Every individual should have a budget to be on top of their finances. With inflation at its highest, even Manitoba, which has a lower cost of living, is starting to get expensive. See a reason why you need a budget.

As of 2019

  • Rent for a single room: $600
  • Rent for a 3-bedroom apartment: $1,500
  • Groceries: $250 per individual

As of July 2022

  • Rent for a single room: $1,061.27
  • Rent for a 3-bedroom apartment: $1,740.53
  • Groceries: $463 per individual

There is an increment in the price of things. The truth is that the trend will continue. Follow closely and learn more about budgeting in Winnipeg.

How To Save Money

saving money

The best way to save money is by creating a budget. Here are the methods to follow to create a budget:

1. Know your expenses

You must know your possible expenses and how often they happen. You should create a list for them. Below is an example of a student.

– Term – This includes Tuition fees, books and stationaries, and health insurance.
– Monthly – personal care, household expenses, memberships, recreation.
– Daily – food, transportation
– Occasional – Moving, rent deposit, computer, car insurance, visa renewals, or study permits.

The list will be longer if you have a family. All you have to do is arrange them from the most important to the least important. You should write the price of each item by them and remove irrelevances. Do not forget that the plan is to save as enough money as possible.

2. Know every source of your income

It is essential to know where the money comes from to explain where it goes accurately. You can list all of the sources on a piece of paper. Common sources can be:

– Job
– Investments
– Savings
– Family contributions
– Stipends
– Awards
– Gifts

3 . You can have a budgeting tool

There are different tools you can use for your budgeting. Examples are:

– Paper: you can get a handy book that can fit in your pocket. The idea is to have something to tick and monitor your expenses.
– Excel: if you are familiar with spreadsheets, you can work with them to curate your budget. Microsoft Office 365 always comes with your HUB account. This choice is more appropriate for students.
– Budgeting app – there are scheduling apps that you can download. They have notifications that can alert you regularly. Eventually, you can track your budget.
– Government – there are budgeting guidelines recommended by the Canadian government. You can explore them.
– Financial institutions – as expected, banks and credit unions have budgeting tools for their service user. You can also request your monthly income to compare your income with expenses.

4. Build your budget

Create a personalized budget using the first point in this section. You can dedicate 10% of your regular earnings to this. You may have to consider miscellaneous as some unplanned events can surface.

5. Update your budget

You have to check your budget regularly. Know your spending habits offhand to know if anything changes over time. You can pick a time of the month to check how much you spend.

6. Lock in your money

You can save in banks and make it impossible to access the funds till a specified time. Similarly, some apps help. Many students also consider thrifting.

Investing In RRSPs

rrsps

This section answers some frequently asked questions on RRSPs.

– What is an RRSP?

RRSPs means Registered Retirement Savings Plan (RRSP). It is a plan for individuals to register with the federal government and save towards their retirement plans. The better news about RRSPs is that these funds are exempted from tax. The money can keep growing till you withdraw it.

– How do they work?

There is a large array of investments. You can choose the most appropriate plan for you as they include bonds, stocks, mutual funds, and guaranteed investment certificates (GICs). Firstly, you should know that RRSPs are also known as Retired Savings Plans (RSP).

– How much can I contribute yearly?

Your annual contribution is based on your deduction limit or RSP contribution. For 2022, your RSP contribution limit will be 18% of your earnings 2021.

– What are the available options?

There are several portfolios you can move your money into. They are:

a. Cash
b. Savings account
c. Guaranteed Investment Certificates
d. Corporate and Government Savings Bonds
e. Mutual funds
f. Securities on some stock exchange

– What age can I contribute to an RRSP?

Another good news is that there is no age boundary to open an RRSP. Nevertheless, some institutions prefer that the age is that of the majority. You can keep contributing till you are 71. You only need to live in Manitoba or Canada, earn, and have a tax return.

– What are the benefits of an RRSP?

There are several benefits you will enjoy when you invest in RRSP. They include:

i. Tax-deferred Savings: As much as your investment income is RRSP, there is no tax charge.
ii. Optimizing Deductions: you can maintain your RRSP portfolio from your early years as a low earner to when you become a higher earner. Hence, you will enjoy tax savings at a later stage.
iii. Tax Deductions: they remove tax from your RRSP contributions as this helps to lower the amount you pay as a tax on your income.
iv. Financing Your Education or First Home: you can buy a home or sponsor education with your RRSP. However, the contributions have no immediate tax under Lifelong Learning Plan (LLP) or Home Buyers Plan.
v. Income Splitting: you can combine with your spouse to have an RRSP. Eventually, you will have less to pay as tax.

– When can I get my contributions?

The answer is straightforward; it is anytime you are ready. Your money is not locked. However, your money is tax-deductible at this stage. Most times, a part goes to the government as prepayment for that year’s tax while the rest adds to your income.

The financial advice is that you keep up with your RRSP till the taxable income is lower than in previous years.

Putting Emergency Funds Away

Everyone would agree that an emergency fund helps to sort out unexpected expenses. However, if you do not plan for this, you will experience a drop in income. Emergency cases are not the same as occasional expenses, as the latter can be winter tires, holiday expenses, and school supplies.

