I'm also in Canada (outrageously priced Vancouver Island at that) and your grocery spending sounds insane to me. I have a family of three (DH, myself and DD14). I'm sure we don't spend more than $400 a month at most. My daughter is a teenager now, but even when she was in diapers, I bought the cheap Zellers or Shoppers Drug Mart no name brand ones. We didn't even have a Walmart in Victoria yet at that point or I'm sure they would have been even cheaper than what I paid. I would have to see in more detail what you are buying to offer any real advice on where you might be able to cut back. Good luck!
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