RBC poll found family finances near breaking point as costs climbed on all fronts
Canadian parents entered the 2025 holiday season with budgets already running hot, as rising day-to-day costs and mounting extras collided with higher debt-servicing burdens and looming mortgage renewals.
The latest RBC Family Finances Poll: Parenting Edition showed parents are most worried about the ongoing, not seasonal, costs of raising children, with nearly three-quarters saying they are surprised by how much child-related expenses has risen over the past year (72%).
These findings came as other national indicators point to household finances being stretched, with household credit market debt reaching 173.9% of disposable income and mortgages accounting for close to three-quarters of that total.
“Trying to balance needs versus wants for your children can be even more challenging during the holiday season, especially when you’re finding it difficult to cover everyday costs throughout the year,” said Dawn Tam, BC-based senior manager, regional financial planning consultant at RBC Financial Planning.
As parents juggle rising basics such as food and clothing and higher prices for extracurriculars, 60% reported their household budget has never been stretched so thin, and 52% said they have never been so stressed about covering child-related expenses.
Nearly all respondents (94%) are concerned these costs would climb higher in the new year.
Impact on housing and debt decisions
The squeeze extended beyond kids’ activities into broader household balance sheets. Two-thirds (67%) of parents said they have, or would, sacrifice their own financial future to spend what they could on their children today, while 41% reported dipping into savings or emergency funds and one-third (33%) has taken on debt to cover family costs.
Those patterns arrived as Canadians face heavier borrowing loads elsewhere. Equifax data showing total consumer debt reached $2.54 trillion at the end of 2024, with average non-mortgage debt of $21,931 per consumer.
Many renewing mortgages were encountering sharp payment increases, raising concerns that more households would lean on credit to bridge shortfalls.
"Parents often underestimate how much extras add up over the year, which can bring some unexpected pressure on family finances. Smaller costs can quickly reach hundreds of dollars, while bigger expenses can run up into thousands," Tam said.
"As a parent of young children myself, I understand the desire to give a child every advantage possible in life. The red flag we raise here when advising our clients is to make sure the choices they're making won't cripple their current – or future – finances."
Single parents and stretched budgets
Tam said pressures were even more acute in single-income homes.
"Trying to manage today's high costs in a single income household can be so much more challenging – let alone trying to save for the future they're hoping to achieve, for themselves and their children," Tam added.
"The good news is we can often help single parents as well as couples uncover hidden opportunities to stretch their budgets further and make the most of their cash flow."
Families are prioritizing children’s needs and everyday essentials at the same time rising rates, high home prices and heavier non-mortgage debts narrow room for error.
With more than 2.2 million mortgages set for renewal in 2024 or 2025, totalling over $675 billion, advisors and brokers face a client base whose budgets are already “stretched from all angles” before new housing costs are locked in.
Conversations about refinancing, renewals and credit options might need to start not at the mortgage statement, but at the family kitchen table, where parents are tallying up camp fees, grocery bills and rising payments, and deciding which future goals could still fit.
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