British Columbians are planning on boosting their savings accounts in 2014.
Residents of B.C. expect to save an average of $15,117 each in 2014 – 57% higher than the national average of $9,635 – which would make them the biggest savers in the country, according to the results of a BMO poll released January 23.
These expected savings are considerably higher than the actual amounts saved in 2013, both province-wide and nationally. Respondents from B.C. also saved the most last year compared with their counterparts in other parts of the country, having saved an average of $11,224. This is 28% higher than the Canadian average of $8,764.
Nationally, the household saving rates increased from 5% in 2012’s third quarter to 5.4% in the same period of 2013.
“Canadians increased their savings last year in response to higher long-term interest rates and with one eye on elevated debt,” said Sal Guatieri, senior economist with BMO Capital Markets.
“We expect the saving rate to remain above 5% in 2014, as households are borrowing at the slowest rate in three decades and long-term interest rates are likely to drift higher due to a stronger economy and a reduction in Federal Reserve stimulus.”
Albertans come in second place in terms of how much they plan to save this year, with $12,478. Quebeckers are planning to save the least in the country, with an average of $6,179.
The most common savings vehicle was a Tax-Free Savings Account (47%), followed by a high-interest savings account (31%).
The top reason identified for saving in 2014 is for a vacation, with 48% of those surveyed saying this was their number one goal this year. This was followed by building an emergency fund (43%) and saving for retirement (39%).
The survey also found a gender difference in amounts saved. In 2013, Canadian men saved $10,567 – almost 52% more than women, who only saved an average of $6,961. This trend is expected to continue, with men saying they plan to save $11,228 in 2014 compared to $7,989 for women.
