Rising cost of living forces Quebecers to make tough sacrifices: One in five are eating less to save; nearly a third are sharing expenses from housing to carpooling, childcare, and groceries

More than half of Quebecers say they are concerned about their ability to repay debt, even if interest rates decline — the highest of any province

MONTREAL, QC – October 16, 2024 – Facing the burden of high living costs, Quebecers are making difficult sacrifices and sharing expenses to make ends meet. According to the latest MNP Consumer Debt Index, conducted quarterly by Ipsos, nearly a third (30%) of Quebecers say they’ve turned to bill-splitting strategies such as carpooling, buying in bulk, sharing subscriptions and childcare. More than one in 10 (12%) are saving money by living with friends, partners, or family members, or seeking out additional roommates or co-living spaces. One in five (20%) Quebecers say they’ve even resorted to eating less to save money.

“We’re seeing the same trend of bill-splitting in Quebec that’s happening across the country as households adjust their budgets to the high cost of living. Co-living arrangements and sharing expenses not only highlight Quebecers’ adaptability but also the financial strain many are under,” says Frédéric Lachance, a Licensed Insolvency Trustee with MNP LTD in Montreal. “What is especially concerning is that one in five in the province has had to cut back on food just to get by. These strategies reflect the challenging reality of rising living costs, which is forcing many Quebecers to explore additional methods of saving.”

Quebecers are making other sacrifices to manage costs. More than two in five (43%) say they have tried to save money by grocery shopping more strategically or have stopped eating in restaurants or getting take-out (44%) — and nearly half say they are avoiding impulse purchases (47%).

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

Prudent cost-cutting efforts and declining interest rates do seem to be providing Quebecers with some relief in their financial situation. Quebecers are building up the bank this quarter, reporting they have $888 (+$101) left over at the end of the month on average. Two in five (40%, -5 pts) now say they’re $200 or less away each month from financial insolvency.

“Lower interest rates and cost-saving measures have offered some relief to Quebecers as financial pressures ease. Overall, households have more breathing room to manage their debts and plan for the future,” says Lachance. “However, two in five still say they are on the edge of insolvency, struggling to keep up with their financial obligations.”

Impact of interest rates on debt and financial outlook

With Quebecers expecting interest rates to continue falling over the next few years, many believe their ability to absorb interest rate increases has improved. A quarter (26%, +7 pts) say they’re much better equipped to manage an interest rate increase of one percentage point than they used to be. Quebecers are the most likely among the provinces to feel positive about the future. A third (34%, +5 pts) expect their debt situation to improve when looking ahead one year from now, and fewer believe it will worsen (7%, -3 pts).

Following three interest rate cuts this year, still over half (53%, -1 pt) of Quebecers say they’re concerned about their ability to repay their debt, even if interest rates decline — more than any other province. While slightly fewer say they will be in financial trouble if interest rates go up, three in five (60%, -2 pts) still indicate they would be in trouble.

“Despite some relief from lower interest rates and slowing inflation, many Quebecers are still weighed down by their debts,” says Lachance. “Simply cutting costs may not be enough for those facing severe financial challenges. A Licensed Insolvency Trustee can provide a clearer path forward, offering tailored options to resolve financial difficulties. Bankruptcy is just one of many options available for those seeking debt relief.”

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

“Although splitting expenses can provide short-term relief, it often doesn’t tackle the underlying causes of significant debt,” says Lachance. “For those feeling burdened by mounting bills and debt, turning to a Licensed Insolvency Trustee is a crucial step toward getting back on solid financial ground.”

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 Quebecers plan to cut costs or save money in the year to come, the survey revealed the following:

Quebecers' top money-saving strategies for the next 12 months

1. Bill splitting – 25%
2. Creating a budget / recording all expenses – 13%
3. Cancelling subscriptions – 13%
4. Finding free or low-cost entertainment – 13%
5. Living with friends, family, a partner or roommates – 12%
6. Reducing utility consumption – 12%
7. Negotiating bills – 12%
8. Stopping eating in restaurants or getting takeout – 11%
9. Avoiding impulse purchases – 10%
10. Going thrift shopping – 10%
11. Grocery shopping strategically – 10%
12. Cutting vices – 8%
13. Moving somewhere more affordable – 5%
14. Splitting grocery costs / buying in bulk with roommates, friends, or family – 5%

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.