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Canadian Savings and Investing - January 2014

“As their national economy continues to struggle, Canadians are changing their priorities in order to improve their financial standing. Saving money and eliminating debt are increasingly important, and institutions with the best tools to help people achieve their goals will come out ahead. However, firms can’t forget that the ‘personal touch’ will also go a long way toward creating satisfied customers.” – Robyn Kaiserman, Financial Services Analyst

This report looks at the following areas:

  • How will changing financial priorities affect Canadians’ saving and investing habits?
  • How is the Canadian economy affecting Canadians’ perspectives?
  • Where is the opportunity for investment companies?
  • How can investment companies retain young customers?

Most Canadians use banks for their savings and investment accounts rather than credit unions, caisses populaires, or investment companies. What is more, they tend to have multiple products of all kinds at the bank at which they have their primary chequing account and they rarely switch banks once they begin a relationship. This gives the Big Five banks a huge advantage as they are most likely to attract customers at the beginning of their banking relationships and are unlikely to relinquish those customers any time in the future.

This report focuses on the current—and potentially future—savings and investment behavior of Canadians. It discusses the current landscape as well as identifies pockets of opportunity for all types of financial institutions, including banks, credit unions, caisses populaires, and investment firms.

This report builds on the analysis presented in Mintel’s Canadian Lifestage Financial Services Marketing—Canada, April 2012 and Canadian Lifestage Marketing in Financial Services—Canada, May 2013.

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Table of contents

  1. Scope and Themes

    • What you need to know
      • Data sources
        • Consumer survey data
          • Direct marketing creative
            • Abbreviations and terms
              • Abbreviations
                • Terms
                • Executive Summary

                    • The market
                      • Market drivers
                        • Figure 1: Financial priorities, overall, November 2013
                      • Leading companies
                        • Figure 2: Big Five bank assets as of Oct. 31, 2013
                      • The consumer
                        • Figure 3: Type of non-chequing account/product owned, by age, November 2013
                        • Figure 4: Attitudes toward banks and advice, by gender and age, November 2013
                        • Figure 5: Attitudes toward the Canadian economy and own household financial situation, by age, November 2013
                      • What we think
                      • Issues and Implications

                          • How will changing financial priorities affect Canadians’ saving and investing habits?
                            • Issues:
                              • Implications:
                                • How is the Canadian economy affecting Canadians’ perspectives?
                                  • Issues
                                    • Implications
                                      • Where is the opportunity for investment companies?
                                        • Issues
                                          • Implications
                                            • How can investment companies retain young customers?
                                              • Issues
                                                • Implications
                                                  • Figure 6: Reasons for considering switching investment companies, by age, November 2013
                                              • Trend Applications

                                                  • Trend: Access All Areas
                                                    • Trend: Immaterial World
                                                      • Mintel futures: Human
                                                      • Market Drivers

                                                        • Key points
                                                          • Consumer confidence heading up
                                                            • Canadian economy is still fragile
                                                              • Personal debt levels remain high
                                                                • Figure 7: Total per capita non-mortgage debt, Q4 2008-Q4 2014 (est)
                                                                • Figure 8: Financial priorities, November 2013
                                                              • Canada’s population is aging
                                                                • Figure 9: Population of Canada, by age, selected years, 2010-36
                                                            • Competitive Context

                                                              • Key points
                                                                • Big Five banks comprise 90% of all bank assets
                                                                  • Figure 10: Big Five Canadian banks assets and market share, as of Oct. 31, 2011, 2012, 2013
                                                                • Largest credit unions/caisses populaires
                                                                  • Figure 11: Top five credit unions/caisses populaires in Canada by assets, Q4 2012-Q2 2013
                                                                • Credit union membership is aging
                                                                  • Figure 12: Age distribution of credit union members, 2009 and 2013
                                                              • Innovations and Innovators

                                                                • Key points
                                                                  • Credit unions of BC targets young people
                                                                    • Growth of mobile investing apps
                                                                    • Marketing Strategies

