Those earning less than $40,000 most likely to use tax refund to shop
Younger Canadians most likely to save refund
TORONTO, May 27, 2011 /CNW/ - If they haven't already, the majority of
Canadians will soon be receiving a tax refund and according to
Scotiabank's Annual Income Tax Refund Poll conducted by Harris/Decima,
almost one quarter of Canadians (23 per cent) plan to put their refund
toward debt reduction. An additional one-in-five Canadians plan to save
their refund by putting it in the bank (14 per cent), investing it
(five per cent) or contributing it to their RRSP (one per cent). Just
over one tenth (11 per cent) of Canadians don't yet know what they will
do with their tax refund.
"The commitment Canadians are showing to reducing their debt and saving
is promising," said Mike Henry, Senior Vice-President & Head, Retail
Payments, Deposits, and Lending, Scotiabank. "Paying down debt, saving,
or investing with a tax refund demonstrates that Canadians are thinking
ahead for their financial well-being."
Though the 2011 poll results are fairly consistent with the 2010
results, this year only six per cent of Canadians plan to use their tax
refund to go shopping, marking a slight decrease from last year's nine
per cent. Canadians are also less likely to use their tax refund to go
on vacation this year (two per cent vs. five per cent in 2010).
"It's encouraging to see that Canadians are thinking before they spend
when it comes to their tax refund," commented Mr. Henry. "While it can
be tempting to spend the lump sum of a tax refund, it can also be a
great way for Canadians to boost their savings and set aside money for
a rainy day. For Canadians who want to set aside their refund, a
tax-free savings account can be an excellent place for them to put
their money as interest is earned tax-free and there aren't any
penalties for withdrawals."
Residents of Atlantic Canada are more likely than other Canadians to put
their tax refund toward home renovations (14 per cent vs. four per
By Household Income
Although still top priorities, only 21 per cent of those Canadians
earning less than $40,000 are likely to spend their refund on reducing
debt and only 15 per cent on saving for the future. So where is their
refund going? Canadians earning less than $40,000 a year are more
likely than those earning $40,000 or more to use their refund for
shopping (10 per cent vs. four per cent).
Younger Canadians (18-34) are more likely than their older counterparts
to deposit or invest their refund (27 per cent vs. 13 per cent),
whereas older Canadians (55+) are less likely to expect to get a refund
(36 per cent vs. 18 per cent).
Men are more focused than women on saving their refund (23 per cent vs.
17 per cent), while women are just as likely as men in their likelihood
of using their refund to pay off debt (24 per cent vs. 22 per cent).
"Young Canadians seem to have their financial priorities in order, a
trend that we hope continues in years to come," added Mr. Henry. "It's
important to remember that a tax refund isn't free money - it's your
money! So, take a minute to think about your financial priorities
before making any decisions."
For more information on the Tax-Free Savings Account, visit www.scotiabank.com.
The data was gathered between April 7th through April 10th, 2011 through Harris/Decima's weekly teleVox, the company's national
omnibus survey. Results are based on a sample of 1,018 Canadians, and
the corresponding margin of error is ±3.1%, 19 times out of 20.
Scotiabank is one of North America's premier financial institutions and
Canada's most international bank. With more than 70,000 employees,
Scotiabank Group and its affiliates serve some 18.6 million customers
in more than 50 countries around the world. Scotiabank offers a broad
range of products and services including personal, commercial,
corporate and investment banking. With assets above $541 billion (as at
January 31, 2011), Scotiabank trades on the Toronto (BNS) and New York
Exchanges (BNS). For more information please visit www.scotiabank.com.
For further information:
Robyn Harper, Scotiabank Media Communications, (416) 933-1093 or firstname.lastname@example.org