Many Canadians unprepared to withstand a financial emergency
Almost 40 per cent of Canadians are feeling the financial pinch with their bank accounts and would be unable to withstand a financial emergency, up from 33 per cent two years ago, according to a new survey by FP Canada.
FP Canada says given the ongoing uncertainty and economic damage caused by COVID-19, this year has proven that Canadians need to have a plan in place to help secure their financial well-being in good times and bad – even though four-in-10 say they don’t have a financial plan (39 per cent).
“This is an opportune time to take a hard look at how people are faring with their finances,” said Mark Halpern, a Certified Financial Planner. “Given the whirlwind year we’ve had, it’s no wonder that people are feeling stressed about their financial situations. It is also not surprising that the percentage of Canadians who cannot afford a financial emergency has gone up since the last FP CanadaCross-Country Checkup in 2018. Now more than ever, it’s important to put a plan in place so that household fiscal burdens don’t become too overwhelming.”
Canadians aged 45-54 are the most pessimistic, with 53 per cent saying they could not handle a financial emergency — well surpassing the national average. Adding to the problem is the fact that 37 per cent of Canadians say they rarely or never put aside money into an emergency account.
The FP Canada Cross-Country Checkup is commissioned every two years and has been released to mark Financial Planning Week, which takes place from Nov. 15-21.
Leger conducted the online survey on behalf of FP Canada of 1,538 Canadians between Sept. 18-20, 2020.
The new research once again highlights that people who work with a professional feel much more confident when it comes to money matters. Among those who have updated their financial plan, 71 per cent are confident they will achieve their financial goals.
Barriers to seeking advice
FP Canada says there are misconceptions among Canadians about seeking professional advice. Some 48 per cent of those who don’t currently work with a financial planner say they would do so if they had more money. Other barriers cited by Canadians include uncertainty about where to find a professional they can trust (17 per cent) and what kinds of questions to ask a financial planner (14 per cent).