Some Canadians unprepared for financial emergencies

For those who have one month or less in savings, the average amount saved is only $2,051. Forty-seven percent have enough savings to cover three months or less, up seven percentage points. And three in 10 Canadians are living paycheque to paycheque or spending more than they earn.

In addition, the survey finds the following:

• the majority (52%) of Canadians have less than $10,000 in emergency savings, with 41% holding under $5,000;
• one in five (19%) has less than $1,000;
• 29% have between $10,000 and $49,999, while 19% have more than $50,000;
• those with an annual income under $50,000 are most likely to have savings under $1,000; and
• a quarter of those with an annual income above $100,000 have under $5,000 in savings.

Savings also vary by region:

• Quebecers account for the highest percentage (40%) of those with a savings fund of $10,000 to $49,999, while Ontario has the lowest at 22%;
• B.C. represents the province with the highest percentage (23%) of residents holding more than $50,000 in savings, while Quebec is the lowest (13%); and
• B.C. residents have the highest average rainy day fund at $43,818.15—that’s $8,581.36 above the national average.

“Two-thirds of Canadians have relied on their savings to help deal with unpredictable financial emergencies,” says Christine Canning, head of everyday banking with BMO Bank of Montreal. “In order to avoid taking on an unmanageable amount of debt, the ideal emergency savings fund should be equal to three to six months of your income.”

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