Rising prices are affecting the ability to meet day-to-day expenses for many Canadians. Now is a good time to discuss ways to adapt your finances and protect your future. Fortunately, you can do a few key things to get started today!
- Review your income and expenses and identify areas for reduction – such as getting a cheaper cell phone plan, reducing streaming service or TV subscriptions, reviewing bank fees, etc.
- Allot a percentage of your income towards savings such as an emergency fund. Your goal should be to have the equivalent of 3-6 months of earnings in this fund to provide breathing room should you lose your job or face any unexpected expenses. Another form of emergency funds could also be a line-of-credit. Once set up, it generally has no cost to you unless you use it in the event of an emergency.
- Evaluate your investment portfolio. While you will want to avoid making knee-jerk reactions, it may be a good time to diversify your portfolio to help reduce risk. Always talk to an expert.
- Find additional income sources! Many people have found innovative ways to increase their income by asking the following three questions:
- Are you a fit for a potential promotion?
- Do you have a review coming up?
- Do you have transferable skills that you can apply to consulting or additional contract work?
Having a healthy and realistic budget will give you peace of mind and allow you to properly allocate your monthly cash flow between debt, expenses, and savings. Making appropriate adjustments will help you stay financially secure.