BMO Real Financial Progress Index reveals Canadian Financial Confidence remains steady as U.S. confidence dips

Increased anxiety over rising cost of housing among Gen Z Canadians

TORONTO, March 17, 2022 /CNW/ - According to new research findings from BMO's Real Financial Progress Index, Canadians' financial confidence remains steady for the past year with more than a third (39 per cent) of Canadian consumers continuing to feel that they are making progress in their finances.

Consistent with last quarter and a year ago, more than three quarters (76 per cent) of Canadian consumers are confident in their current financial situation and 55 per cent are making financial progress by continuing to set and achieve financial goals. In contrast, financial confidence has been declining steadily among U.S. consumers, returning to levels not seen since the start of 2021.

As Canada's inflation rates hit a three-decade high and real estate pricing continues to climb, the Index also shows that Gen Z are becoming increasingly worried about housing costs compared to last quarter with a five-point increase. Housing costs overall continue to be a major obstacle impeding financial progress rising three points this quarter.

"It's encouraging to see that Canadians continue to feel confident in their financial situations and that over half are continuing to set and achieve their financial goals," said Gayle Ramsay, Head, Everyday Banking and Customer Growth, BMO Bank of Montreal. "Despite the confidence, it's not surprising to see that soaring housing costs are concerning young Canadians. Whether consumers are feeling confident about their finances or feeling the effects of inflation and rising housing costs, we encourage customers to meet with a BMO financial planner for advice on the best ways to save and find a solution for their unique situation."

To help ease consumer anxieties, BMO offers a 130-day mortgage rate guarantee once preapproved for a mortgage, the longest rate guarantee of any major Canadian bank. This means that if rates go up, customers can keep their original lower rate, and if they go down, BMO will honour the new lower rate.

BMO offers the following tips to help Canadians maintain confidence and ease concerns over housing costs:

• Automate saving into a savings account: Having money (ideally 10 per cent) automatically deducted from your paycheque ensures savings for unexpected expenses – including rising monthly bills.
• Reset monthly budgets based on recent bills: As the cost of inflation is passed on to consumers, bills are bound to go up. Revisit your monthly budget based on recent bills to get an updated view of your current financial situation.
• Take advantage of home-buyers support programs: Look into programs or incentives aimed at assisting first time home buyers like the BMO Default Insured Borrowed Down Payment Program or government incentives like the First-Time Home Buyers' Tax Credit and the GST/HST New Housing Rebate.
• Seek advice: Start or review your financial plan to ensure savings and spending goals are still on track and adjust when necessary.

U.S. Financial Confidence Dips
The Index shows a steady decline in Americans' financial confidence since the middle of last year and is down three points from year-end. Financial confidence among Americans, especially those between the ages of 18 and 24, has experienced a significant decrease in comparison to the 4^th quarter of 2021. Only 65 per cent of those between ages 18-24 feel confident about their finances, down from 75 per cent in the last quarter of 2021 and compared to 75 per cent of all age groups surveyed this quarter.

To find out how BMO can help customers make financial progress, visit: https://www.bmo.com/main/personal 

About the BMO Real Financial Progress Index
Launched in February 2021, the BMO Real Financial Progress Index is an indicator of how consumers feel about their personal finances and whether they are making financial progress. The Index aims to spark dialogue that will help consumers reach their financial goals and to humanize a topic that causes anxiety for many – money.

The research detailed in this document was conducted by Ipsos in the United States from Jan. 7-28, 2022. A sample of n=3,401 Canadian adults ages 18+ were collected. Quotas and weighting were used to ensure the sample's composition reflects that of the Canadian population according to census parameters.

About BMO Financial Group
Serving customers for 200 years and counting, BMO is a highly diversified financial services provider - the 8th largest bank, by assets, in North America. With total assets of $1.02 trillion as of January 31, 2022, and a team of diverse and highly engaged employees, BMO provides a broad range of personal and commercial banking, wealth management and investment banking products and services to more than 12 million customers and conducts business through three operating groups: Personal and Commercial Banking, BMO Wealth Management and BMO Capital Markets.

SOURCE BMO Financial Group

For further information: Media contact: Kate Simandl, [email protected], [phone]