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Rob Carrick
Rob CarrickPersonal Finance Columnist

This article was published more than 1 year ago. Some information may no longer be current.

I asked in a newsletter last week where readers are seeing inflation, and the answer was close to unanimous: Food.

Of the more than 600 responses, about 80 per cent mentioned food in some way. Some responses were hyper-specific – cans of tuna and weiners, for example. Others singled out fresh produce and meat, while others simply said food or groceries. Many people also mentioned higher prices for takeout food.

The most recently reported national inflation rate came in at 2.2 per cent on a year-over-year basis, with the biggest price jumps coming from gasoline, new vehicles, building and household-maintenance materials, and food purchases from restaurants. The inflation rates reported by readers for food varied widely but were typically in the range of 15- to 20-per-cent higher than year-ago levels. It’s clear that food costs are now among the biggest stress points for household budgets.

Some specific reader comments on food inflation:

  • $100 per week [on groceries] is now $135 approximately
  • I have a takeout menu from a year ago and the prices now for the same items are 12-17 per cent higher now
  • Spending up 50 per cent for meat
  • I have to buy foods for lactose and gluten intolerance, and they have really gone up.
  • Beef prices seem to have doubled; chicken and pork a more reasonable 10-20 per cent.
  • Grocery bills that used to be $200 are hard to keep under $330. And takeout that used to cost $21 is now $26 for the same dish.
  • Pizza $9.99 to $10.99

After food, the next most-commonly cited source of inflation was lumber and building and renovation materials. Gasoline prices came up a lot, and insurance costs and condo fees were cited a few times as well. Clothing was cited most often by far as a good or service that has dropped noticeably in price in the past year.

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Rob’s personal finance reading list

A 12-pack of inflation-fighting investments

Worried about a breakout in inflation as the economy recovers from the pandemic? Forbes offers a bunch of suggestions, including gold, houses, cryptocurrencies and much more.

Edifices versus equities

A money manager compares returns from stocks and real estate in Vancouver and Victoria over a few different timeframes. Houses do very well in this analysis. But, as the author notes, house prices have been fed by a decades-long decline in interest rates. Looking ahead, houses won’t have that working for them.

50 cooking mistakes that wreck your dinner

Yes, you are making some of these mistakes and thus not getting full value for the considerable amount of food spending you – and most everyone else – is doing these days. Now for a bunch of handy uses for the little plastic tags used to close a bag of bread. And a surprise use for vinegar that will save you money on air fresheners.

Makes sense of cryptocurrency

An investment management company’s thorough, well-argued and quite readable take on what investors should make of cryptocurrencies like bitcoin. To summarize, you’re speculating, not investing, with crypto. And forget about crypto-hedging your portfolio against the next stock market plunge.

Ask Rob

Q: There is quite a bit of advice warning investors that high mutual-fund fees are eroding their returns. This makes sense on the surface, but if a mutual fund with a high management expense ratio consistently outperforms its peer group and benchmark index, then is there anything to be concerned about? I keep seeing financial advice urging investors to ditch their high-fee mutual funds, but there is no discussion on whether those funds are actually worth the higher management fee.

A: No question, a high-cost mutual fund that has outperformed consistently can be said to have earned its fees. Now, let’s look ahead. There is no way to know if the fund can continue at a high level of performance. What if the manager leaves or makes a bad bet at a key shift in the market? A low fee is something you can count on to help returns both now and in the future. Suggestion: Keep a close eye on this high-performing mutual fund to ensure it keeps justifying its cost. If returns revert to the mean, as they tend to do, then fees will become increasingly important.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length and clarity.

TUNE IN

The Globe and Mail is excited to share with you that next week, we’re starting a new daily podcast called The Decibel. Have a listen to our trailer, or find us on your favourite podcast player.

Today’s financial tool

Scouting for better rates and lower fees from a digital bank operating online and through mobile devices? Here’s a list of banks that are members of Canada Deposit Insurance Corp., the federal agency that insures eligible deposits for up to $100,000 in principal and interest.

The money-free zone

One of the best things I’ve watched in the pandemic is the mini-series Small Axe, which is about the West Indian community in London in the 1960s through the 80s. The series features a lot of great music, including a very catchy Janet Kay song called Silly Games. It’s an example of a style of reggae called lovers rock.

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