Common examples of emergency cases are:

a. Car breakdown
b. Loss of job
c. An urgent visit to the veterinarian
d. Medical attention

Having an emergency fund helps to:

i. Cater for the unexpected expense with no debt
ii. Experience financial control
iii. Opt for low-cost loans

You can set up your emergency fund via:

  1. Open a savings account
  2. Start by saving a realistic amount
  3. Create a regular saving habit
  4. You can schedule your savings
  5. Remove a non-essential need and save it instead
  6. Update your financial goals
  7. Add more funds to your emergency fund

Coupons For Grocery Stores

coupons

You can save more money using coupons. Many regard coupons as the most sought-after. You can use them to cater food, baby & pet supplies, beverages, health care, beauty items, and household necessities. You can check the following sites for coupons, as they are regularly updated.

– Websaver.ca: is one of the most famous online sources of coupons for Canada. You only need to register on the site, select the printable coupons you want, and print your coupons. You can order the coupons online for a specific time. Also, the coupons are available for a period of use.

Watch out for the value of the coupon, its expiry date, your name, and the code.

– Save.ca: the app is available on iOS and Android devices too. You can print your coupons and use them for your in-store purchases. You can even send the coupon compilation to your mail and print them out.

– Flipp.com: You can have the Flipp app on your desktop, iOS, and android devices. The app allows you to choose an appropriate deal based on what you are shopping for. Also, you can set notifications for deals that are close to expiration.

The app compiles all circulars for a week and gives you the best discounts and deals. It notifies you of the best value as it is a time-saving and efficient app. You can check the trending and most popular deals that satisfy you via the app.

– Redflagdeals: redflagdeals.com is the service provider for online deals and shopping promotions. It is a community where hundreds of thousands of Canadians share coupons and the best deals. There are thousands of deals for various categories. It has been serving people for almost 20 years.

You can subscribe to the newsletter for the latest updates or check the site for good deals.

– Flashfood app: Flashfood is a free app on iOS and Android. Sign up and see what’s readily available to shop online or in a physical store. The discount can be as high as 50% for several food items.

The idea is this, stores allow discount deals on low shelf-life foods rather than throw them away after their expiry date. Not only are you benefitting from this, but it also helps to reduce food wastage in Winnipeg.

Reward Points For Credit Cards

credit card canada

Here is a list of the best rewards in 2022.

Best overall Rewards Credit Card: American Express Cobalt Credit Card has a fair credit score. The first-year value is $1,524.
Best Credit Card for Staying at Home and Ordering In: Scotiabank Gold American Express Card has a good credit score. The first-year value is $1,074.
Best Family Credit Card for Gas and Groceries: President’s Choice Financial World Elite Mastercard has a fair credit score. The first-year value is $476.
Best Credit Card for Young Professionals: American Express Cobalt Credit Card has a fair credit score. The first-year value is $1,524.

Ensure you check your financial institution’s possible reward points before committing. It would be best to have these bonus rewards for your regular spending.

Other Tips You Should Know About

The most important tip while budgeting is learning how to manage debt. The common approaches to do this include:

  1. Set goals
  2. Have a budget to repay them
  3. Change your spending habits and mindset
  4. Return the money in cash if you can
  5. Plan contingency funds for unexpected cases to discourage taking a loan
  6. Work more while you spend less
  7. Resist the urge to borrow money
  8. If at all you have to borrow, get a lender with a reduced interest rate

Budgeting does not have to be stressful. You only need to save appropriately and manage resources while you maximize returns. Get started.

 

REFERENCES
– 2022. [online] Available at: <https://www.numbeo.com/cost-of-lihttps://www.numbeo.com/cost-of-living/in/Winnipegving/in/Winnipeg> [Accessed 11 July 2022].
– 2022. [online] Available at: <https://www.canada.ca/en/financial-consumer-agency/services/savings-investments/setting-up-emergency-funds.html> [Accessed 11 July 2022].
– Interactive, P., 2022. Learn how to set a budget for your spending and stay within your budget.. [online] money smart. Available at: <https://www.moneysmartmanitoba.ca/financial-basics/set-a-budget/> [Accessed 11 July 2022].
– International Education at RRC Polytech. 2022. Planning Your Finances. [online] Available at: <https://www.rrc.ca/international/student-support/planning-your-finances/> [Accessed 11 July 2022].
– Rates.ca. 2022. Canada’s Best Rewards Credit Cards of 2022 – RATESDOTCA. [online] Available at: <https://rates.ca/credit-cards/rewards> [Accessed 11 July 2022].
– Td.com. 2022. What is an RRSP (Registered Retirement Savings Plan) & How Does It Work? | TD Canada Trust. [online] Available at: <https://www.td.com/ca/en/personal-banking/personal-investing/learn/what-is-rrsp/#:~:text=A%20Registered%20Retirement%20Savings%20Plan,year%20you%20make%20the%20contribution> [Accessed 11 July 2022].