Canadians Making Budget Cutbacks

As interest rates and the cost of basic necessities have continued on their upward trajectory over the past few months, Canadians are becoming acutely aware of the impact on their household budgets. Increasing a staggering seven points since last quarter, six in 10 (59 per cent) Canadians say they are already feeling the effects of interest rate increases, says the ‘MNP Consumer Debt Index.’ Many Canadians are now being forced to make tough budget decisions to make ends meet, with nearly half (46 per cent) saying they are cutting back on non-essentials such as travelling, dining out, and entertainment, and one-third are buying cheaper versions of everyday purchases (37 per cent) and driving less (30 per cent). Over a quarter (27 per cent) are making the difficult decision to cut back on essentials such as food, utilities, and housing. Only 12 per cent are fortunate enough to say they don’t have any increased expenses to pay for. While most Canadians (82 per cent) agree that with interest rates rising they will be more careful with how they spend their money, more than half (56 per cent) say that as interest rates rise, they are more concerned about their ability to pay their debts.