Canadians & Money 2021-2022: 70% Say Canada Is Becoming Unaffordable [Study]

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In This Article

2021 was a rollercoaster of a year for many Canadians. 

With the red hot housing and stock market, economic uncertainty from the pandemic and rapid increases in the inflation rate, Canadians are justified in wanting to firmly close the door on 2021.

And yet, in 2022, the pandemic continues to put stress on pre-existing socioeconomic divisions, with lower-income Canadians feeling the pinch the most. The inflation rate in Canada hit 5.1 per cent in January 2022, the highest since 1991, and housing affordability is at a 31 year low.

We wanted to take the temperature on this unique situation. Which is why we asked over 1,500 Canadians about their financial wins (and setbacks) from 2021, as well as their outlook for 2022, as part of our first inaugural Canadians and Money Survey.

The result? Most Canadians believe Canada is becoming too expensive to live in, but the majority still consider themselves financially resilient. We also uncovered positive trends in terms of savings rates and worrisome data about a lack of emergency funds.

Let’s dive in.

Key findings

  • 70 per cent of Canadians say Canada is becoming unaffordable
  • 40 per cent of Canadians had to pull from their savings in 2021
  • 42 per cent are feeling more stressed
  • 63 per cent are concerned about the impact of rising interest rates on their mortgage payments
  • 86 per cent of people are facing barriers to homeownership
  • 65 per cent of parents consider themselves financially resilient
  • 45 per cent of Canadian parents still made regular contributions to savings in 2021
  • 70 per cent say that they would have six months or less of a financial cushion if they or their partner lost their primary source of income
  • 1/3 of Canadians have one month or less of a financial cushion
  • 44 per cent of Canadians don’t have life insurance, 40 per cent of which say it’s because they can’t afford it.

Survey results are clear: many Canadians are worried about their finances, but they’re also taking positive financial actions to protect their households.

Seventy per cent say that Canada is becoming unaffordable, 40 per cent had to withdraw from savings in 2021, 42 per cent felt more stressed in 2021 compared to 2020 and 63 per cent were concerned about potential interest rate hikes in 2022.

Yet, most Canadian parents feel in control of their money, 65 per cent still feel financially resilient and 45 per cent contribute to savings. 

This is definitely news worth celebrating during the ongoing, uncertain economic environment created by COVID-19.

Still, ⅓ of Canadians only have a month or less of emergency savings and 44 per cent don‘t have life insurance.

With costly rates making most Canadians timid of life insurance, comparing insurance quotes is necessary to save money. It is also important to research prior to determining what coverage you need.

Our medical life insurance Canada reviews, is a safe bet for those looking for coverage without the hassle of an exam. On the other hand, you can purchase last to die insurance.

Let’s dive into the stats by category and try to make sense of them given everything that happened in 2021.

70 per cent of Canadians say Canada is becoming unaffordable

With our inflation rate reaching an all-time high last fall and the ongoing housing crisis, it’s no wonder that 70 per cent of Canadians told us that Canada is becoming unaffordable.

Headlines from 2021 speak volumes:

  • I’ll Never Be Able To Buy A Home & I’m Not Alone (Refinery29)
  • Severe drought in Western Canada will pressure food industry, raise prices (Global News)
  • Halifax housing ‘market’ excludes far too many (Chronicle Herald)
  • Experts warn Albertans to lock in gas and electricity rates as prices set to soar (CBC Edmonton)
  • Parents are giving their adult kids an average of $130k to help buy homes in Toronto (BlogTO)
  • From forestry to resorts, the economic fallout from B.C.’s devastating wildfires (The Globe and Mail)

From climate change to housing affordability and supply chain issues to a widening gap between rich and poor, Canada is clearly struggling. Even as Canadians themselves strive to shore up their personal finances.

Let’s tackle this issue by issue, and look for bright spots where we can.

Inflation, income inequality and child care statistics and infographic, Canadians and Money Survey 2021-2022

The struggle with inflation rate increases and cost of living

You may have noticed in 2021 that the price of everything, from used cars to gas and even food, shot up.

So it’s not surprising that 30 per cent of Canadians are worried about inflation

Inflation isn’t expected to slow down anytime soon, either. RBC predicts that inflation rates will increase in Canada in 2022 and will remain higher than pre-pandemic levels until at least 2023. 

According to the RBC report, demand remains strong for goods and services, while supply chain issues, labour shortages and higher material costs continue to impact global economic recovery.

The CTV News article reports that last November, gas prices were over 40 per cent higher than a year ago, and food prices have increased almost four per cent. Many parents worry about how they’ll feed their family, and young adults struggle to secure stable employment.

Some Canadians are more anxious about cost of living increases than others. In Saskatchewan and Manitoba, 37 per cent of residents expressed concern about the rising cost of goods and services, compared to 22 per cent of British Columbia respondents. 

That’s probably because 51 per cent of Saskatchewan and Manitoba residents said they are $200 or less away from financial insolvency at the end of the month, according to a Consumer Debt Index report from July 2020.

This is likely due to loss in wages plus increases in groceries, utilities and online shopping in the region, leaving little left over at the end of the month.

