BMO survey shows most Gen Z and Millennials fear children will jeopardize long-term financial security
Seventy percent of Gen Z and 69 percent of Millennials in Canada want children but believe it would jeopardize their financial security, according to the latest BMO Real Financial Progress Index.
This concern is echoed by 53 percent of parents who say raising children has compromised their financial position, despite 81 percent of Canadians reporting that parenthood brings joy and fulfilment.
The survey found that 84 percent of Canadians believe the cost of raising children has become unmanageable, with parents citing the most surprising expenses as:
- Groceries (39 percent)
- Toys and activities such as sports and recreational clubs (37 percent)
- Daycare, private school, and after-school care (31 percent)
- Housing costs to accommodate a child (30 percent)
- Baby supplies like diapers and formula (28 percent)
- Children’s clothing (27 percent)
- Strollers, car seats, and similar items (25 percent)
- Extra childcare help such as nannies or babysitters (21 percent)
Financial stability emerged as the top factor influencing Canadians’ decisions about whether to have children, named by 44 percent of respondents.
Other considerations included finding the right partner (34 percent), the ability to be fully present for children (27 percent), mental and physical health (24 percent), and career goals or prospects (17 percent).
Over a third, or 35 percent, would reconsider not having children if the financial impact was reduced.
The emotional and financial demands of parenting weigh heavily on households.
The survey reported that 89 percent of Canadians find it challenging to balance these demands, while 55 percent regularly feel overwhelmed by their family’s financial responsibilities.
This sentiment is most pronounced among Gen Z and Millennials, both at 72 percent.
In addition, 76 percent feel pressure to match other families’ spending, and 86 percent say childcare costs hinder saving for long-term goals such as higher education or homeownership.
On average, aspiring parents want two children, but that figure rises to three if financial constraints are removed.
Many Canadians also plan to provide support well into their children’s adulthood: 22 percent until a full-time job is secured, 18 percent until the child moves out, and 22 percent regardless of life stage.
On average, respondents believe parents should provide financial support for 19 years, with 29 percent saying it should last as long as the parents are alive.
BMO Economics stated that household resilience is being tested in the current economic environment.
The Bank of Canada’s Survey of Consumer Expectations shows most respondents hold a negative view of their financial health, tied to concerns about tariffs, trade, rising unemployment, and declining home prices in parts of Ontario and British Columbia.
Financial conditions, however, have shown signs of improvement with lower interest rates, reduced borrowing costs, and steady income gains over the past year, easing the debt service burden from earlier record highs.
BMO Economics said stress could ease further if a trade deal with the US is secured and if the Bank of Canada resumes policy easing in the fall, potentially reducing mortgage reset pressures over the next two years.
Gayle Ramsay, head of Everyday Banking, Segment & Customer Growth at BMO, said starting and raising a family can be meaningful but brings significant financial and emotional pressures.
She advised families to have ongoing conversations about money and create financial plans that reflect their values and long-term goals, noting that working with an advisor can help keep them on track during life’s changes.
