Canadians seeking advice report greater financial confidence, survey finds

Canadians who’ve worked with an advisor have greater confidence in both their short- and long-term financial situations, according to Winnipeg-based IG Wealth Management’s latest Financial Confidence Index results.

The index research, commissioned by IG Wealth and conducted in partnership Ipsos Canada, found that 80% of those surveyed who had consulted with a financial planner between September 2020 and now had confidence when it came to their finances over the next 12 to 24 months.

Conversely, only 60% of those who hadn’t consulted with a planner had the same confidence.

As for the longer-term picture – considering when and how individuals would retire, for example –  80% of Canadians who had sought advice expressed confidence, compared with 57% of Canadians hadn’t.

“Inflation and housing affordability are real concerns for many,” said Damon Murchison, president and CEO of IG Wealth Management, in a release. “It’s a perfect time to work with an advisor to either revisit or create a holistic financial plan that not only addresses the present, but also helps ensure you’re well insulated for what could come.”

Overall, Canadians were feeling more confident about their personal finances and outlooks — not only compared with last year, but even with June 2021.

The latest index found that respondents’ overall financial confidence stood at 57 points, up from 50 a year ago and up three points from mid-2021. (IG’s mid-year study was conducted between April 12 and April 19, and published in late June.)

The increase was led by those aged 55+ and 65+ as well as by new Canadians, with each of the groups reporting confidence of more than 60 points, and is generally led in every age group by those who are wealthier.

When it came to making a major purchase, people’s comfort increased from 50% to 56% between June and now. Further, 56% of those surveyed said they’re feeling good about the economic situations in their respective communities, compared with 47% previously.

Personal income has increased for the majority of Canadians in recent months as well, with 59% of respondents reporting confidence, compared with 53% in the first half of the year.

Despite these positive indicators, there was less optimism about the economic outlook for 2022.

Nearly one quarter of respondents (22%) suggested that stock markets will improve, but that result fell from 29% in June. People were more upbeat about Canada’s economy (26%) than the global economy (22%), but both results lagged the previous percentages (31% and 28%, respectively).

Confidence is also low regarding economic factors such as inflation, the affordability of consumer goods and real estate (14%, 16% and 12%, respectively) — all were new questions added for the latest survey.

There was also a gender gap when it came to financial confidence.

While the confidence of women in their short-term financial situations has improved since the first wave of 2021 research, only one in two women felt they were better off coming out of the pandemic. In contrast, 60% of men felt their situations were improved after the pandemic.

One factor was 44% of women felt less prepared than a year ago, compared with 36% of men. And, 57% of women said their financial futures appeared less clear, compared with 49% of men.

However, women are now less concerned or anxious about managing money than they were closer to the beginning of the year. For instance, 16% of Canadian women said they can enjoy life because of the way they’re managing money, up from 12% in June, closer to the 19% of men who stated the same, similar to 18% previously.

In a regional breakdown, the index suggested that while overall confidence results were similar across Canada, the leading provinces were Quebec and B.C. at 59 points. The least optimistic region was Atlantic Canada at 50.

The results tied to the index were collected through an online survey that was conducted from Oct. 8 to Oct. 14.  A total sample of 2,601 respondents from across the country participated, and weighting was applied based on age, gender, region and education level to ensure the final sample was representative of Canada’s adult population. Read the full report.