As a trade war escalates with their closest neighbour, it appears Canadians should anticipate shaky economic times ahead, at least in the near term. The wave of new tariffs washing over from the United States, some totalling as much as 50 per cent on certain Canadian goods, has been met with a suite of counter-tariffs that will take effect next Tuesday, along with a $7.5-billion package meant to help local workers and businesses stay afloat. Personal finance experts say the uncertainties surrounding the situation — including how long the levies last, whether they increase or if more sectors get hit — underscore why it’s important for Canadians to prepare in case their wallets or livelihoods suffer. One of the best ways to plan for that is by building up an emergency reserve fund, said Kristy Rachkowski, chief member experience officer at Your Neighbourhood Credit Union. “There’s definitely some individuals, depending on what industry you’re working in, that will naturally be potentially more at risk of being affected by the tariffs,” she said. But one of the “worrisome” trends Rachkowski said she sees is Canadians relying on credit for day-to-day expenses, which can backfire if significant unexpected costs arise. “That becomes concerning, obviously, especially because of the latest round of tariff announcements. It puts additional pressure on household costs,” she said. “If those prices rise while households are already using credit for groceries, utilities, or other necessities, there’s obviously a risk that temporary borrowing could become more long-term.” Rachkowski said setting aside money wherever you can is key to building an emergency reserve that can be drawn upon should you lose income or even your job. If you’re in a sector that’s particularly vulnerable to tariffs, she recommends focusing on “the mandatories” when it comes to spending. “What are your housing costs, groceries, utilities, transportation, minimum debt payments? You don’t want to fall behind on any of those,” she said, adding it helps to also do some research now on what workplace benefits and government supports are available if your employment situation changes. “For anyone who works in manufacturing, auto, steel, forestry or any other trade-exposed industry, I think it makes sense to also be more cautious about taking on major new monthly payments until there’s greater clarity.” An RBC survey released in July found more than half of respondents worry they haven’t saved enough for emergencies, with more than two-in-five concerned that one major unexpected expense could derail their finances. The RBC poll found nearly one-third don’t have an emergency fund, and around three-quarters of poll respondents cited the high cost of living as the top reason they find it difficult to build or maintain emergency savings. Those surveyed also pointed to other reasons, including the need to save money for other priorities, their finances already being stretched too thin, and having had to dip into their rainy day reserve for non-emergency expenses. “One of the things that people are concerned about is having to go into debt when they do come up with an unexpected expense or they experience a job loss,” said Craig Bannon, national director of financial planning support for RBC. The online survey was conducted in April among a representative sample of around 1,500 Canadians who are members of the Angus Reid Forum. By comparison, a probability sample of that size would carry a margin of error of 2.5 percentage points, 19 times out of 20. Asked which type of unexpected expense they were most worried about, 29 per cent said job loss or reduced income affecting their ability to cover essential costs. Car repairs or unexpected transportation costs, major home repairs, medical costs and pet emergencies were also among the top selections. Bannon said planning ahead for those potential scenarios can provide peace of mind. He said saving up three to nine months of expenses, as a general rule of thumb, can help weather the storm of an emergency. “Really, that nine months is the guidance in case something should happen where that income is variable throughout the year,” he said. While there’s nothing wrong with setting a target, Rachkowski said many households already stretched thin may find that range daunting to meet. She said focusing on “what is an achievable amount” is the first step to readying for an emergency. She said it’s also important to avoid the mistake of panic buying, even with the price of imported goods from the U.S. set to rise as the clock ticks toward Canada’s counter-tariffs taking effect. “I’ve been asked before, ‘Should I be stockpiling things that I think are going to go up?’ And I’m saying, ‘No, don’t do that,’” said Rachkowski. “Really try to manage cash flow, keep as much available as you can, but try not to fall into that kind of panic mode,” she said. --- Sammy Hudes, The Canadian Press This report by The Canadian Press was first published Sept. 3, 2026.