What’s one thing Canadians should stop doing?

“In 2022, reduce eating out, bring a lunch, lower utility bills or cancel them, shop smart using coupons and coupon apps. Buy clothes on sale or at second-hand shops … Practice budgeting and if you fail, try again. It's a lifeline many Canadians choose to ignore, believing that everything will be alright."

- Mr. CBB, CEO of Canadian Budget Binder

Parents are feeling the effects of inflation even more

The rising inflation rate is especially difficult for families with children. 

47 per cent of Canadians think food is the most expensive and/or challenging child-related spending expense to manage, with 43 per cent citing clothing, shoes and other accessories.

38 per cent of parents said that keeping their kids involved in sports, arts and/or other extracurricular activities is getting to be expensive or difficult.

Paying for childcare is another biggie. For 30 per cent of respondents, childcare costs are the most expensive and/or challenging child-related spending category. 

Forty-one per cent of respondents in both Saskatchewan and Manitoba said childcare costs were the most expensive and/or challenging kid-related expense, compared to only 22 per cent in Alberta.

This is curious since a 2021 study showed that Regina’s median toddler child carefees were $675 per month and Winnipeg’s were $451 in 2020.

This compares to a high of $1,578 in Toronto and a low of $181 in Quebec. 

This could be because nationally, average weekly earnings increased by 2.6 per cent compared to only 1.5 per cent in Saskatchewan from September 2020 to September 2021, according to Statistics Canada

In fact, this is the lowest per cent increase after Prince Edward Island (0.3 per cent). 

Manitoba, on the other hand, had a nice 3.8 per cent bump year over year.

That said, Manitoba has been slammed by higher than average inflation rates in comparison to the rest of the country. Inflation was 4.4 per cent in August 2021, compared to 4.1 per cent nationally. Rising meat and gas prices and a drop in housing affordability all contributed to the crunch. And expected cost of living increases in 2022 will put even more pressure on these families.

What’s one thing Canadians should start doing in 2022?

“Invest 10% of their pre-tax income in the market. Compound interest is a powerful force, you'd be shocked how many middle-class families become millionaires just by putting away a few hundred dollars a month. A lot of people think they can't afford to do this, but try and treat it like a tax or almost like an expense you have to pay every single month.”

- Noel Moffatt, Founder of the Financial Geek Blog

The state of homeownership in Canada

The real estate market in Canada is hotter than ever. And yet:

Twenty-five per cent of Canadians told us that homeownership is becoming more and more unaffordable for middle-class and lower-income Canadian families. 

Owning a home is especially expensive in Ontario and British Columbia, where 32 per cent of Canadians in each region identify with this statement. Only 14 per cent of people in Alberta and Saskatchewan/Manitoba regions agree.

Research from the Canada Mortgage and Housing Corporation (CMHC) is in agreement: 65 per cent of homebuyers paid the most they could afford on their home purchase in 2021.

Boosting the housing supply would help slow down price increases, but it’s not easy to do. 

Despite rising housing prices, our survey results show that 65 per cent of Canadians own their own homes, and 28 per cent are renters. 

Here are our main findings about Canadians and homeownership:

Real estate, home ownership and housing statistics and infographic, Canadians and Money Survey 2021-2022

The dream is alive for homeownership in Canada

A place to call our own–the dream of so many Canadians.

Whether it’s a studio condo in a busy metropolis, a stacked townhouse in a suburban development, a trailer on a wooded lot, a creaky century home by the ocean, friendly co-op housing or a custom off-the-grid tiny house, we all have different dreams of home, fed by fantasy (and fenced in by the reality of our socioeconomic status).

It doesn’t hurt that we’ve seen record-low mortgage rates in the past year. In December 2020, home buyers could get a five-year mortgage rate below one per cent, a first in Canadian history. The average was 3.14 percent in 2019, says The Walrus.

So given favorable mortgage rates, it’s no surprise that 39 per cent of Canadian renters are looking to purchase a home in the next five years. 

The vast majority of people believe that homeownership is a smart long-term financial investment, even during a pandemic and uncertain housing market, according to the CMHC study mentioned above. 

On top of that, three-quarters of people expect their home’s value to increase in the next 12 months. Many plan on completing renovations to help improve their home’s value even more.

Here's one hopeful fact: Canada's not in a housing bubble in 2022, at least according to BMO senior economist Robert Kavcic. He defines a housing bubble as a phenomenon where "prices accelerate simply because people think prices are going to rise further." Housing affordability is a concern, but we're not at the level of a housing crisis in 2022. Or at least not yet.

Housing affordability is less critical for Canadians earning $50k+

And yet: there’s huge income disparity in who actually believes they can buy a home in our overheated housing market. 

Forty-eight per cent of Canadians with household incomes between $50,000-$100,000 continue to seek homeownership, compared to only 25 per cent of those earning less than $50,000. 

After all, Canada actually has the lowest number of housing units per 1,000 residents of any G7 country, according to The Walrus article mentioned above. 

We’ve all heard stories of homes going for way over asking, fierce bidding wars and a general lack of housing stock on the market (especially affordable housing).

