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BMO Bank of Montreal

BMO Bank of Montreal

January 31, 2012 07:32 ET

REPEAT: Holiday Hangover? Canadians Stayed on Budget and Are on Track for 2012

- Including Boxing Day purchases, Canadians who shopped this holiday season spent an average of $1029 over the holiday season - approximately $300 less than planned

- Most Canadians indicated that holiday spending will not keep them from meeting financial obligations or goals in 2012

- Reducing overall household debt number one priority for Canadians heading into 2012

TORONTO, ONTARIO--(Marketwire - Jan. 31, 2012) - According to a BMO survey, the majority of Canadians are heading into 2012 without the cloud of excessive holiday spending hampering their financial responsibilities or goals.

In fact, households kept holiday spending in check in 2011, with 76 per cent spending less or the same on holiday gifts, trips and entertaining than in 2010. Furthermore, the majority (57 per cent) indicated that financial responsibilities will not suffer as a result of their recent holiday spending.

"The latest numbers are a very positive sign that Canadian households are both setting realistic spending limits, and also staying on budget, which is especially important during a busy spending period like the holidays," said Su McVey, Vice President, BMO Bank of Montreal. "This also indicates that most Canadians are starting 2012 on the right foot, without holiday debt loads getting in the way of their big picture financial responsibilities or aspirations."

Ms. McVey added that now is good time for Canadians to speak to a financial expert and develop a plan that will help them achieve their 2012 financial goals.

Heading into the New Year, the top five financial priorities for Canadians are as follows:

  • Reducing overall household debt (25 per cent)

  • Saving enough to afford ideal retirement lifestyle (24 per cent)

  • Reducing everyday spending and increasing savings (19 per cent)

  • Being more financially responsible by better managing household budgets (19 per cent)

  • Increasing wealth by investing more (9 per cent)

BMO Bank of Montreal offers the following tips to help keep your financial priorities on track heading into 2012:

Pay yourself first - If you don't already have one, the start of the new year is a great time to open up a savings account. Set up automatic payment transfers so that each pay day you pay yourself first. Putting away just $50 every paycheque adds up to $1300 a year, proving that a little today really can add up to a lot tomorrow. Additionally, a Tax-Free Savings Account (TFSA) or a high interest savings account such as BMO's Smart Saver Account are flexible and smart options for anyone looking to increase savings.

Track your spending - To stay on top of your money this year, develop a household budget with realistic expectations to ensure you don't overspend. The most important part of budgeting is having a clear understanding of the money going into and coming out of your bank accounts. BMO MoneyLogic allows you to manage and track your money easily and in one place.

Only spend what you have - Reduce credit card use until outstanding balances are paid down. Credit cards provide useful benefits such as rewards and are a great tool when used responsibly, but you should treat your credit card as you treat your debit card - only spending what you have - to avoid overspending.

For more details on BMO MoneyLogic, visit www.bmo.com/moneylogic, and for more details on how to save, borrow and spend smartly, visit www.bmo.com/smartsteps.

The online survey was conducted by Leger Marketing among 1504 Canadian adults between December 28, 2011 and January 3, 2012. A probability sample of the same size would yield a margin of error of ± 2.5% 19 times out of 20. The BMO Financial Literacy Report Card study was conducted online by Leger Marketing among 1520 Canadian Adults between November 21, 2011 and November 24, 2011. A probability sample of the same size would yield a margin of error of ± 2.5% 19 times out of 20.

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