Canada has long been thought of as a nation of savers and a new study by HSBC Bank Canada finds that this behavior has intensified due to the current economic uncertainty.

According to the study released Wednesday, 84% of Canadians have some savings put aside. This percentage is up dramatically compared to a 2006 HSBC survey, which found that only 67% of Canadians had funds put away for the future or an emergency.

The percentage of Canadians that indicated they have savings varied somewhat across the country. Albertans have the highest savings rate with 92% indicating they have some savings.

The savings rate for British Columbia residents is 84%, in line with the national average, while 89% of Manitoba and Saskatchewan residents claimed to have savings.

In central Canada, 86% of Ontario residents had some savings put away, while the percentage of Quebec savers was 80%.

Atlantic Canada has the lowest rate of savers at 77%.

“It is not surprising that Canadians are becoming increasingly cautious about not only how and when they spend their hard earned dollars these days, but also how and where they save. For example, not only are savings rates up but Canadians are increasingly becoming more conscious of the kinds of savings options available to them such as the TFSA or high rate savings accounts,” says Rick Kelln, senior vp HSBC Bank Canada.

The newly launched Tax Free Savings Account (TFSA) is proving to be a particularly popular saving tool as a result of the recent awareness campaigns by the federal government and many banks. The survey found that 88% of Canadians are already aware of the TFSA, with 68% of them saying they plan on opening an account.

Of those planning to open a TFSA, 70% say they would use it for general savings and retirement planning while 23% see it as a good vehicle for emergency funds.

Younger people (defined as those aged 18-34) who plan to open a TFSA intend to use the account for general savings, emergencies or education. This is in contrast to older Canadians aged 34-54 who, according to the survey, are more likely to see their TFSA as part of their retirement savings.

Thirty-four per cent of those who plan to open a TFSA intend to open a high-interest savings account, while 15% will be using their TFSA for GICs or term deposits. Just 16% anticipate using the TFSA for mutual funds or stocks and bonds, and 36% intend to use a combination of all these investments and savings instruments.

The survey of 1,000 Canadians was conducted in February 2009 by the national market research data collection firm Opinion Search.

IE