Protect your wallet against COVID-19

COVID-19 brings its share of financial uncertainties. Maybe you have more than financial difficulties since the crisis. The vast majority of Quebecers have continued to work by receiving their salary. By reducing their expenses since confinement, many have more savings. An opportunity to invest for retirement or real estate projects.

The pandemic forces to review its finances

The pandemic will have influenced the wallets of Quebecers who must now prepare for the second wave. Since March, several companies have frozen employee salaries and financial anxiety has skyrocketed. Conversely, some people have managed, thanks to the reduction in their expenses, to build a solid stocking.

“Right now, we’re writing history as we go. There is no one who really knows what will happen next week ”, answers the Newspaper Stéphane LeBlond, President of Syndic LeBlond et Associé.

“Several economic forecasts related to the impacts of COVID-19 have not come true. For example, after the first confinement, we predicted a tidal wave of consumer bankruptcies and this has not yet happened, ”he continues, to illustrate this period of uncertainty.

However, the pandemic has prompted Quebecers to review their way of spending to avoid bankruptcy, others have taken the opportunity to save in order to carry out projects that are close to their hearts:

A young businesswoman takes the opportunity to buy a house.
A family of three manages to get through the crisis with the help of the state.
A young person in business takes advantage of the drop in expenses to pay off his debts.
And Amélie and Jean who are experiencing a descent into hell because of COVID-19.

Photo QMI Agency, Joël Lemay

Francis Dumais, 39, testifies in our file about the importance of paying his debts in the midst of a pandemic.

Savings climbed 34.5%

Due in particular to the increase in teleworking, lockdowns, government assistance programs and financial institution relief measures, several Quebecers have managed to put more money aside in recent months.

Moreover, according to data from the Institut de la statistique du Québec, the household savings rate fell from 13.4% in the first quarter of 2020 to 34.5% in the second quarter. And savings jumped during that same period from $ 36.8 billion to $ 106 billion (annualized rate).

This situation was reflected in particular in the accounts of TD Bank. The latter noted an 18% increase in deposits.

At Desjardins Group, spokesperson Chantal Corbeil also confirmed to the Newspaper that the financial institution of Lévis had observed since March an increase in the number of deposits, that is, among other things, the money found in the bank accounts of members.

For the first six months of 2020 compared to 2019, Desjardins recorded an increase of 14%. As of June 30, the accumulated amounts stood at $ 220 billion, according to their financial report.

As for the National Bank, the volume of deposits climbed 9.7% in the third quarter, compared to the same period in 2019.

With the growth of telecommuting, people’s spending has also declined. Still according to the Institut de la statistique du Québec, they fell by 13.9% between the first and second quarters of 2020.

Despite the increase in savings in recent months, more than one in two Quebecers still considers that he does not put enough money aside for his retirement, suggests a survey by Éduc-Épargne, carried out as part of Financial Planning for Retirement Month.

According to Pierre Fortin, president of Jean Fortin & Associés, this honeymoon concerning savings should however come to an end for some when the banks put an end to their relief measures, in particular the postponement of mortgage or product payments. financial.

He estimates that this is when the number of bankruptcies could increase.

Mr. Fortin mentions that he has never seen such a high savings rate among Quebecers. “It is not realistic that this can be maintained at nearly 40%,” he notes. In 2017, it was 5.7%.

Move of mercy

As for companies, according to the president of the syndic LeBlond et Associés, the second wave of the pandemic should lead to its share of bankruptcies and restructuring, among others, in the sectors affected by the reconfinement. And who says bankruptcy means loss of jobs.

“In the restaurant business, this will be the final blow to all the companies that thought they had an opportunity to get by with government programs,” Newspaper Stéphane LeBlond. This means that there is likely to be a lot of people on real unemployment. You can sense financial anxiety among business people, ”he continues.

The latter, who does not believe that it will be possible to save all the companies, affirms that those which were already in financial difficulty before the pandemic will be still so at the end of the assistance programs.

This week, Revenu Québec extended until December 31 the deadline for filing refundable tax credit applications for businesses, applications for the non-refundable tax credit for international financial centers as well as for development. e-business.

Benefits and financial anxiety

COVID-19 created financial anxiety for some consumers, which was reflected in their spending. Conversely, some people have been able to take advantage of the impacts of the pandemic.