Rising cost of living forces British Columbians to make tough sacrifices: more than one-third are eating less to save money

British Columbians are more likely than any other province to have tried saving by sharing expenses, from cohabiting to carpooling, childcare and groceries (38%).

VANCOUVER, BC – October 16, 2024 – Under the burden of high living costs, British Columbians are making difficult sacrifices and finding ways to share expenses to make ends meet. According to the latest MNP Consumer Debt Index, conducted quarterly by Ipsos, British Columbians are more likely than any other province (38%) to report turning to bill-splitting strategies such as carpooling, buying in bulk, sharing subscriptions and childcare, and living with others. One in five (20%) say they’re saving money by living with friends, partners, or family members, or seeking out roommates or co-living spaces — more than any other province. British Columbians and Albertans are the most likely (35%) to say they’ve even resorted to eating less to save money.

“We’re seeing a bill-splitting boom in B.C. and across the country as people adapt to the high cost of living,” says Linda Paul, a Licensed Insolvency Trustee with MNP LTD in the Lower Mainland. “These cost-saving approaches like sharing expenses and housing highlight both British Columbians’ adaptability and the immense financial strain they are under. What’s especially worrying is that British Columbians are among the most likely to report cutting back on food just to get by.”

British Columbians are making other sacrifices to manage costs. More than half (53%) say they’ve tried to save money by grocery shopping more strategically, and nearly half say they are avoiding impulse purchases (46%). Nearly two in five have stopped eating at restaurants or getting take-out (37%).

Cost-cutting measures and lower interest rates create breathing room in some household budgets

Perhaps in part due to prudent cost-cutting efforts and declining interest rates, British Columbians are reporting some relief and improvements in their financial situation. British Columbians are building up the bank this quarter, reporting they have an additional $277 left over at the end of the month on average. This significant jump is the highest increase compared to the other provinces and increases British Columbians’ money left over each month to $1093 — the most among any province and the largest amount of money British Columbians have had after all expenses in the last five years. Nearly two in five (37%, -10 pts) British Columbians say they’re $200 or less away each month from financial insolvency.

“Cost-cutting measures and declining interest rates have certainly eased some of the financial pressure and provided some British Columbians with more wiggle room,” says Paul. “However, with close to two in five still on the edge of insolvency, it’s clear that others are still grappling with persistent financial challenges.”

Pessimism about financial outlook, debt grows despite falling interest rates

While British Columbians expect interest rates to continue falling over the next few years, perceptions of their ability to absorb interest rate increases have weakened; nearly a quarter (23%, -2 pts) say they’re much better equipped to manage an interest rate increase of one percentage point than they used to be. Still, fewer British Columbians are looking positively to the future, with only three in 10 (30%, -3 pts) expecting their debt situation to improve when looking ahead one year from now. In fact, British Columbians are more likely than any other province to believe it will worsen (16%, +5 pts).

Despite three interest rate cuts this year, significantly more British Columbians this quarter (48%, +5 pts) say they are concerned about their ability to repay their debt, even if interest rates decline. More than half (53%, unchanged) say they will be in financial trouble if interest rates go up.

“Inflation is easing and interest rates are declining, but many British Columbians are still burdened by the debts they‘ve taken on,” explains Paul. “While some have felt financial relief, the reality is that those facing significant debt may find that bill-splitting measures alone won’t suffice. For individuals in need of guidance, a Licensed Insolvency Trustee can offer a range of debt-relief options. Bankruptcy is not the only solution.”

Licensed Insolvency Trustees provide unbiased advice on options including debt consolidation, debt management plans, budgeting, Consumer Proposals, and Bankruptcy. They are the only federally regulated debt professionals who are authorized to administer government-regulated insolvency solutions such as Bankruptcies and Consumer Proposals.

“Cutting down on expenses may provide some short-term relief, but bill-splitting strategies often fail to address deeper debt challenges. Individuals grappling with mounting bills and financial stress can consult with a Licensed Insolvency Trustee for advice to help them explore long-term solutions and regain control of their finances,” says Paul.

MNP’s extensive network of Licensed Insolvency Trustees provides free consultations in over 200 offices nationwide, delivering local, personalized support to help individuals navigate their debt options.

Looking ahead to how British Columbians plan to cut costs or save money in the year to come, the survey revealed the following:

British Columbians' top money-saving strategies for the next 12 months

1. Bill splitting – 31%
2. Moving in with family, friends, a partner, or roommates– 21%
3. Creating a budget / recording all expenses – 18%
4. Cancelling subscriptions – 16%
5. Stopping eating in restaurants or getting takeout – 15%
6. Reducing utility consumption – 14%
7. Going thrift shopping – 14%
8. Cutting vices – 13%
9. Moving somewhere more affordable – 12%
10. Finding free or low-cost entertainment – 12%
11. Avoiding impulse purchases – 11%
12. Negotiating bills – 11%
13. Splitting grocery costs / buying in bulk with roommates, friends, or family –11%
14. Grocery shopping strategically – 9%

About MNP LTD

MNP LTD, a division of the national accounting firm MNP LLP, is the largest insolvency practice in Canada. For more than 50 years, our experienced team of Licensed Insolvency Trustees and advisors have been working with individuals to help them recover from times of financial distress and regain control of their finances. With more than 240 offices from coast to coast, MNP helps thousands of Canadians each year who are struggling with an overwhelming amount of debt. Visit MNPdebt.ca to contact a Licensed Insolvency Trustee or use our free Do it Yourself (DIY) debt assessment tools. For regular, bite-sized insights about debt and personal finances, subscribe to the MNP 3-Minute Debt Break Podcast.

About the MNP Consumer Debt Index

The MNP Consumer Debt Index measures Canadians’ attitudes toward their consumer debt and gauges their ability to pay their bills, endure unexpected expenses, and absorb interest-rate fluctuations without approaching insolvency. Conducted by Ipsos and updated quarterly, the Index is an industry-leading barometer of financial pressure or relief among Canadians.

Now in its thirtieth wave, the Index has increased to 89 points, up four points since last quarter. Visit MNPdebt.ca/CDI to learn more.

The data was compiled by Ipsos on behalf of MNP LTD between September 6 and September 11, 2024. For this survey, a sample of 2,000 Canadians aged 18 years and over was interviewed. Weighting was then employed to balance demographics to ensure that the sample's composition reflects that of the adult population according to Census data and to provide results intended to approximate the sample universe. The precision of Ipsos online polls is measured using a credibility interval. In this case, the poll is accurate to within ±2.5 percentage points, 19 times out of 20, had all Canadian adults been polled. The credibility interval will be wider among subsets of the population. All sample surveys and polls may be subject to other sources of error, including, but not limited to, coverage error and measurement error.