Half of Canadian homeowners unprepared for personal financial dilemma

November 25th, 2016  |  Personal Finance

A recent survey conducted by Manulife Bank has found that many Canadian homeowners would either be unprepared to weather the storm of a personal financial dilemma or aren’t sufficiently informed enough to know where they stand. Dilemma, in this case, refers to mostly unexpected developments such as job loss, major housing expenses, or repairs.

There were 2,372 Canadian homeowners polled in the online survey, all of whom were between the ages of 20-69 and boasted a household income of $50,000 or more. Almost a quarter of them (24%) said they had no idea how much of an emergency fund they had. Fourteen per cent of respondents hadn’t put away anything and nine per cent had contributed less than $1,000 to their emergency funds.

In all of the major categories in the “Preparing For Unexpected Expenses” portion of the survey, millennials—who admittedly have had less time to save than their older counterparts—fared the worst. Only 29% of millennial respondents had saved more than $5,000, compared with 32% of Generation X and 37% of Boomers.

According to Manulife’s CEO Rick Lunny, responsible homeowners should always be setting aside three to six months’ worth of expenses. Otherwise, the only alternative can sometimes be to take out high interest credit card loans.

With Canadian mortgage rates and premiums on the rise, homeowners will have to be even more prudent with their finances and payment plans. They would be wise to learn from the results of this survey.