With the economy the last few years, many individuals all over Canada have had to make some sort of sacrifices. When times get tough, it is wise to start looking at your own expenses and determining what should be cut. However, no matter what type of economic situation you may be facing, there are a few expenses that just shouldn’t be cut. In fact, by cutting some of these expenses, you may make things worse for yourself or your family. These mistakes can lead to poorer health, and a deeper economic hole that you find yourself in. Without further ado, here are the five budget cuts that you should never make to your budget.
Retirement Contributions
When in a time of economic uncertainty, it may be tempting to cut some of those retirement contributions that you are making. There may be that voice in your head that will tell you it’s okay, as you can always contribute more to your retirement later on. However, life rarely works out that way. Every year, we face all sorts of obstacles and unplanned expenses, and it’s important that we regularly contribute to our retirement. If you start getting into a habit of cutting off retirement contributions when times get tough, you are going to be looking at a very difficult retirement. Don’t hurt your long-term financial situation just to try to get ahead in the short-term.
Debt Repayment
Another tempting expense that you may wish to cut during economic uncertainty is the payments to pay down your debt. However, this is strongly discouraged. By failing to pay down your debt as quick as possible, you could be looking at all sorts of additional interest charges. You are simply digging yourself in a deeper hole if you choose to cut off debt repayment, and repaying your debt should be one of the top priorities in your budget. After all, it’s one of the best ways that you can escape the hole that you are currently in.
Car and Home Insurance
As you look at your monthly expenses, the car and home insurance may stick out as being particularly costly, and not providing any immediate benefit. However, suffering some sort of disaster with your house or your automobile without insurance will take your current financial situation to a whole new level. Besides, having car and home insurance provides you peace of mind. The last thing you need to lose during difficult times is any of the peace of mind that you still have. Continue making those insurance payments, and take comfort in knowing that a disaster to your house or automobile is not going to financially ruin you.
Healthy Meals and Gym Costs
A common mistake that many Canadians make is to begin cutting their healthy meals or gym costs. Some individuals may consider these items to be a luxury items, items that should be the first to go in times of economic uncertainty. However, this mindset couldn’t be more wrong. Healthy meals and working out at the gym are not luxury items, they are a lifestyle. A lifestyle that can add many years to your life. If you are still thinking of cutting your meal or gym costs, ask yourself this question. Do you really want to potentially trade extra years of your life just to make some spending cuts? When it comes to making changes to your budget, your health just isn’t an option.
Health and Dental Insurance
This goes right up with making budget cuts to your meal or gym visits. You should never sacrifice the health of you and your family just to escape your current financial situation. Health and family are the most important things in your life. Why would you want to sacrifice them just to get ahead in your monthly budget? If you still feel that you should make cuts to your health insurance, look over your entire budget again and again until you find some other way. It just isn’t a good idea to make any sort of cut to your health insurance. Besides, no matter what financial mistakes you may or may not have made, you deserve the peace of mind that comes with your health and dental insurance.