                                                                      • Key point
                                                                        • Banks beginning to focus on wealth management
                                                                            • Figure 13: TD Bank direct mail ad, 2013
                                                                            • Figure 14: BMO direct mail ad, 2013
                                                                            • Figure 15: Manulife online ad, 2013
                                                                          • Brand analysis: RBC
                                                                            • Online initiatives
                                                                              • Email
                                                                                • Figure 16: RBC email ad, 2013
                                                                              • Direct mail
                                                                                • Figure 17: RBC direct mail ad, 2013
                                                                              • YouTube
                                                                                • Figure 18: RBC YouTube video, 2013
                                                                              • Brand analysis: Toronto-Dominion Bank Group (TD Bank)
                                                                                • Online initiatives
                                                                                  • Print
                                                                                    • Figure 19: TD Bank print ad, 2014
                                                                                  • Direct mail
                                                                                    • Figure 20: TD Canada Trust direct mail ad, 2013
                                                                                  • YouTube
                                                                                    • Figure 21: TD Trust YouTube video, 2013
                                                                                  • Brand analysis: desjardins
                                                                                    • Online initiatives
                                                                                      • Print
                                                                                        • Figure 22: Desjardins print ad, 2013
                                                                                      • Online
                                                                                        • Figure 23: Disnat (Desjardins) online ad, 2013
                                                                                      • YouTube
                                                                                        • Figure 24: Desjardins YouTube video, 2013
                                                                                    • Most Consumers Have Savings and Credit Cards

                                                                                      • Key points
                                                                                          • Figure 25: Type of non-chequing account/product owned, by gender, November 2013
                                                                                          • Figure 26: Type of non-chequing account/product owned, by age, November 2013
                                                                                          • Figure 27: Type of non-chequing account/product owned, by gender and age, November 2013
                                                                                          • Figure 28: Type of non-chequing account/product owned, by household income, November 2013
                                                                                          • Figure 29: Type of non-chequing account/product owned, by provinces, November 2013
                                                                                      • Most Keep Primary Non-chequing Accounts at Banks

                                                                                        • Key points
                                                                                          • All savings/investment/mortgage/credit accounts
                                                                                            • Figure 30: Where primary savings/investment/mortgage accounts are held, by type of account, November 2013
                                                                                          • Primary savings account
                                                                                            • Figure 31: Where primary savings account is held, by age, November 2013
                                                                                            • Figure 32: Where primary savings account is held, by household income, November 2013
                                                                                            • Figure 33: Where primary savings account is held, by provinces, November 2013
                                                                                          • Primary investment accounts
                                                                                            • Figure 34: Where primary investment account (other than retirement account) is held, by gender and age, November 2013
                                                                                            • Figure 35: Where primary investment account (other than retirement account) is held, by household income, November 2013
                                                                                            • Figure 36: Where primary investment account (other than retirement account) is held, by provinces, November 2013
                                                                                          • Primary retirement savings accounts
                                                                                            • Figure 37: Where primary retirement savings account is held, by gender and age, November 2013
                                                                                            • Figure 38: Where primary retirement savings account is held, by household income, November 2013
                                                                                            • Figure 39: Where primary retirement savings account is held, by provinces, November 2013
                                                                                        • Most Canadians Bundle Chequing and Savings

                                                                                          • Key points
                                                                                            • Accounts at primary institution
                                                                                              • Figure 40: Type(s) of products/accounts held with primary chequing/debit card provider, November 2013
                                                                                              • Figure 41: Type of products/accounts held at primary chequing account provider, by gender and age, November 2013
                                                                                              • Figure 42: Type of products/accounts held at primary chequing account provider, by household income, November 2013
                                                                                              • Figure 43: Type of products/accounts held at primary chequing/debit account provider, by provinces, November 2013
                                                                                            • Accounts at other institutions
                                                                                              • Figure 44: Type of products/accounts at financial institutions other than primary provider, by gender and age, November 2013
                                                                                              • Figure 45: Type of products/accounts at financial institutions other than primary provider, by household income, November 2013
                                                                                              • Figure 46: Type of products/accounts at financial institutions other than primary provider, by provinces, November 2013
                                                                                          • Where Savings Products are Held

