Clothing optional for British Columbians who fall on hard times
Finance: Study shows interesting discrepancies in how we would each choose to trim our budget
British Columbians endure a wide range of expenditures every month. Some may have the advantage of extended health plans that cover the cost of massage therapy and physiotherapy. Others work for employers who subsidize gym memberships or transportation options (such as pre-purchased transit passes). But what would happen if we had to pay all our current bills with a reduced income?
To test how British Columbians would behave, Insights West relied on a list of 10 typical household expenses and asked which would be the first five areas to be slashed from the family budget.
The most favoured for cuts, across all regions, demographics and household incomes, is clothing. More than a third of all British Columbians (36 per cent) say their first measure of defence in the event of an economic downturn would be to stop buying new clothes.
Next on the list of cuts is eating out. The third expense that would be abandoned is related to sports and gym memberships, followed by massage therapy (an expense that is often not included in expanded health plans) and a vacation.
The demographic analysis shows we are not all equal when it comes to facing a rainy day. While clothing was the de-facto top choice for all, there are some striking differences in other areas that would see a smaller budget in the household.
Women, for instance, are more likely than men to cut down on meals at restaurants instead of stopping their gym membership or sports gear. Men would be willing to abandon massage therapy, while women do not include this in their top five.
The age analysis provides a stern warning. British Columbians aged 18-to-34 selected “Saving for Retirement” as their third area to be slashed — one that is not present at all in the lists of residents aged 35-54 and those over the age of 55. However, B.C.’s youngest adults would not abandon their gym, while the two older demographics include it as one of their first three cuts.
Geographic location also plays a role in our prospective decisions. Saving for retirement is one of the top cuts for people living in Metro Vancouver and the Fraser Valley, while northern British Columbians would say goodbye to mobile devices and online services, the only region to say so. Physiotherapy would be chopped in southern B.C., while entertainment would be cut in Vancouver Island.
The last layer of analysis is annual household income. British Columbians in the lowest bracket would trim clothing, eating out, gym, vacation and transportation in that order. The middle-income bracket would swap massage therapy for transportation. Those in the highest bracket would give up on physiotherapy, but have no intention of altering their holiday plans.
We learned three key findings from this virtual situation of need. First, that despite the unwarranted criticism from other provinces and urban centres, British Columbians are not shallow people concerned primarily with outside looks. All of us — urban and rural, young and old — would cut clothing from the household budget first.
Second, we are more tied to online access than ever before. In the 1990s, it would have been fairly simple for a head of the household to slash online access from the family budget. Now, families may have more than a handful of devices they need to keep track of. Electronics have become indispensable.
Finally, and an important measure to watch in the next few years, we learned life in our province’s urban areas, and especially for younger residents, is definitely getting more expensive. Urban dwellers and Millennials were more likely than older or rural British Columbians to give up on the idea of saving for retirement, than to cut everyday expenses to make ends meet.
This does not necessarily suggest a hedonistic cohort unwilling to leave their entertainment or electronics behind. More likely, it is a reminder that the discussions about life after work should start as soon as possible.