Wrangling personal debt is the main financial priority among Canadians heading into the new year.
According to a recent poll by CIBC, 20 per cent of respondents tabbed debt repayment as their top priority in 2022, followed by growing investments (16 per cent) and simply keeping up with bills (15 per cent).
Meanwhile, when it comes to national economic concerns, inflation was the most pressing issue identified in the poll (66 per cent), followed by uncertainty due to COVID-19 (36 per cent).
The poll also found some concern about rising interest rates, with 40 per cent of homeowners worried about rate hikes, compared to 31 per cent of non-homeowners.
“It’s understandable that Canadians are concerned about the economy in 2022, but what’s important is to have their personal financial house in order, if goods, services and carrying debt are going to cost more,” said Carissa Lucreziano, CIBC’s vice-president of financial and investment advice.
Secondary financial priorities for 2022 include saving as much as possible/growing an emergency fund (28 per cent), avoiding taking on more debt (26 per cent), and saving for a vacation/travel (17 per cent).
Asked about their definition of financial wellness, nearly half (47 per cent) of respondents said steering clear of financial stress, while 41 per cent tied it to being able to afford their basic needs, such as food, housing or transportation.
“It is imperative to seek ways to mitigate financial stress, as it’s clearly a key factor in overall wellness,” said Lucreziano. “Having a plan to reach your long-term ambitions and a clear understanding of your monthly cash flow can significantly reduce stress.”
Among those who saw their debt levels increase in 2021, 37 per cent attributed it to expenses exceeding their monthly income.
Approximately 49 per cent of respondents admitted that they need to get a better handle on their finances in the coming year. However, only 27 per cent of those surveyed expect their financial situation to improve during 2022.
According to CIBC, 80 per cent of those polled expect that their financial goals will remain the same once the pandemic is over.