                                                                                            • Key points
                                                                                              • Savings at primary chequing account provider
                                                                                                • Figure 47: Type(s) of savings/loan products held at primary chequing provider, November 2013
                                                                                                • Figure 48: Type(s) of savings/loan products/accounts held at primary chequing/debit account provider, by gender and age, November 2013
                                                                                                • Figure 49: Type(s) of savings/loan products/accounts held at primary chequing/debit account provider, by household income, November 2013
                                                                                              • At other institutions
                                                                                                • Figure 50: Type(s) of savings/loan products held at institutions other than primary provider, by gender and age, November 2013
                                                                                                • Figure 51: Type(s) of savings/loan products held at institutions other than primary provider, by household income, November 2013
                                                                                            • How Financial Transactions are Conducted

                                                                                              • Key points
                                                                                                • Mobile device ownership
                                                                                                  • Figure 52: Mobile devices owned, by gender, November 2013
                                                                                                  • Figure 53: Mobile devices owned, by age, November 2013
                                                                                                  • Figure 54: Mobile devices owned, by gender and age, November 2013
                                                                                                  • Figure 55: Mobile devices owned, by household income, November 2013
                                                                                                  • Figure 56: Mobile devices owned, by provinces, November 2013
                                                                                                • Canadians prefer PCs for financial transactions
                                                                                                  • Figure 57: Channels used to conduct transactions, November 2013
                                                                                                • Smartphones
                                                                                                  • Figure 58: Channels used to conduct transactions—Smartphone, by gender and age, November 2013
                                                                                                  • Figure 59: Channels used to conduct transactions—Smartphone, by household income, November 2013
                                                                                                • Tablets
                                                                                                  • Figure 60: Channels used to conduct transactions—Tablet, by gender and age, November 2013
                                                                                                  • Figure 61: Channels used to conduct transactions—Tablet, by gender and household income, November 2013
                                                                                                • Desktop/Laptop
                                                                                                  • Figure 62: Channels used to conduct transactions—Desktop/laptop, by gender and age, November 2013
                                                                                                  • Figure 63: Channels used to conduct transactions—Desktop/laptop, by gender and household income, November 2013
                                                                                                • In branch
                                                                                                  • Figure 64: Channels used to conduct transactions—In branch, by gender and age, November 2013
                                                                                                  • Figure 65: Channels used to conduct transactions—In branch, by province, November 2013
                                                                                                  • Figure 66: Channels used to conduct transactions—In branch, by gender and household income, November 2013
                                                                                              • Attitudes Toward Investments and Investment Companies

                                                                                                • Key points
                                                                                                  • Only half feel investment firms are better than banks
                                                                                                    • Figure 67: Attitudes toward investments and investment companies/advisers, by gender, November 2013
                                                                                                    • Figure 68: Attitudes toward investments and investment companies/advisers, by age, November 2013
                                                                                                • Investment Behavior

                                                                                                  • Key points
                                                                                                    • Most invest in mutual funds
                                                                                                      • Figure 69: Investment behavior, by gender, November 2013
                                                                                                      • Figure 70: Investment behavior, by age, November 2013
                                                                                                  • Lower Commissions are Main Reason to Switch

                                                                                                    • Key points
                                                                                                      • One quarter wouldn’t switch for any reason
                                                                                                        • Figure 71: Reasons for switching brokerage firms/mutual fund companies, by gender, November 2013
                                                                                                        • Figure 72: Reasons for switching brokerage firms/mutual fund companies, by age, November 2013
                                                                                                    • Attitudes Toward the Economy

                                                                                                      • Key points
                                                                                                        • Half are focusing more on saving
                                                                                                          • Figure 73: Attitudes about Canadian economy and household financial situation, overall, November 2013
                                                                                                          • Figure 74: Attitudes about Canadian economy and household financial situation, by gender, November 2013
                                                                                                          • Figure 75: Attitudes about Canadian economy and household financial situation, by age, November 2013
                                                                                                          • Figure 76: Attitudes about Canadian economy and household financial situation, by household income, November 2013
                                                                                                          • Figure 77: Attitudes about Canadian economy and household financial situation, by provinces, November 2013
                                                                                                          • Figure 78: Attitudes about Canadian economy and household financial situation, by educational attainment, November 2013
                                                                                                          • Figure 79: Attitudes about Canadian economy and household financial situation, by gender and household income, November 2013
                                                                                                      • Consumer Financial Priorities

