5 Surefire Ways to Efficiently Maintain Your Budget Amidst Inflation
While the Bank of Canada is predicting that inflation is slowing down and will fall to three per cent by the end of 2023, consumers are still feeling the pinch. Consumers still continue to feel the pinch brought about by the steady increase of the inflation last year, where it peaked at 8.1 per cent in the summer.
Food inflation rate remains above 10 per cent, where it has been at since August last year, and thus the price of groceries continues to increase. The prices for meat, bakery goods, and vegetables have been the most affected.
In addition, mortgage interest costs continue to rise, reaching 21.2 per cent in January this year, the largest increase since September 1982.
During these times, economization has become extremely important. Of course, it’s a challenge for those who have grown accustomed to a certain lifestyle and whose circumstances have changed at the same time.
Below are five ways for more effective budgeting during inflation.
Do an assessment of your spending habits.
The first step in economizing your budget is to take a closer look at how exactly you’re spending your money. If you’re ordering a grande cup of coffee from your favourite coffeeshop twice a day instead of making your own at home or in your workplace, then that’s a spending of already at least $40 each week, something which can go towards to your essentials like groceries.
You may also be spending too much on dining out where now you’re expected to tip no less than 15%. If each meal costs you $40 at the very least (tip included), then again something that can cover basic needs costs like utilities. Be a tough auditor on your spending habits, and you’re on your way to budgeting more efficiently.
Take advantage of coupons and rewards.
These days, most stores offer loyalty programs to attract more customers. It’s a competitive market out there, and this is where you can maximize your benefits as a customer. Take advantage of the shop’s point system to earn rewards that convert to a purchasing amount or free items. It will truly benefit you in the long run.
That being said, don’t get carried away and purchase perishable items more than you need for the sake of earning more points. You don’t want to end up with cartons and cartons of free range eggs or organic milk which will end up spoilt in your fridge.
Resell unused items.
During the pandemic, most of us relied on online shopping retailers for all our needs. Since there wasn’t a lot to do because we were under lockdown, you most likely ordered something just out of curiosity because it was trending on social media and you didn’t want to feel left out. Months later and post-COVID, you probably have a plethora of items you don’t need or haven’t used at all since you purchased them.
Instead of them taking space in your home, why not try to resell these items to earn yourself some bucks?
Curtail your online shopping.
If you’re one who’s latched on to online shopping a little too much even after the pandemic and you can’t stop browsing and adding to your cart, maybe delete the apps from your devices. This way, you won’t receive any notifications about any promos or any free shipping deals that usually entices you to check out what’s in store and you end up shopping.
Of course, even with the apps gone, you may be tempted to log in to the website directly, so this is where practicing self-discipline comes in. Convince yourself that unless you need something badly, like a gift for your best friend’s birthday, don’t shop online.
Consider GIC investments.
If you’ve built a considerable amount of savings, and you’re always tempted to spend it on something, look into investments that can truly pay off after some time. An ideal one is a Guaranteed Investment Certificate, or GIC, where your money will be locked in for a certain period of time but will gain a fixed interest. This way, you’re guaranteed to earn interest while your investment is safely untouchable.
Above are tips to effectively handle the inflation rate. Remember though there is real work involved here, and as long as you’re willing to put in that work, you’ll be raking in the benefits in no time!