Canadians reduce financial stress and gain optimism by working with financial professionals, survey finds
The 2024 Financial Stress Index, a national survey of over 2,000 Canadians conducted by Leger on behalf of FP Canada, indicated that financial stress is increasing.
Despite this, Canadians are prioritizing their financial health and feeling more hopeful about their financial futures compared to a year ago.
This survey reveals that despite ongoing financial concerns, many Canadians are adopting strategies to mitigate financial stress amid persistent economic pressures.
The data shows that Canadians are recognizing the benefits of proactive financial management. Year-over-year findings highlight that those who work with a financial professional experience less financial stress.
They feel more optimistic about their financial futures and are better equipped to navigate financial uncertainties.
Financial stress on the rise as external pressures persist
The 2024 Financial Stress Index reports that money remains the top stressor for Canadians, with 44 percent citing it as their primary concern. This number has steadily increased from previous years (40 percent in 2023, 38 percent in 2022 and 2021).
Major contributors to financial stress include high grocery prices (69 percent), inflation (60 percent), and housing costs (52 percent).
These economic challenges continue to impact Canadians' mental health, with nearly half (49 percent) losing sleep over financial worries and more than half (54 percent) experiencing anxiety, depression, disruptions in workplace productivity, and strained personal relationships.
However, those who work with a financial professional are less likely to lose sleep due to financial stress (42 percent) compared to those who do not (52 percent).
Meghan MacPherson, a Qualified Associate Financial Planner (QAFP) professional at Impact Financial Group Inc., notes, “Persistent affordability concerns can cause significant financial strain, so it's no surprise that Canadians continue to feel the impact of these difficult conditions.”
“Thoughtful planning and proactive measures can help reduce financial stress caused by economic factors beyond our control. The Financial Stress Index shows that working with a financial professional can help Canadians create a sense of confidence and control in the face of uncertainty,” she continued.
Impact of financial stress more severe for young adults, interest in financial planning grows
Younger Canadians are experiencing the highest levels of financial stress, with half (50 percent) of those under 35 citing money as a top stressor, compared to 42 percent of those over 35.
Financial stress weighs more heavily on younger individuals, with nearly three-quarters (72 percent) reporting at least one negative impact on their lives, compared to less than half (48 percent) of those over 35.
Younger Canadians are also more likely (50 percent) to experience anxiety, depression, and mental health challenges due to financial stress than those over 35 (34 percent).
Despite this, 39 percent of younger Canadians recognize the value of creating a financial plan to mitigate stress, compared to 22 percent of those over 35. This indicates a growing interest in financial planning among younger Canadians.
Stress less: The power of professional financial planning support
The Financial Stress Index highlights Canadians' desire to take control of their finances, but managing personal finances alone can be challenging.
Findings show that Canadians who do not work with a financial professional are 33 percent more likely to be stressed about money and 23 percent more likely to lose sleep over financial worries than those who do.
Those who work with a financial professional are more optimistic about their financial futures (56 percent) compared to those who do not (48 percent).
“A trusted CFP or QAFP professional can be a strategic ally, offering personalized solutions tailored to each client's unique circumstances and aspiration,” said Nabila Mirza, a QAFP professional at Aviso.
Our goal through comprehensive financial planning is to empower Canadians to make informed choices, optimize their resources, and build financial resilience for a more secure future.”
Growing optimism as Canadians focus on financial well-being
Despite economic challenges, Canadians are focusing more on financial self-care. The 2024 Financial Stress Index shows that 91 percent of Canadians have taken at least one action to reduce financial stress in the past year.
Popular strategies include tracking expenses (45 percent), repaying debt (38 percent), and increasing savings (33 percent).
The research indicates a shift towards prioritizing financial well-being, with more Canadians planning to pay off outstanding credit card debt (24 percent) than going on vacations (19 percent) within the next 12 months. This reflects a fiscal-responsibility mindset that contributes to long-term financial stability.
Ravi Chhabra, a CFP professional, says, “Canadians are adopting a mindset focused on fiscal responsibility, which is key to financial empowerment and long-term stability.”
She continued “While the current economy imposes limitations on financial choices, prioritizing debt repayment and budgeting for joy can lessen immediate burdens and lay the groundwork for a future where life's pleasures do not compromise financial health.”
Half (50 percent) of Canadians are more optimistic about their financial futures compared to 2023 (47 percent), with younger Canadians (55 percent of those under 35) showing a particularly resilient mindset towards financial challenges.
