FCAC releases new data on Canadians’ budgeting behaviours and financial well-being

November 27, 2018
Ottawa, Ontario

The Financial Consumer Agency of Canada (FCAC) presented the findings of two research projects during the National Research Symposium on Financial Literacy in Toronto on November 26 and 27. FCAC shared preliminary Canadian results of an international Financial Well-Being Survey and from the Agency’s latest behavioural budgeting research.

Saving drives financial well-being

Regardless of how much they earn, individuals can substantially improve their financial resilience and well-being by regularly saving even small amounts for unexpected expenses. This is according to preliminary findings from a Financial Well-Being Survey that was recently conducted in Canada and in Norway, Ireland, Australia and New Zealand. Being an active saver is one of the biggest drivers of personal financial well-being, which is defined as being able to comfortably meet financial commitments and needs, now and in the future. However, only about half of Canadians in the sample regularly save money for unexpected expenses, such as vehicle repair or a new roof.

The survey also indicates that relying on credit to pay for daily expenses is linked to lower levels of financial well-being. One in seven (14%) use credit to buy daily essentials such as groceries because they are short of cash. Nearly one in ten admit to being impulsive shoppers, which leads to buying things they cannot afford.

Overall, Canadians ranked second among respondents from participating countries in terms of their financial well-being. Canadians scored well on aspects of money management including meeting financial commitments, making informed financial decisions and understanding risks related to financial products.

Financial education leads to sustained budgeting

According to a longitudinal study by FCAC, over half (54%) of Canadians who began budgeting during a 2016 pilot project were still budgeting a year and a half later. During the pilot, FCAC sent targeted financial education messages to users of the Carrot Rewards mobile app to encourage them to start budgeting. 70% of participants who continued to budget after the pilot said they were able to keep up with their financial commitments, compared to just 45% of those who were no longer budgeting.

National Research Symposium

FCAC’s bi-annual National Research Symposium on Financial Literacy brings together Canadian and international experts to share best practices and foster innovative approaches to improve Canadians’ financial well-being. This year’s Symposium was co-hosted by Behavioural Economics in Action at Rotman (BEAR), University of Toronto.