It is no secret that an increasing cost of living is causing many households to struggle in recent months, both in Canada and globally. Rising prices are making it more difficult for many Canadians to live their lives comfortably. The steady increase of inflation and rising interest rates, as well as heightened consumer demand against supply chain challenges have been just a couple of the issues we have faced in Canada recently. Following a survey carried out by Statistics Canada, it was discovered that for almost three in four Canadians, rising prices are affecting their ability to meet day-to-day expenses. This includes transport, housing and rent, food, clothing, and lifestyle. This is causing many Canadians to make changes unwillingly, with the lowest income households affected most severely. In this article, we will discuss the ways the increasing cost of living is impacting Canadians, and what to do if you are struggling.
How to combat rising food prices
In the past year, the cost of food has increased by almost 10%, with Canadians having to pay much more for basic food items including fresh fruit, vegetables, and meat. The increased cost of housing and rent has often meant that most households also have less money to budget for their grocery shops. Some ways to be savvy with your grocery shop include the following:
- Establish a food budget – check out our guide on how to budget
- Strategically plan your meals for the week – use a list to keep focused in stores
- Eat before you shop to avoid impulse purchases on an empty stomach
- Check unit prices to compare and contrast prices
- Buy in bulk where possible to save money
- Purchase fewer branded items and opt for cheaper alternatives
- Utilize coupons wherever possible
- Use discount hunting apps and capitalize on opportunities
- Cook at home wherever possible, and cut back on takeouts
- Obtain food or meals from a community organization, such as food banks or community centres
How to combat increasing housing costs
Canada already struggles with expensive housing costs, particularly in cities like Toronto and Vancouver. In fact, you may already have been wondering ‘how much rent should I pay?‘ It is unwelcome news, therefore, that the cost of rented accommodation, owned accommodation, water, fuel, and electricity bills have all risen by around 7% year over year. This has sparked great concern by many Canadians about their ability to afford rent or housing, particularly so among younger Canadians. This is likely because older Canadians have have already bought and paid off their homes. It has meant that many Canadians who wanted to move to a new rental property or purchase a home have decided not to because of concerns over cost. Here are some tactics for beating the increasing cost of living when it comes to housing costs:
- Ask for a discount on your cell phone or internet bills from your provider
- See if your employer can give you a raise to cope with the increased cost of living
- Take on a side hustle to allow you to more comfortably tackle cost increases
- Consider taking on a roommate to raise some extra funds
- Downsize if you no longer need the space
How to combat increasing gasoline prices
No matter which province in Canada you live in, it is likely that you are experiencing some concern around the rising cost of driving and gasoline. Gas prices have climbed by more than 50% in the last year, contributing to rising inflation. Unfortunately, prices show no signs of slowing down either, as a tight global supply has been worsened by the Russian invasion of Ukraine. Prices have also been pushed even higher as the economy reopens after the pandemic, and while a busy travel season is in full flow. Here are a few tips for combating increasing gasoline prices:
- Use public transport where possible
- Car pool where possible
- Drive conservatively and avoid abrupt starts while driving
- Try not to accelerate rapidly or brake hard in order to lower fuel economy by up to 40%
- Minimize cold engine operation, instead driving the car normally to warm up the engine
- Observe speed limits
- Remove unnecessary objects from your vehicle
- Use cruise control to minimize speed fluctuations
- Avoid excessive idling to reduce fuel consumption
Other ways of tackling the increasing cost of living
Given the rising costs, many Canadians are having to adjust their spending habits and lifestyles to counteract inflation. Lots of individuals are choosing to seek out sales, use coupons for purchases, or look for promotions. Many are also choosing to buy cheaper alternatives or unbranded products instead. Often, Canadians are choosing to delay making their purchases while prices are high. As well as adjusting their spending habits, many Canadians are borrowing money from family and friends, taking on additional debt, and using credit cards to meet their daily expenses. Taking on additional debt to get by can quickly spiral. If you are struggling with unmanageable debt, speak to a reputable Licensed Insolvency Trustee. They are the only professionals in Canada legally able to file all forms of debt relief. No matter how bad you feel your financial situation may be, there is always a form of debt relief to help you. These include the following:
- Debt consolidation loans – a new loan that is taken out to condense multiple other separate loans into one. It has the advantage of simplifying your monthly payments into one and often either eliminates or reduces your interest rate.
- Consumer proposal – a legal debt settlement filed by a Licensed Insolvency Trustee whereby you propose an affordable amount to repay your creditors over a fixed time period of up to five years. It has a number of advantages including allowing you to keep your assets, and reducing your debt by up to 80%.
- Bankruptcy – the best option for a fresh financial start, bankruptcy is the process of assigning any non-exempt assets you may have over to your Licensed Insolvency Trustee in exchange for the clearance of your unsecured debts. It also offers full protection from your creditors via a stay of proceedings.
With the increased cost of living, many Canadians are also struggling to save, or are using their savings in order to fund their day to day expenses. At Spergel, we can assist you with advice on money management, how to save, and credit counselling if you need further support during these tough financial times.
For support in combating the increasing cost of living in Canada, book a free consultation with Spergel. Our experienced Licensed Insolvency Trustees have helped over 100,000 Canadians begin a fresh financial future. Whether you have overwhelming debt or are struggling to make ends meet in these tough conditions, we are here to help you with compassion and understanding. Reach out today – you owe it to yourself.