Case in point, this CBC headline from last May:

“Buyers fed up with blind bidding, other shenanigans in red-hot real estate market”

That pretty much sums it up.

That’s why, 61 per cent of Canadians seeking homeownership believe that there are not enough affordable options available

And it’s not just Vancouver and Toronto being affected. All of the following markets experienced a decrease in housing affordability, according to a National Bank of Canada Q3 2021 study.

From worst housing affordability deterioration to least:

  1. Vancouver
  2. Victoria
  3. Toronto
  4. Ottawa-Gatineau
  5. Hamilton
  6. Montreal
  7. Calgary
  8. Quebec City
  9. Winnipeg
  10. Edmonton

Hamilton, previously a more affordable place to buy a house, is currently being squeezed by low inventory and high demand, with a 20 per cent price increase year over year from August 2020 to August 2021. It’s a trend that’s being repeated across the country.

Down payments continue to be a serious barrier to homeownership

Soaring home prices means that having enough cash for a down payment is getting tougher and tougher.

The average home price was a whopping $720,850 in Canada as of November 2021.

Which is why saving enough for the down payment is a barrier faced by 56 per cent of people, according to our study.

Consider that the average household income of Canadians was $62,900 in 2019, according to Statistics Canada.

And that the average mortgage payment, as a percentage of income, rose 1.7 points in Q3 of 2021 (after a 3.2-point increase in Q2) and home prices rose 4.6% while the median household income rose only 0.8%.

Especially when you consider that paying 20 per cent of the purchase price is required to avoid mortgage default insurance

A 10 per cent down payment is required for homes priced over $500,000. 

If the average home price in November 2021 was $720,850*:

  • A 20% down payment would be $144,170
  • A 10% down payment would be $72,850, with a monthly payment of $3,161.65 (includes mortgage insurance)

*Numbers based on a 3% mortgage interest rate over a 25 amortization period.

These numbers obviously don’t include transfer taxes, closing fees and all the ongoing expenses of maintaining a home.

So it’d take about seven and a half years to come up with a 10 per cent down payment on a household income of $62,900 (income after tax in Ontario: $47,791) saving at a rate of 20 per cent.

And assuming that nothing goes wrong i.e. someone loses their income, inflation keeps going up, rent increases etc.

All this pales in comparison to the upwards battle people face in Canada’s hottest housing markets.

To buy a house in Toronto, you’d need to save for 330 months with a yearly salary of $196,913 (saving rate of 10%), according to that National Bank of Canada study.

Which is an astounding 27.5 years, which possibly makes sense if you start saving when you’re about five years old.

At least condos take about 58 months – as long as you have a six-figure salary. 

What’s one thing Canadians should start doing in 2022?

“Start investing. There are many people that fear the stock market due to it currently being overvalued or have some perception of extensive risk in the markets. Whether they heard about a family member losing it all or a company going bankrupt. So, they simply hold too much of their capital in savings. The reality is the stock market has been known as one of the best possible ways to fight inflation over the long term and increase your buying power. Whether it be stocks, bonds, mutual funds, or exchange-traded funds, it's important Canadians find something that works for them and get started as soon as possible.”

- Dan Kent, Stocktrades

Rising mortgage interest rates is cause for worry (except there may be nothing to worry about

For Canadians who are fortunate enough to own a home in today’s tough real estate climate, it’s often anything but trouble-free. 

The fact that interest rates are likely going up in 2022 worries 63 per cent of Canadians, in terms of how it'd impact their mortgage payments.

Alberta respondents are the most concerned. In fact, Albertans self-reported as being the most financially stressed in the country.

And there’s good reason for that: Alberta’s economy is further behind than other provinces, it’s experiencing a sluggish economic recovery and has a high provincial unemployment rate of 7.6 per cent as of November 2021, according to The Calgary Herald

Studies have also shown that many Albertans have little to no money left over at the end of the month, which would make any mortgage interest rate hike in 2022 painful. 

We also found that eight per cent of Albertans are more likely to spend 40 to 49 per cent of their income on their mortgage for their principal residence, compared to the national average of five per cent. 


Canadian mortgage holders are going to make it through any interest rate increases, reports Maclean’s. Which is good, since the Bank of Canada has signalled that interest rates are definitely going up in 2022. Money markets project the current interest rate will increase from 0.25 per cent to 0.5 per cent in March 2022, with at least five increases total expected over the course of 2022.

About 75 per cent of mortgages at present are locked in at fixed rates, while floating rates that renew in 2022 should see about $50 in extra payments per month and 2023 renewals should see $65 in additional monthly payments.

$50 extra can seem like a lot. Then again, Canadian borrowers have to prove they can deal with rates about 180 basis points (bps) higher under federally mandated stress tests. Interest rate hikes of only 36 to 45 basis points are projected for 2022 and 2023 respectively in Canada.

New borrowers in 2021 actually had to prove they could handle a 5.25 per cent interest rate, which is about 250 bps higher.

Variable rate mortgages did increase in 2021, but they still only account for about a quarter of all mortgage balances outstanding. Plus, variable-rate terms usually lengthen amortizations in response to rising rates; they mostly don’t trigger bigger monthly payments.

