A survey from Sun Life Financial finds financial-related challenges cause the most significant stress among Canadians, and that stress has a serious impact on Canadians’ work life. According to the 2016 Sun Life Financial Canadian Health Index,1 almost one-third (29 per cent) of Canadians are distracted at work, as a result of their financial situation. “Financial health is an important component of our overall health and wellness, because it has a direct impact on our day-to-day lives, at work and at home,” explains Kevin Dougherty, President, Sun Life Financial Canada.
Many Canadians blame stress on the difficulties they have managing their costs of living:
Three of the 4 top drivers of uncomfortable levels of stress for Canadians are all related to financial challenges:
• 45% worry about personal/household finances,
• 32% worry about trying to maintain a budget, and
• 31% worry about unexpected expenses.
One-third of Canadians also report feeling insecure about their overall financial health. They list several roadblocks that are stopping them from improving their finances:
When asked what the largest barriers to improving their situation were, respondents said current:
• Income (48%),
• Debt level – mortgage and credit cards (25%), and
• Employment situation – contract and temporary work (24%).
Take action now to reduce financial stress
Getting on the path to financial security can seem intimidating. Help your clients during their financial journey by considering the following 5 tips:
- Savings assistance: work with clients to create a plan to start saving and investing as early in life as possible. RRSPs and TFSAs are great vehicles to consider first. Encourage clients to contribute to their savings through automatic deductions from their paycheques.
- Power in the plan: having a written, holistic financial plan in place can help outline where they are, where they want to be, and how they can get there. A plan can also help reduce uncertainties, especially during times of economic volatility.
- Reality check: set a realistic and attainable budget to help clients pay down debt and save for the short- and long-term. To avoid potential credit card shock after the holiday season, they could put money aside throughout 2017 to cover their end-of-year expenses.
- Matching money: if their employer offers a workplace pension plan with a matching component, encourage them to contribute the maximum amount possible.
- Personal pension: if they don’t have access to a workplace pension plan, they can work with you to create a retirement savings plan through products such as annuities and segregated funds.
By working with your clients on these strategies, you can set them up for financial well-being. Helping them set and achieve financial goals is a great start to preparing for the future, having money available for an emergency or even taking a trip to escape the cold weather.
Dougherty emphasizes the value of your advice: “Canadians are balancing competing priorities when it comes to their finances. While it’s important to understand how to budget, plan for retirement, manage debt and be prepared for the unexpected, it’s not always easy to do this on their own,” he says.” Working with an advisor can help build a lifetime of financial security and well-being.”
Tools and resources to help clients get started on reducing financial stress
- For more key findings and results, visit 2016 Sun Life Canadian Health Index.
- Use our Retirement savings calculator to see how much your clients will need to save for retirement. See how making adjustments to their various retirement income sources can help them meet their retirement savings goals.
- If clients don’t have a budget, our Net worth calculator can help them start the budgetary process, understanding the difference between what they own (their assets) and what they owe (their liabilities).
- Check out Money for Life for ideas and insights to start the conversation, present solutions, and help your clients reach their goals.
- To share articles with your clients about healthy living and financial planning, visit Learn and Plan.
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1The Sun Life Canadian Health Index measures the attitudes of Canadians towards healthy lifestyles and reports these in the form of an index. The seventh annual Sun Life Canadian Health Index is based on the findings of an Ipsos Reid poll conducted between September 19 and September 30, 2016. A sample of 2,402 Canadians from 18 to 80 years of age was drawn from the Ipsos I-Say online panel.