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Inflation 2023, reflected in my household expenses
December 29, 2023
4:56 am
Alexandre
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2023 is about to end and I can calculate how actual inflation impacted my household expenses, comparing to 2022.

Utilities: +4%
Groceries: +26%

For groceries, we have same grocery shopping patterns as in 2022, not impacted by rising prices yet. Which means, this all is true price increases on food my household buys.

For utilities, we recently had electricity prices go up in Ontario, but that will get better reflected in 2024. House uses natural gas for heating, warm November and December helped to keep heating bills down.

On the positive note, interest income I am getting from Savings/RRSP/TFSA - doubled in 2023 vs. 2022. Thanks mostly to the fact that all of my remaining 1.5%-2% GICs matured early 2023 and were renewed with much better rates.

With doubling of interest income extra grocery expenses were easily covered. I noticed that in 2023 I was buying more of "nice to have" things instead of just "must have."
My discretionary income is way higher in 2023 than it were in 2022, all thanks to BoC moving rates up.

December 29, 2023
5:37 am
cgouimet
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Alexandre said
2023 is about to end and I can calculate how actual inflation impacted my household expenses, comparing to 2022.

Utilities: +4%
Groceries: +26%

For groceries, we have same grocery shopping patterns as in 2022, not impacted by rising prices yet. Which means, this all is true price increases on food my household buys.

For utilities, we recently had electricity prices go up in Ontario, but that will get better reflected in 2024. House uses natural gas for heating, warm November and December helped to keep heating bills down.

On the positive note, interest income I am getting from Savings/RRSP/TFSA - doubled in 2023 vs. 2022. Thanks mostly to the fact that all of my remaining 1.5%-2% GICs matured early 2023 and were renewed with much better rates.

With doubling of interest income extra grocery expenses were easily covered. I noticed that in 2023 I was buying more of "nice to have" things instead of just "must have."
My discretionary income is way higher in 2023 than it were in 2022, all thanks to BoC moving rates up.  

Interesting Alexandre ...

I played the groceries points and specials game harder in 2023 and actually reduced our Groceries cost 0.5% while actually eating better.

On the Utilities front (Gas, Hydro, Water/Sewer, Satellite, Internet, Cellular, Streaming) we're up 3% with higher Hydro and Gas, more streaming but lower cellular going from Rogers to Fido.

CGO
December 29, 2023
6:14 am
mordko
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Depending on the age and “cushion” between savings and future expenditure, treating 2023 “fallout” interest as extra spending income for discretionary items could be risky.

Additional discretionary spending is nice but your capital has been devalued by inflation. Interest, particularly in the taxable accounts, barely helps us to keep up with inflation.

Interest income on HISAs and new GICs in 2024 and subsequent years could plausibly go back to, say, 3% range while grocery prices will never go back to a lower value.

For Ontario food CPI went up 5.1% in the year to November but this of course varies by location and personal habits.

December 29, 2023
6:43 am
BlueSky
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mordko said
Additional discretionary spending is nice but your capital has been devalued by inflation. Interest, particularly in the taxable accounts, barely helps us to keep up with inflation.
 

Agreed. If talking current GIC rates, to come on top, one must have bigger amounts invested, to offset inflation, shrinkflation, and rising costs and taxes. Only those who have no mortgage/loan would fair better. If any indication, the last 8+ years were detrimental to the Canadian economy. Failed economic policies, and shortsighted economic plans caused this country, once strong economically, to drop to one of the lowest standings among developed countries.

December 29, 2023
7:05 am
BlueSky
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December 29, 2023
7:14 am
cgouimet
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BlueSky said
Brace yourselves...
https://www.msn.com/en-ca/money/other/terrazzano-trudeau-planning-to-hike-taxes-again-in-the-new-year/ar-AA1maq62?ocid=windirect&cvid=9990d159cdab46f08cf7ee2c33762137&ei=5  

Looks like something by Poliver's team.

Can you imagine the outcry if the Feds cancelled the the Carbon Tax? How dare they cancel the accompanying Climate Action Rebate?

CGO
December 29, 2023
7:23 am
Alexandre
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cgouimet said

I played the groceries points and specials game harder in 2023 and actually reduced our Groceries cost 0.5% while actually eating better.

I, too, use groceries points, noticed I collect many more now. It became way easier to hit bonus point thresholds which are based on amount spent in a single visit to grocery store. Spending went up, but they haven't adjusted thresholds yet.

December 29, 2023
7:39 am
cgouimet
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Alexandre said

cgouimet said

I played the groceries points and specials game harder in 2023 and actually reduced our Groceries cost 0.5% while actually eating better.

I, too, use groceries points, noticed I collect many more now. It became way easier to hit bonus point thresholds which are based on amount spent in a single visit to grocery store.  