Our guide to fixed versus variable mortgages has more details about the pros and cons of each in 2022.

What’s one thing Canadians should start doing in 2022?

“Canadian families should be stress testing their own finances. With interest rates heading higher as soon as March 2022, those with debt tied to prime rate should make sure they can handle the higher debt payments, if and when they arrive.”

- Sean Cooper, Mortgage Broker and Author of Burn Your Mortgage

Except in Quebec, where the opportunity cost of homeownership is higher

Compared to the rest of Canada, those who live in Quebec are the least likely to own their own homes. 

Only 59 per cent of Quebec respondents are homeowners, versus 75 per cent in the Prairies, 69 per cent in British Columbia and 63 per cent in Ontario.

Thirty-six per cent of people living in Quebec are renters, when the country-wide average is 28 per cent. 

Potential reasons could be that lower income renters in Quebec can’t afford any homes on the market, even the lowest priced options. Even higher income renters face few options, which puts more pressure on the rental market and drives rent up, according to a December 2021 study by the CMHC.

The average home price in Quebec was $459,955 in September 2021. The average income in Quebec was around $51,700, making the average home price about 8.8 times the average income. Neighboring New Brunswick’s home prices are a more affordable 5.2 times the average income, though Ontario’s are a staggering 16 times more.

That said, 13 per cent of Quebec residents spend less than 10 per cent of their monthly household income on their mortgage. Only six per cent of people nationwide can say the same.

My city is becoming unaffordable, but I probably won’t leave

Despite the rising cost of living in major city centres, most Canadians would continue to choose urban or suburban living.

Fifty-two per cent of urban/suburban Canadians told us that they would not consider moving to a smaller town or rural area to save money on housing and other cost of living expenses.

Twenty-five per cent would consider relocating to a smaller town or the countryside.

Ontarians (30 per cent) and Greater Toronto Area residents (35 percent) were most likely to say they’d consider moving to save money.

People aged 18-34 were also more likely to say they’d consider moving (32 per cent), as are unemployed people (41 per cent versus 26 percent of employed folks).

The higher a renter’s annual income, the less they spend on rent

There’s a common belief that renting’s cheaper than owning. Our results show that the opposite is actually true: renters spend more on their rent than homeowners pay on their mortgages.

The difference is significant: 38 per cent of renters spend 40 per cent or more of their income on housing, yet only 14 per cent of homeowners spend a similar amount on mortgage payments

The higher a renter’s annual income, the less they spend on rent. 

  • For renters with a household income of less than $50,000, an average of 40.7 per cent is spent on rent. 
  • But when there’s a household income of $50,000 to $100,000, only 33 per cent goes towards the cost of rent.

Then again, there are many additional costs associated with homeownership such as property taxes, utilities and repairs that can add up to 40 per cent more than your mortgage costs alone, according to My Money Coach.

At least Canada’s rental market became much more affordable during the pandemic, though some Canadians struggled to pay their rent, causing provinces such as Ontario to put a halt to evictions

Though average rental prices today haven’t reached the level of 2019 yet, luxury rental prices with 6 or 4 bedrooms are well on the rebound – likely folks with good salaries working from home wanting more space.

Chart detailing the following: Average rent by month for all property types, listings in Canada, January 2019 to November 2021

Source: December 2021 Rent Report

Average rent is still highest in British Columbia and Ontario, but Nova Scotia has also reported a spike thanks to Ontario residents moving back, which has driven down available listings and driven up rent.

Looking for an alternative to homeownership

Not all Canadians are able to buy their own home or are interested in buying their own home. Alternative living arrangements are on the rise in the face of rising mortgage interest rates and Canada's housing affordability crisis. 

There’ve been stories about friends or family banding together to co-buy property, such as the six friends who bought a $1.3M Toronto home together

And there’s also the prospect of renting indefinitely and investing your down payment to build a nest egg.

In Alberta and Ontario, nine per cent of respondents have alternative living arrangements, such as living with their parents or other family members. 

Ontario’s high rent and home prices make this choice obvious; this trend in Alberta could be because of economic struggles, which we discussed earlier.

In British Columbia, only four per cent of people have alternative living arrangements, which is surprising given that the province’s housing prices are typically higher. 

This could be due to British Columbia’s commitment to helping out its renters. Announced in 2019, the government’s spending more than $7 billion over ten years to create new affordable rental homes for low-to-moderate-income British Columbians. 

Rather than live with family members, many British Columbia respondents can continue to afford renting.

Top financial stressors of Canadians in 2021

Younger peopleRob Carrick from The Globe and Mail recently said: “The past year in personal finance has been like watching the events of a normal decade or two played at high speed.”

Inflation, the worst housing affordability in 31 years, a hot stock market and economic trouble resulting in a big jump in the use of food banks – it’s no wonder that 42 per cent of Canadians are more stressed about their finances compared to 2020, with parents and younger Canadians especially worried. 

Only 22 per cent of respondents were less stressed about money compared to 2020. 

