Surveying the surveys, some basic consumer behaviour around consumer behaviour becomes clear.
A new survey from President's Choice Financial finds that, when it comes to buying insurance, Mom and Dad are the first call for Canadians seeking advice. The poll found that more than half of respondents seek advice from family, friends or coworkers when researching insurance options. Only 35 per cent will do their own research. Young Canadians are especially dependent on family when making insurance decisions, with 59 per cent of respondents between the ages of 18 and 34 indicating that they would turn to their parents for advice.
A TD Survey finds most Gen Xers build-in “budget flexibility in when it comes to personal finance so that they can afford other things in life. So-called Gen X Canadians overwhelmingly consider themselves "House-Plus" buyers, that is, someone who buys a smaller house so that they have money left over after the mortgage payment to do things like travel. Only one in seven (14%) Gen X Canadians consider themselves "House-All" buyers, that is, people who buy the biggest house then can and put all their money toward the mortgage, leaving less room for discretionary spending.
A whole slew of studies and reports on the financial state of the North American consumer are not so encouraging for the state of spending power through the year ahead.
One survey found that consumer spending in the U.S. unexpectedly dropped in July for the first time in six months, a sign households are lagging behind as wages fail to accelerate. None of the 79 economists in a Bloomberg survey projected a decrease in this measure. Incomes climbed 0.2 percent, the smallest monthly advance this year. Consumer spending, which accounts for about 70 percent of the economy, has been held back “by tight credit and meager wage growth that is barely able to keep up with inflation.”
Another survey finds car buyers are falling behind when it comes to payments on their auto loans. The auto loan delinquency rate -- borrowers who are at least 60 days behind on their loans -- rose to 0.95% in the second quarter, up more than 9% from 0.87% the same quarter a year ago.
A National Payroll Week Research Survey conducted by the Canadian Payroll Association (CPA) suggests the financial picture for working Canadians across the country is weakening. According to the study more Canadians than ever are living pay cheque-to-pay cheque. Not only that, but they're saving less and falling further behind in meeting their retirement goals. Half of employees (51%) report that it would be difficult to meet their financial obligations if their pay cheque was delayed by a single week. This is up from an average of 49% over the past three years. This is not good. Nationally, 26% of study respondents said they "probably could not" pull together $2,000 over the next month if an emergency expense arose.