Tightening up, drawing down: Vast majority of Canadians making tough decisions to handle cost-of-living crisis
More than a year into a stubborn and persistent costof-living crisis, a considerable number of Canadians have progressed from belt-tightening on spending to drawing on existing savings to make ends meet.
The latest data from the non-profit Angus Reid Institute finds two-thirds of Canadians reporting cutting back on discretionary spending in recent months – a number 14-points higher than reported around this time last year.
However, for millions, penny-pinching doesn’t go far enough. Two-in-five (40 per cent) say recent challenges have forced them to draw money from accounts that they try not to touch, and one-in-three (35 per cent) say they deferred a contribution to their RRSP or TFSA.
For one-in-ten the situation has been so difficult they’re either borrowing from friends and family (13 per cent), selling assets (11 per cent), or seeking out a bank loan (eight per cent).
Little wonder then, that fully one-in-three (34 per cent) Canadians say they’re in either “bad” or “terrible” shape financially. This represents a six-point increase from last July. Those individuals continue to struggle with food costs, for which inflation remains significantly higher at approximately 10 per cent. Among those who say they are in “terrible shape” financially, nine-in-ten (94 per cent) say it is difficult to feed their household. Four-in-five (80 per cent) say this among the group who are in self-described “bad shape”.
The federal government recently tabled a budget including policy measures, such as one-time grocery rebate, designed to alleviate the financial pressure that many are individuals and households are feeling.
And while these moves may provide some relief to some households, persistent challenges remain, perhaps exacerbated for nearly half of Canadian workers (45 per cent) who say they have not received additional compensation from their employer over the past 12 months.
The full poll can be viewed at https://angusreid.org/ cost-of-living-inflation-discretionary-spending-savings-canada/