Inflation is cooling, but Albertans still experiencing highest financial stress rates in Canada

Canada's annual inflation rate fell to 2.5 per cent last month marking the slowest increase since March 2021, but a new survey highlights that Albertans are still the most stressed about finances among all Canadians.

According to FP Canada’s latest 2024 Financial Stress Index, about 56 per cent of Albertans reported being the most stressed about money compared to other stressors such as personal health, work and relationships.

This is significantly above the national average of 44 per cent and the second consecutive year Alberta has seen the highest financial stress rates in Canada.

“Because it's such a high stress, it quite often creates health implications, anxiety, depression, loss of productivity, and relationship issues,” said Ryan Gubic, a certified financial planner with M|R|G Wealth.

“The survey showed also that Albertans were one of the top provinces that said they don't work with a financial professional, and quite often there is a direct link to financial stress, having unanswered questions, not feeling in control, or not having clarity of your financial future.”

• Sign up for breaking news alerts from CTV News, right at your fingertips
• The information you need to know, sent directly to you: Download the CTV News App

The survey of more than 2,000 respondents (margin of error +/- 2.2 per cent 19 times out of 20) found that nearly half (48 per cent) of Albertans experience anxiety, depression and other mental health challenges linked with money.

Only 29 per cent of Albertans work with a financial professional, the lowest rate in Canada and only two per cent of respondents sought advice from a professional financial planner.

“So it’s really important to have that discussion and clarify what your values, goals and vision of life is,” Gubic said.

“Because really, when it comes to financial stress, a lot of it originates from not having a clear vision and plan and path on how to move forward, and it creates that anxiety and depression and other things when you have unclear and unresolved issues.”

Stage set for Bank of Canada rate cut: ATB Financial

Despite rising stress for Albertans, there is some good news on the horizon, according to ATB Financial chief economist Mark Parsons.

“So Albertans might not be feeling it because prices are still very high, it’s just that the rate is slowing year-over-year which is what the Bank of Canada needs to see to reach its two per cent target,” he said.

“Canadian unemployment is also at 6.4 per cent and we're seeing a lot of signs of slowing in the Canadian labor market which we see passing through to wages. So one of the culprits on inflation has been high wage growth and we see some of those pressures easing off going into the later part of this year and into next year.”

Parsons says however that gas prices are exerting some pressure on the market but this was also offset by lower travel-related costs.

"So overall, energy costs were down in the last month, year-over-year, but yes, definitely, gas prices are a little bit higher.,” Parsons said.

“Part of the reason is that the fuel tax pause was in effect this time last year, and it's no longer in effect this time this summer, so that has added a little bit more pressure to gasoline price increases in Alberta.”

Canadian Taxpayers Federation calls out high gas taxes

The Canadian Taxpayers Federation is calling for gas tax cuts in Alberta following the release of its Gas Tax Honesty Report.

“Alberta used to lead the country in low fuel taxes, but that award goes to Manitoba now,” said Kris Sims, CTF Alberta director.

"The Alberta government needs to cut taxes for all Albertans like it promised to do in the election.”

Sims added that Alberta Premier Danielle Smith’s suspension of its fuel tax previously had consumers saving 13 cents per litre which is roughly $15 or so per fill-up for the average pick-up truck.

Fast forward to 2024 however and that tax is now back.

“So all told, when you combine the federal taxes and the provincial fuel taxes, we are paying more than 48 cents per litre, broken down, that's more than $30 every time you fill up a family minivan, and that's more than $50 every time you fill up a light duty pickup truck,” Sims said.

“That's just taxes and so especially here in the summer, when folks are trying to take family road trips and they're getting ready to go back to work and back to school, we wanted to highlight the fact that Albertans are no longer paying the lowest fuel taxes in all of Canada.”

The federal carbon tax is also adding to the pains at the pump averaging at around 17 cents per litre.

“We’re urging both levels of government to reduce our taxes.”

Looming rail strike set to put pressure on food prices

Grocery prices are still expensive, but they’re increasing at a much slower rate according to the latest Statistics Canada Consumer Price Index.

Agri-Food Innovation chair with the University of Saskatchewan Stuart Smyth notes that no particular items are seeing significant spikes and inflation is evenly distributed this time around, but there’s huge supply chain concerns on the horizon.

“I think the carbon tax has, has been keeping food inflation a little bit higher, but I think the thing we're going to see, and shipping companies have been indicating this now for the last two weeks, is that non perishable goods are no longer being shipped in containers to Canada because they don't want them stranded in harbours for a rail strike,” Smyth said.

“So that means that you know, things like tin goods and those other items in grocery stores are likely going to start to tighten up in terms of supply and availability over the coming weeks, and depending on how long this strike lasts, some of those goods may be relatively scarce on grocery store shelves come this time a month from now.”

Smyth particularly pointed to items like cereal for example which tends to be shipped fairly close to the time it needs to arrive on grocery store shelves.

“There’s a fairly high flow-through rate or turnover of those products so if you haven't got much cereal and suddenly the containers are no longer moving on rail, grocery stores may start to run out of some of those products, certainly within the next 30 to 45 days.”