Here we’ll dig into why. We’ll also deliver you hot tips from personal finance experts to help you get more control of your money – because the last thing we want is to make you more stressed and depressed! 

Personal finance, affordable housing, cost of living statistics and infographic, Canadians and Money Survey 2021-2022

Groceries is the biggest strain on most people’s budget

For 25 per cent of people, putting food on the table causes the largest strain on their finances. Unfortunately, this pressure may worsen before improving due to rising food inflation costs.

Multiple factors contribute to food cost increases, says The Globe and Mail, like:

  • Poor weather conditions
  • Supply chain delays
  • Labour shortages 
  • Higher production costs due to increased energy prices

In September 2021, food prices soared to the highest annual rate since early 2016. The Globe and Mail also found that rising food costs aren’t limited to Canada only: there has been a 30 per cent increase in global-wide food costs over the past year.

Although the price of food typically increases as the growing season ends in most of North America, it’s not predicted to slow down anytime soon. 

What’s one thing Canadians should stop doing in 2022?

“Hoarding cash. With pandemic shutdowns and economic stimulus, the household savings rate in Canada has never been higher. But, with the current rate of inflation at the highest levels we've witnessed in quite some time as well, your money is also losing a significant amount of buying power every year. Hoarding it in a savings account paying you 0.25% or less is not optimal.”

- Dan Kent,

Rental prices, credit card debt and rising fuel costs also causing strain

Besides the cost of groceries, other expenses are creating significant financial strain on people’s finances. 

For 15 per cent of Canadians and 17 per cent of Ontario respondents, rental prices generate the most stress. 

Credit card debt payments are the runner-up. Nineteen per cent of those living in Atlantic Canada struggle with credit card debt, compared to 14 per cent of Canadians overall. 

There are many reasons for Atlantic Canadians’ debt problem, explains the University of King’s College School of Journalism

Half of Atlantic Canadians live paycheque to paycheque. Nova Scotians have the second-lowest salaries in the country. Atlantic Canada also ranks second in the country for the highest rate of loans at least three months in arrears. 

It’s no wonder that Atlantic Canadians are taking on more credit card debt to try to bolster themselves in a suffering economy.

What’s one thing Canadians should start doing in 2022?

“Pay down debt as fast as possible. The coming tsunami of short-term inflation will cause the government to react with higher interest rates.”

-Alan Whitton,

Besides groceries and rent, rising fuel costs have caused gas and transportation to be another economic burden. 

Nine per cent of Canadians worry about the cost of gas/transportation and 16 per cent of respondents in the Prairies. 

Gas prices are hitting record highs thanks to the global energy crisis and for those in areas without reliable public transit, which is many places, it’s impossible to avoid the pinch at the pumps.

Albertans are the most stressed about their personal finances compared to 2020

In Alberta, 28 per cent of people reported higher stress about their personal finances in 2021 than in 2020. Only 14 per cent of people in British Columbia feel the same.  

Even before the pandemic, Albertans were already experiencing a very unstable economy. Output from the province’s biggest industry, the oil and gas sector, fell by 22.2 per cent in 2019

The province’s construction, manufacturing and retail industries also suffered. Unemployment numbers ran high (7.3 per cent in December 2021 compared to 5.9 per cent nationally), and COVID-19’s travel restrictions halted economic activity even further. 

To help ease their financial burden, 12 per cent of Albertans downsized their housing in 2021. They either moved to a cheaper rental unit or house or moved in with parents or roommates. 

Most Canadians reduced their spending on restaurants/dining out to compensate

With the cost of living increasing, Canadians have had to decide where to cut household costs.

Over half (57 per cent) of Canadians chose to reduce their spending on restaurants and dining in 2021, and 48 per cent spent less on takeout and delivery. 

That said, those who could choose to cut back on eating out were lucky. There was a 20 per cent surge in the use of food banks from 2019 to 2021, according to Food Banks Canada.

Fifty-three per cent of people cut activities and entertainment costs instead to compensate. 

What’s one thing Canadians should stop doing in 2022?

“Many Canadian families subscribe to multiple monthly services for things like gaming, music, TV and movies, podcasts, meal boxes and fitness. Most subscriptions come with a fairly low monthly fee, but even low fees start to add up if you have enough of them. If you added a lot of subscriptions in 2021, try doing a "subscription audit", keeping the ones you actually use and canceling those you no longer want or need.”

- Robin Taub, author, The Wisest Investment: Teaching Your Kids to Be Responsible, Independent and Money-Smart for Life

Younger people searched for a new job instead

To help improve their financial situation, many Canadians chose to seek new employment in 2021 instead of only cutting back on costs. 

Thirty-two per cent of people ages 18-34 searched for a new job, compared to 20 per cent of people 35-54 years old.

Cast into low-skill jobs with massive student debt, maybe younger folks feel job hopping is their best opportunity to find a (marginally?) better paying position.

Despite their stress, Canadians are feeling financially resilient in 2021

Despite all the bad news, financial resilience, or the ability to overcome economic hardship, stressors and shocks resulting from unplanned life events, is still within reach for most Canadians.

