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article imageStudy: Canadians preparing for financial New Year's resolutions

By Andrew Moran     Nov 27, 2012 in Business
Toronto - The Royal Bank of Canada (RBC) published its Canadian Consumer Outlook for 2013. It found that the GDP will beat expectations, but it also discovered that a lot of Canadians are already creating New Year's resolutions for 2013 for their finances.
This month, the federal government released its expectations for economic growth in 2013. It projected that GDP growth will be two percent, but RBC Economics is forecasting 2.4 percent economic growth.
Next year will be the year of economic optimism, at least according to findings from the new RBC poll. More than one-third of Canadian consumers expect their financial situation to significantly improve in 2013, while another third say they are taking the necessary steps to get into better financial shape.
The measures taken to maintain fiscal prudence include establishing a plan to reduce debt (31 percent), attempt to spend less (26 percent) and save and/or invest more than what they currently do (25 percent). When it comes to performing all three measures, 20 percent said they intend to take these actions.
“Canadians may believe brighter days are ahead because they are making resolutions to better manage their finances by reducing debt and curbing spending not because of their outlook on the Canadian economy," said Richard Goyder, vice-president of personal lending at RBC, in a press release. "While New Year's resolutions may start with great intentions and fizzle out later in the year, setting out a plan to reduce your debt, keep it under control and save more for that rainy day will help keep you on track."
Furthermore, 37 percent of Canadians expect the economy to improve, up from 32 percent in 2011. However, only 16 percent anticipate their local economy to get better, which is up only from 12 percent from the year prior.
Less Canadians will consume. The survey suggested that 44 percent of Canadians will spend less money on major items, such as household appliances, vehicles and vacations. This could be a sign that consumers may begin to rebuild their savings. It was reported that the national savings rate is at 2.9 percent.
RBC listed the top 10 tips to “tune-up” Canadians’ finances:
- Reduce debt
- Consolidate debt
- Annual budgeting
- Track credit card spending
- Maintain an emergency fund
- Compare loans to lines of credit
- Get pre-approved for a home mortgage
- Review your investments
- Utilize all income tax deductions
- Individual Pension Plan for business owners
More about Canada, royal bank of canada, 2013, Resolutions, Canadian Consumer Outlook
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