Should I?

At 48, Tyler should be a rock star. Engineer, two kids, a 2017 3-series, paid-off house he figures is worth $1.2 million. Happy wife, too. Even a Softail. All’s good.

But Tyler worries. Otherwise, why write me?

“I may have screwed up,” he says. “For the last seven years I did what Sharon wanted most and paid down the house with everything I had. So now the mortgage is gone, but we have nothing else – no savings, no TFSA and just a crappy work RRSP. I read your pathetic blog and wonder. You’re scaring me, buddy. Should I borrow to invest?”

So typical. The maple thing to do. A one-asset strategy. But when middle-age arrives, with three people dependent on you and no financial cushion for the future, having all the eggs in one basket – one house at one address in one city – may not be the best plan.

So, T wrote to follow up on some comments made here a few days ago about borrowing to invest. “Is this for me? How would I justify taking on a new mortgage when we just paid off the last one? She might kill me.”

Maybe she will. But let’s run some numbers.

Historically, houses have gained 3% a year in value (although those days may be behind us for a while). If that happens, in 12 years when Tyler wants to retire the place might be worth $1.76 million. Nice. But it’s all tied up in one asset which then needs to be sold. If interest rates have risen, the housing market weakened or the economy’s cycled down at that time, the place could be illiquid or worth less. Risk.

Now let’s assume Tyler took out a HELOC for 40% of his home’s value – $480,000 – and invested that in a balanced, diversified portfolio for the next 12 years and earned the historical average of 7%. The interest charge would be (at 4%) $1,600 monthly, or just over $19,000 a year. But it’s tax-deductible, so T gets to write off about 40% of it, reducing the annual cost to $11,500.

That $480,000 in 12 years would become $1.1 million, of which $629,000 would be growth. To earn that money would cost $230,000 in interest over a dozen years, and the $480,000 would have to be paid back upon retirement. Total cost of the portfolio then would be $710,400, for a gain of $400,000. Or, Tyler could keep the loan in place, and have the $1.1 million portfolio pay the interest – a small ask since it would generate about $75,000 a year in returns. The interest would still be tax-deductible.

The advantages: more money, obviously, with which to retire. More diversification since everything would not be in the house. Liquidity, as the portfolio can be converted into cash almost instantly (unlike real estate). More balance. Increased flexibility. Less financial risk in case the housing market tanks just when you need to bail.

The risks: Financial market gains disappoint (although 12 years is a long time and corrections are typically brief). Interest rates and loan costs rise (but are still tax-deductible). Stock markets crash (2008 was a good example and a balanced portfolio lost 20% but recovered in one year). The real estate market takes off again (but T would still own the place). Tyler loses his nerve when markets dip following Trump’s impeachment and sells out at a loss. The feds change rules and disallow interest deductibility (kiss of death for financial markets, so unlikely). Sharon kills him.

Make no mistake: borrowing to invest is not a slam-dunk. It magnifies gains, but also losses. Yes, it takes unproductive house equity and converts it into growth assets. But that growth is no more assured than real estate values.

So, never borrow to invest, unless you (a) have seriously thought about this and concluded you can ignore portfolio fluctuations (because they’re common), (b) invest in diversified assets that are balanced in a way that reduces volatility, (c) have a time horizon that’s long – years and years – to smooth out market gyrations, (d) keep good records in order to prove interest charges to the CRA, (e) ensure your portfolio is 100% liquid in case of an asteroid attack, rate spike or marital setback, (f) have time to manage this portfolio or have a smart guy do it for you and (g) are confident and courageous.

It’s a strategy. Not for everyone. But he asked.


#1 Honey Dripper on 07.15.18 at 2:16 pm

This works, I’ve done it. Why have an asset sitting there doing nothing? Great advice but def not for the squeamish.

#2 Shawn allen on 07.15.18 at 2:31 pm

A reasonable strategy for some. But his wife here would never allow it. More realistic here is take the now freed up mortgage payments now that house is paid and invest that in TFSA. Also look into work RRSP to see if anything can be improved in terms of asset allocation or investment choices. P.S. well done! He is far ahead of most people.

#3 The Real Mark on 07.15.18 at 2:46 pm

Just as diversification is important in investments, diversification of credit sources is also important when doing leveraged investment. The last thing one wants to be is beholden to a particular lender who may, on a whim, view a borrower as a short-term source of liquidity.

Just as there’s many tales of people finding their margin accounts restricted during the 2008/2009 downturn, even when technically their positions were completely on-side and the account was appropriately capitalized, the same is likely to happen with residential mortgage-backed lending at some point.

Also, particular attention needs to be made to ensure that the investments selected are not particularly highly correlated to where the interest rate cycle is at the moment. Yes, portfolio balance can help de-correlate a portfolio from the interest rate cycle, but (for example) it would be profoundly unwise to fill a leveraged portfolio with financial stocks and REITs where a rising interest rate environment is predicted (alternatively doing so would actually be a home run in a falling rate environment!).

The net effect of all of this is that there are many minefields for most “retail” investors in borrowing to invest. Most will use too expensive of credit. Fail to diversify their credit sources. Pick too many past “winners” not understanding that they were only ‘winners’ due to the macro environment which probably won’t repeat itself. Fees paid are often way too high. And credit, especially when not diversified, can pose substantial risks during periodic declines of the price of the collateral thus pledged.

#4 Werd on 07.15.18 at 3:00 pm

I have a Heloc that was secured against my house. I sold the house, but the bank hasn’t closed the Heloc! I am very tempted to use the credit to invest as you outlined in the article today, but it scares the crap out of me as well. That and it’s probably bank fraud as well.

The HELOC balance was paid out of proceeds when you sold the house or, if not extended, it was voided. If still in place, it was not secured. – Garth

#5 Ron on 07.15.18 at 3:02 pm

CAD margin loans at Interactive Brokers are currently at 2.6% if you borrow over $140,000.

Borrow at 2.6%, tax-deductible, invest at 4-7% yielding blue chip TSX stocks within a reasonable equity ratio. It’s as close to free money as you can get.

Absolutely do not borrow to buy individual stocks. – Garth

#6 North Burnaby on 07.15.18 at 3:28 pm

I don’t want to miss out on the next GREAT housing market bull run

#7 taxpayer on 07.15.18 at 3:33 pm

I’ve been doing this for 25 years, backstopped only by the investments held in the account. So, seen ups & downs, credit risk & stock risk. Still way ahead & never got called away or disallowed the interest charged. If you read the Act about it, it states clearly “income from investments” so dividend paying stocks are prime. When interest rates get up there, then they qualify….when the rates are locked in & rates are dropping. Haven’t seen that one since rates crept below 7-8%. Doubt that you’ll see those double digit rates of the 80’s anytime soon, but sh%t happens, eh? Look at RE today.

