Canadians aged 18 to 34 are the most likely to use credit cards, despite being among the most anxious about their finances
A new joint survey by FP Canada and Angus Reid Forum explores the impact of a frequently overlooked area of spending - unconscious spending habits - on Canadians' financial lives.
According to the survey, many Canadians often engage in unconscious spending, or purchases done out of habit or convenience rather than with an eye toward long-term financial goals and budgets.
The Quiet Spend reports that although half (51%) of Canadians are worried about their financial situation right now, most people have not changed their unconscious spending patterns from half a year ago.
Some reported areas of increased unconscious spending include using credit cards for payments (28% more frequently than before, compared to only 13% less frequently), charging monthly subscriptions directly to credit cards (21% more frequently vs. 14% less frequently) and adding extra items to receive a "perk" like free shipping (25% vs. 20%).
"With the rising cost of living, Canadians' dollars simply aren't going as far as they once did. Now more than ever, it's critical for Canadians to be mindful of their spending habits," said Tashia Batstone, president & CEO of FP Canada.
According to Batstone, working with a professional financial planner can help Canadians better understand their overall financial picture, from identifying spends they didn't know about and setting budgets that work for them today so tomorrow can be a little easier, to providing a second opinion or simply letting them know there's someone in their corner.
The report also showed that Canadians between the ages of 18 and 34 who have seen an increase in certain unconscious spending patterns are keeping an eye on the effect on credit card bills.
Compared to other age cohorts, they were more likely to say that they’re more often using credit cards for payments (34%) and monthly subscriptions (29%) than six months ago, as well as exceeding their planned purchases on sales (28%) and turning to “buy now, pay later” schemes more frequently.
Canadians between 18 and 34 years old, as well as those in the 35-54 range, were more likely to be concerned about their current financial situation (57% and 53%, respectively) than those who were 55 years old and above (43%).
The 18-34 and 35-54 groups also estimate they’re engaging in unconscious spending habits at the same rate as they did six months ago.
The Quiet Spend study found that compared to Canadians who utilize no financial planning assistance at all (38%), a majority of Canadians (69%) who work with a Certified Financial Planner professional or Qualified Associate Financial Planner professional felt substantially better about their overall financial situation.
FP Canada advises Canadians to practice mindfulness when making unconscious purchases in response to the poll results.