Monday, October 15, 2012

Reducing the grocery bill

As I mentioned in my previous post, I've been thinking of ways we will save money when I go on mat leave as I will be making 60% less a month. One of the largest variable expenses that I think will be affected will be our food budget. Currently I allow for $550 in our budget for groceries and restaurants, although I just added up what we spent last month and it came to $760 so apparently I've been a little to flexible in following my budget.

Also the majority of that is because we've been eating out too much. One of the main reasons has been my husband does not cook (he'll vacuum, clean toilets, litter boxes, laundry, etc but the kitchen duties scare him) and during my first trimester the idea of preparing food was enough to make me nauseous. I only just started cooking again last week.

I want to reduce our budget to $350/month while on mat leave. Do you think this is realistic for 2 adults? I'm also basing the budget on the assumption that I'll be breastfeeding for the first year, obviously if I have to supplement with formula this amount will have to increase or I will have to starve!

My steps to reducing our food budget are:
  1. Reducing 'eating out' to once a month if we have a social event to attend, otherwise $0
  2. Meal Planning and bulk cooking/freezer cooking
    1. Many of my grocery trips are last minute grabs because I could decide what to eat and then I purchasing things based on convenience, regards cost
    2. A lot of our groceries spoil and go to waste because I don't get around to making what I thought I would that week.
    3. Cooking in bulk and freezing the extras help with the nights that I don't want to cook and allows me to take advantage of the bulk savings.
  3. Grocery Shopping with a list and cross referencing sales flyers before going so that I don't subcome to impulse buys and take advantage of the best prices
  4. Actively using couponing and point collection programs. I don't think I'll every be an 'extreme' couponer with a stock pile in my basement but using coupons on my regular purchases only make sense
    1. We have a PC Mastercard that we collect points that can be redeemed at Superstore for cash to pay for groceries. 20,000 points equals $20 as the minimum redemption and every 10,000 points more that we have at the time relates to $10. PC points don't offer 'better deals' as your points balance increase so it doesn't really matter when we redeem although Superstore isn't our primary grocery store so I would like to plan when we shop, like once a month when the points are added after a statement is issued.
    2. I finally signed up for a Sobey's club card. There are rumors that the construction site a block from our house will be a Sobey's which will make it our closest grocery store so I'd be ridiculous not to have a card. Sobey's club points DO offer 'better deals' as yours points balance increases so when the teller tells you, "you have $5 would you like to redeem?" say No Thank You!
      • Basically 725 points will get you $5.00 BUT 12,500 points will get you $100. If you were to redeem at $5.00 every time the teller told you that's how much you had, you would have had to have collected 14,500 points to reach the $100 of savings. That's an extra 2,000 points ($15) that you wasted!
      • Sobey's offers Bonus Points coupons which help get to your points goal faster.
    3. We also have a Shopper's Drug Mart Optimum card that I rarely use but their points system is much like Sobeys and their sales flyers tend to have some great sales so I plan to pay more attention there. Shopper's also sells grocery items so I can redeem the points once I hit the max to help reduce my budget line
      • Along with bonus points, Shopper's also has events where point redemption actually are valued higher, watching for these will maximize the grocery budget that month!
Another point that I'm considering is the Making at Home versus the Buying option. I've read articles where making bread is better then buying because bought bread is $4+ a loaf versus the $1 a loaf to make it but I usually get my bread around the $2 range. There are other items that are suggested as being cheaper, not to mention healthier as you know whats going in them, to make at home rather then purchasing premade. Frosting, guacamole, hummus, pasta sauce, etc.

Is there anything you make from scratch because its cheaper?

Wednesday, October 10, 2012

Planning to live on less

With my approaching mat leave the idea of reducing of my salary to less then 50% of what I'm currently receiving is enough to give anyone pause. In Canada we have the opportunity to draw maternity (15 weeks) and parental (35 weeks) leave from employment insurance, which is wonderful, but the max benefit is 55% of $45,000 annual salary and as the Director of Finance for my company my compensation surpasses that by a good percentage. Working well on mat leave isn't worth it as your benefit is clawed back by the amount you are compensated so you don't come out ahead and you have less time to spend with your baby. There are companies that offer a 'Top Up' to the employment insurance benefits but there are usually strings attached to these benefits. My company hasn't confirmed if they will be providing any form of top up during my leave and currently I'm budgeting with the assumption that I will get nothing, this way if they chose to do anything it will be a bonus.

Luckily, we are in the financial position to live on 'less' for a year and not have to take out loans or feel a huge impact to our daily spending. Mainly my RRSPs are what are going to take a huge hit but with that said I really don't want to dip into my savings to cover my social life so I need to start doing some rethinking to my monthly spending.

Not quite sure how women that make less then the max benefit manage to live on 55% of that for a year! I am definitely happy that I don't have to worry about going back to work before my 50 weeks are up. With that said I don't think I could do this with out a budget because it will definitely be a huge change for us.

Things I will miss....
  1. My morning Starbuck or Tim's 'coffee' run
  2. Lunch at the mall food court or other take out restaurants around my office
  3. My MANY Kobo purchases a month...the library will become my new best friend
  4. Adding seasonally to my wardrobe
  5. Not having to think before I whip out my VISA card
Actually that isn't really a lot and I probably shouldn't be wasting my money right now on these things.

Things I plan to do...
  1. Monthly meal plan - this is necessary if I want us eating on a strict monthly budget - lots of home cooked meals and probably a lot of premade and frozen ones at that to make it more convenient. My husband is a vegetarian which means for convenience sake I don't eat a lot of meat at home either...why prepare two different meals every time?...which also helps cut costs on the grocery budget. Consider going meatless a few times a week to save. (Great blog for family meal planning inspiration is Good Cheap Eats)
  2. Cloth diapers - my sister has already purchased the gDiapers so I don't have too much more to invest in now except adding a few based on wear and tear. Did you know that it takes 30 months on average before your baby is potty trained and during that time you will have approximately 7354 diapers to change? This can cost around $1912.04 ($0.26/diaper) if you are using disposables (not including the cost of garbage removal if your municipality charges for extra bags) where as Cloth diapers will cost you around $774.75 (diapers and laundry...assuming this is the first time you are using cloth and have to purchase them, splitting the cost with a friend or using them for multiple babies with increase savings. Not to mention that you can sell your used cloth diapers on eBay or a local Buy&Sell, which is where my sister picked up the majority of hers, and make almost 50% of your investment back). (To read a great article on the costs of disposables verses cloth diapers, as well as others on building a cloth diaper stash, read SquawkFox)
  3. Breast Feeding - I say this is my 'plan' but having so many friends and family that have recent had babies I am completely aware of all of the issues that can arise to prevent breast feeding from happening. I will make every effort to do this until my baby moves to solids but I realize that it might be out of my control. Apparently formula can cost $100-$150/month depending on the brand, to feed your baby so I will attempt to go as long as possible on the breast.
If I manage to organize my time while I'm on maternity leave, I also hope to finally plant my vegetable garden and use coupons while grocery shopping but those are two things I've been saying I want to do for a few years now so we'll see if I'm adventurous come spring!

Am I forgetting any major cost savings I should take into consideration?