My margin rate is 4.5% this week, hasn’t changed yet. Therefore buy stocks paying >4.5%. Their interest rate equivalent is around 5.85-5.75% depending on your income or provincial domicile. If they are great dividend growers, their dividends will increase over time, some companies regularly. In that case a 3-3.5% dividend should work,because 5 years from now they might be 5%.

If you use margin & borrow to the hilt like you did with your recent house purchase….you are financially insane & more so if what you bought was Moose that is a “hot stock”, “sure win” whatevah. You’ll lose your shirt & still owe the debt. Borrow reasonably, as in can I pay off a 200 share purchase in a few months or next week. Repeat as desired. Buy on dips, market pullbacks, hey even sell some but wait the required time to repurchase, if that’s your thing. Always play by the rules.

Use margin judicially & buy the stocks you want to hold for a long time. 2008 was a banner year for buying bank stocks on margin, telcos, pipes, things like that. My margin account is worth high 6 figures & pays over 6.8% average yield. Some stranded Cap Gains in there that are slowly being capitalized & used to pay down the debt, or re-invested into other investments. I don’t need the cash flow yet, but then I’ll move the remainder into TFSA incrementally, when there is no interest cost. Have to play by the rules as they are today.

Never margin more than 25% of your margin available, make payments regularly (monthly) to keep it that way & buy companies that everyone uses….like banks. You can earn a 50K annual dividend income & pay zippo in taxes, or very little if no other income. There are other things to consider, but that’s up to you to discover on your own.

Sell your losers annually to offset any gains. Losses can be carried forward. Work with those numbers.

If I could have kept the CPP premiums, I’d not ever need .gov’s “pensions plan” & be a burden on society.

#8 Buy? Curious? on 07.15.18 at 3:35 pm

Hey Garth! I know it’s easy for most Canadians to make the the linear connection between Doug Ford and Donald Trump, but hear me out, YOU may closer to Donny T than people would like to believe! Billionaire, hating on cats, the similarities are undeniable!

#9 Reynolds531 on 07.15.18 at 3:39 pm

Even if you don’t borrow having zero debt and a paid off house allows you to seriously rethink the definition of balanced.

Why borrow at 3% to invest in bonds earning 2%? I suggest piling money monthly instead of borrowing Or if his credit score is good use smaller unsecured debt. Keep the house off the table.

Emotional thinking. And nobody borrows to buy just bonds. – Garth

#10 Bull on 07.15.18 at 3:57 pm

“I don’t want to miss out on the next GREAT housing market bull run”

After a great bull run, you typically get a great crash before you can hope on the next bull run.

#11 oncebittwiceshy on 07.15.18 at 3:59 pm

Soggy Shorts: “If you put in 40K in 40 years, and so did your employer, that adds up to $ 400,000 with 7% returns.

I hope you live to be at least 110 years old.”

That's an excellent but flawed calculation, my friend. You can't start with an initial investment of $2000. when the actual contributions are considerably less. I do appreciate the good wishes on a long life though. Lol

Year Your contributions Your pensionable earnings
1975 $4.94 $329.00
1976 $135.00 $8,300.00 M
1977 $151.20 $9,300.00 M
1978 $169.20 $10,400.00 M
1979 $190.80 $11,700.00 M
1980 $212.40 $13,100.00 M
1981 $239.40 $14,700.00 M
1982 $268.20 $16,500.00 M
1983 $300.60 $18,500.00 M
1984 $338.40 $20,800.00 M
1985 $379.80 $23,400.00 M

#12 Yanniel on 07.15.18 at 4:00 pm

Tyler can also withdraw the money from his RRSP to pay then loan interest. Sweet.

#13 pay your taxes on 07.15.18 at 4:00 pm

When the “7%” number comes up, are you also factoring in the 0% years? 2015 comes to mind but this year isn’t stellar either. The big pension plans are getting double digit returns because they’ve got tens of billions under management and diversify globally in ways that mortals can only dream of.

Have his nibs run the numbers on Firecalc if he wants to see all of the possible outcomes based on historical averages.

#14 Werd on 07.15.18 at 4:12 pm

I have a Heloc that was secured against my house. I sold the house, but the bank hasn’t closed the Heloc! I am very tempted to use the credit to invest as you outlined in the article today, but it scares the crap out of me as well. That and it’s probably bank fraud as well.

The HELOC balance was paid out of proceeds when you sold the house or, if not extended, it was voided. If still in place, it was not secured. – Garth

Thanks, Garth. Yes, the Heloc was paid off from the proceeds of the house sale, so there is no balance. Just a lot of credit doing nothing. I will call the bank to clarify it, as it’s not worth the headache.

#15 dakkie on 07.15.18 at 4:13 pm

US Housing Bubble Enters Stage Two: Suddenly-Motivated Sellers

#16 Stan Brooks on 07.15.18 at 4:16 pm

Aged 48 with a paid house only and nothing else to show is a failure.

He needs 3 millions in current loonie purchasing power just to be able to retire here.

Good luck with that.

Or he still can:
Get 1.2 millions if he sells that house – this is a nice villa in Spain, really free health care for residents and 900 k left over that can bring in 32-35 k per year in income stream without touching the capital, enough to retire immediately and spend his time between the beach and the golf course.

Note that this is time limited opportunity as there is no way for shacks in the big white frozen north with no economy to continue being valued that much in real value.

Or he can try building that saving nest for another 20-25 years, learn investing, accumulate half of it, maybe even 70 % (again 3 mil in current valuations) and then kiss it all goo bye when greedy politicians raid his RRSP or other investments with either higher taxes or outright expropriation.

+ his kids might be much better in Europe from education/jobs perspective.

His chance of ever retiring despite his ‘success’ so far is not greater than that of a hamster reaching the end of his spinning wheel.

He is just blind not to see that the purpose in life determined by the rulers of this place for him and enforced by government and institutions is to work until he dies passing absolutely nothing to his kids.

Thinking that he is free. What an irony…

#17 cmj on 07.15.18 at 4:18 pm

I’ve had a HELOC for years and if you aren’t disciplined as well as financially knowledgeable, it can be a disaster. It’s like a kid going into a candy story with way too much money in his pocket. Don’t do this on your own, Tyler but seek an advisor who will manage a well balanced ETF portfolio for you.
Your present financial experience by paying off the house shows your level of investing beyond a home. Getting $480K HELOC is tons of money and ignorance can play a big part of sleepless nights. Great financial strategy but read over Garth’s points of what it means to take out a HELOC. Then reread it again and again. Once digested, have you and your wife recite them by heart :)

#18 Bobs ur uncle on 07.15.18 at 4:21 pm

Can’t comment on leveraging a paid off house – not my thing personally – but the story does speak to people’s priorities. I am no fan of debt, but even when I still had a student loan, I didn’t go overboard to pay it off and always kept putting hundreds aside monthly to invest, as I knew the sooner I started, the magic of compound returns was on my side. Wasn’t smart enough at the time to calculate my returns vs the interest I was paying to see if I was ahead, but the strategy worked for me regardless. Got me used to seeing the portfolio numbers going up while the loan balance continued to decrease. It was a good feeling that continues to this day.

