Amid rising costs and stagnating incomes, holiday expenses are set to delay financial goals for nearly half of Canadians

A new study from Coast Capital uncovers a holiday spending ‘domino effect’ that could put people in Canada further behind in achieving their financial goals

/EIN News/ -- VANCOUVER, British Columbia, Nov. 27, 2024 (GLOBE NEWSWIRE) -- Canada’s largest federal financial cooperative, Coast Capital, has released a new study revealing a concerning holiday spending ‘domino effect’ triggered by the added financial stress of the holiday season, compounding the already challenging economic environment.

The survey, commissioned by the credit union and conducted among members of the Angus Reid Forum, found that 55 per cent of people in Canada report being a long way from achieving their financial goals, citing inflation, lack of savings, household debt and low incomes as the top factors holding them back. Holiday season spending pressures will only exacerbate financial stressors for the vast majority (72 per cent) of Canadians, with 78 per cent of respondents not planning to set a specific budget for their spending. In fact, more than half (59 per cent) of individuals already experiencing high financial stress are prepared to incur debt to cover holiday expenses, leading to further delays in both short- and long-term goals.

“This new data highlights how challenging it is for people in Canada to get on stable ground, especially when faced with the pressures of the holiday season,” says Xin Lou, financial planner, Coast Capital. “Although it isn’t surprising that 94 per cent of Canadians say they plan to spend on gifts, entertainment and other related holiday purchases, the number of people who are going to over-extend themselves rings some alarm bells.”

The study found that while the majority of Canadians (60 per cent) have not seen increases to their incomes over the past 12 months, they plan to spend the same or more over the holidays than they did in 2023.

Additional key findings include:

• 72 per cent of Canadians say that holiday expenses are intensifying financial pressures.
  • Pressure is significantly more likely to be felt by those aged 18-34 (84 per cent).
• 60 per cent of respondents plan to spend the same amount during the holidays in 2024 as they did in 2023, while 12 per cent plan to spend more than last year.
• 79 per cent don’t plan to set a specific budget for their holiday expenses.
• 41 per cent do not feel the need to discuss holiday spending with others, whether to suggest alternatives like lower-cost gifts or experiences or to manage expectations.
• 47 per cent of Canadians report that they are falling behind on their short- and long-term financial goals due to holiday spending.

“At Coast Capital, we aim to be real partners to our members by providing them with the resources and advice they need to feel confident in their finances,” Lou says. “This includes helping them navigate today’s spending decisions to set them up for a better financial future. While it can be challenging to manage the expectations of the season, we want to encourage people to put their financial goals ahead of the pressure to spend in order to avoid the domino effect in the new year.”

Lou points to five key tips for approaching holiday spending while also staying on track with longer-term financial goals:

1. Create a holiday spending budget. This will help you figure out what you can spend this holiday season while staying within your means.
   
2. Make a no debt commitment. If you can’t purchase without putting it on a card or a line-of-credit that won’t be paid off quickly, think twice before buying. This way, you don’t have to worry about lingering holiday debt in the new year.
   
3. Be loud and proud about your budget. De-stigmatizing conversations about finances and normalizing transparency when talking about money can do wonders for your wallet. This could mean setting expectations with family and friends for what the holidays might look like this year, such as exchanging fewer gifts or narrowing down the number of outings.
   
4. Embrace creativity. Maybe you can’t buy another Secret Santa gift or go out for a fancy meal, but you might be able to swing a potluck dinner at home or a coffee and a walk through a free light display. Find a balance that will work for you and your finances, while still enjoying the season’s traditions!
   
5. Think beyond December. With knowledge comes power. Consider booking an appointment with a financial advisor to get advice tailored to you, your goals and your circumstances.
   

With this survey, Coast Capital’s goal is to empower people in Canada to take control of their finances this holiday season. By understanding their spending behaviours and taking steps to mitigate the impact of holiday spending on their financial goals, Canadians can set themselves up for success as we approach 2025 and build a better financial future.

Learn more about the report, Canadians’ spending behaviours this holiday season and how it will impact their financial goals at coastcapitalsavings.com.

About this survey
The findings are based on a survey conducted between [October 22 – October 28], among a representative sample of 1,683 Canadian adults, separated into quotas of 500 in the Lower Mainland, 200 in Kelowna, 150 in Vancouver Island, and 833 in ROC. All the participants are members of the Angus Reid Forum. The survey was conducted in English and French. The precision of Angus Reid Forum online polls is measured using a credibility interval. For comparison purposes only, the sample plan would carry a margin of error +/- 3.1 percentage points, 19 times out of 20. Discrepancies in or between total are due to rounding.

About the Angus Reid Forum
The Angus Reid Forum is Canada’s most well-known and trusted online public opinion community consisting of engaged residents across the country who answer surveys on topical issues that matter to all Canadians.

About Coast Capital
At Coast Capital, we’re not dreaming about a better future, we’re building one. We’re a member-owned financial cooperative with an 80-year legacy of unlocking financial opportunities that positively impact people and communities. We believe that every Canadian deserves a financial partner who actually cares how things turn out. Driven by our social purpose, we look at everything we do through the lens of how we can help nearly 600,000 members, our employees, and communities. Ranked in the platinum category of the 2022 Corporate Knights’ Social Purpose Ranking and a proud Certified B Corporation™, we’re part of a global movement building a more inclusive, equitable and regenerative economic system. Each year, we invest 10 per cent of our budgeted bottom line into our communities, which totals more than $100M since 2000. We’re deeply committed to making our financial cooperative a great place to work as demonstrated by some of our accolades. Coast Capital is a platinum member of Canada’s Best Managed Companies and one of Canada’s Most Admired Corporate Cultures. To learn more, visit us online at coastcapitalsavings.com.

Media Contact
Cristina Melo
Senior Account Manager, Citizen Relations (on behalf of Coast Capital)
cristina.melo@citizenrelations.com

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