New data shines a light on the affordability
crisis in Canada; vast majority of
Canadians say the Canadian economy is on the brink of a recession,
if not already in one.
TORONTO, Nov. 22,
2023 /CNW/ - Manulife Bank has released its
semi-annual Financial Healthy Survey, finding that the Canadian
economy, which has been in a period of volatility and uncertainty
for the last 18 months with soaring inflation, record cost of
living, and a near fivefold increase in interest rates has,
continues to affect Canadians.
According to the results, 86 per cent of Canadians are concerned
about the direction of the Canadian economy and a vast majority (84
per cent) think we're either already in a recession or heading into
one within the next year (73 per cent). It's also becoming clear
that things are hitting close to home for Canadians: almost 90 per
cent are concerned about the affordability of life in Canada and 70 per cent are worried about their
overall financial health and wellness.
"We've been in a period of economic volatility for a number of
months and that it is not likely to change any time soon," says
Alex Lucas, President, Manulife
Bank. "Despite slowing inflation, our data indicates that close to
two-thirds of Canadian households still need to renew their
mortgages at higher rates which will undoubtedly put a lot more
pressure – and stress – on household finances."
Canadians already have a lot on their mind: 71 per cent worry
about being able to afford essentials, like food and housing; 70
per cent are worried about making their mortgage payments and 85
per cent of people who have to renew their mortgage in the next 12
months are worried about having to do so. The results also found
that as many as one in three (32 per cent) of homeowners with
mortgages think they will be forced to sell their homes if interest
rates increase further and fewer than two in five (37 per cent)
Canadians feel prepared, financially, to weather further interest
Additionally, household debt in Canada is on the rise. Almost half (49 per
cent) of indebted Canadians are not comfortable with the amount of
debt they have, and four in five (79 per cent) are increasingly
worried about making their debt repayments – an increase of 14
points compared to one year ago.
"While the results of our survey are eye-opening, there are
often options available to help free up cash flow, pay down debt
and help ease some of the stress," continues Lucas.
According to Lucas, there are things that can be done to help
Canadians get through this period of economic uncertainty and ease
some of the stress. He recommends starting with the following:
- Plan: The survey found that 71 per cent of
Canadians don't have a financial plan. Every Canadian, regardless
of income level, should have a plan. The CRA has a helpful website
that can help Canadians get started.
- Consolidate Debt: Many Canadians were caught
off-guard with the rapid increase in interest rates and how that
impacts debt repayment. Canadians can consolidate lines of credit
into a single solution with a potentially lower interest rate.
- Rainy Day Fund: Canadians should have three months'
worth of savings accessible to ease stress and Concerns highlighted
in the findings.
- Seek Professional Help: If Canadians feel that they
are not able to make it all work, speaking to a certified financial
planner or advisor can help eliminate stress and prepare for
Manulife Bank is committed to improving Canadians' financial
health with solutions that provide access to better financial
outcomes and improved financial health. For more information, visit
manulifebank.ca, or click here to find an advisor near you.
About the Manulife Bank of Canada
Financial Health Survey
Now in its 13th year, the Manulife Bank of Canada poll surveyed 2,001 Canadians in all
provinces between ages 20 and 69 with household income of more than
$40,000. For the past six years, the
survey has been conducted online by Ipsos and the current survey
took place between October 5 and 11,
2023. National results were weighted by gender, age, region,
and education. This survey has a credibility interval of +/- 2.5
per cent 19 times out of 20, of what
the results would have been had all Canadian adults between the
ages of 20 and 69 been surveyed.
Manulife Financial Corporation is a leading international
financial services provider, helping people make their decisions
easier and lives better. With our global headquarters in
Toronto, Canada, we provide
financial advice and insurance, operating as Manulife across
Canada, Asia, and Europe, and primarily as John Hancock in the
United States. Through Manulife Investment Management, the
global brand for our Global Wealth and Asset Management segment, we
serve individuals, institutions, and retirement plan members
worldwide. At the end of 2022, we had more than 40,000 employees,
over 116,000 agents, and thousands of distribution partners,
serving over 34 million customers. We trade as 'MFC' on the
Toronto, New York, and the Philippine stock exchanges
and under '945' in Hong Kong. Not
all offerings are available in all jurisdictions. For additional
information, please visit manulife.com.
SOURCE Manulife Financial Corporation