If you focus on the mortgage only, hey that’s great to be prudent, but you then have less time to invest for your retirement after the mortgage is gone. Better to use the time to your advantage and put money aside as well, even if it means keeping the mortgage a few extra years.

#19 Millenial CTO on 07.15.18 at 4:22 pm

I believe in the benefits of diversification between many asset classes. Given todays environment, I expect to have a sizeable portfolio before ever considering real estate.

Say one has a 500k portfolio, then buys a house fully mortgaged at 500k. No mortgage interest may be written off in Canada.

Alternatively, one liquidates the portfolio and buys the house in cash. Then, fully mortgages the house to re-buy the portfolio. Would this not allow one to write off their mortgage interest as interest to make investments?

#20 Ben on 07.15.18 at 4:29 pm

I couldn’t find the actual post where you explain it but why so much against the Smith Manoeuvre?

Borrowing to invest before finishing to pay off the mortgage seems like starting Tyler’s process even earlier, magnifying his future gains greatly.

Simply claiming tax-deductible interest is not a SM. That strategy involves using leverage you service with systematic withdrawals from investments purchased with the loan. It doesn’t work any more. – Garth

#21 Samuel on 07.15.18 at 4:35 pm

My wife also felt paying down a mortgage was the safest thing to do. I’m in my early 40s and also have a house worth about $1.2. Instead, we maxed RESP’s TFSA’s and RRSP’s ( plus a small amount in non registered investments) and just made minimum mortgage payments over the last 15 years. We now have about $300k left on the mortgage, no other debt. Our largest investment now is not our house, it is by far our financial portfolio. We now have the choice to pay off our mortgage and still keep almost $1.5 million in investments. Maybe we will, maybe we won’t. Balance for us has yielded wealth, choices, security, and optimism about our future. I was on this road before Greater Fool, but kept on it by reading this blog daily.

#22 Danny on 07.15.18 at 4:40 pm

Garth “Historically, houses have gained 3% a year in value (although those days may be behind us for a while).”

Not sure for how long, but in Etobicoke housing prices not reducing.

One lot value for $1,100,000….based on other sales for old bungalow.
Owner got severance for 2 narrow lots.
Now selling the 2 lots (land only) for $1,500,000.
Hoping to increase value by $400,000.
Plus 30 % profit for getting a severance from the City.
Madness continues.

And Ontario Conservatives blaming the “little guy ” new immigrants and refugees for housing crisis?

With no proof, facts or figures……just putting up a diversion from the truth ” Canadian speculators in the construction industry and the Toronto Real Estate Board are behind this kind of price stretching ”

I am still waiting for Parrot Ford to respond to my request for his proof. I am not holding my breath. So much for ” My friends I’m for the little guy “slogan by Ford.

#23 SoggyShorts on 07.15.18 at 5:09 pm

#11 oncebittwiceshy on 07.15.18 at 3:59 pm

Fair enough, I was lazy and looked at $40,000 over 40 years as 1 per year.

With your actual contributions each year (x2 for employer portion) then adding 7% each year, what does the total come to?
Or even more specific you could enter in the actual S&P 500 for those years instead of the 7% average.

I’d love to know real numbers, but I don’t have yours, and I don’t pay CPP myself.

#24 Stan Brooks on 07.15.18 at 5:15 pm

About 44 per cent of Canadians are $200 a month or less away from financial insolvency, according to accounting firm MNP.

Credit agency TransUnion said earlier this month that average non-mortgage debt stood at $29,312 per person, including an average credit card balance of $4,154. But about half of Canadians pay off their credit cards each month, so the burden is actually much higher for those who don’t.

Tackling debt can seem daunting, and many consumers choose to ignore the problem by paying only the monthly minimum, but an honest financial self-assessment and some planning will pay dividends in the long run, said Hannah.

Pay up, stupid sheeple, the owners need their rent.
Kids? Investments? The owners said: no. Pay the mortgage.
They think they can import more immigrants for their giant labour camp producing cheap goods for US.

And besides, who needs your kids, there is no jobs for them with automation anyway.

No planning, logic or reason will help you if you are in the wrong place at the wrong time.

#25 Penny Henny on 07.15.18 at 5:18 pm

HSBC 5 yr fixed at 3.19% only with high ratio mortgage.
3.44% if not high ratio

#26 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 07.15.18 at 5:25 pm



Vive la France!

#27 Stan Brooks on 07.15.18 at 5:30 pm

#22 Danny on 07.15.18 at 4:40 pm

Etobicoke is a shit hole.
$1,100,000 for a lot there?
Sure, everything is possible in cuckoo land.

It is time to close this mental institution.

#28 Willy H on 07.15.18 at 5:38 pm

At 48, Tyler should be a rock star. Engineer, two kids, a 2017 3-series, paid-off house he figures is worth $1.2 million.
__ __ __ __

2 kids heading to university/college? Hope they have at least $150K in RESP’s.

This can cost far more than a monthly mortgage over 4 years. Believe me!

Looks like there are going to have to be some serious sacrifices in order to build-up a retirement portfolio.
>inexpensive vacations – staycations
>economical cars – used car
>downsize home and invest proceeds
>controlled consumer spending
>no expensive home renovations

It’s the only way to plough as much of your disposable income into your portfolio as fast as possible at near 50.

#29 The Real Mark on 07.15.18 at 5:44 pm

“Simply claiming tax-deductible interest is not a SM. That strategy involves using leverage you service with systematic withdrawals from investments purchased with the loan. It doesn’t work any more. – Garth”

So the concept behind the SM is otherwise solid if not for the fact that previously advocated implementations involved the use of funds that deliberately returned an investor’s initial capital rather than just duly earned dividends and interest income?

Am I understanding your comment correctly?

Or is there some other fundamental issue here with the so-called ‘manouevre’? Aside from the usual problems involving advisor compensation and conflict of interest that is often inherent in leveraged investing schemas.

#30 SoggyShorts on 07.15.18 at 5:44 pm

#11 oncebittwiceshy on 07.15.18 at 3:59 pm

OK, I found the historical CPP max contributions. Not knowing which 3 years you didn’t make max, I just did all of them. You can make a copy of the sheet and just edit those 3 years, and any your didn’t work to see how much you would have if you controlled it.

#31 crowdedelevatorfartz on 07.15.18 at 5:52 pm

@#16 Stan Brooks
“Aged 48 with a paid house only and nothing else to show is a failure.”

Agreed but our financial acumen (education?) is deplorable.
Never in school are we taught how to manage our finances, the power of interest rates, Tax avoidance, etc etc etc.
But we learned Algebra, Geometry, Biology, English , French, how to interpret Shakespeare, The Battle of Waterloo,The electoral system, on and on and on.
Now? The kids are told “good job!” every time they tie their shoes. Everyone wins at Sports Day! Trangendered Washrooms for everyone.
As our parents, us and our kids wallow in financial ignorance and retirement purgatory.
An utter disgrace.

