Canadians in debt, but shop to feel better: BMO study

A majority of Canadians surveyed by the Bank of Montreal say they shop to cheer themselves up, and these mood-lifting impulse purchases cost Canadians $3,720 annually. The Bank of Montreal poll found that 59% of those surveyed did impulse shopping and bought items like clothes and shoes, and also treated themselves to eating out. “We’re […]

A majority of Canadians surveyed by the Bank of Montreal say they shop to cheer themselves up, and these mood-lifting impulse purchases cost Canadians $3,720 annually.

The Bank of Montreal poll found that 59% of those surveyed did impulse shopping and bought items like clothes and shoes, and also treated themselves to eating out.

“We’re really struggling to save money on a monthly basis,” said Janet Peddigrew, district vice-president of midwestern Ontario at BMO.

Consumers have been spending more than they’ve been saving over the last 10 years, which is cause for concern, Peddigrew said.

The survey found that 60% of Canadians took part in emotional shopping to cheer themselves up and 55% bought something they might not need because it was on sale.

On average, that amounts to $310 a month being spent on items that are wanted but not needed, according to the survey released on Tuesday.

Those surveyed believed they could save two-thirds of that amount if they made an effort to limit impulse spending.

The poll results come as Canadian debt-to-income ratios sit at a record 152% and top officials issue warnings to start paying down debt before interest rates rise.

There’s also an element of regret that comes with impulse shopping and in some cases, financial difficulties.

The survey found that more than half of respondents regretted their purchases and 43% sometimes spent more than they earned in a month. Another third of those surveyed had to borrow money or take out a loan to cover their impulse spending.

The consequences of impulse spending were more common among Canadians under 30, with one in three unable to afford something they needed because of spending on “wants,” the survey said.

Men said they spent more than women on average ($414 versus $207 dollars), with men tending to spend more on technology items, Peddigrew said.

BMO said its psychology of spending report is the first in a series that will examine personal finance and investing behaviours among Canadians.

The online survey was conducted by Pollara and interviewed 1,000 adults between Aug. 31 and Sept. 5. The survey has a margin of error of plus or minus 3.1%, 19 times out of 20.

Brands Articles

Sport Chek floods Toronto with 1,891 free basketballs

The stunt served as the kick-off to the retailer's new basketball-themed campaign

BMO’s “Ball-Star” hits the court for All-Star Weekend

Bank's marketing also includes a 10-foot tall ATM

OMD tops Gunn Report for 10th straight year

Report lists Canadian office's 'Smart City Project' among the network's best work

Edo Japan re-signs with Brookline Public Relations

Calgary-based PR shop appointed AOR for sixth consecutive year

Adidas kicks off All-Star Weekend with a pop-up shop

The global sportswear brand has opened a Toronto sneaker boutique

Veritas opens in Vancouver

The move will help the PR shop better serve its new B.C.-based client, Best Buy

New York Fries puckers up on Snapchat for Valentine’s

The brand is asking consumers to "French" their fries on Snapchat

How grocers are aiming to connect with ethnic consumers

Loblaw, Sobeys have opened ethnic format stores. But are they authentic enough?

DavidsTea introduces product line to benefit Kenya (Video)

Co-founder David Segal talks about the brand's approach to CSR