New report from TransUnion shows rising prices stifled Canadian personal finance optimism

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More than half of Canadians (56%) reported that inflation and interest rate concerns continue to influence buying behavior despite current positives

Q1 2022 TransUnion’s Consumer Pulse study key findings:

  • 56% of Canadians reported being ‘very concerned’ about inflation rates and related effects

  • 60% indicated that their current household finances are Q1 2022 . employed in or better

  • 54% reported not feeling confident about the household finance outlook in the next 12 months

  • 46% indicated they were cutting discretionary spending

  • One in four (25%) reported that they do not expect to be able to pay at least one of their current bills and/or loans in full.

  • 53% indicated that rising interest rates affect their approach to applying for credit

TORONTO, April 19, 2022 (Globe Newswire) — TransUnion’s most recent consumer pulse The study* shows that while most Canadians feel positive about their current personal finances as the economy reopens, concerns about longer-term macro-economic pressures are casting a shadow on their optimism.

“Canadian families are building up their savings during the pandemic,” said Matt Fabian, director of financial services research and consulting at TransUnion. “As the impact of the pandemic subsides, we expect consumers to distribute these savings towards credit, wealth management and increased household spending. But for now, concerns over inflation and interest rates are creating a sense of worry and hesitation.”

Canadians feel positive about their current financial situation – but are concerned about the future: The latest Consumer Pulse survey showed that 60% of Canadians felt their finances were the same or better than planned in Q1 2022. This may be partly due to government subsidies supporting families during the pandemic, as well as lender debt relief. Overall, 19% reported that their household income had increased from the previous quarter, versus 54% who said it remained the same, and 28% said it decreased. However, more than half (54%) indicated that they do not feel optimistic about their household finances in the next 12 months.

Future outlook affected by inflationary and cost escalation pressures: When it comes to a longer-term perspective over the next 12 months, much of Canadians’ outlook is tainted by concerns about rising inflation and affordability. This is despite the fact that 52% of Canadians expected their household income to remain the same, and 35% expected it to increase during the following year. More than half (56%) of Canadians said they are ‘very concerned’ about the inflation rate and the associated impact when it comes to their financial outlook. These concerns influenced the purchasing behavior of 56% of Canadians.

In wait-and-see mode to access or refinance Canadian new credit: Many Canadians appear to be in ‘wait and see’ mode when it comes to accessing credit, with 78% saying they have no current plans to apply for new credit or refinance existing credit. More than half (53%) of Canadians said rising interest rates affected whether they were applying or waiting for credit. For some, the worry about being approved for credit because of their income or employment status made them more reluctant to apply. Despite the low demand for credit, 81% of Canadians agreed that access to credit is important. Among Canadians who plan to either apply for new or refinance existing credit:

  • 45% planned to apply for a new credit card

  • 28% planned to apply for a new personal loan

  • 21% planned to apply for a new mortgage, home loan or bond payment

Canadians take a cautious approach to spending: Consumers are willing to spend a little more on discretionary goods; However, many Canadians are holding back on spending and taking a more conservative approach overall.

  • 46% of Canadians reported cutting back on discretionary spending (such as eating out, travel, entertainment), versus 9% who increased discretionary spending

  • 20% canceled subscriptions/subscriptions, versus 7% who added subscriptions or subscriptions

  • 15% canceled or reduced digital services, compared to 8% additional or extended digital services

Canadians take a conservative approach to managing their debt and savings: Many Canadians reported focusing on increasing their savings and paying off debt, while, conversely, a smaller percentage reported increasing available credit and/or using their retirement savings to help manage cash flow. gave information.

  • 19% of Canadians reported they saved more in an emergency fund

  • 18% said they paid off loans faster

  • 13% increased utilization of available credit

  • Saved 10% more for retirement

  • 9% used retirement savings

Most Canadians are confident they can pay their bills – but one in four report they are struggling: When it comes to being able to pay bills, 75% of Canadians reported that they expect to be able to pay their current bills. However, one in four Canadians (25%) said they expected not to be able to pay at least one of their current bills or loans.
Of these Canadians:

  • 20% said they would borrow money from friends or family to pay their bills or loans

  • 12% said they would use money from savings

  • 7% said they would use unemployment benefits

“Although pandemic restrictions have been eased across the country supporting Canada’s economic recovery, Canadians are feeling the shock waves of supply chain disruptions and inflation-driven price increases,” Fabian said. “At least – rising food costs and skyrocketing prices at the pumps. promoting it.”

TransUnions COVID-19 Help Center Provides useful information for consumers who are concerned about their ability to pay bills and loans. The entire Consumer Pulse study can be viewed Here,

*The most recent Consumer Pulse study includes a survey of 1,069 Canadian consumers conducted between February 14 and 17, 2022.

About TransUnion (NYSE:TRU)

TransUnion is a global information and insights company that makes confidence in the modern economy possible. We do this by providing a comprehensive picture of each individual so that they can be reliably and securely represented in the marketplace. As a result, businesses and consumers can transact with confidence and achieve great things. We call this information good.® TransUnion provides solutions that help create economic opportunity, great experiences and personal empowerment for millions of people in more than 30 countries. Our clients in Canada include some of the largest banks and card issuers in the country, and TransUnion is a leading credit reporting, fraud and analysis solutions provider in the finance, retail, telecommunications, utilities, government and insurance sectors.

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