#32 Reynolds531 on 07.15.18 at 6:02 pm

#9 to clarify my point.

If Tyler borrowed $100k and invested in a balanced portfolio let’s say 60/40.

I’m saying he’d have less risk borrowing 60k and going 100% stocks with it. The 40k left in the house saves him higher mortgage interest than the bonds pay. And zero risk on that portion.

#33 TRUMP on 07.15.18 at 6:05 pm


Whatchu talkin about Willis?

#34 Ace Goodheart on 07.15.18 at 6:09 pm

His house is too expensive.

If his net worth is 1.2 mil probably max 400k of that should be in a house.

Borrowing on a 1.2 mil house to invest is just ignoring the problem. Kicking the can down the road so to speak. You even out the playing field but you still have not solved the issue that brought you here. That being, your house is too expensive.

Do what I did. Put 300k or so of your 2.5 mil net worth in to a small house in a crap neighbourhood.

Then buy a rental building for another 250k with a positive 6% cash flow, and invest the rest.

House too small? Who cares? With 120k per year off your 2 mil or so portfolio, taxes on cap gains and dividends meaning you pay less tax than a person who works for their 120k, and a paid for house, you travel a lot. Not at the house very much anyway. Air b and b your way around the world. The kids love it. Wife thinks it’s romantic. Ever try to keep things going marriage wise in the same room every night? Things get boring?

It’s not the girl. It’s the place. Regular travel works wonders for your love life.

The secret to happiness is simple. Firstly, money can buy it. Anyone who tells you different has never had money. It buys me happiness every day. Dividends, capital gains. All put towards making me and my family as happy as possible.

Secondly simplify your life. Lots of dividend and capital gain income that you don’t have to work for. Small low maintenance house. Avoid debt at all costs. Travel a lot. Travel is food for the soul.

Above All, live for right now. The future is for schmucks. Live every day right now and be as happy as you can be right here right now.

You will be dead soon….

#35 A J on 07.15.18 at 6:19 pm

This is for the deplorables in the comment section who say Liberalism is dead….

#36 Eating quinoa in Vancouver on 07.15.18 at 6:40 pm

Ouch! Townhouse in my Vancouver hood sold a few weeks ago – full price, first open which is typical as not too many go up for sale and realtors still dropping notes in our mailboxes saying they have buyers.
Anyway, buyer thought they had a firm deal with a developer to buy their detached YVR house so dropped a $50k deposit.
fast forward, deal wasn’t so firm, townhouse just re-listed at same price and original buyer has lost the $50k deposit.

#37 Nonplused on 07.15.18 at 6:47 pm

Tyler could also chose to continue banking the amount of money he was paying into the mortgage. That should add substantially to his savings over the next 12 years. Not saying that is an exclusive strategy it could be done while borrowing to invest as well.

#38 Trojan House on 07.15.18 at 6:50 pm

Okay, he still has to pay $1600 per month in interest (only receiving the 40% back as a tax return at the end of the year). How does he do this? Out of the returns?

#39 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 07.15.18 at 6:51 pm



Vive la France!

Garth, I want to apologize for my earlier comment today celebrating France’s World Cup victory.
This was insensitive of me. I was overtaken by a moment of exuberance. Please forgive me.

I totally forgot for a moment that the readers of your blog include many residents of Torontowe and Ontariowe. And I realize now that for most of them the concepts of a “Win” or “Winners” may seem very strange, an alien phraseology in their local dialects.

Let me clarify for all those sad people what I meant:

A “win”, such as by France today, means a competently managed sports organization equipped with well-chosen and trained quality players has exceeded the performance of their competitors in the measures that matter, on the scoreboard, going so far as to win a championship, such as today.

I realize how obviously (duh!!) foreign this wording seems to people in Toronto and Ontario, and again, I do apologize. I might as well have been speaking Russian to you, LOL. My bad!

To make amends for my oversight, in case the concept of “winning” still seems too abstract for Toronturds and Ontariturds, let me clarify even further by noting what “winning” does NOT mean:

WINNING – does NOT mean accomplishing nothing for more than 50 years, like your pathetic Make Believes hockey team, or 25 years, like the pathetic Blow Jays, or never winning at all, like the Wrapped Whores.

WINNING – does NOT mean always trading away your best players for next to nothing, Sittler, McDonald, Clark, not to mention all those lost draft picks (Phil Kessel was great, wasn’t he?!) so you can fool your low IQ supporters into a belief that ‘next year will be better’, or that what you need is more ‘truculence’, as opposed to actual talent and effective coaching

WINNING – does NOT mean being ruled by racists like Conn Smythe (who told black players they needed to be “turned white”) and criminals on your ownership team and board for decades, people who go to jail like Ballard and only care about fleecing generations of duped ticket buyers, while their subordinates commit horrific acts behind closed doors, like the pedophilia of the 1990s and earlier where 90 people were sexually abused by Maple Leaf Gardens staff and management did nothing to stop it

WINNING – does NOT mean being stupidly delusional, thinking that just because ticket prices go up, the chances for your team’s success do as well. (That’s more like a drug addiction)

WINNING – does NOT mean that borrowing more on your HELOC because you cannot pay your hydro bills is okay, because real estate in the GTA “always goes up, it’s different here”, so what’s a little more debt added to your $1 million slanty semi…

WINNING – does NOT mean that living in a sprawling suburban wasteland where the murders, assaults and robberies are going up faster than the Bitcoin bubble therefore makes it a ‘world-class city”

WINNING – does NOT mean that just because so many other GTA idiots have gambled everything on real estate that therefore there will be no correction, “can’t happen here”

WINNING – does NOT mean that a city with the worst weekend traffic jams, lousy public transit with no political will to make the right moves to improve it, and a growing gap between rich and poor, is going to have much of a future at all

WINNING, however, DOES mean what France did today!

Vive la France!

#40 Pepito on 07.15.18 at 7:05 pm

#16 Stan Brooks on 07.15.18 at 4:16 pm
Or he still can:
Get 1.2 millions if he sells that house – this is a nice villa in Spain, really free health care for residents and 900 k left over that can bring in 32-35 k per year in income stream without touching the capital, enough to retire immediately and spend his time between the beach and the golf course.
I live in Spain and what you claim is bs. There is no free health care for non Spanish residents unless they work here and pay into social security. Also, unless you have an EU passport, the options for acuiring residence for most retired foreign nationals is through the purchase of residential real estate with minimum value of 500k euros. Not much left over for the golf course, I’m afraid. C$35k is worth about €22k. Enough to get by, but not much more.

