Financial woes top source of stress for Canadians

Nearly half say they have less disposable income compared to a year ago: survey

Financial woes top source of stress for Canadians

Money remains the top stressor for Canadians for the sixth year in a row.

Two in five (40%) Canadians cite money as a leading source of stress in this year, up from 38% in 2022, reports FP Canada, a financial planning firm. Money ranked higher than personal health (23%), relationships (17%) and work (16%) among the top stressors.

Financial-related stress has negatively impacted over half of the Canadian population, with over one in three (36%) Canadians experiencing mental health challenges such as anxiety or depression related to financial stress. As a result, more Canadians (48%) are losing sleep over money this year compared to last year (43%). 

“Canadians continue to struggle with their financial picture, and financial stress can have a significant impact not only on financial well-being, but also on mental health,” said Tashia Batstone, president & CEO of FP Canada.

Financial stress costs Canadian employers $893,000 annually, according to a previous report.

Cost of living impacts financial health

Inflation’s impact on the costs of goods and services, and elevated gas and grocery prices specifically, are contributing to Canadians’ financial stress, according to FP Canada’s survey of over 2,000 Canadians, conducted between March 29 and April 7, 2023.

As a result, nearly half (48%) have less disposable income compared to a year ago, a substantial increase from 2022 (39%).

Saving enough for retirement (35%) and saving for a major purchase (32%) are two areas of growing concern.

Canadian employees could need $1.7million in order to retire, according to a previous report.

How Canadians are coping with financial stress

Canadians have taken steps to reduce their financial stress, including tracking expenses (44%), paying down debt (36%) and saving more (34%).  

Just over a third (36%) of Canadians also work with some type of financial professional, and 5% work with a financial planner specifically.

This is the case even though over half (55%) of respondents who work with a financial planner said that financial stress has no negative impact on their lives and only two-in-five (38%) said they have lost sleep over financial worries, compared to nearly half of all Canadians (42% and 49%, respectively) who don’t have a financial planner. 

“The FP Canada Financial Stress Index clearly shows the toll that external factors can take not only on our wallets but also our overall well-being,” said Alim Dhanji, a CFP professional at Assante Financial Management in Vancouver, BC.

“Professional financial planners work with their clients to build a sense of financial security by supporting them in taking small, accessible steps – like creating budgets – to regain control over their finances so that they stay on the path to financial well-being and help keep stress at bay.”  

How can employers help?

Here are some ways employers can help with their workers’ financial wellbeing, according to access, a provider of business management software to small and mid-sized organizations in the UK, Ireland, and Asia Pacific:

  1. Do regular salary reviews.
  2. Direct employees to professional financial support.
  3. Provide good financial wellness benefits.
  4. Educate workers about financial wellbeing.
  5. Create a culture of financial security.

Almost nine in 10 (88%) of respondents to a previous study feel more needs to be done to encourage people to save for retirement, while 60% feel there is not enough public information available about pensions.

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