Many Canadians don’t save for unexpected events

Nearly half of Canadians (46%) dealt with a major unexpected event or emergency during the past year that required most of them either to borrow money or dip into their savings to cover the unplanned costs, finds a CIBC poll.

Read: Most fear falling short of retirement savings goals

Almost three-quarters (74%) of those who experienced the unexpected did not have enough dedicated emergency savings and were forced to find other sources of money to cover the expense. Almost one-third (29%) borrowed money from family, friends or a financial institution, or tapped their line of credit or credit cards. If they couldn’t access new funds, they either adjusted their household budget (18%), or used savings earmarked for other purposes (14%).

Other key findings:

• Among the most common emergencies were:
  • Major household repairs or purchases (27%)
  • Major auto repairs or purchases (23%)
  • Illnesses or medical bills (16%)
  • 41% of all Canadians have no emergency savings/rainy day funds

The poll also found those aged 35-54 were more likely than the average Canadian not to have a rainy day fund (46% vs. 41%), yet they were also more likely to have experienced an emergency in the past year (51% vs 46%).

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Staff

The staff of Advisor.ca have been covering news for financial advisors since 1998.