#41 Butcher on 07.15.18 at 7:13 pm

Vive La France!
And Putin’s umbrella was the best

#42 Smartalox on 07.15.18 at 8:20 pm

@Fartz #31:

Now? The kids are told “good job!” every time they tie their shoes. Everyone wins at Sports Day! Trangendered Washrooms for everyone.
As our parents, us and our kids wallow in financial ignorance and retirement purgatory.

You know what this sort of behaviour breeds?

HELOCopter parents!

#43 joblo on 07.15.18 at 8:30 pm

“The advantages: more money, obviously, with which to retire.”

Retire, what a dated old school concept.
New rule, Retirement no, financial independence, ya!

#44 Smoking Man on 07.15.18 at 8:38 pm

Capitalism rocks.

#45 I feel so bad for this guy on 07.15.18 at 8:48 pm

I am in the same position without the house.

No money, no problems. Except for figuring out where I am going to get my next meal.

#46 Lifexprt on 07.15.18 at 8:51 pm

I am in the same boat but almost 15 years junior and have a few hundred k’s in weedstocks.

Starting to think about packing it in and retiring in Europe within the next few years. Maybe living off dividends, somehow the thought of slaving off for the next 30 years scares the crap out of me

#47 Tony on 07.15.18 at 8:54 pm

Margin debt is at all time highs for people long U.S. stocks. In the past this hasn’t worked out well and I don’t know how long the U.S. market can keep on rising all on bad news? The South China Morning Post states China will retaliate against America but as yet no details. News is one day old. America may allow a bear market at the start of 2021 if Trump does 2 terms but if he only does one term stocks are the last place on Earth to be midway through 2020. Remember what was supposed to happen when Hillary won the presidency?

#48 Vancouver - How low will it go? on 07.15.18 at 9:00 pm

A $2M+ house (land value) just sold for $1.4M on my block in Vancouver. Market is on the move off a cliff. This is not uncommon nowadays.

#49 Duke on 07.15.18 at 9:03 pm

I have a couple of my friends who borrowed moeny from HELOC to invest on bitcoin. One of them is currently in trouble because he bought them at $10k. The other is still OK as he bought them at $6k, however they both will lose significant chunk of their money for sure.

Borrowing money to invest is a bad idea, especially on bitcoin. Please, please don’t go there.

Now where did I suggest buttcoin? – Garth

#50 Jungle on 07.15.18 at 9:45 pm

There have been a few 12 year periods of unflattering returns for a balanced portfolio; the most recent approx. 2001-2013

I would say at a minimum you need to look at 20 year commitment for this, just in case you get nasty bear market or unlucky entry points. (all time highs right now, anyone?)

The time to take advantage of this is when stock/ economy are in bear market (down -20+%), don’t be afraid to execute and use your leverage.

Not mentioned is capital gains and dividend tax, and the possibility of much higher interest rate. We can’t say 100% interest rates will not double from today in your life time.

#51 MF on 07.15.18 at 9:52 pm

46 Lifexprt on 07.15.18 at 8:51 pm

Lol easily the funniest comment ever.

Weed stocks are garbage, just like the underlying legalization idea is garbage.
Hopefully they fall back to where they should be: $0.00


#52 AK on 07.15.18 at 9:58 pm

“The risks: Tyler loses his nerve when markets dip following Trump’s impeachment and sells out at a loss.”


Might as well scratch this off the list, cause it’s not happening.

#53 MF on 07.15.18 at 10:02 pm

This idea is a little too complicated and risky for most people.

I happened to mention the idea to my parents a while ago. They have a paid off house “valued” at around 1.2 million and a portfolio valued at about 1.8 million or so.

No way was the answer. No and no.

I tried.


#54 Yorkville Renter on 07.15.18 at 10:34 pm

dude should do the math of starting at $400k and paying down the loan with freed-up mortgage $$$ versus just plowing that freed-up mortgage $$$ and starting at $0.

Is the differential worth the risk? That’s the question.

#55 TO Rules on 07.15.18 at 10:38 pm

#27 Stan Brooks on 07.15.18 at 5:30 pm
#22 Danny on 07.15.18 at 4:40 pm

Etobicoke is a shit hole.
$1,100,000 for a lot there?
Sure, everything is possible in cuckoo land.

It is time to close this mental institution.

You’re obviously a rube.
Etobicoke is great: The Premier himself lives here.

#56 Lifexprt on 07.15.18 at 11:05 pm

MF on 07.15.18 at 9:52 pm

As someone who has watched the industry grow from an idea to the current unfolding full blown global acceptance (medical cannabis) i have to disagree. Recreational legalization is only the cherry on top, medical export and derivatives is where the margins will be made. We are still very early in, Global sales could increase ten fold from here. Time will tell.

#57 Happy Housing Crash Everyone! on 07.15.18 at 11:49 pm


Another great post. Keep up the good work. The delusion in Toronto runs deep. Very delusional people.

#58 ww1 on 07.15.18 at 11:59 pm

#53 MF on 07.15.18 at 10:02 pm
This idea is a little too complicated and risky for most people. I happened to mention the idea to my parents a while ago. They have a paid off house “valued” at around 1.2 million and a portfolio valued at about 1.8 million or so. No way was the answer. No and no. I tried.

So with a net worth of $3.0 million and maybe 20 years to go (?) the prospects of holding tight with the lowest possible risk(regardless of the government contrived inflation rate) might actually be a good plan? Especially if you don’t care how much you leave to your sometimes ungrateful children.

#59 Ponzius Pilatus on 07.16.18 at 12:08 am

#39 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 07.15.18 at 6:51 pm

Vive la France!
You must have watched a different game that I and most commentators watched.
Croatia was the better team.
Own Goal and awful officiating (wrong hand ball call) caused them the Cup.

#60 For those about to flop... on 07.16.18 at 12:23 am

Pink Lemonade Stand in Vancouver.

Not entirely sure of the current status of this one ,as Zolo has it removed,but when you’re asking 600k less than you paid for it ,I would file it under not good.

Picked up for 3.75 in April 2016 ,trying to exit the market has been a slow grind for them ,like it has for a lot of the detached market that bought in the epic Spring Fling of that year.

As I said Zolo has it down ,other brokers have it up ,but no matter how contrived the market is here no one is going to make them whole,including expenses ,at this stage of the game.

The previous person took on a bit of risk and flipped it to these guys for a tidy profit and the current guys were in possession the day the music died.

Drove the Chevy to the levee,but the levee was dry…


3657 W 37th Avenue, Vancouver paid 3.75 April 2016 ass 4.21

Dec 19:$4,180,000
Jul 15: $3,180,000
Change: – 1000000.00 -24%


Feel free to make a donation.

