(Montreal) Carlyne St Jules may have to cut her family vacation short this year due to soaring inflation.
Posted yesterday at 2:51 p.m.
“All you get here is $300 and up,” she says of hotel rooms in Montreal, where she has family and has previously studied dance.
“To fill up […] to come here it cost like $89. I have a small four-door Kia. »
Mme St Jules, a 29-year-old events coordinator who now lives in New York with her three children, ages 2, 7 and 10, says she “brought them here so they could see my old game — but I don’t know how long I’m going to hang around here with these prizes.
From ballooning grocery bills to more expensive extracurricular activities, parents are facing cost-of-living increases that worry them about opportunities for their children and a stable financial future for their families. .
Annual inflation hit a 39-year high in June amid the economy remaining hampered by COVID-19, labor shortages, supply chain challenges and the looming threat of a recession.
Money doesn’t allow you to do so much these days. Essentially everything from diapers and daycare to family outings and vacations are getting tougher on the wallet as the price of a full tank of gas and travel accommodations soar.
Young parents are not used to such rapid price increases; many had not yet been born when inflation last reached this rate in 1983.
Mortgages and rent, along with car loans, are among the biggest drains on parents’ incomes, said Scott Hannah, CEO of the Credit Counseling Society.
For drivers, pump prices have risen even faster — gasoline prices for June, according to the most recent data available, were 54.6 higher than the same month in 2021, according to Statistics Canada. This is the main driver of inflation during this period.
These financial losses are “really hurting a lot of Canadians now,” he said. Meanwhile, appetites grow, clothes need to be replaced, and sports, classes, and extracurricular activities multiply. “If you have a young family, this is the most expensive time of your life. »
“I’ll be 65 next February — it’s hard to admit — and when I was a kid it wasn’t such a big deal if you didn’t have the latest or better stuff. But damn it, it sure is today,” Hannah observed of the pressure from consumer trends.
For their part, Montrealers Nabil and Samia Haliche have been persuaded by higher grocery bills and payments at the pump to devote more effort to bargain hunting.
“You can clearly see it at the grocery store,” Samia said, after she and her husband walked out of a second-hand clothing store in Montreal with their two daughters, ages 2 and 10.
“Everything is more expensive than usual. »
Families with young children often have a parent on parental leave, who has taken a break from work or is working part-time, which adds to the financial strain.
Rising house prices
Housing prices and rents have also increased throughout the pandemic. The national home price index, which adjusts for price volatility, peaked at $835,000 in March, up 52% over two years, according to the Canadian Real Estate Association (CREA). . Prices have soared in a frantic shopping streak that has seen families stretch their budgets to enter the market or move to larger spaces during the period of pandemic lockdown and very low interest rates.
The average Canadian rent jumped 9.5% in June from a year earlier, but remained 3.5% lower than in June 2019, according to Rentals.ca, an apartment search website.
“Many young families over the past two years have taken advantage of this opportunity, first to start their family, and then to move into their first home,” observed Leah Zlatkin, Mortgage Expert at LowestRates.ca.
Many pushed their budgets to the limit to make a down payment and lower their monthly interest — which quickly began to rise when the Bank of Canada began to raise its key rate.
“For these people, seeing an increase in variable rates can come as a bit of a shock,” Ms.me Zlatkin.
To the owners concerned about their situation, Mr.me Zlatkin suggests sitting down with a mortgage broker to discuss a refinance. If payments seem out of reach at the moment, she believes customers should immediately let their mortgage provider know, who may offer a payment deferral program or a temporary interest-only payment plan.
A lucid look at what can be taken out of the budget — or replaced with less expensive options — is also necessary.
“Late at night while breastfeeding, browse the Flipp app for deals and compare prices when you’re at the grocery store. »
Hannah suggests buying in bulk — small families can partner with bigger ones — cashing in loyalty points and swapping name brands for generic brands. Even a slightly awkward conversation with family members to lower expectations for Christmas gifts can be a good idea.
“Nobody wants to receive a gift from someone who can’t afford it,” he said.