Millennials Grapple with Financial Strain as Living Costs Soar
Canadian millennials are confronting a daunting financial reality, struggling to balance escalating living expenses with the need to save for the future. According to a recent survey by the Royal Bank of Canada, more than half of this demographic report having little money left after covering monthly bills, while approximately 40% have no investments whatsoever.
Savings Depleted and Debt Concerns Mount
High costs are placing immense pressure on individuals aged 30 to 45. The survey indicates that nearly half have resorted to dipping into their savings just to pay bills, and a striking 40% express concern that they may never manage to pay off their debts. Jodi Wright, senior director and head of RBC Financial Planning, emphasized the severity of the situation in a news release.
"Today's lack of affordability is a crucial challenge for millennials at a time when they need their money to be working as hard as they are," Wright stated. "It can be overwhelming when you're trying to cover monthly expenses, pay down debt, and invest for the future."
Household Debt Reaches Record Levels
Compounding these personal financial struggles, Canadian household debt surged to $2.6 trillion in the fourth quarter of 2025, marking a 4.3% year-over-year increase, as reported by TransUnion of Canada Inc. Despite this growth, TransUnion suggests that Canadians are utilizing credit more strategically as a financial management tool, reflecting a healthier, expanding economy rather than heightened financial stress.
Delinquency rates have seen some increases but appear to be stabilizing as interest rates decline and Canadians adapt to the evolving financial landscape. Notably, credit card delinquency rose by just two basis points in the quarter—the smallest annual increase since 2021—while auto loan delinquencies decreased by 5%.
"Stabilizing and improving delinquency rates indicate that Canadians are better at managing debt after several years of volatility," remarked Matt Fabian, director of financial services research and consulting at TransUnion Canada.
Financial Literacy Gaps Exacerbate Challenges
The RBC survey also uncovered significant gaps in financial literacy among millennials. Almost half do not have a financial plan, and 55% admit to difficulty navigating the complexities of their financial situations. Despite these issues, only 22% have sought professional financial advice in the past year.
Key reasons for this reluctance include:
- 44% feel they lack sufficient knowledge about their finances and fear being judged.
- 40% are unsure where to begin with financial planning.
This combination of high living costs, mounting debt, and inadequate financial guidance paints a challenging picture for millennials striving to achieve financial stability and future security.
