November 1, 2023, Toronto – Canadians of all ages are feeling the pinch of inflation, and according to a Financial Literacy Month poll from Advocis, a significant number of Canadians are facing steep financial challenges as a result of increased interest rates and a looming recession, leading to an inability to meet their monthly financial obligations and payments.
At a time of heightened economic uncertainty, a disparity in savings is resulting in a heightened period of hardship for Canadians, especially those with lower incomes. The recent survey findings from Advocis are more cause for concern as they reveal a distressing outlook from financial advisors and financial planners across the country, a perfect storm that could spell disaster for those with limited financial literacy skills. Among the findings:
40% of respondents indicated their clients have been late to make their monthly credit card or mortgage payments.
47% of respondents indicated that they’ve seen clients get a loan to purchase or refinance a car, and some went as far as selling personal items to help support paying their monthly bills.
“The increased burden of living expenses and heightened interest rates have resulted in a financial challenge, as the weight of debt has become even more significant for Canadian households. Additionally, the majority of Canadians have not experienced a proportional increase in their incomes to match the escalating costs of everyday purchases,” says Julie Martini, COO of Advocis.
Advocis’ survey was conducted throughout the month of October and includes responses from more than 150 Members of Advocis. This comes on the heels of Financial Literacy Month, which will take place across the country from November 1st through the 30th.
“Financial education can help anyone migrate through these difficult times more successfully. With that thought in mind, I encourage anyone not currently dealing with a competent financial advisor to align themselves with one. You can’t change the past but you can start planning for the future,” says David R. Johnson with D.R. Johnson Financial Ltd. in Winnipeg, Manitoba.
The collected responses from Advocis Members seem to echo the comments of Johnson, as 56% of respondents say they’ve had clients reaching out to adjust their financial plans as the escalating strain of household bills and food prices has intensified their financial anxiety.
The upside is that 66% of respondents indicated clients are showing an increased appetite for improving their overall financial literacy and resiliency.
“One positive outcome amid these challenging circumstances is the increased awareness and emphasis on emergency savings. Many clients are recognizing the importance of having a financial safety net in place, particularly during uncertain economic times,” says Emma Lang, a CFP at Branstone Financial Strategies Inc. in Vermilion Bay, Ontario.
New content from Advocis will be posted weekly on financialadviceforall.com, and Advocis’ 2023 campaign theme will focus on ‘Coming Back Stronger: Emerging Together During Inflationary Times’.
“Saying it’s a tough climate would be putting it gently. We are tremendously excited to continue our support for Financial Literacy Month, and we hope that our innovative approach through an award winning resource such as Financial Advice for All will help us engage and increase awareness about the importance of financial education for all Canadians. Financial professionals have a responsibility to consistently provide reliable guidance and resolutions, aiding clients in adjusting to the evolving environment and safeguarding their clients during these turbulent periods,” Martini says.
Advocis encourages Canadians to follow the #FLM2023 on social media for the latest news and updates on content from a variety of Canadian financial organizations.
Advocis, The Financial Advisors Association of Canada, is the largest voluntary professional membership association of financial advisors in Canada. Advocis offers designations, continuing education opportunities, industry-leading publications, and membership in a chapter network with mentorship programs, study groups, and practice development resources.
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