Energy prices fueling changes to spending habits says Investors Group poll
Two-thirds of Canadians also say rising costs will affect saving and investing
Winnipeg, MB – June 27, 2007 – The increasing cost of gasoline and energy is creating a national reexamination of spending and consumption according to a survey conducted by Investors Group.
While a significant portion of Canadians say they are considering changes to what and how they drive, many also say they are examining household costs and longer term expenditures. For example, two-thirds of Canadian adults (69 per cent) say they are already avoiding the use of air conditioning or lowering the thermostat in winter to cut back on energy use, while a similar number (64 per cent) say the rising cost of energy will reduce the amount of money left over for saving and investing.
“Costs for shelter and transportation are two of the largest parts of total household spending, according to Statistics Canada, and Canadians appear to be responding to increased energy costs by adjusting their lifestyle and spending patterns,” said Jack Courtney, Assistant Vice-President of Advanced Financial Planning at Investors Group. “The challenge this presents to families is how to balance tighter household budgets without losing sight of longer term financial plans for important things like children’s education, their family’s financial security and their own retirement.”
Automobile use is the priority for change
Among those who drive, 73 per cent say they will change how often they use their car or the speed they drive due to higher gasoline prices. In addition, 81 per cent say they will choose a vehicle that uses less gas on their next purchase or lease. When asked how high gasoline prices need to go before they will change their vehicle use, 46 per cent of Canadians identified the threshold as $1.50 per litre.
Baby boomers and seniors were the most likely group to report changing their driving habits as a result of high gas prices. Seventy-nine per cent of those over age 45 report that they will drive less frequently, or change the speed at which they drive.
Overall it appears that Canadians are prepared to change their driving habits more than their living accommodations. The majority of Canadians (60 per cent) do not plan to live in a smaller home in the future to help reduce energy costs.
Energy costs affect other spending
Just over half of Canadians (53 per cent) say they will have to cut back spending on other things in order to pay for higher energy costs. And for the summer of 2007, over one-third (37 per cent) say they are likely to change vacation travel plans because of higher gasoline costs.
Regional highlights:
British Columbia:
- Only 33 per cent of British Columbians say they will reduce the use of their vehicles if gas prices go as high as $1.50 per litre, compared with the national average of 46 per cent
- B.C. residents are also the least likely among Canadians to change their vacation plans because of increased gasoline prices; only 28 per cent said they would do so
Ontario:
- Fifty-three per cent of Ontarians say they are likely to alter the use of their vehicles if gasoline goes as high as $1.50 per litre, compared with the national average of 46 per cent, making them the most sensitive to gas price increases among all regional populations in Canada
- 78 per cent of Ontarians avoid using air conditioners or turn down the heat in winter as energy saving measures, compared with 69 per cent of all Canadians who do so
Alberta:
- At 42 per cent, Albertans are the least likely among all Canadians (48 per cent) to have already cut back on using their automobiles
- 11 per cent of Albertans say they haven’t made any changes to accommodate higher energy costs (compared with only 8 per cent of all Canadians who say the same)
- 76 per cent of Albertans say they have changed how often and the speed at which they drive (compared with 73 per cent of all Canadians)
- 43 per cent of Albertans say they will change the use of their vehicles if gas prices go as high as $1.50 per litre, making them more price sensitive than many Canadians including British Columbians
Manitoba/Saskatchewan:
- Residents of Manitoba and Saskatchewan are generally the least likely among Canadians to make changes to their daily lives as a result of higher gasoline and energy prices:
- Avoid using air conditioner/turned down heat – 57 per cent (69 per cent all Canadians)
- Bought energy efficient appliances – 45 per cent (54 per cent all Canadians)
- Made no changes – 15 per cent (8 per cent of all Canadians)
Atlantic Canada:
- 56 per cent of Atlantic Canadians have bought energy efficient appliances compared with 54 per cent of all Canadians
- At 51 per cent, Atlantic Canadians are the most likely among all Canadians to say that increased gas prices have already resulted in cutting back on use of their automobiles (48 per cent all Canadians)
- Atlantic residents (at 68 per cent) are the most likely to say that rising energy costs will reduce the amount that they can save and invest (compared with 64 per cent of Canadians)
Quebec:
- At 42 per cent, Quebeckers are least likely among Canadians to cut back on other spending as a result of increased energy costs
- 73 per cent of Quebec residents say they have changed how often/the speed at which they drive
- 35 per cent say they are very likely or somewhat likely to change their vacation plans, generally in keeping with the rest of Canadians (37 per cent)
The Decima data were gathered between June 1st and June 11th, 2007, through Decima teleVox. Results are based on a sample of 1,026 Canadians and the corresponding margin of error is 3.1%, 19 times out of 20.
Investors Group, founded in 1926, is a national leader in delivering personalized financial solutions to Canadians through a network of over 4,000 Consultants located throughout Canada. In addition to an exclusive family of mutual funds and other investment vehicles, Investors Group offers a wide range of insurance, securities, mortgage and banking services. Investors Group is a member of the IGM Financial Inc. (TSX: IGM) group of companies. IGM Financial is one of Canada’s premier financial services companies with over $126 billion in total assets under management.
| For more information contact: | |
|---|---|
| Ron Arnst Media Relations (204) 956-3364 ron.arnst@investorsgroup.com |
Teresa Pagnutti Environics Communications (416) 969-2721 tpagnutti@environicspr.com |
