MONTREAL 鈥� With inflation at a nearly 40-year high, Canadians are feeling the financial strain. In a six-part series this summer, The Canadian Press is speaking to people at different stages of life to see where they鈥檙e being hit the hardest. This story details the experiences of parents with young children.
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Carlyne St Jules may have to cut her family vacation short this year, thanks to soaring inflation.
鈥淓verything out here, it鈥檚 $300 and up,鈥� she says of hotel rooms in Montreal, where she has family and previously studied dance.
鈥淭o fill my tank 鈥� to come here it was like $89. I have a small four-door Kia.鈥�
St Jules, a 29-year-old event co-ordinator who now lives in New York City with her three children, ages two, seven and 10, says she 鈥渂rought them out here so they can see my old stomping grounds 鈥� but I don鈥檛 know how much I鈥檒l be stomping around here with these prices.鈥�
From ballooning grocery bills to pricier extracurricular activities, parents are confronting cost-of-living increases that have them worried about opportunities for their children and a stable financial future for their family.
Inflation hit a 39-year high in June amid an economy hampered by COVID-19, labour shortages, supply chain challenges and the looming threat of a recession.
Money doesn鈥檛 stretch as far these days on everything from diapers to daycare and family outings and vacations are harder on the wallet as the cost to fill up your gas tank soars and prices for travel accommodations rise.
Young parents aren鈥檛 accustomed to such speedy price hikes; many weren鈥檛 born yet when inflation last hit this pace in 1983.
Mortgage and rent, along with car loans take some of the biggest bites out of parents鈥� incomes, said Scott Hannah, CEO of the Credit Counselling Society.
For drivers, prices at the pump have increased even faster 鈥� gasoline prices for June, the most recent month available, were 54.6 higher than in the same month in 2021, Statistics Canada data show, the biggest driver of inflation in that period.
Those financial drains are 鈥渞eally hurting a lot of Canadians now,鈥� he said. Meanwhile appetites grow, clothes need replacing and extracurricular sports, classes and activities mount. 鈥淚f you鈥檝e got a young family, it鈥檚 the most expensive part of your years.
鈥淚鈥檒l be 65 next February 鈥� it鈥檚 hard to say that 鈥� and back when I was a kid it wasn鈥檛 that big of a deal if you didn鈥檛 have the latest and greatest. But boy, it sure is now,鈥� Hannah said of the pressure of consumer trends.
For Montreal residents Nabil and Samia Haliche, bigger grocery bills and toll at the pumps have pushed them to hunt harder for food sales.
鈥淲e see it clearly at the grocery store,鈥� said Samia, after she and her husband stepped out of a second-hand clothing store in Montreal with their two daughters, ages two and 10.
鈥淓verything is more expensive than usual.鈥�
Families with young children often have one parent on parental leave, off work or working part-time, adding to the financial strain.
Housing prices and rents also shot up throughout the pandemic. The national home price index, which adjusts for pricing volatility, peaked at $835,000 in March, capping off a two-year climb of 52 per cent, according to the Canadian Real Estate Association. Prices spiralled upward in a frantic buying streak that saw families stretch budgets to enter the market or upgrade to more spacious digs amid COVID-19 confinement and rock-bottom rates.
The average Canadian rent leaped 9.5 per cent in June from a year earlier, though remained 3.5 per cent below June 2019, according to Rentals.ca, an apartment-search website.
鈥淎 lot of young families in the last two years have used this opportunity, No. 1, to start their family, and No. 2, to get into that first home,鈥� said Leah Zlatkin, a mortgage expert at LowestRates.ca.
Many pushed their budgets to the limit to make down payments and monthly interest 鈥� which promptly began to rise as the Bank of Canada started raising its key interest rate.
鈥淔or those people, when you see a variable-rate increase it could be a bit shocking,鈥� Zlatkin said.
For homeowners worried about their situation, Zlatkin suggested sitting down with a mortgage broker to discuss refinancing. If payments seem beyond their means at the moment, she said clients should immediately inform their mortgage provider, who can offer a payment deferral program or temporary interest-only payment plan.
A clear-eyed look at what can be removed from the budget 鈥� or replaced with less expensive options 鈥� is also called for.
鈥淟ate night while you鈥檙e bottle-feeding or breast-feeding the baby, flip through the Flipp app and find some deals and do some price matching when you鈥檙e in the grocery store.鈥�
Hannah suggests buying in bulk 鈥� small families can team up with larger ones 鈥� cashing in loyalty points and swapping name brands for generic ones. Even a slightly awkward conversation with family members to lower holiday gift expectations may be wise.
鈥淣o one wants to receive a gift from someone who can鈥檛 afford to give it,鈥� he said.
Christopher Reynolds, The Canadian Press
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