Only two-fifths (39%) of respondents said they account for their mortgage when creating their monthly budget, even though mortgage payments are among the biggest monthly expenses (35%) for those who have one.
“In many cases, monthly mortgage payments, along with taxes, account for one of the largest monthly expenses Canadians face,” said Alana Riley, Head of Mortgage, Insurance and Banking, IG Wealth Management.
“So, while it is encouraging that so many reported having a monthly budget, it’s only providing a partial snapshot of their overall cashflow situation if they don’t factor in their mortgage. In order to truly optimize the effectiveness of a monthly budget, it should include all major expenses and be a part of a comprehensive financial plan that captures all dimensions of an individual’s financial world,” Riley added.
Riley pointed out that in an era of rising interest rates and inflation, including one’s mortgage in budgeting has become even more crucial.
The research revealed that for nearly three fifths (56%) of mortgage holders, their ability to pay their mortgage should interest rates continue to climb is a concern, and only 45% believe they’ll retire mortgage-free.
