85% of Canadians think living paycheque to paycheque is the ‘new norm’: study

If you find yourself struggling with your finances lately, you’re not alone.

A new study from H&R Block Canada indicates that a concerning level of Canadians are relying on their next paycheque for everyday expenses and are unable to build a savings nest egg.

According to the study, a whopping 85% of Canadians feel that living paycheque to paycheque is the “new norm,” a significant increase from the 60% who said the same thing a year earlier.

Although more than eight in 10 people feel that way, another result of the study would indicate that not that many Canadians are living paycheque to paycheque.

“Overall, 54% of Canadians feel good about their current personal financial situation, compared to 46% who are not feeling positive,” a release from H&R Block Canada stated.

“More than half of Canadians (51%) say that despite making a decent salary, it's hard to make ends meet, and 81% are concerned their income is not keeping pace with the cost of living.”

The study found that people’s savings are taking a hit as the cost of living increases.

It found that 74% of Canadians worry they’re not putting enough money into savings accounts and 62% feel they don’t have enough left over from their paycheque to build up a nest egg.

“Looking ahead, 78% say they're likely going to have less to put into a savings account in 2025, given the high day-to-day cost-of-living,” the H&R Block Canada release added.

“Nearly half of Canadians (46%) say they're unable to save money for long-term goals like retirement or a home, as their paycheque goes to their immediate needs.”

Furthermore, the study found that just under half of Canadians (48%) rely on their credit card, rather than savings, to make larger purchases, while 17% rely on installment payment options.

It also discovered that 56% of Canadians worry they’ll have to go into debt if faced with an unexpected expense like replacing an appliance, home repairs or dental costs.

The study surveyed a nationally representative sample of 1,790 Canadians on Feb. 12-13, 2025, with a margin of error of +/- 2.3 percentage points at a 95% confidence level.

Click here to read more about the H&R Block Canada study.