I’ve always been attracted to alternative forms of investing and one investment that we all make and is very personal is in the groceries that we buy. Specifically I’m talking about long life groceries such as canned peas and toilet paper. Things that will still be good 1+ years from now.
Groceries are an almost unavoidable expense of modern life and if you have money today you basically have two choices. Choice one is invest it (such as in a GIC) and then buy the things you want later when you need them. Choice two is to buy the item now and then hold onto it until you need to consume it. Which one to choose?
With the start of the Russia / Ukraine war we had a brief moment of increased inflation where the prices of goods rose quite a lot on the back of rising oil and fertilizer prices. I was quite worried about this at the time but it seems that after a year or two the economy mostly recovered from that shock and inflation fell back down. With the Israel/USA and Iran war the world is once again I believe facing a period of heightened inflation. Nobody knows the future but I feel like it will be even higher than it was last time. Inflation is almost universally bad for investors and I know I suffered from it before and so want to make sure I am somewhat insulated this time.
In that regard I have decided to carry out an experiment. I am going to pre-buy a stockpile of long lived grocery items over the month of April and record the prices I paid for all of them. At the four month and one year mark I am then going to compare the change in the prices of those goods vs. what return I could have made if I just invested in a GIC instead. For the GIC I am going to be using the rates from Saven Financial as a base of comparison. Saven has the highest GICs rates I’ve seen so I’ve been using them for that. Right now they offer 3.2% for four months and 3.55% for one year.
This experiment should be fun and I will get to see what actual benefits there are to stocking up on groceries are vs just investing the money and buying things when you need them. I am honestly not sure between the groceries and the GIC which will win.
Cold and Rich 