INFLATION AND THE RISING COST OF LIVING IN CANADA

Inflation is a process in which money loses some of its value. A supply crunch of too much demand chasing too few goods or services can cause inflation. This results in paying higher costs for the same item. The inflation rate affects almost all goods and services you will need to pay more for essentials such as food and housing. Overall, this will increase the cost of living. According to a new survey more than half of Canadians can’t keep up with the rising cost of living. More Canadians feel stressed about money as inflation rates continue to grow. The basic day to day necessities such as food, gasoline and energy are the key factors adding to the cost of living to household bills. Canadian’s budgets are getting squeezed with the rise of inflation.\n\nWith rising housing, gasoline and grocery prices driving inflation, the survey found that 53 percent of respondents reported not being able to keep up with the rising cost of living. When it comes to emergency expenses, 51 per cent reported they would be unable to cover an unexpected $1,000 bill, including 14 per cent who said they couldn’t manage an emergency expense of any kind. Households with children appear to be feeling financial pressure and were more likely to report cutting back on spending and savings. Nearly 40 percent of parents said they face challenges paying for childcare.\n\nInflation affects all parts of the world, but it affects some more than others. Within Canada, you will find that in some cities, goods and services are very expensive compared to other cities. Vancouver is Canada’s most expensive city. The real estate market is very expensive and hard to get in for an average Canadian family. Rent is not cheaper either. On the positive side, Vancouver does offer many benefits. Vancouver city provides many jobs and it is easy to find jobs as compared to other cities in Canada. Vancouver gets little to no snow with mild winters and cool summers. If you love the outdoors, Vancouver also offers many outdoor activities such as hiking, skiing, swimming, biking, etc. Overall, the city is a great place to live if you can afford the housing market.\n\n\n\nLife in Canada may be expensive but living in one of the best places in the world is never going to be cheap. Training yourself to plan out and stick to a budget is one of the best habits you can have. It will protect you from constant overspending and will help you correct it if you do. Your budget should always be your first line of defense against an increasing cost of living. By far the best investment you can make to be prepared for an uncertain financial future is an investment in yourself. One that will increase your future earning power.\n\nSources: How to Profit From Inflation: Investment Options (investopedia.com), Angus Reid Institute Survey, Yahoo finance, Inflation And How It Ends | Seeking Alpha\n