Consumer Confidence levels rising for Canadians

Wednesday, July 3, 2013

Canadians willing to spend moreWith Alberta home insurance or car insurance, Canadians carry a certain degree of confidence that some of their most valuable investments will be protected in the event of an accident or incident. And as recent survey data suggests, this positive sentiment has factored into some of their other views on the economy - both their own as well as their country.

According to newly released polling data from Investors Group, Canadians' consumer confidence levels rose in the second three-month period of 2013, jumping seven basis points from last year at the beginning of the second quarter.

Allan Gregg, chairman of Investors Group, noted that while the report suggests individuals are more bullish about the state of Canada's financial system, there are some inconsistencies that indicate individuals are still somewhat hesitant about the state of the economy.

"While more consumers believe 'now is a good time to make a major purchase,' there has been no corresponding improvement in the number of Canadians who believe the economy will be better off in a year's time," said Gregg. "The situation is far brighter when Canadians contemplate the state of the economy five years from now, but for the time being consumer enthusiasm seems to be held back by a lack of personal financial growth."

Despite this, GaetanReust, assistant vice president of product and corporate research at Investors Group, noted that confidence - no matter how robust or guarded it may be - is a good thing that suggests Canadians are more content than they are dissatisfied.

"Increased confidence in both the near term and the longer term outlook is a positive development as we move into the second half of the year," said Reust.

Canadians Split on Which Year They Were in Stronger Position

As for how Canadians feel they are doing from a personal financial perspective, there is a divide between those who feel they are better off and worse off when compared to where they were in 2012. For example, 18 percent said they were definitely in a more favorable financial position this year versus 2012, about 20 percent felt that they were in a better economic place last year.

Though personal circumstances typically play the largest role in consumers' determination of whether they're in good times or if last year's were better, the ability to budget plays into this as well. With the appropriate funds on hand, consumers can rest assured that they can take care of all their financial obligations and still have money left over for emergencies or entertainment.

When it comes to property insurance - whether for a residence, car or apartment - the more comprehensive a policy is, the better off the policyholder will be. There are ways, though, to buy coverage with a budget in mind. For example, with tenant insurance, Albertans and Canadians in general can purchase the type of protection that they believe they need the most, such as for personal property, liability and living expense. There are called name perils, which are more confined and typically less expensive than all risk.

Another way to be budget minded with respect to insurance is determining how much to spend for the deductible. This is the portion of a claim that policyholders agree to pay before the insurer pays the rest. It may behoove motorists and homeowners to increase the size of their deductible. While they assume more out-of-pocket expense, it could pay off in the end, as premiums will be more affordable. Taking on a large share of a plan's deductible may be particularly advisable for those who drive infrequently.