Learning About Financial Health in Canada

39 Pages Posted: 10 Jan 2020 Last revised: 13 Jul 2020

See all articles by Adam Metzler

Adam Metzler

Wilfrid Laurier University - Department of Mathematics

Yuhao Zhou

Wilfrid Laurier University, Canada

Chuck Grace

University of Western Ontario - Richard Ivey School of Business

Date Written: December 20, 2019

Abstract

This paper applies cluster analysis to a unique set of data on the financial health of working Canadians. The data consists of eleven (continuous) years’ worth of responses to the highly regarded Canadian Payroll Association (CPA) survey of employed Canadians. Because of its longevity and consistency, access to the CPA data offers unique insights into Canadians’ financial circumstances and how, if at all, those circumstances have evolved over time. Our results suggest that each working Canadian falls into one of three categories, which we label financially comfortable, financially coping and financially stressed. We find that financial stress is both widespread (one third of all respondents are identified as stressed) and complex (stress is only weakly related to simple demographics such as age or income). All of our findings are remarkably consistent through time, and authenticate results reported by a growing body of research on financial health in Canada.

Keywords: cluster analysis, financial well-being

Suggested Citation

Metzler, Adam and Zhou, Yuhao and Grace, Chuck, Learning About Financial Health in Canada (December 20, 2019). Available at SSRN: https://ssrn.com/abstract=3507769 or http://dx.doi.org/10.2139/ssrn.3507769

Adam Metzler (Contact Author)

Wilfrid Laurier University - Department of Mathematics ( email )

Canada

Yuhao Zhou

Wilfrid Laurier University, Canada ( email )

Chuck Grace

University of Western Ontario - Richard Ivey School of Business ( email )

1151 Richmond Street North
London, Ontario N6A 3K7
Canada

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