81 percent of Canadians fear a recession may be imminent this year, and three-quarters (75 percent) say their concerns about inflation have increased over the past three months
Nearly 8 in 10 adults are making lifestyle changes due to recession concerns
TORONTO, September 28, 2022 /CNW/ – This quarter’s BMO Real Financial Progress Index results show that Canadians are increasingly concerned about a recession, inflation and rising consumer costs. 81 percent of Canadians said they are concerned about a recession by the end of the year, and over the past three months, three-quarters (75 percent) said their concern about inflation has increased. More than 75 percent of Canadians believe their financial dynamism is threatened by higher grocery bills (81 percent) and rising gas costs (76 percent).
Concerns vary greatly by generation. Older Canadians report feeling more concerned than younger generations. 79 percent of 45-64 year olds said their concerns about inflation have increased over the past three months, compared with 66 percent of 18-24 year olds and 73 percent of 25-34 year olds.
In response to the rising cost of living, 77 percent of Canadians said they were making lifestyle changes, such as ).
“With the cost of living and essential necessities rising, and a possible impending recession on the way, it’s understandable that Canadians’ concerns are growing, too,” he said Gayle Ramsay, Head, Banking, Segments & Customer Growth, Personal Banking, BMO. “Now more than ever it’s important to look at your finances, develop a budget and actively manage your cash flow to avoid unplanned expenses. A BMO financial advisor can help clients create a plan that meets their individual needs to get through uncertain economic times and continue to make real financial progress.”
Compared to this time last year, significantly fewer Canadian adults are confident about making financial progress (down four points to 34 percent). The loss of confidence since that time last year is particularly severe Vancouver where confidence fell 10 points to just 14 percent and said they feel secure about their financial situation. in the TorontoConfidence is down 5 points to 37 percent and Montreal stays the same at 43 percent. However, nearly three in four Canadians (72 percent) feel they have enough savings to cover an emergency, an improvement from both last quarter (67 percent) and year-on-year (68 percent).
“The fear of a recession could be self-fulfilling, so Canadian households need to be prepared, especially if interest rates continue to rise to tame inflation,” added Sal Guatieri, Senior Economist, BMO.
Best practices to help Canadians weather inflation and economic downturns
Most Canadians understand the importance of a budget, but there is room for improvement as the Index shows 25 percent of Canadians are not tracking their financial progress. The figure is highest for 45 to 54 year olds at 31 percent.
BMO offers the following tips to help Canadians continue to make financial progress:
Use digital banking tools and apps to track spending patterns: About half of Canadians (48 percent) said mobile banking tools have helped them get ahead financially. BMO’s mobile banking app offers digital features geared towards helping our customers make real financial progress, including Savings Goals, Pre-Authorized Payments Manager, BMO Insights and BMO CashTrack.
Talk to a financial advisor who can help you review and adjust your budget to account for rising costs and save for emergencies. An expert can help you make sure your savings and spending goals are still on track, or develop a savings and retirement plan.
Postpone large purchases, such as household appliances or cars. Some price increases may be temporary, in which case it may be worth waiting.
Check the monthly paymentssuch insurance bills and monthly subscriptions to ensure you get the most bang for your buck.
These findings come from the latest BMO Real Financial Progress Index, a quarterly survey conducted by BMO and Ipsos that measures Canadian sentiment towards financial confidence. The survey was conducted by July 27 to August 29, 2022.
To find out how BMO can help customers achieve financial success, visit: www.bmo.com/personal
About the BMO Real Financial Progress Index
Online research was conducted in both the United States and United States Canada out July 27 to August 29, 2022. A sample of n=3,402 adults 18 years and older in the US (including n=300 oversamples in Chicago, Indianapolisand Milwaukee) and a sample of n = 3,404 adults aged 18 and over Canada (including n=300 oversamples in Montreal and Vancouverand n = 302 inches Toronto) were collected.
BMO has been serving clients for 200 years and is a highly diversified financial services company – the 8th largest bank by assets in North America. With total assets of $1.07 trillion as of July 31, 2022 and a team of diverse and passionate employees, BMO provides more than 12 million clients and executives with a wide range of personal and corporate banking products and services, in wealth management and investment banking businesses through three operating groups: Personal and Commercial Banking, BMO Wealth Management and BMO Capital Markets.
SOURCE BMO Financial Group
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