Flop For Fox Fund…

#61 Oft deleted much maligned stock.picker on 07.16.18 at 12:31 am

You can’t eat your house…..but somebody else might. That’s why banks fake you out by including your current house value guestimate in your net worth statement (branch only) but you can’t get half that for a margin loan where the real money lives. Real estate is a non-fungible asset, meaning it’s value and liquidation for debt can’t be realized in a timely manner. Your 1.2 million estimate is so yesterday….an off the cuff blah blah blah from an unqualified appaiser ( your real estate sales sub-agent) and anything can nuke your guestimate and halve your 1.2 into a 50% loss overnight… change. And when they do….they change absolutely… changies….no take backs… time outs. This fact makes borrowing against your house when the market is into a sideways downward bias…….well…..a little Bitcoin with a tulip on the side. Bottom line….unless youve already sold your house is worth nothing. That’s why TD Waterhouse etc values you’re assets at half or less what you do……real money doesn’t sleep on dreamy cloud pillows of real estate agents fart bubbles..

Sorry to burst yours. Because I’m in the money business I don’t include my house value at all….not a stick in my net worth calculation. It’s because if the market Huff’s and Puffs and blows your job down at a time when the property market goes for a crap….and you have a pile of debt when your cash flow dries up ( oh…this stuff really happens) , then someone else will be sleeping in your bed….sleep on that.

#62 Oft deleted much maligned stock.picker on 07.16.18 at 12:45 am

BTW…..forgot to mention that HELOC is a demand loan..

So is the Margin acct. Any change, real or percieved by your lender and they call it in….bango wango…you owe it all in 30 days. A job loss of either spouse….any change…comoany gets sold….rules change….health issue in the family , kids inc…even briefly might trigger the call. That liquid thing means you sell it all today whatever the price or consequence . Oh….and the CRA will wants this upfront. Keep passport handy.

#63 Mortgage Free on 07.16.18 at 1:27 am

I have used the margin debt a little and I am happy to share some learnings:

– Indeed, as pointed out above, IB have an unbeatable margin interest rate; currently at 2.167% for over 140k. It is deductible of course, so for a high earner you are talking about 1.3%ish… Now the spread makes sense.

– Use margin debt super carefully (max 25% of the portfolio used as a collateral at ANY TIME) and temporarily (when things go great, get rid of the margin debt; that is the hard and counterintuitive part as we tend to chase returns…) when great opportunities arise (like March 2009, January 2016 for Canadian resource stocks etc.)

– I personally could, but do not use HELOC to chase additional returns (but I not only have the house paid off, but also have a good sized portfolio; if it were not the case, I would simply remortgage the house to build a portfolio). First, 4% IR is a rip off. Second, as I mentioned in a previous post, all great dividend paying companies DO USE LEVERAGE already. The debt is on their balance sheets and overtime magnifies their returns on equity. So why burden permanently your family balance sheet with debt when you can outsource leverage so to speak to companies, which are probably much better at managing leverage than any family will ever be? Third, HELOC does have a handy feature many people overlook (but Garth did mention it months ago when discussing why people with house equity do not need an emergency fund) and that is its use during unexpected events requiring a sudden cash injection. Assume you got carried away, use stupid amounts of margin leverage, but the market just keeps on tanking and you get afraid your positions might get liquidated at a loss. Now HELOC is super handy as a source of funds which can be temporarily used to inject the portfolio with additional cash until the market recovers. But keep your margin debt at a fraction of your portfolio size at ANY TIME and you will never have this problem!

– Re using margin to buy individual stocks. Here I differ with Garth. Anybody these days can construct their own ETF very inexpensively. IB charges pennies on a trade. Assume you borrow 100,000 and invest 1,000 into each blue chip dividend paying stock you select. Assume you pay max CAD1 for each trade. That is CAD100 in trading commissions or just 0.1% of the portfolio value. Then each year, you decide to sell 10 stocks and buy 10 other stocks for a total outlay of CAD20, which is 0.02% of the portfolio (if it appreciated in the meantime, even less). This allows you to greatly reduce your capital gains tax burden as you offset gains with losses. Sure you can buy ready made ETFs, but customizing your own ETF while minimizing fees is entirely possible. And if these 100 stocks are companies such as Apple, IBM, Intel, Caterpillar etc. with 100bn+ capitalizations, worldwide earnings and domiciled in the safest jurisdiction in the world, I would argue you end up with a well diversified portfolio. You want some Canadian exposure as well? Sure, just throw into the mix at CAD1000 each some banks, insurers, telcos, railroads, pipelines… To each his own!

– Oh, and re Spain / Europe being a paradise, come on. As an insider, I can tell you that the youth unemployment rate is 15%-25% (even for highly educated youth!) and unless you already have family wealth, life can be tough. In many countries as a working person you hit the 50+ marginal tax rate much faster than in Canada. And typically ALL income is taxable at the marginal rate… Free education? Sure, but only at home. Try to send your kid to a US college; unfortunately your taxes paid for educating your kid at local unis will not be returned to you. Unless your kids get a great fellowship, you may not be able to. RESP as I understand it can be used for educating your kids anywhere in the world. So all parents on this blog get your RESPs going!

We moved to Canada from one of the wealthiest European countries and we are loving our Canadian life every single day. There is still this sane balance between individual freedom and nanny state directives. Plus, when you come from Northern Europe, Canadian weather is really really nice! All that light and in many places great four seasons full of colours… Also, even in my country of origin which used to be the welfare mecca, public services have been scaled down fast in recent years as welfare state models are very expensive to maintain. Socialism works only when there is enough money to redistribute. When that is not true anymore (i.e., boomers retire and the new workforce is not paid that highly and/or is unemployed / underemployed, the music stops and belt tightening arrives creating a lot of social tension and conflict (think riots and frequent hand grenade attacks in Sweden, Sweden!) And don’t get me started on European racism… Oh, and so much space!!! Many many places in Europe start being very crowed. You want to be completely alone? Some many places in Canada to chose from. Try that in Europe… Canada is not perfect, but in many aspects living in Canada beats Western European life hands down. Canada is such an amazing country and still very much in the making, which is probably the coolest thing about it!

#64 Longterm on 07.16.18 at 1:48 am

#53 MF on 07.15.18 at 10:02 pm

Why on earth would your parents need to do that with a 1.2 mill house and 1.8 in investments that should be throwing off ay least 90K a year? They should/could be living a pretty fine life.

#65 Dolce Vita on 07.16.18 at 2:18 am


Nobody in the EU cheers for the French, but the French.

Lost on Canadians. You need to conform Canada, as is your usual.

Besides, when TRUMP TWEETS (obviously he did not watch the game and France’s “Pee Wee Hockey” goalie & Croatia shooting itself in the foot with Auto and Penalty Shot goals):

“Congratulations to France, who played extraordinary soccer…”

…you know it’s time to turn tail and head in the opposite direction [fast].

THE ONLY bright light in that BADLY played game was the exceptional at any age 19 YEAR OLD Kylian Mbappé, announcing himself to the World as the next CR7 (the latter will be ageing away at Juventus).

#66 Dolce Vita on 07.16.18 at 2:36 am

“It’s a strategy. Not for everyone.”

I DISAGREE. Anyone with substantial home equity ought to follow your advice.

