Out with the avocado toast and lattes, in with the sack lunch?
The Credit Counselling Society says Canadians age 18-34, also known as Gen Z and younger millennials, are more likely to be taking on more debt while feeling more anxious about their current financial situation than their elders; however, they are also increasingly cutting back on spending to counter those worries.
And perhaps the most drastic measure one in five young Canadians has done to shore up their financial well-being is move back home with their parents; and another one in five is considering making the move soon, according to the society’s 2024 Consumer Debt Report, which draws inferences from a nationwide survey.
Meanwhile, one in five young Canadians has taken on a second job while another one in five is considering doing the same.
A key reason is that 54 per cent of the cohort has taken on more debt to keep their finances afloat.
"This is a concerning pattern we've started seeing a lot more often, especially with younger clients, and it's simply not sustainable," said Peta Wales, president and CEO of the Credit Counselling Society, via a news release on the report.
Across the board, 39 per cent of Canadians feel they do not have enough of an emergency fund, whereas that percentage rises to 50 per cent for the 18-34 age group.
And while this group reports feeling the most embarrassed about incurring debt they are also showing more signs of being proactive; whereas 77 per cent of people make lifestyle changes to better manage debt, 85 per cent of the Gen Z and younger millennial crowd does so.
Compared to 2023, more people are feeling anxious (36 per cent, up from 33 per cent) and fewer people are feeling confident (44 per cent, down from 46 per cent) about their financial situation.
The key reason for the worsening conditions is the higher costs of essentials, such as housing, transportation and food.
The society suggests reaching out to a counsellor for support.
"People are always surprised when they meet with one of our credit counsellors," said Mason Cox, the society’s director of counselling.
"From budgeting tips and tricks to make life easier, to strategies to manage debt better, people usually have more options than they realize, especially if they seek help sooner."
