A report released by BMO Wealth Management found 30 per cent of Canadians say their most important financial priority is to reduce or eliminate debt. According to Statistics Canada, the debt-to-disposable income ratio was 165.3 per cent for the first three months of 2016. This amounts to what Canadians owe for every post-tax dollar they earn, which is $1.65 for every dollar.
Millennials want to save more
The report found the biggest financial issue for millennials (aged 18-34) was to save more with 26 per cent responding in that category. Priorities also shifted depending on the age of respondents. The number one priority for Boomers (those aged 35-54) is to reduce or eliminate debt (34 per cent) and for Canadians aged 55 and over prioritize effective investing and tax efficiency (29 per cent).
BMO says effective investing and tax efficiency, saving more, budgeting and spending on personal needs or goals were other financial priorities for Canadians’.
“It’s a good idea to re-evaluate your financial plan on a regular basis to ensure your saving, investing, borrowing and spending are in balance as priorities shift over time,” says Chris Buttigieg, senior manager for wealth planning strategy at BMO Wealth Management.
Conquering financial fears
The report also found that almost one third of Canadians (29 per cent) are concerned they will not be able to save enough to reach their financial goals. Millennials are more likely to have this concern (35 per cent) than Boomers (29 per cent).
Canadians reported stock market losses, (36 per cent) failed business ventures, (23 per cent) divorce or separation (18 per cent) and financial loss on a property sale made it difficult for them to save or invest to achieve their financial goals (13 per cent).
“These types of financial losses weigh on people’s minds and may make them more tentative, fearful or hesitant to prepare for the future. A financial professional can help you re-establish control over your finances by re-orienting your strategy,” says Buttigieg.