Canadian households hit a high of $18.6 trillion in wealth last year — but geopolitics could lead to growth ‘reversal’ in 2026

Canadians' household wealth rose to $18.6 trillion in the final quarter of 2025, getting a boost from stock market gains. Photo by Selensergen /Getty Images

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Last year, Canadian households added more than $1 trillion to their collective net worth, driven by significant gains in financial assets, according to Statistics Canada’s latest national balance sheet, released Monday.

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Household net worth increased by nearly $230.2 billion quarter over quarter to reach $18.6 trillion in the fourth quarter of 2025, continuing a winning streak of wealth gains since the end of 2023. At the end of last year, Canadians’ wealth stood at about $17.6 trillion.

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Financial assets in the fourth quarter grew 10.5 per cent year-over-year — and the ratio of financial assets, such as stocks, to non-financial assets, such as real estate, hit 120.7 per cent, its highest point in more than two decades.

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“For the last two years, financial assets have been the primary driver of gains,” said Maria Solovieva, economist at Toronto-Dominion Bank.

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Domestic markets stole the show, with the S&P/TSX composite index climbing 5.6 per cent in the fourth quarter of 2025, closing out the year 28.2 per cent higher than it did at the end of 2024 and marking the largest annual increase since 2009. The S&P 500 index also inched up 2.4 per cent in the fourth quarter and ended the year 16.4 per cent higher than it did at the end of 2024.

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As a result, financial assets grew 2.5 per cent, or $296.9 billion, to reach $11.95 trillion in the fourth quarter.

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Meanwhile, the value of residential real estate assets dipped 0.4 per cent to $8.45 trillion in the fourth quarter, ending the year 0.2 per cent lower compared with the end of 2024.

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“We’re not expecting a meaningful recovery in housing demand and prices through this year, and so that would indicate that there’s still going to be a preference towards financial assets through 2026,” said Shelly Kaushik, senior economist and vice-president of economics at the Bank of Montreal.

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The household savings rate declined to 4.4 per cent in the fourth quarter, as household spending rose by 1.2 per cent and well surpassed muted disposable income gains of 0.6 per cent.

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Kaushik said reduced interest rates have meant households have had less incentive to save, and “the overhang of strong inflation” has potentially prevented households from tucking away funds for a rainy day as well.

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“If the labour market is loosening, (there is) potentially a little bit less job security (and) actual money out there in the economy to be diverted to savings,” Kaushik said.

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At the same time, the pace of seasonally adjusted household credit market borrowing, which includes consumer credit and loans, declined slightly to $36.2 billion. Despite mortgage demand ticking up to $28.7 billion, overall household borrowing was likely dented by a slowdown in auto sales impacting non-mortgage debt, Solovieva said.

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“It kind of makes sense, because you have some households that continue to spend, maybe boosted by gains in the financial assets … but those are not necessarily the same households that are borrowing in the non-mortgage space,” she said.