Repaying debt a priority for Canadians with extra cash

Repaying debt a priority for Canadians with extra cash

Yet, Canadian consumer spending rose 4.7% to $1.084 trillion in 2014

repaying debt

(Mike Kemp/Getty Images)

Low oil prices may be putting a few extra dollars in the pockets of Canadians, but record debt levels have us taking a conservative approach to spending, a new report says.

The review by market intelligence agency Mintel, released Wednesday, found Canadians are focused on paying off debts and making cutbacks when it comes to their finances.

“There is a glimmer of hope, however, with consumers still looking to treat themselves to long- and short-term rewards, creating a mood of sensible spending for 2015,” said Carol Wong-Li, senior lifestyle analyst at Mintel.

“We’re predicting food-related categories like dining out and groceries will experience reasonable growth this year.”

Nonetheless, paying down debt was the top response when those surveyed were asked where their extra money was being spent—with 34% listing it as an option.

Other popular answers included long vacations, dining out and “small extras” for family members.

The report also found nearly a third of Canadians expected to spend more on food at home.

Mintel noted that Canadian consumer spending rose to $1.084 trillion in 2014, up 4.7% from 2013.

The report said housing was the biggest category at about 25% of all Canadian consumer spending, followed by transportation and personal finance expenditures including savings, investments and insurance.

Total Canadian consumer spending is forecasted to grow by 4.7% over the next five years and top $1.2 trillion in 2019.