Canadians’ financial confidence slipping amid recession fears: survey

On the back of jumpy markets and inflationary pressures, the financial confidence of Canadians is sliding.

According to the IG Wealth Management Financial Confidence Index — based on a survey of 2,600 respondents across the country between Sept. 13 and 27 — Canadians scored a 51 for financial confidence, down from 57 a year ago. The research was commissioned by Winnipeg-based IG Wealth and conducted in partnership with Ipsos Canada.

While “Canadians remain relatively confident about the state of their personal financial situation,” a release said, their outlook for the economy has worsened. More than half (55%) said they believed the country is already in a recession, and two-thirds (68%) forecast a recession in the year to come. Almost half (46%) said the inflation rate will increase.

This sentiment follows last year’s index results, which showed confidence in the economy was already slipping.

The 2022 release noted that the financial confidence of Canadians aged 35 to 54 — the so-called “sandwich generation” often caring for children as well as elderly parents — has dropped significantly compared with a year ago, dipping 17% to 43 points.

By province, British Columbians’ confidence slid the most, to 47 points from 59, the release added.

With only 30% of respondents saying they believed financial authorities are responding well to economic pressures, the outlook for goals like home ownership are in flux. More Canadians (22%, up from 12% in 2021) predicted housing prices would become more affordable in the year to come, even while more than one-third (36%) of those aged 18 to 34 said they will postpone buying homes, the release said.

One consistent finding was Canadians who work with an advisor are more confident. The 2022 index noted a confidence score of 59 for those with an advisor versus 48 without. Almost 40% said professional financial advice is “more important than ever” given economic current conditions, according to the release.

“Canadians are trying to make sense of what’s happening around them and how it could potentially impact their personal situation, so it makes sense that those who have access to professional advice are feeling more confident,” said Damon Murchison, president and CEO of IG Wealth Management.

Katie Keir

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Katie is special projects editor for Advisor.ca and has worked with the team since 2010. In 2012, she was named Best New Journalist by the Canadian Business Media Awards. Reach her at katie@newcom.ca.