If those are Loblaws like 12.5kpts for $125+, many are now cumulative as in applicable to all purchases during the offer period. They even had at least one that was cumulative Loblaws+NoFrills el al.

CGO
December 29, 2023
9:20 am
Alexandre
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mordko said
For Ontario food CPI went up 5.1% in the year to November but this of course varies by location and personal habits.  

Of course. Also, the power of averages... All we need in this conversation is three more people who, like cgouimet, managed not to increase their annual grocery bill, and for the five of us our average will be, indeed, about 5%.

I thought I can share my data, because in my case I haven't changed grocery shopping habits and preferences for my household. We haven't switched from olive oil to canola oil for cooking, for example, but price of same brand of cold pressed olive oil we buy went up by 1.5 at least.

I do follow sales and specials for brands we buy, but in many cases the current price "on sale" is what regular price used to be just a year-two ago.

Note that I am not complaining. I am lucky to be financially secure, I can afford it. Thus not changing shopping habits.

Just making the point, actually same as you do, that government provided inflation numbers should be considered with asterisk which points to "It depends."

December 29, 2023
9:45 am
Dean
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BlueSky said
Brace yourselves...
https://www.msn.com/en-ca/money/other/terrazzano-trudeau-planning-to-hike-taxes-again-in-the-new-year/ar-AA1maq62?ocid=windirect&cvid=9990d159cdab46f08cf7ee2c33762137&ei=5  

cgouimet said

Looks like something by Poliver's team.

    Yup

How could you tell? ... LOL sf-laugh

    Dean

sf-cool " Live Long, Healthy ... And Prosper! " sf-cool

December 29, 2023
10:21 am
mordko
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Alexandre said

Of course. Also, the power of averages... All we need in this conversation is three more people who, like cgouimet, managed not to increase their annual grocery bill, and for the five of us our average will be, indeed, about 5%.

Sorry, I have no idea. We produce a lot of own food, including most vegetables and eggs. Producing a higher share of consumption this year than last.

And I am pretty bad at tracking expenditure anyway. Know my income to a cent, investment returns and net worth change so I guess could figure out total personal spend easily but don’t have the need - and variability in expenditure from year to year has many variables. Just rely on CPI and averages.

What I did notice was that our municipality raised local taxes by 3% for 2024 while the one next door raised them by 9%. Pretty sure ours will catch up sooner or later. Some of this “personal inflation” averages not just between people but over time. Sooner or later everyone will pay unless they beat the inflation by dying.

December 29, 2023
11:33 am
Case1030
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mordko said

Just rely on CPI and averages.

 

+1

Use the national figure for indexed benefits and the provincial figure for budgeting and planning. Although not having any debt (amongst other things) no doubt lowers our personal inflation, we don't get too bent out of shape about it.

December 29, 2023
11:47 am
phrank
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Alexandre said

Of course. Also, the power of averages... All we need in this conversation is three more people who, like cgouimet, managed not to increase their annual grocery bill, and for the five of us our average will be, indeed, about 5%.

I thought I can share my data, because in my case I haven't changed grocery shopping habits and preferences for my household. We haven't switched from olive oil to canola oil for cooking, for example, but price of same brand of cold pressed olive oil we buy went up by 1.5 at least.

I do follow sales and specials for brands we buy, but in many cases the current price "on sale" is what regular price used to be just a year-two ago.

Note that I am not complaining. I am lucky to be financially secure, I can afford it. Thus not changing shopping habits.

Just making the point, actually same as you do, that government provided inflation numbers should be considered with asterisk which points to "It depends."  

Thank you for sharing this info.

People who changed their habits aren't valid comparison points. Our increase is less than yours (10.59%) and we didn't change our habits, but I think that our lower inflation here is because of what we are buying, but this is a significant increase considering our average inflation on groceries was %4.63 for the previous 3 years. Our utilities look to be up 7.82%, but that will probably be higher after we get the final bills for the year in Jan. Here we did change our habits a little by caring less about conserving if it has any impact on our comfort, because with the general increase of unpleasantness in the world we choose comfort where we can. Be that more lights on or a warmer/cooler place to live. So here, we did change our habits quite significantly and the weather has been warmer in winter and cooler in summer.

My conclusion is that costs are up significantly more than one could offset if one didn't change their habits and much more than any government says they are up in their "data".

December 29, 2023
7:07 pm
savemoresaveoften
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phrank said
My conclusion is that costs are up significantly more than one could offset if one didn't change their habits and much more than any government says they are up in their "data".  

Especially true if one shop for convenience and dont take price into consideration when grocery shopping.

Threre are still people who regularly shops at loblaws brand like NF, etc yet still dont have PCO membership. What are they thinking ???

