Canadians' Financial Outlook Divided as Inflation and Recession Fears Appear to Shape Behaviours

Core Insights - Canadians' financial optimism is declining due to rising living costs, with 53% stating their household income is not keeping pace with inflation [1][5] - A significant portion of Canadians (31%) are pessimistic about their financial situation in the next year, despite 20% reporting an income increase in the last three months [1][5] - Economic uncertainty is prompting Canadians to adjust their spending habits, with 67% seeking sales and discounts more frequently [4][5] Financial Strain - 25% of Canadians are unable to pay at least one current bill or loan in full, with credit card payments (63%) and personal loans (55%) being the most affected [2][3] - Over half (51%) of Canadians have cut back on discretionary spending, while 19% plan to reduce contributions to retirement funds [4][5] Recession Sentiment - 27% of Canadians believe the country is currently in a recession, and 32% expect one within the next year, leading 84% to prepare for potential economic downturns [3][4] Spending Adjustments - Canadians are increasingly prioritizing essential goods, with 85% changing shopping habits in response to economic conditions [5] - Common adjustments include reducing spending (61%), building savings (38%), and shopping at more affordable retailers (44%) [6] Credit Access and Intentions - 82% of Canadians view access to credit as essential for achieving financial goals, but only 56% feel they have sufficient access [7][10] - 21% plan to apply for new credit or refinance existing credit, with younger generations (47% of Gen Z and 31% of Millennials) leading this trend [8][9] Fraud Concerns - Nearly half (46%) of Canadians reported being targeted by fraud in the past three months, with younger Canadians being the most vulnerable [12][13] - Despite the risks, 36% of Canadians took no action to address cybersecurity concerns, highlighting a need for better education on fraud prevention [13]