Inflation and Cost of Living Remain Top Financial Concerns for Canadians in 2025: TD Survey
TORONTO – Despite improvements in financial optimism, nearly half of Canadians still view inflation and the cost of living as their most significant financial challenges in 2025, according to a new survey by TD Bank.
Canadians Cutting Back Amid Persistent Strains
Released Wednesday, the survey highlights that approximately 50% of respondents plan to reduce spending this year. Younger Canadians, particularly millennials, are more inclined to cut expenses compared to baby boomers.
While inflation has receded to align with the Bank of Canada’s 2% target, the lingering impact of high living costs continues to strain household budgets.
Financial Priorities for 2025
The survey revealed several key financial priorities for Canadians:
56% of respondents are focused on managing day-to-day expenses.
47% are prioritizing saving and investing for the future.
30% are concentrating on paying down debt.
Millennials, more so than baby boomers, are likely to focus on reducing their debt burden this year.
Improved Financial Optimism
Despite ongoing concerns, financial confidence is on the rise. According to the survey, 24% of Canadians feel more optimistic about their finances in 2025.
This shift in sentiment follows the Bank of Canada’s five consecutive interest rate cuts by the end of 2024, which have alleviated some financial pressures, said Emily Ross, TD’s Vice-President of Everyday Advice Journey.
“Although the cost of living remains a significant concern, Canadians are beginning to feel more positive about achieving their financial goals,” Ross said in a statement.
Financial Planning Gaps
The survey also revealed that most Canadians lack formal financial planning tools:
61% do not have a financial plan in place for 2025.
70% do not use budgeting tools, such as spreadsheets or mobile apps, to manage their finances.
Ross emphasized the importance of establishing a financial plan and seeking professional advice. “A clear plan can help Canadians effectively manage daily expenses, reduce debt, and achieve long-term goals,” she added.
Looking Ahead
While challenges persist, the survey underscores a cautious yet growing optimism among Canadians about their financial future. By focusing on financial literacy and proactive planning, more households may navigate the year ahead with greater confidence and control over their finances.
Source : The Canadian Press