                                                                                                        • Key points
                                                                                                          • Credit is number one priority
                                                                                                              • Figure 80: Financial priorities in next 12 months, November 2013
                                                                                                              • Figure 81: Financial priorities in next 12 months, by age, November 2013
                                                                                                              • Figure 82: Financial priorities in next 12 months, by gender and age, November 2013
                                                                                                              • Figure 83: Financial priorities in next 12 months, by income, November 2013
                                                                                                          • Cluster Analysis

                                                                                                            • Cluster methodology
                                                                                                              • Young Educateds
                                                                                                                • Demographics
                                                                                                                  • Characteristics
                                                                                                                    • Opportunity
                                                                                                                      • Distrustful Independents
                                                                                                                        • Demographics
                                                                                                                          • Characteristics
                                                                                                                            • Opportunity
                                                                                                                              • Older Loyalists
                                                                                                                                • Demographics
                                                                                                                                  • Characteristics
                                                                                                                                    • Opportunity
                                                                                                                                      • Cluster characteristic tables
                                                                                                                                        • Figure 84: Target clusters, November 2013
                                                                                                                                        • Figure 85: Type of non-chequing account/product owned, by target clusters, November 2013
                                                                                                                                        • Figure 86: Where primary savings account is held, by target clusters, November 2013
                                                                                                                                        • Figure 87: Where primary investment account (other than retirement account) is held, by target clusters, November 2013
                                                                                                                                        • Figure 88: Where primary retirement savings account is held, by target clusters, November 2013
                                                                                                                                        • Figure 89: Type of products/accounts held at primary chequing/debit account provider, by target clusters, November 2013
                                                                                                                                        • Figure 90: Type of products/accounts held at other financial institutions, by target clusters, November 2013
                                                                                                                                        • Figure 91: Type of savings/loan products/accounts held at primary chequing account provider, by target clusters, November 2013
                                                                                                                                        • Figure 92: Type of savings/loan products held at other institution, by target clusters, November 2013
                                                                                                                                        • Figure 93: Attitudes toward banks and advice, by target clusters, November 2013
                                                                                                                                        • Figure 94: Mobile devices owned, by target clusters, November 2013
                                                                                                                                        • Figure 95: Channels used to conduct transactions—Smartphone, by target clusters, November 2013
                                                                                                                                        • Figure 96: Channels used to conduct transactions—Tablet, by target clusters, November 2013
                                                                                                                                        • Figure 97: Channels used to conduct transactions—Desktop/laptop, by target clusters, November 2013
                                                                                                                                        • Figure 98: Channels used to conduct transactions—In branch, by target clusters, November 2013
                                                                                                                                        • Figure 99: Attitudes toward Canadian economy and personal household financial situation, by target cluster, November 2013
                                                                                                                                      • Cluster demographics
                                                                                                                                        • Figure 100: Target clusters, by demographic, November 2013
                                                                                                                                      • Cluster methodology
                                                                                                                                      • Appendix – Trade Associations

                                                                                                                                        Companies Covered

                                                                                                                                        • Bank of Montreal
                                                                                                                                        • Bank of Nova Scotia
                                                                                                                                        • CIBC World Markets Inc.
                                                                                                                                        • Coast Capital Savings Credit Union
                                                                                                                                        • Credit Union Central of Canada
                                                                                                                                        • Meridian Credit Union Limited
                                                                                                                                        • Mouvement des caisses Desjardins
                                                                                                                                        • Royal Bank of Canada
                                                                                                                                        • Toronto-Dominion Bank

                                                                                                                                        Canadian Savings and Investing - January 2014

                                                                                                                                        £3,277.28 (Excl.Tax)