TORONTO - Nearly one-third of Canadians do not have a savings plan in place even though almost everybody would like a financial safety net, according to a survey done for one of the country's largest banks.
"People want to save .... I think the issue is they don't know how to get started," said Gillian Riley, senior vice-president of retail deposits, payment and lending at Scotiabank, which commissioned the study of Canadians' savings habits.
Only 55 per cent of people surveyed told pollsters they save on a regular basis. And nearly one-in five Canadians said they don't have any rainy day savings at all. But Riley said she was most surprised by the survey's finding that one-quarter of Canadians live day-to-day and don't think about saving money.
Canadians need to start thinking about their long-term finances again after many found themselves in financial hardship during the 2008-2009 recession, she said.
"We did have a tough period in the last few years and I think now is a great time to really focus on this and get people thinking about how they can save," she added.
Many Canadians were laid off during the recession and some were forced to dip into savings, while other saw the plunging stock market wreak havoc on their investments.
As the early stages of recovery took hold, consumers began to take advantage of historically low interest rates and favourable borrowing conditions.
But as interest rates begin to rise again, borrowing is becoming more expensive, while higher rates translate into more interest on savings accounts.
Many of those polled said they would like to save more but there are too many competing demands for the money in their wallets.
"We have bills, we have borrowing, we have all sorts of things we're thinking about and we've got to remember to think about this savings piece," Riley said.
Meanwhile, almost everybody surveyed -- 94 per cent -- said they feel better when they have a safety net of savings.
Time-starved consumers can find it difficult to navigate an increasingly sophisticated world of financial products, Riley said.
But she said automatic payments are an almost painless way to save. Such payments can be made through rounding up debit card payments at the till and devoting the difference to savings, or by an automated transfer of even $50 to $100 per month.
And although economic conditions are becoming more favourable for savings, Canadians shouldn't let the market drive their desire to save, she said, adding that putting away a portion of a paycheque in any economic environment is the best way to protect against future uncertainty or sudden life changes.
Consumers will find that saving an additional $1,500 a year will make a significant improvement to their finances -- and although it may sound like a lot, it works out to about four dollars a day, Scotiabank said.
The survey of 1,000 Canadians was done in March by Harris/Decima for Scotiabank which announced the findings on Tuesday.
The survey kicks off the bank's Let the Savings Begin program, which will debut its next instalment related to investing in the fall.
