TORONTO – Fewer than 20 per cent of Canadians appear financially prepared to deal with an emergency, according to a poll done for the Bank of Montreal.
In its annual Rainy Day survey, 17 per cent of respondents say they have less than $1,000 in savings to draw upon in the event of an emergency.
Another 20 per cent have up to $5,000, 14 per cent have up to $9,999 set aside and 18 per cent say they have set aside $50,000 or more for an emergency.
Half of the respondents said they have the equivalent of three months of expenses set aside while 43 per cent have less than three months.
About one-quarter, or 23 per cent, said they are living paycheque to paycheque.
Two-thirds have had to dip into their rainy day fund in the past, with car repairs, job loss and home repairs being the most common reasons.
The poll also found that those over the age of 65 are most likely to feel prepared while those between the ages of 35-44 are the least likely.
“Financial emergencies, such as a broken furnace or major car repairs, can crop up at any time and, without some form of financial cushion, can potentially cause households to take on more debt than is necessary,” said BMO vice president Janet Peddigrew.
“The ideal emergency savings fund should be equal to three to six months of your income.”
The online survey of 1,000 Canadians by Pollara was conducted between July 26-30.