TORONTO – An emergency fund is meant to be there in times of need, but a new survey suggests nearly half of Canadian homeowners would be ill prepared for a personal financial dilemma such as job loss.
The poll released today by Manulife Bank finds that 24 per cent of those surveyed don’t know how much is in their emergency fund, 14 per cent have not put away any funds and nine per cent have access to $1,000 or less.
The remainder of those surveyed have up to $10,000 saved, with the average amount being $5,000.
Manulife says among those polled, homeowners had an average of $174,000 in mortgage debt, with an average of 28 per cent of their net income going toward paying off their home each month.
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About half (46 per cent) of those polled say they would have difficulty making their monthly mortgage payments in less than six months if their household’s primary income earner lost his or her job.
Sixteen per cent say they would have financial difficulty if interest rates cause their mortgage payments to increase.
Mortgage data has been a hot-button topic in recent months as the federal government takes steps toward reducing the risks in the Canadian housing market.
Earlier this month, Finance Minister Bill Morneau announced that stress tests will be required for all insured mortgages to ensure that borrowers would still be able to make their mortgage payments if interest rates rise or their financial situations change.
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Last year, Ottawa raised the minimum down payment on the portion of a home worth over $500,000 to 10 per cent.
The poll by Environics Research was conducted online with 2,372 Canadian homeowners from June 28 and July 8 of this year. Survey participants were between the ages of 20 to 69 with household income of $50,000 or more.
The polling industry’s professional body, the Marketing Research and Intelligence Association, says online surveys cannot be assigned a margin of error because they do not randomly sample the population.