BDO poll: Many Canadians will sacrifice saving for retirement and paying down debt to renovate their home this year

43% of Canadians who renovate will use at least some debt to pay for renovations, taking 2.5 years on average to pay off – 21% of renovators will not be saving enough for retirement

TORONTO, June 6, 2017 /CNW/ - Many Canadians are making financial sacrifices to complete home renovations this summer. As a result of their planned renovations, nearly one-quarter say they are not paying down debt as fast as they should be, 25% aren't saving enough for emergencies, and 21% are not saving enough for retirement as they focus on renovating their home, according to a new Ipsos poll conducted on behalf of BDO Canada Limited.

And, should those renovations go over budget, most renovators would choose to spend more rather than put the work on hold. Nearly half (44%) would dip into savings to cover the extra costs, while 15% would take on more debt.

"Ideally, you want to avoid carrying a large debt balance over several months," says Doug Jones, President of BDO Canada Limited. "With interest charges adding up each month, you could be paying back much more than you originally spent. We would suggest that Canadians focus on saving for retirement and reducing their existing debt rather than taking on more debt for home renovations."

Key Poll Findings (**For full tabular results, please visit the Ipsos website at www.ipsos-na.com).

Across the country, 57% of homeowners say they're likely to renovate in the next year, with Quebec (72%) and Ontario (61%) having the highest number of households considering a renovation. On the other hand, only 40% of homeowners in the Atlantic provinces are considering renovations.

On average, Canadian homeowners plan to spend $16,439 on their home renovations. Albertans anticipate spending the most on their renovations ($22,586 on average), while those in Saskatchewan and Manitoba anticipate spending the least ($11,934 on average).

Quebecers will finance the largest portion of their renovation with debt (31%) while those in Saskatchewan and Manitoba will use the least amount of debt (20% of the renovation cost). Homeowners relying on debt think it will take them a little more than two-and-half-years (30.6 months) to pay off debt.

Four in ten Canadians (42%) say they haven't set a renovation budget yet, but that they intend to, while 9% have no intention of budgeting. Atlantic Canadians are most likely (19%) to say they haven't budgeted and won't do so. They're also the most likely to use a credit card to pay for their renovations (23% vs. the national average of 13%).

Top Financial Fears for Homeowners

Finding larger problems that will add to their renovation costs

33%

Sudden change in financial situation (job loss, divorce or illness)

18%

Not getting their investment back when they sell their home

17%

A collapse in the housing market that lowers their home's value

15%

Taking on too much debt

14%

Not paying off renovation debt as quickly as they'd like

13%

An interest rate increase that increases their debt

9%

 

About BDO Canada Limited's Financial Recovery Services practice:

BDO Canada Limited's Financial Recovery Services practice is one of Canada's oldest (operating since 1958) and largest debt help firms, with offices across the country. BDO's advisors include Licensed Insolvency Trustees (Officers of the Court and licensed by the OSB) and Proposal Administrators providing credit counseling, consumer proposals and personal bankruptcy services.

These are some of the findings of an Ipsos poll conducted between May 18 and May 24, 2017, on behalf of BDO. For this survey, a sample of 1,003 Canadian homeowners aged 18+ who are at least somewhat likely to renovate was interviewed online via Ipsos' online panel. In this case, the poll is accurate to within ±3.5 percentage points, 19 times out of 20, had all Canadian homeowners planning a renovation been polled.

SOURCE BDO Canada Limited 

SOURCE BDO Canada Limited

For further information: Media inquiries please contact: Eric McLean at Environics Communications, 416-969-2756, emclean@environicspr.com

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