Savings rates, consumer spending, investing and estate planning statistics and infographic, Canadians and Money Survey 2021-2022

Pandemic, what? Canadians are feeling pretty okay about their personal finances

2021 wasn’t a great year for so many reasons, but many Canadians are still feeling hopeful about their personal finances.

Sixty-five per cent of Canadians consider themselves financially resilient, and 67 per cent feel in control of their finances. 

According to Statistics Canada, the national average financial resilience score improved between February 2020 and June 2021 from 49.58 to 55.67, despite the ongoing pandemic. 

Unsurprisingly, men fared better than women and single-parent families in terms of perceived financial resiliency.

Why the positive trend? The pandemic forced Canadians to change their spending habits and tighten their budgeting

The household savings rate was around 3 per cent just before the pandemic and by mid-2020, it shot up to 28.2 per cent, and was 14.2 per cent in July, 2021.

The financial help given through the Canadian government’s COVID relief measures also helped people be more financially resilient.

What’s one thing Canadians should stop doing in 2022?

“Don't load up on bonds. With the current low interest rate, Canadians should be wary of having too many bonds in their investment portfolio.”

- Bob Lai, Personal Finance and FIRE blogger

Canadians saved 20 per cent of their income in 2021 (good job!) 

When Canadians didn’t spend their money due to lockdown measures and fear of catching COVID, they put it towards savings.

And it’s paid off. Canadians are on track with budgeting according to the well-respected 50/30/20 rule, which advises that 20 per cent of after-tax income should go towards savings. 

Forty-five per cent of people made regular contributions to savings in 2021, using 20 per cent of their net income.

Investing in RRSPs and TFSAs is particularly popular amongst young adults. Compared to a nationwide total of 37 per cent, 45 per cent of people ages 18-34 made regular contributions to their RRSP/TFSA in 2021.

Between spending less and collecting money from government support programs, the average Canadian saved more than $5,000 during 2020

The personal savings rate declined at the end of 2020 but rose again when lockdowns returned in 2021. Much of the savings were spent on paying down debt and putting money into investments.

Saving rates in 2022 depend on whether wage increases will counter inflation rates and the cost of housing.

Other financial wins from 2021, life insurance still lagging behind

Three in five Canadians took a positive financial planning action in 2021.

Other than 37 per cent contributing regularly to an RRSP/TFSA, 26 per cent met with a financial advisor, 22 per cent made regular contributions to their retirement plan.

Six percent bought life insurance. Unfortunately, 44% of Canadians don’t have life insurance, 40% of which say it’s because they can’t afford it.

The good news is that life insurance in Canada isn’t as expensive as Canadians might think, which makes it easy to get term life insurance at accessible prices. PolicyMe can help find the best life insurances in Canada, tailored to every everyone's needs.

And with rising household debt levels and growing economic pressures, purchasing life insurance policy to cover your mortgage and other debts, kids’ education and day-to-day expenses is a smart step towards improving your financial resiliency.

Trying to figure out your life insurance needs? Use our easy online life insurance calculator to figure out how much coverage you need in seconds.

Read more: Canadians Life Insurance Statistics (2022)

The state of employment in Canada

Although some industries like fitness, travel and restaurants have been slower to recover from the pandemic than others, most Canadians said they didn’t experience any negative effects on their employment in 2021, which is more much-needed happy news going into 2022. 

76 per cent of Canadians said their employment wasn’t negatively impacted

Just over three-quarters (76 per cent) of Canadians’ employment didn’t change in 2021.

This includes being laid off, furloughed, losing their job or taking a pay cut or leave of absence; working shortened hours or having decreased responsibilities; or working for a company that reduced its hours of operation, closed temporarily or shut down.

Eight per cent of Canadians had shortened hours or decreased responsibilities at work. 

These work changes were most common in Atlantic Canada, where 11 per cent of Canadians experienced this situation, versus seven per cent in Ontario and Quebec.

Fortunately, for the 24 per cent of people who said they’d experienced a job loss, shortened hours or a pay cut, the experience was short-lived

Our survey results showed that some people were hired back or had hours/pay restored at their original company. 

Some were able to get a new job at a lower salary or with fewer hours, while others fared even better – by finding new employment at the same or increased pay and number of hours.

Quebec has the most vacant positions of any province, making it easier for job seekers to find employment. The region has shortages in numerous industries, with most vacant jobs requiring only a high school diploma. 

Women have been slower to recover from job loss

Not everyone has been fortunate enough to avoid changes in employment.

Sixty-three per cent of men and 45 per cent of women said they could secure employment again, with those in Quebec the most likely to. 

Overall, the pandemic has caused women’s employment rates to suffer more than men’s. There are now 858,000 fewer jobs in industries including hospitality, retail and food – places where women make up the majority of the workforce and which are more vulnerable to lockdown measures. 

CBC also reports that almost 100,000 working-age Canadian women have completely left the workforce. The longer they remain unemployed, the harder it will be for them to secure a job in the future.

Unlike other recent recessions, this one’s disproportionately affecting women more than men. Women have been ten times more likely to leave the workforce during the pandemic. 

