A new study from investment firm Edward Jones discovered a majority (61%) of Canadians often look to their friends and wonder how they can afford their lifestyles. This was felt most among those aged 18-34 (71%) and 35-44 (66%) who are curious to understand how those around them finance their purchases.
The poll revealed looking at the purchases of others may influence Canadians to buy items beyond their budget. This is shown by an overwhelming majority (93%) of Canadians citing they experience buyer’s remorse and admit to regrettable spending habits.
When it comes to age, 96% of those aged 18 to 34 experience remorse following a purchase. Not far behind were boomers, with 90% feeling the same once they’ve left the cash register.
The survey also examined the type of purchases Canadians are most likely to regret making and found:
83% regret tangible purchases such as, clothing/shoes (35%); jewelry (28%); and electronics (26%).
Of that, Millennials were more likely to regret spending money on clothing/shoes (47%), while boomers were more likely to regret spending money on jewelry (34%).
Canadians tend to regret tangible purchases (83%) more than experiential purchases (71%).
“Understanding how you spend money is important when considering your short and long-term goals,” said Roger Ramchatesingh, Director, Solutions Consulting at Edward Jones. “For example, if you know you enjoy spending money spontaneously, build this into your monthly budget. When it is unplanned for, it can add up over time and hurt other long-term goals such as retirement or the purchase of a home.”
Additionally, the poll found that only 44% of respondents have a strategy in place and adhere to it. When it comes to age, 75% of Canadians believe they should have their finances in order between 18-34, yet only 38% in that age group have a financial strategy and follow it. Close behind are those aged 35-44 with only 44% of that age group having a strategy in place, despite 46% believing finances should be in order by then.
“It’s never too late to get your finances in order,” added Ramchatesingh. “A financial advisor can help develop a financial strategy that addresses what is most important to you and help you towards the lifestyle you desire.”
“By following and executing a proven and thoughtful process, you can have more confidence,” said Ramchatesingh. “It’s clear that when people have a financial strategy in place and work with someone they trust, they feel more comfortable with their finances.”
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