Amid growing household debt and the possibility of more increases in interest rates, settling debts remains the top financial priority for Canadian consumers in 2018, according to the latest poll conducted by CIBC.
This represented the eighth consecutive year that paying off existing debts has topped the list in the annual survey. The CIBC study also found that other priorities are increasing in importance over more immediate financial concerns.
“While debt repayment is still the number one priority, Canadians recognize that it’s just as important to focus on building savings and growing your nest egg,” CIBC managing director for financial planning and advice Jennifer Hubbard said.
“With inflation outpacing average earnings and the risk of outliving our assets, it’s essential to set out your short- and long-term financial goals in a comprehensive financial plan that strikes the right balance between paying down debt and growing savings,” Hubbard added.
Read more: Canada debt-to-household-income ratio swells to 171% – StatsCan (see Post below)
25% of the survey respondents said that paying down debt is their top financial priority for this year, while others said that they will aim to grow their wealth (13%) or save for retirement (7%).
67% admitted that they need to get “a better handle” on their finances in 2018. Fully half of Canadians (51%) expressed regret at not paying down more debt while interest rates were low. To meet their financial goals last year, 46% of Canadians said they reduced their spending on non-essential items, and 31% set a household budget.
In 2018, 55% are planning to cut down on non-essential spending, while 27% will be establishing emergency funds. Meanwhile, 23% will be prioritizing savings by setting up automatic transfers into savings or investment accounts.
