Just 32 per cent of Canadians feel they are making financial progress in their lives, down five points from this time last year, according to the most recent research from BMO Financial Group.

The BMO Real Financial Progress Index research further found that 77 per cent of those surveyed say inflation is impacting their holiday spending decisions. “Overall financial confidence significantly dropped with 69 per cent of Canadian adults feeling confident compared to 75 per cent a year ago,” they write.

To combat inflation’s effects, survey respondents – 3,400 Canadian adults surveyed in October and November – say they will purchase less expensive gifts, reduce big purchases and trim their gift recipient lists. Fewer are travelling as well this holiday season, with 21 per cent saying they will spend less on travel due to inflation. Just 35 per cent plan to travel internationally over the holidays.

A large number, 63 per cent say they also no longer intend to move forward on large purchases such as buying a car or a home. The research also found that 82 per cent say their financial situation is causing them increased anxiety. The most significant sources of financial anxiety cited include housing costs, fear of unknown expenses and family-related expenses.

Nearly half, 43 per cent say their financial New Year’s resolutions have changed because of inflation. To help, BMO suggests clients utilize tools that track spending, reconsider big-ticket purchases and talk to an expert.