Plus, when school closures happened, women were more likely to take time off work, leading to the loss of more paid hours than men (26 per cent versus 16 per cent).

We also found that more men than women received bumps in their pay (32 per cent versus 22 per cent). 

Sadly, this is par for the course. Women with the same experience, socio-economic and demographic background earn about $7,200 less per year than men in Canada, according to the Canadian Women’s Foundation.

77 per cent of Canadians said their income either increased or stayed about the same in 2021

Incomes increased in 2021 for 27 per cent of people, compared to 23 per cent who experienced a decrease in pay. 

Half of Canadians’ incomes didn’t change at all in 2021.

Another curious fact: the higher your pay, the more likely you were to get a raise in 2021.

Thirty-four per cent of people earning $100,000+ said their income increased in 2021, but only 20 per cent of people’s income increased when it was less than $50,000

CTV News reports that the lower the pay grade, the worse the job market performance was in 2020. All of the country’s job losses due to COVID-19 affected people making below-average wages.

Still, it’s clear that many Canadians don’t have a financial cushion to fall back on

As we saw above, Canadians are feeling overwhelmingly positive about their financial resilience and whether they have control of their money.

And yet, our study found that Canadians are leaving themselves financially vulnerable by not having a sufficient emergency fund or having life insurance, which are a key part of weathering life’s financial ups and downs.

Savings rates, emergency fund, income inequality statistics and infographic, Canadians and Money Survey 2021-2022

1/3 of Canadians have 1 month or less of a financial cushion

No matter their employment type or income amount, Canadians need to prepare for the unexpected.

The Canadian government’s recommendation is to save the equivalent of three to six months of regular expenses or three to six months of income.

And yet 1/3 (32 per cent) of Canadians lost their primary source of income, they would have only one month or less of a financial cushion for expenses. 

Lower-income Canadians are much more vulnerable to financial shocks.

Half (50%) of Canadian households who earn less than $50,000 a year could cover no more than one month of expenses if they were to lose their primary source(s) of income.

This is more than twice the proportion of high-income households earning $100,000+ per year who say the same (20 per cent).

Only 15 per cent say they’d have six months’ worth of funds to cover loss of income. 

What’s one thing Canadians should start doing in 2022?

“If we've learned anything from the past few years, it's how important savings is. An emergency fund is a good idea for anyone and everyone. Not only does it give us money with flexibility to withdraw from and to build back up, but it won't mean dipping into long-term savings, for things like school, mortgage and/or retirement savings.”

- Lisa Hannam, Executive Editor, MoneySense

Canadians are having to pull from savings to afford extra expenses

For 40 per cent of Canadians in 2021, savings came in handy to cover extra or unexpected expenses, possibly due to unexpected job losses and rising inflation rates. 

Twenty-four per cent of Canadians dipped into their emergency savings and 16 per cent withdrew from their TFSAs to cover unexpected expenses.

Those who live in Alberta were the most likely to use their savings in 2021. Combining the province’s oil and gas industry downturn with pandemic-related unemployment has made it especially hard to keep up financially. 

Forty-eight per cent of Albertans used their savings to cover extra or unexpected costs. 

Whether they needed it or not, 13 per cent of Canadians didn’t pull from their savings or investments because they couldn’t. They didn’t have any. 

Thirty-six per cent of Canadians didn’t have to use their savings or investments at all.

In the Prairies, 32 per cent of people used their investments compared to 23 per cent in Alberta and 25 per cent nationwide. 

Only 20 per cent of those living in British Columbia had to withdraw from their investments, the lowest region across Canada.

British Columbia’s five billion dollar COVID-19 relief plan has helped many deal with the financial fallout from the pandemic. It included a freeze on student loans, postponed tax increases, postponed tax deadlines for businesses and an increase in the B.C. Climate Action Tax Credit.  

What’s one thing Canadians should start doing in 2022?

“Every family needs a financial safety net. If you don't already have one, try to build up an emergency fund, roughly three to six months' worth of living expenses in cash reserves. You also want to make sure you have adequate life and disability insurance.”

- Robin Taub, author, The Wisest Investment: Teaching Your Kids to Be Responsible, Independent and Money-Smart for Life

44 per cent of Canadians don’t have life insurance

Thirty-three per cent of parents and 44 per cent of Canadians lack life insurance coverage.

Even if parents have life insurance through their work benefits, it’s often not enough to protect their whole family. 

Or they’ve bought permanent life insurance, such as whole or universal life insurance, which is better suited for folks with complex financial situations. 

Our previous study found that almost half (49 per cent) of Canadians bought permanent life insurance – of those who bought it through an advisor (as opposed to accessing it through work benefits).

Permanent life insurance is costly, complicated and often unnecessary.

Luckily, term life insurance is more affordable than Canadians think, simple to apply for and provides robust protection for families when they actually need it i.e. when the kids are young and debts like mortgages are at their highest. 

Financial outlook for 2022

2022 is definitely going to be an, how should we put it, interesting year for Canadians and their finances.

The Canadian economy is projected to improve in 2022 but inflation is definitely here to stay, says The Toronto Star. We’ll likely see a 3.5 per cent increase in the Consumer Price Index (CPI), though that’s definitely better than the 4.7 per cent increase we saw last November.

