More than half of Canadians feel “financially paralyzed” by the rising cost of living, with almost half saying that they cannot maintain their standard of living due to the increasing costs.
According to an RBC poll published on Thursday, around one in three, 29%, of respondents said their finances are in a constant state of chaos.
“As financial flexibility continues to erode, it’s not surprising to hear that Canadians are feeling anxious and uncertain about what steps they can take to try to find their footing again,” said Craig Bannon, an RBC financial planner.
Canadians who felt most paralyzed by rising costs lived in Atlantic Canada. Atlantic Canadians were also the most likely to feel they could not maintain their standard of living, spending all their income on essentials and living paycheque to paycheque.
Furthermore, the majority of Canadians, 60%, worry that they don’t have enough money to cover unexpected expenses today.
A Fraser Institute study highlighted that Canadians spend more on taxes than on food, shelter, and clothing combined.
However, the feeling of financial paralysis decreased with age. Canadians aged 29-44 were most likely to feel financially paralyzed due to rising costs, with 63% of respondents in that age group feeling that way. The percentage decreased with age.
A previous survey showed that inflation is outpacing income for the majority of Canadians. A TD Bank report showed that income inequality reached its highest levels since 2015.
Every one of the 15 metrics measured by RBC was worse among millennials than among boomers (Canadians aged 61-70). Millennials also generally felt worse than Gen X (Canadians aged 45-60) in all categories, barring a few.
While many Canadians were worried and anxious—like the 44% who said that it was not a matter of if but when they would run out of money to live comfortably—many were already making drastic changes to cope with the cost of living.
For example, over a quarter of Canadians, 27%, have taken on debt to cover their monthly basic needs. Almost a quarter, 23%, have asked family for money or moved in with relatives.
Nearly half have lost hope — 48% say that they don’t believe they’ll ever be able to get ahead financially.
A previous study highlighted that 45% of Canadians said they are “greatly affected” by the continuously rising cost of living.
Rising costs have caused more Canadians to declare bankruptcy, as Canada faced a 15.4% rise in personal insolvencies in 2024. Business insolvencies similarly rose at the fastest level in 37 years.
