As Canadians navigate broad economic uncertainty and affordability challenges, most (77%) are worried about the negative impact of inflation on their ability to afford their daily expenses and 60% say they have no disposable income.

With many struggling to keep up, the top concerns for Canadians are Canada–U.S. relations (67%) and the cost of daily living (67%). Other concerns include:

• economic uncertainty (65%)
• housing affordability (60%)
• having enough money in retirement (56%)

Canadians are particularly worried about the impact of geopolitical uncertainty, including global trade tensions, on:

• the increasing cost of living (61%) and housing (54%)
• their retirement savings (46%)
• losing their jobs (33%)

Rising expenses and economic uncertainty have hurt Canadians’ retirement savings and outlook. Fifty-nine per cent of unretired Canadians do not think they will ever be able to retire due to their financial situation. Half (49%) have not set aside any money for retirement in the past year and 39% have never saved for retirement.

The economic challenges facing Canadians have also taken a toll on their well-being, leaving them more likely to feel anxious (52%, +7 pts from 2024), fearful (48%, +6) and sad (47%, +6) about their finances.

Despite the challenges posed by a lack of affordable housing and a struggling housing market, nearly two-thirds (62%) of Canadians view homeownership as a key part of their retirement strategy, either as a financial investment or a source of stability in retirement.

As part of their strategy, half (50%) of unretired homeowners plan to rely on the sale of their home to set themselves up for retirement. Yet only 30% of Canadians who do not own a home say they have enough money coming in to save, and 62% are worried about the impact of interest rates on their ability to buy a home.

Meanwhile, a growing proportion of unretired homeowners are concerned about their ability to pay off their mortgage so they can retire when planned (65%, up 14 pts from 2024). In fact, 66% of homeowners with a mortgage say their payments have increased in the past year or are expected to go up within the next 12 months. Of this group:

• 78% agree the increase has meant or will mean cutting back in other areas to continue to afford their housing.
• 78% agree the increase has or will reduce their ability to save for retirement.

With affordability top of mind for many, more than a third (36%) of Canadians report having less than $5,000 in savings, including for retirement, and one-in-five (20%) have no money saved. Those who do not own a home are significantly more likely to have less than $5,000 saved (57% vs. 19% of homeowners).

The rising cost of rent is also a concern for most (84%) non-homeowners. In fact, the top financial priority for non-homeowners is paying rent (66%), while homeowners are more likely to focus on saving for retirement (54%). Only 38% of non-homeowners selected saving for retirement as a priority.

This may help explain why unretired homeowners are twice as likely as non-homeowners to have ever saved for retirement (71% vs. 36%).

Notably, the results suggest having a workplace pension can help Canadians save more, regardless of homeownership. Just 13% of homeowners and 50% of non-homeowners with pensions reported having less than $5,000 in savings, compared with 33% of homeowners and 66% of non-homeowners without retirement benefits.

Canadians continue to face rising prices, rents and mortgages, leaving many concerned about how these challenges could affect their futures:

• 66% of unretired Canadians expect to continue working in retirement to support themselves financially.
• 49% of all Canadians are concerned about outliving their retirement savings and 46% expect their quality of life to decrease in retirement.

Having a pension improves Canadians’ outlook. Canadians with a defined benefit (DB) pension are most likely to agree they will be able to meet their financial needs in retirement (59%), followed by 55% of those with a defined contribution pension and 30% of those without retirement benefits.

Most Canadians also recognize the value pensions provide, with nearly two-thirds (62%) agreeing that amid global uncertainty, workplace pensions are of greater value for individual contributors.

Underscoring this, an overwhelming majority of Canadians (88%) would choose to pay 9% of their salary, with contributions matched by their employer, to a DB pension plan in exchange for a lifetime income in retirement. Canadians of all ages see the value of a DB pension and would opt-in if they could, including:

• 82% of those aged 18 to 34
• 88% of those aged 35 to 54
• 92% of those aged 55 to 64
• 93% of those 65+