Inflation may be stabilizing, but that stability is based on an already enormous growth in prices. That’s especially on items that take up much of our everyday budget. Groceries and interest rates — they’re all going up. Moreover, these are items we need. So, it’s not realistic to say you can just cut some out.
Today, we’re going to look at tricks Canadians can use that will actually save on your annual budget. What’s more, they can create extra cash as well.
Find a new credit card
One of the easiest ways to save perhaps $100 in annual fees and gain some extra spending money is by switching up your credit card. There’s no reason why you can’t open a new credit card, even with the same company. That way, you can cancel the old one and its annual fee and instead move over to a new one.
Of course, there are things to watch for. Every credit card company and bank usually has deals on multiple credit cards. However, there are two things you’re looking for here. There’s first the deal of finding a credit card with zero annual fees for the first year or so. Second, there’s the deal of adding on tens of thousands in reward points. This can be a great way to pay off your credit card in the future!
Consolidate loans
If you have multiple debts (like many of us do), then consider consolidating your loans. If you have something like a car loan, student loan, and other debts, you can pile them all together. This can usually be done with your banking institution and at a lower rate. This can be an absolute saviour if you have credit card debts at 19% and can bring the rate all the way down.
This also has the added benefit of putting all your loans in one place. You won’t have to juggle multiple debts with the risk of missing one. Also, you’ll have the benefit of never having to choose which has the minimum payment and which does not. Instead, your financial advisor will help balance your payments, so you pay them down fast, at a lower rate altogether. This puts cash back in your pocket and helps bring your annual budget down as well by lowering your interest rate.
Create automated contributions
Finally, you can also save on annual payments by forcing yourself to. This can come from creating automated contributions that go straight into your savings account. You’ll continue to invest instead of spending outside of your budget. Simply keep a couple of bucks for yourself for spending, and never use your credit card if you don’t have the cash to pay it off!
What’s more, not only will you keep your annual budget lower at this method. You’ll also make money by investing through the money you’ve automatically contributed. In that case, a great option is investing in a Canadian bank for the long term.
A great option these days if you really want lots of income is dividend stock Canadian Imperial Bank of Commerce (TSX:CM). CIBC stock is down right now with the Canadian housing and economic market the way it is. Shares trade at just 10.29 times earnings; its dividend yield is 3.3%. Therefore, CIBC is a steal at this rate.
While shares are down about 13% in the last year, this does present a great opportunity for growth. After all, Canadian banks like CIBC stock have been solid in the last few decades. CIBC stock will likely come back roaring, as the market returns to normal. So, if you hold and invest for the long term, you’re likely to create massive income and save on the way.
