- Year-end Index stands at 50, same as 2023 and one point
below 2022
- Canadians' trust in the economy on shaky ground with
majority fearing a recession in 2025
- Western provinces' average financial confidence ahead of
their Eastern neighbours, with B.C. leading the way
- Financial confidence of those who work with an advisor 15
points higher than those who do not
WINNIPEG, MB, Nov. 21,
2024 /CNW/ - According to the seventh annual
edition of the IG Wealth Management Financial Confidence Index
("the Index"), 2024 has brought financial stability to Canadians
after years of volatility. However, the Index also revealed that
many are concerned about what 2025 could have in store for them and
showed a clear regional divide in Canadians' financial
confidence.
The Index, commissioned by IG Wealth Management ("IG") and
conducted in partnership with Ipsos Canada, tracks and reports on
Canadians' overall financial confidence based on 10 survey
questions relating to IG's Four Pillars of Financial Confidence
("the Pillars"): Current Personal Financial Situation,
Personal Financial Outlook, Planning and Literacy, and
Trust in the Economy.
This year's Index revealed stabilization, with the Index landing
at 50, mirroring 2023 and one point down from 2022. Interestingly,
prior to this period the Index score was at a high of 57 in 2021,
which can be attributed to several factors including an economic
recovery from the initial impacts of COVID-19 and low interest
rates.
Canadians' Unease About the Future Dragging Index Score
Down
While three of the Pillars remained relatively consistent this
year, Canadians' Trust in the Economy (40) was the weakest by far,
trailing the others by as much as 10 points or more. Factors
contributing to this relatively low score included:
- Concerns about a recession: While many Canadians remain wary of
a recession, confidence is improving as fewer (54 per cent)
anticipate one compared to at the same time last year (68 per
cent).
- Job insecurity: Canadians face insecurities related to job
stability, with more than one-third (38 per cent) believing the job
market will worsen in 2025.
- Anxiety about political climate and global issues: Half of
Canadians expect the political situation and economy of
Canada and the U.S. to deteriorate
in 2025.
"While the Index has stabilized since the pandemic, there's
still a clear sense of anxiety among Canadians as we head into
2025," said Damon Murchison, President & CEO, IG Wealth
Management. "This isn't surprising – over the last year, Canadians
have had to deal with political uncertainty, a higher interest rate
environment, a rising cost of living and spiraling housing
costs."
Financial Confidence: A Tale of
Two Canadas
The latest Index reveals a regional divide in Canadians'
financial confidence, with the average confidence level of the four
Western provinces ahead of their Eastern counterparts. B.C.
outpaced all provinces with a high score of 55, while Quebecers'
confidence (49) dropped by a significant four points from 2023.
These results may, in part, be attributed to the proactive
approach of British Columbians, as more than half (51 per cent)
report using financial advice – significantly higher than the
national average (43 per cent). Political and economic factors,
including a disproportionate reaction to recent interest rate
reductions and wage increases, may also explain this recent surge
in optimism. On the other hand, Quebec's declining confidence calls for
greater financial education and guidance with just 49 per cent of
Quebecers feeling prepared and on track to meet their financial
goals, a steep decline from 62 per cent last year.
Financial Confidence and the Value of Advice
The Index also continues to show a clear trend: Canadians
benefit from the value of advice, with those who currently work
with a financial advisor having a significantly higher level of
financial confidence (59) than those who do not (44).
"Given the growing complexity of the world around us, the speed
at which things are changing and the volatility of the last few
years, it's not a surprise that people who work with an advisor
feel better about their situation," observed Mr. Murchison. "A
qualified advisor can put things in perspective, help you see the
forest from the trees and create an integrated financial plan that
takes all dimensions of your financial world into
consideration."
About IG Wealth Management
Founded in 1926, IG Wealth
Management ("IG") is a Canadian leader in delivering financial
planning with approximately $136.6
billion in assets under management as of October 31, 2024. For more than 95 years, IG
has been focused on improving the financial well-being of Canadians
so they can confidently embrace all of life's possibilities.
Through a network of advisors located across the country, IG
provides approximately one million clients with personalized
advice, comprehensive financial planning, insurance and mortgage
services and professionally managed investment solutions. IG is a
member of IGM Financial Inc. (TSX: IGM), part of the Power
Corporation group of companies and one of Canada's leading diversified wealth and asset
management organizations with approximately $264 billion in total assets under management and
advisement as of October 31, 2024.
For more information, visit ig.ca.
About the IG Financial Confidence Index
The 2024
results presented in this summary report are from an Ipsos survey
conducted online from September 20th to
October 1st, 2024. A total sample of 2,001 respondents from
across Canada participated in the
survey. Weighting was applied to the total sample by age, gender,
region and education level to ensure that the composition of the
final sample is representative of Canada's adult population according to the
latest census data from Statistics Canada. This survey has a
credibility interval of +/- 2.2 per cent
19 times out of 20, of what the results would have been had
all Canadian adults 18+ been surveyed.
SOURCE IG Wealth Management