-Tax efficient (worth doing for just that alone, esp. if you have a high MTR).

-The correct way to milk home equity – forces discipline in spending/saving vs. frittering it away with a HELOC where most spend that money on vacations, home improvements, etc. and in general, do not pay their demand loan back.

-As you state, recessionary periods are relatively short, the stock market corrects and then recovers.

-Returns are at historic lows already; thus, only upside as variable rates escalate (i.e., low return risk already at its highest and will only lessen in the years to come).

Yet again, WISE advice.

#67 crazed and a little confused on 07.16.18 at 3:25 am

hi garth,

I’m glad you are admitting you were kinda wrong about lower mainland real estate. I remember you mentioning % rate will decrease and the debt level is unsustainable. but here we are . from 2008 Van special about $700 k to about $ 1.5 million. 10 years to double …that’s pretty amazing 10 %growth yr after yr

granted Apple stock is 700 % higher and Amazon is 1000% higher. very few had such foresight and it not leverage 10.26 to 1
you deposit $10,000 to buy $102, 600 home approx.
that would be buying on margin if it were stocks…no bank would agree to that.

its alright…this is a blog no one forced anyone to heed your advice.
but you do give very informative insight onto finances
ETFs, REITS, preferred some bonds…etc

I still don’t buy preferred only common. if you buy blue chip then its not much a concern. don’t buy bonds direct …just 2 bond ETFS. it a good buffer in case the whole market goes to shit.
I didn’t completely fail the financial road
my TFSA is work $108K,
personal RRSP $98k
investment acct RBC $120 K
TD invest $98k ish
cash $ 22 k in high e savings
and my corp pension about $53K
so I’m not exactly poor

but I do get kinda giddy every fiscal quarter when I receive $ 2300 in dividends and half is in DRIPs plan. thanks to US stocks. I have apple , psifer , MCd;s etc
and every month I get $500 from ETFs and reits.

but unfortunately no girl likes my non real estate ass here in BC. you can see it on their face when they realize I rent. oh well…I can still flirt or swipe / poke .
whatever term you want to use

#68 Honey Dripper on 07.16.18 at 6:40 am

This is a much better strategy than the SM ever was. The SM was designed as another ruse to enrich mutual fund salespeople under the guise of paying off your mortgage with leveraged investments.

In the above strategy you own everything and are eligible to claim interest and is much more tax efficient.

#69 MF on 07.16.18 at 6:57 am

#64 Longterm on 07.16.18 at 1:48 am

No they are. They are living a very carefree and enjoyable retirement. My parents did everything right. Saved as much as they could, lived below their means. No lavish vacations or cars/toys etc. Dad even has a pension on top of it all.

It’s just that the equity in the home is sitting unused. They bought it in 1993 all cash with no mortgage at all.

I think Garth has wrote about the idea in the past so I figured I would float it. Didn’t go very well.


#70 IHCTD9 on 07.16.18 at 7:21 am

It’s way too late for Tyler, he’s only got 17 years left till retirement age. A portfolio should at least offer the option to get out by 55 – that’s only 7 years away.

It’s popped up a number of times on here over the last couple weeks just how important time is to a regular working dude/ette. If he had just stashed 500.00 measly dollars a month starting at 25, he’d have a million by 65 at only 6%, and 1.25 Mil if he got 7%. $116.0/ week –

If I were T, and decided to borrow to invest; I’d power it into RRSP’s if the wife has a decent job. There would be 10’s of thousands of accumulated room in each, and the tax return is like getting double digit interest right away, every year. Take that return and TFSA it. This will get some cash together quick, call the tax savings your interest – but when the accumulated RRSP room is maxed, the party’s over. Hopefully the wife worked her whole life and made decent money, maximizing the room between both of you.

It takes a good 20 years of chucking money at an investment before things start looking interesting, and T just doesn’t have it.

#71 Shawn on 07.16.18 at 7:21 am

Probably your best blog post in a while. I agree. Use the HELOC to buy VFV and forget about it. Pay down the HELOC as though it’s your mortgage.

It’s likely that the S&P500 triples by 2030 (yes I mean S&P500 10000 by 2030) while the value of your house remains flat.

Why would you pay off a fully tax-deductible borrowing? – Garth

#72 PuppetCrackers on 07.16.18 at 7:50 am

lol, you lost me at ‘Historically, houses have gained 3% a year in value’ … we are not convinced Churchill, Manitoba is an accurate national representation.

#73 fancy_pants on 07.16.18 at 7:51 am

borrowing to invest in RE was a huge winner the last decade, far more than the claimed 3%

#74 crowdedelevatorfartz on 07.16.18 at 8:18 am

@#48 Vancouver – How LOW will it go?
“A $2M+ house (land value) just sold for $1.4M on my block in Vancouver. Market is on the move off a cliff. This is not uncommon nowadays.”

Yeah…been a while since Brdy Skytrn has pumped the “uppa uppa uppa it always goes uppa”

#75 crowdedelevatorfartz on 07.16.18 at 8:26 am

@#6 North Burnaby Inn
“don’t want to miss out on the next GREAT housing market bull run”
Speaking of Bdy Skytrn.
Hey NBI!
Buy any more condos this month?

#76 NoName on 07.16.18 at 8:27 am

@66 Dolce Vita on 07.16.18 at 2:36 am

That penalty is debatable, when i sow referee going to the little box to check it out, because side guy told him to it was just pathetic… like nfl bs…

CRO out played FRA, buy bgood margin, and as I always say I would rather be lucky than good, FRA got lucky. Majority of game was played on french side of the field. Anyway congratulations to French, that was one very good game.

I bet you French felt like million buks after the game, good for them.

#77 50 YEARS OF MAPLE LEAF INCOMPETENCE! on 07.16.18 at 8:43 am

A shout out to Ponzius Pilatus and Dolce Vita :)

You two are PERFECT Toronturds – Congrats!

So….Croatia actually won the World Cup, you say…

…just like the Make Believes have won everything since 1967, and Toronto real estate will go up forever!!

Yes, yes, I see a VERY bright future for both of you as GTA realtor shysters and Make Believe PR weasels (pls. note the realtor positions will be temporary, while the PR positions will be long term, given the economic realities and low IQs of GTA residents)

Make the leap now – your futures are calling!

(Hey, maybe you could both run for city council in your elections this year too!)

#78 Tbone on 07.16.18 at 9:17 am

# 27 Stan Brooks

Central Etobicoke is quite nice.
Lots of big money there .
Check out W8 .

W9 …. 3 Bedroom bungalow 900 +

Some areas not so good moving north .

