TD reveals the biggest money and economic concerns for 2025
Canadians have expressed rising optimism about their finances in 2025, but that doesn’t mean an easy year ahead with some of last year’s most challenging aspects continuing to lead the concerns.
Almost half (49%) of participants in a new poll by TD Bank Group expect inflation and its impact on the cost of living to be their number one financial challenge this year, but this was down nine percentage points from a year ago.
With this in mind, 56% of respondents said that their financial priority is everyday expenses, while 47% are focused on investing for the future, and 30% want to reduce their debt burden, which recent data shows continues to weigh heavily on many households. Debt reduction is the biggest priority for Millennials (38%) while Boomers are less concerned about this (21%).
Younger Canadians – Millennials and Gen Zs – are also more likely than Boomers to say they have cut back their spending as much as possible (49% vs. 35%) which was cited by 42% of respondents overall. Around half of all respondents are intending to cut back on spending, a slight reduction from last year, while 12% don’t want to.
For those watching the dollars, the main strategies for reducing spending are fewer retail purchases of items including clothes and electronics (63%), eating out or ordering food less often (56%), shopping around for savings (52%), and spending less on entertainment including sporting events and concerts (41%).
"As 2024 came to a close with a fifth consecutive interest rate cut from the Bank of Canada, Canadians have responded with increased optimism," said Emily Ross, VP, Everyday Advice Journey at TD. "Although the cost of living is still clearly a concern for many Canadians and again tops their list of financial challenges for 2025, the survey results indicate that things are moving in the right direction, and Canadians are starting to feel more positive about achieving their financial goals."
Those goals include may not include a formal financial plan though with 61% of respondents saying they do not have a plan for 2025, 63% do not work with a financial professional, and 70% don’t use budgeting tools. A recent report also found a lack of long-term estate plans to ensure their heirs are looked after correctly.
"With a significant portion of Canadians looking to save and invest for the future, manage their daily expenses, and pay down debt, establishing a financial plan and seeking professional guidance can make a meaningful difference," added Ross. "Our survey found that those who work with a qualified financial professional are 50 per cent more likely to feel positive about their 2025 finances than those who do not work with one, highlighting the importance of expert advice."
