A study by the Canadian Payroll Association and the Western-Laurier Financial Data Analytics Laboratory found that financial stress amongst working Canadians does not necessarily correlate to how big their paycheques are.
The study found that there are two things that most affect financial stress: the amount of savings Canadians have and their ability to deal with brief financial setbacks.
"This research shows that Blue Monday is much more than a marketing gimmick. Whether it's in the spirit of the season or not, when we spend beyond our means, financial stress follows," said Peter Tzanetakis, president of the Canadian Payroll Association.
The study found that 20% of those with a household income of at least $150,000 were still financially stressed. And while there are preconceptions about millennials struggling to manage their finances, 50% of those who are financially stressed are actually over 40.
The study said Canadians who are financially stressed manifest the following:
- Find it difficult to manage a brief financial setback
- Save little to none of their income
- Place greater emphasis on salary
- Spend as much or more than their net pay
- Are the most heavily indebted – with the highest likelihood to have car loans, student loans, outstanding balances on their line of credit, and credit card debt
- Report that their debt load increased over the previous year
A separate study by Scotiabank revealed that Canadian borrowers are becoming increasingly worried about their finances, with around two in three struggling to save or invest money.
On average, Canadians spend around two hours a day thinking about their finances. Those in the 18-35 age group worry about their financial health the most.
The study also found that Canadians face some degree of financial stage fright from all the overwhelming options for saving and investing their money.
"Canadians can spark change and energize their finances starting with a few simple steps, like meeting with an advisor and creating a weekly budget," said D'Arcy McDonald, senior vice president for retail deposits, investments, and payments for Scotiabank.