Article content

This article was created by MoneyWise. Postmedia and MoneyWise may earn an affiliate commission through links on this page.

Article content

If you are like most Canadians, the past few months have been expensive. Whether you are facing higher mortgage payments, grocery bills or just some unexpected expenses landed on your lap, things are tighter than ever.

Article content

In fact, Canadians are facing near record-high debt levels. According to Statistics Canada, Canadians now owe $1.83 for every dollar of disposable income they bring in. That’s up from $1.77 last year.

Whether you are looking to pay down your debt, or just find more cash, making big budget changes can be painful.

Even so, the process can help you learn more about how you spend, what you truly value and what kind of slow, incremental changes you can make in the future to build good habits.

It starts with knowing where your money goes. Once you start tracking how you’re spending, stop and examine whether the things you need and value match where you’re spending the most.

Article content

Spending more than you expect? Not getting enough value? Time to cut it out. Nowhere to cut? Time to focus on increasing your income and boosting your savings.

Know where you’re money is going

Before you can find savings, you need to track where you are spending. Taking a look back at your credit card and debit transactions for the past month should give you a quick snapshot.

Many banks and credit card companies offer tracking tools that will show you a breakdown of your expenses.

Better yet, if you have accounts at multiple financial institutions, you could use a budgeting service that tracks them all. Popular free services include Mint and Goodbudget. Paid options like, You Need a Budget have more extensive features, but will cost you.

Article content

Also, if you deal with a lot of cash, don’t overthink it. Basic paper and a pen, or a spreadsheet can help you quickly get a sense of what your bills are. Then write out what you want your budget to be on discretionary expenses such as entertainment.

If you need more discipline with your spending, a simple way to see where your money is going is with cash stuffing, also known as the envelope method. The concept is simple, you take your paycheque in cash and divide that into envelopes based on your budget for different needs, including both spending and saving.

When the money in the envelope is gone, that’s it.

Cut down your expenses

Once you have a good idea of how much you’re spending, you’ll probably see places to cut. Depending on how much money you need to save, and how fast you want it, you may need to be ruthless about your cuts.

Article content

Discretionary expenses

Discretionary spending, like your daily Timmies, is easiest to cut, but don’t make yourself miserable unless you have to. The primary goal is to save money fast, but the secondary goal should be to build a sustainable savings habit so you never have to make sudden sacrifices in the future.

Think about those small joys that are worth the cost to you. If getting a $3 latte brings you far more joy than $3 spent elsewhere, get the latte.

But if you’re grabbing coffee and breakfast, plus lunch out at a total of $20 a day, it adds up fast. You are looking at $100 a week, $400 a month and, you guessed it, $4,800 a year.

Sure, a lunch out can feel special, but a treat isn’t a treat when you do it every day. Then you just have an expensive habit.

Article content

If you aren’t ready to pack your own lunch or meal plan, don’t worry. Consider buying nice ready-made meals at the grocery store or even a meal kit. Sure, they are more expensive than cooking from scratch but if it stops you from ordering UberEats and paying for delivery, plus tip, you are saving some money.

Fixed expenses

If you think your fixed expenses are, well, fixed, think again. A little research and being open to change can help you save without cutting corners.

An easy way to reduce your phone bill is to switch to your cellphone provider’s discount brand. You’ll stay on the same network but likely pay way less starting this month.

In the same way, shop around for car and home insurance and see if you can find similar coverage for a better price

Article content

You should also call your internet service provider saying you’re planning to switch and see if you can get a retention offer.

For essential purchases, make sure you aren’t leaving money on the table. Besides using a cash-back credit card on your daily expenses, you can earn extra cash back automatically by connecting your debit or credit card to RBC’s Ampli app. Purchases at places like Petro-Canada and Lowes count towards cash back.

If you’re carrying a hefty balance on a credit card, consider signing up for a balance transfer card with a lower interest rate. You might pay a fee for the transfer, but you’ll get a reprieve from interest for a while. You can also look into a personal loan, which would likely have lower interest rates than your credit card, and allow you to transfer balances.

Article content

Free services like Smarter Loans can help you find the best quote and best repayment term available for your situation.

Increase your income

Inflation has hit food, mortgage and rent prices the hardest, which means you might not be able to cut much from your budget. The solution to getting ahead might just be in increasing your income.

If overtime is an option, that is an easy way to boost your paycheque. If you are facing extra responsibilities or have upgraded your skills, it might be time to ask for a raise.

If that doesn’t work, you can always pick up a side hustle that makes the most of your talents and skills. If you have graphic design skills, writing, editing or video editing, it is worth perusing Fiverr, an online marketplace for freelance services to see how much you could make.

Article content

If you have time to spare, but need flexible hours, Survey Junkie is one of the simplest ways to earn some extra cash fast — plus, you can do it from home.

The platform rewards you for your opinions and all you have to do is sign up with a bit of information about yourself. Then you can start to take surveys about products you use and places you go. You’ll start earning points within minutes.

Once you’ve got $5 in rewards, you can redeem them for gift cards at places like Amazon or Walmart or as PayPal payouts.

Another fast way to get cash in hand is by selling extra items in your home on Facebook Marketplace or Ebay. If you’re not using them, you’re just sitting on excess money.

And you can take that logic one step further if you have a spare room in your home. Consider furnishing it and listing it on Airbnb, renting it out or even getting a long-term roommate.

This article was created by Wise Publishing. Wise is devoted to providing information that helps readers navigate the complex landscape of personal finance. Wise only partners with brands it trusts and believes may be helpful to the reader. This article provides information only and should not be construed as advice. It is provided without warranty of any kind.