December 29, 2023
10:51 pm
HermanH
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savemoresaveoften said Threre are still people who regularly shops at loblaws brand like NF, etc yet still dont have PCO membership. What are they thinking ???  

I am one of those who shop RCSS/Loblaws. I have a PCO membership card, but rarely bring it, because it is, literally, pointless. IIRC, I need 6000 pts to get the next redemption level and have been for 10 years. I simply do not buy anything that gives points. I have tried a few times, but earned zero points from basic items like meat and produce. Unless I buy the expensive non-essential items like cookies or popular brand products, I doubt that I will ever earn enough to redeem the points already on the card. That's what I'm thinking. sf-smile

December 30, 2023
2:12 am
RetirEd
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BlueSky: Some of Terrazzano's points are valid, but most are his own speculation. On the other hand, he's using the usual Conservative mischaracterization of EI and pension contributions as taxes, which they are emphatically not. They are purchases of benefits by the taxpayer. They are mandated personal responsibilities, but so are medical coverage, auto insurance and, in apartments, home insurance. Not taxes.

I had a disgruntled friend keep me on the phone for nearly an hour (on his own toll) last week for just that point. He started off pissed at taxation of RRSP withdrawals despite the tax break at contribution and gradually swung his anger in ever-larger circles, even when I pointed out one of his children had had many hundreds of thousands of dollars of advanced medical treatment in return for his Medicare contributions.

RetirEd

December 30, 2023
4:21 am
cgouimet
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RetirEd said
BlueSky: Some of Terrazzano's points are valid, but most are his own speculation. On the other hand, he's using the usual Conservative mischaracterization of EI and pension contributions as taxes, which they are emphatically not. They are purchases of benefits by the taxpayer. They are mandated personal responsibilities, but so are medical coverage, auto insurance and, in apartments, home insurance. Not taxes.

I had a disgruntled friend keep me on the phone for nearly an hour (on his own toll) last week for just that point. He started off pissed at taxation of RRSP withdrawals despite the tax break at contribution and gradually swung his anger in ever-larger circles, even when I pointed out one of his children had had many hundreds of thousands of dollars of advanced medical treatment in return for his Medicare contributions.  

Better on the phone than in your living room on NYE ...

Do you have call display for the next call?

CGO
December 30, 2023
5:49 am
mordko
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Its semantics, but if the payment is mandatory and is collected by governments then its a tax.

You get to pick car insurance provider and you can choose level of insurance and how much you pay, and government does not disburse money in case of an accident. Not so with EI, which, once collected, is counted as part of government revenues, whether its technically earmarked for a particular type of expenditure or not. In theory you get something in exchange for every tax dollar collected by various levels of government, its just that you have no say over any of it, except at election time.

December 30, 2023
6:03 am
savemoresaveoften
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HermanH said

I am one of those who shop RCSS/Loblaws. I have a PCO membership card, but rarely bring it, because it is, literally, pointless. IIRC, I need 6000 pts to get the next redemption level and have been for 10 years. I simply do not buy anything that gives points. I have tried a few times, but earned zero points from basic items like meat and produce. Unless I buy the expensive non-essential items like cookies or popular brand products, I doubt that I will ever earn enough to redeem the points already on the card. That's what I'm thinking. sf-smile  

Do u have the app ? That is the easiest way to see personalized deal every week. Regular I see banana, broccoli, bread etc, which are btw 10%-20% points rebate equivalent. I collect on average 500k pts each year which is $500. Most of my purchases are on sale items too. For example I regularly gets 4k pts per $15 purchase on ready to eat meal. And lots of 50% off available in the morning. Also when NF has buy 4 get 4k pts on veggie and broccoli at 1.99 per, that makes it 0.99 per when buy 4!
Mind you loblaws is only 5mins from my house so I go regularly.

I don’t even use their PCO cc as my card gives me 4% rebate which is better.

Agree no pt to buy stuff at reg price just to get pts. But if you shift your purchase, you can accumulate pts quickly.

Check out the personalized offer, that’s what u need.

December 30, 2023
6:07 am
Alexandre
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mordko said

I am pretty bad at tracking expenditure anyway. Know my income to a cent...

I do track all expenses and income, and for many years.*
I can tell you exactly how much my household spent on groceries in 2013, for example.

Interesting fact: our household grocery spent went by about 50% in 10 years since 2013, and half of that is increase between 2022 and 2023.

I guess, we had quite good last 10 years, before "transitory inflation" hit us and people in charge were too slow or undecisive to deal with it.

------------------------------------------------------
* “Annual income twenty pounds, annual expenditure nineteen nineteen and six , result happiness.
Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery”
― Charles Dickens, David Copperfield

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