And the bananas housing market? It’ll continue, with excess demand, low inventory and housing prices expected to increase by 4.25 to 5 times in Toronto, Vancouver and nationally, says Maclean’s.

Life’s going to be expensive in 2022. Thankfully, Canadians are gearing up to batten down their financial hatches, build their nest eggs and otherwise adjust, once again, to our new reality.

Personal finance, inflation, cost of living, mortgage interest rate statistics and infographic, Canadians and Money Survey 2021-2022

Canadians anticipate costs will continue to go up in 2022

Last November’s spike in consumer good prices, most noticeably passenger vehicles, furniture, vegetables, meat and pasta (pasta?!), definitely has Canadians bracing for more of the same.

77 per cent of Canadians anticipate grocery costs rising in 2022. 

The higher shipping costs and supply chain disruptions of fresh vegetables, notably cucumbers, mushrooms and broccoli, spiked prices last November and prices of fresh beef went up 15.4 per cent – though this was more due to bad weather conditions and crop yields for livestock feed.

66 per cent are bracing for price hikes in gas and transportation. The latter is no surprise given gas prices rose an astounding 43.6 per cent higher last November, compared to November 2020.

The culprit? The slowdown of oil production coupled with increased demand. 

And with CPI rising 4.7 per cent last year and wages only rising 2.8 per cent, the purchasing power of Canadians took a hit.

Many Canadians managed to squirrel away nice chunks of savings during the pandemic. But inflation threatens to erode those savings in 2022.

27 per cent of Albertans anticipate their credit card repayments will go up versus 20 per cent nationally.

Albertans are also more likely to anticipate these costs going up, too: recreational activities, groceries, gas, restaurants/dining out, clothes and their mortgage interest rate.

What’s one thing Canadians should start doing in 2022?

“If your family plans on traveling, you'll want to consider getting COVID-19 travel insurance. This helps to cover COVID-19 related medical expenses and trip interruption coverage … The worst thing that can happen to you on your vacation is you're traveling abroad and incur expensive medical costs because you've contracted COVID-19."

- Sandy Yong, Keynote Speaker and Award-Winning Author of The Money Master

Paying down debt is Canadians’ top financial priority for 2022

28 per cent of Canadians said paying down debt was their top financial priority for 2022. 

This is interesting because non-mortgage debt actually fell by a record $20.6 billion from March 2020 to January 2021, with credit card debt in particular dropping by $16.6 billion, says Statistics Canada.

CERB benefits and limited ways to spend money meant Canadians could pay down non-mortgage debt at astonishing rates.

Personal finance, debt statistics, retirement savings, home renovation statistics and infographic, Canadians and Money Survey 2021-2022

Paying down their debt was of highest concern overall in Alberta and Atlantic Canada, at 37 per cent and 41 per cent respectively. 

Seventeen per cent said their top financial priortity is having a sufficient emergency fund, which is great since our study found that many Canadians lack a proper financial cushion.

One curious statistic: 10 per cent of people in Atlantic Canada are saving to renovate their home. 

This could be all the folks from other provinces who moved there during the pandemic and who are looking to fix up their new properties.

What’s one thing Canadians should stop doing in 2022?

“Spending too much on their credit cards. It's so easy to spend money on credit that people tend to overspend. I understand credit cards have rewards and points which is all great, but if you overspend on your credit cards to the point where you’re losing money even after all the rewards, then is it really worth it? I'm not saying don't spend on credit cards, but just try not to overspend.”

- Noel Moffatt, Founder of the Financial Geek Blog

In summary: Canadians are working hard to try to protect themselves from economic uncertainty going into 2022 

It’s not all sunshine and roses for Canadians and their personal finances going into 2022. 

Canadians are having to brace for rising inflation, with wage increases not keeping pace. Savings shored up during the pandemic will be eroded. And those who are not already homeowners will have a tough time entering the housing market.

And yet Canadians are saving over 20 per cent of their earnings, seeking out the advice of financial advisors, prioritizing contributing to their RRSPs and TFSAs, exploring alternative housing arrangements and buying life insurance.

There’s a ways to go to make sure we have enough of a financial cushion to fall back on, and persisting socioeconomic factors that make it much easier for some to shore up their resources than others. 

Canada is going to become more expensive in 2022 but Canadians appear to be trying to adjust by finding new jobs, padding their savings and otherwise adjusting to our new reality.

Use the PolicyMe blog to find out how to claim critical illness insurance. Best life insurance for seniors in Canada can be found on PolicyMe.

Methodology: These are the findings of a nationally representative study conducted by PolicyMe. The sample is comprised of n=1,501 Canadians who are members of the online Angus Reid Forum, balanced and weighted on age, gender, region and education. The survey was offered in both English and French. For comparison purposes only, a sample of this size would yield a margin of error of +/-2.5 percentage points at a 95% confidence level. The survey was in field December 2-3, 2021. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables and subgroup sample sizes, please contact Bronwyn Kienapple at

Bronwyn Kienapple

Director of Content Marketing
About the Author

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