
Women living paycheque to paycheque
What to do
In order to change course, Canadians should be actively seeking ways to improve how they balance their debt obligations and future financial goals.
The Licensed Insolvency Trustee at D. Thode & Associates Inc can help you with your debt, planning and offering alternatives for saving for now and the future.