#79 NoName on 07.16.18 at 9:27 am


from 2008 Van special about $700 k to about $ 1.5 million. 10 years to double …that’s pretty amazing 10 %growth yr after yr

More like 7% yoy…

#80 re, Tyler on 07.16.18 at 9:31 am

congratulations at paying off your house and being mortgage free!! awesome . kudos to you

as for having all your eggs in one basket? deep breadth. You’ve done nothing wrong . Start building , aggresively, your TFSA and RRSP. A savings rate of 15% minimum. (im at 30% , like u mortgage free)

there’s a serenity, peace of mind in not having a ‘mortgage on ones head’. Some folks dont do well with debt- that is, Garth’s suggested plan wont work for some. It has NOTHING to do with ‘courage’, good grief. Peace of mind has no monetary value. Start with a plan to aggrseively build your tfsa and rrsp as of today.

gl and congrats!!!!

Retiring with all his liquid assets in registered accounts? Good thing you’re not an advisor. – Garth

#81 Dolce Vita on 07.16.18 at 9:54 am

#76 NoName

I agree. Disappointed they lost.

– – – – – – – – – – – – – – – – – – –


On the subject of turds, below a link to your fellow Les Bleus fans on the corner of Campo de’ Fiori, Roma.

The French celebrating whilst destroying our monuments.

No better than the drunken Dutch ditch pig hooligans that damaged Fontana della Barcaccia by Bernini in Piazza di Spagna, Roma.

Use Google Translate.

Les Bleus fans mistook Italia for their own country:

And here are the Croatian fans celebrating even after losing & thanking Russia for the hospitality (from Twitter):

Quite the contrast in mentality.

Les Bleus fans: Pond scum at its best.

#82 lol on 07.16.18 at 9:54 am

Retiring with all his liquid assets in registered accounts? Good thing you’re not an advisor. – Garth


who said such?

i do know YOU said he should be ‘couragous and confident’

who looks the fool again?

ya, this wont be displayed publically…:)

That made no sense. Wait for October 17th. – Garth

#83 For those about to flop... on 07.16.18 at 9:56 am

Keeping an eye on those darn Milli Vanilli’s…


“Mapping the Best (and Worst) Places for Millennials to Make a Living.

Earning an above-average wage early in a career is a critical predictor of long term success. Raises and promotions compound over the course of several decades. This means that if young people start out earning relatively little compared to their peers, they tend to make less over their lifetimes. Our new map highlights the parts of the country where millennials are earning the most (and least) on an adjusted basis.

We pulled our numbers from the U.S. Census Bureau, which tracked the median amount each age cohort made in 2016, the latest year in which comprehensive data was available. The Census Bureau defines “millennials” as people born between 1982 and 2000. Another factor that influenced the data is the cost of living differences across the country. Knowing those differences, it’s clearly not surprising that people in Massachusetts earn more than those in Alabama. To account for that, we adjusted the figures to reflect the true cost of living in each region according to the Bureau of Economic Analysis. This creates a level playing field to compare income levels in different states. Our next step was to simply create a heat map of the country, showing which states have the highest (purple) and the lowest (light blue) median wages for millennials.

Here are the ten states (plus Washington, DC) where millennials earn the most money:

1. Massachusetts: $80,307

2. Minnesota: $77,090

3. North Dakota: $76,836

4. Washington, DC: $75,220

5. Maryland: $74,737

6. New Hampshire: $73,941

7. Wyoming: $73,345

8. Alaska: $72,374

9. New Jersey: $72,150

10. Virginia: $71,397

Millennials are an interesting group to study for a couple of different reasons. They are the most diverse generation in American history, more of them went to college than previous generations, and they are now the largest contingent in the workforce. Many of them also graduated in the middle of the Great Recession, which economists believe might have a lifelong impact on their wages.

Determining where millennials are doing well (and where they are not) indicates broader trends in the American economy. For example, there’s a pocket of purple and dark blue states in the Upper Midwest where these younger adults tend to make above-average wages, as high as $77,090, on an adjusted scale, in Minnesota. The same can be said about the Northeast between Virginia and New Hampshire. These regions contrast with the South, where Texas is the highest state at $62.2K, coming in at number 32 in our list overall. The South clearly stands out as a lackluster region for millennials in the labor market.

Perhaps the biggest surprise on our map is the West Coast, which doesn’t look that different from the South. The one exception is Washington ($70.4K), which is $7,000 higher than California ($62.9K). This highlights the fact that big tech companies are creating great jobs for a select group of skilled workers, but if making the most money is your primary goal, you have a better chance of succeeding if you move to Nebraska instead of California.”

#84 crowdedelevatorfartz on 07.16.18 at 10:51 am

Yo Floppie.
I commute past a spec house(s) in Burnaby on Duthie st.
The develop bought an old tear down about a year or so ago and bulldozed it.
Built two ” stainless and granite” particle board wonders.
The landscaping is almost done… Sod is laid, irrigation working overtime, driveways were poured last week.
I expect the listing signs any day now………..
We’ll see if the irrigation sprays…. pink mist……

#85 Love Guru’s Dad on 07.16.18 at 11:33 am


from 2008 Van special about $700 k to about $ 1.5 million. 10 years to double …that’s pretty amazing 10 %growth yr after yr
I remember that time well. The Love Guru’s Mom had been researching high schools in Vancouver. Elementary school and onsite daycare people were amazing. But things get serious in high school in Point Grey. We found what would turn out to be another amazing school, but in North Van. So we sold, and moved into a rental. My first experience as a seller.
When we bought, the realtor double ended the deal. Promised us a dishwasher, we got a garburator. Recommended contractors that were ex-addicts and needed work. Electrical contractor ran off on cocaine binge with the $1000 bucks he needed for supplies. My realtor tracked him down and told us what happened. Place was robbed after we fired flooring contractor. He used standard nailer and no glue nails on 5 inch fir we rescued. No major work, basically some necessary lipstick on a real sweet ol’ pig (it was a smoking hole not long ago, sad) This was our home, but we didn’t have a lot of extra cash lying around.

Selling realtor was slick. Message in 2008/2009 was price so you catch the falling ball. Don’t miss the ball! At the time we’d sold prices were likely ramping up again, but our only information came through realtors. We were told we had two offers. High one from someone Chinese, and about 40k less from a reliable doctor. He suggested we take the lower one. We didn’t.

We are not bitter, but grateful. It was just enough, “things that make you go hmmmmmm….” that when we’d discovered Garth’s blog we had already tested the truth and knew it was in his message.

Thanks Garth.

M54BC – thanks Flop

#86 Natwork Admin on 07.16.18 at 11:48 am

#82 lol on 07.16.18 at 9:54 am

That made no sense. Wait for October 17th. – Garth

What happens on October 17th? The only thing I could find about Canada is on October 17, 1977 Canada begins regular live TV coverage of Parliament

#87 James on 07.16.18 at 12:04 pm

Donald J. Trump
10 hours ago

Our relationship with Russia has NEVER been worse thanks to many years of U.S. foolishness and stupidity and now, the Rigged Witch Hunt!
34,327 replies 15,346 retweets 59,688 likes
Ok People WTF, is this guy just plain stupid. The USA is no more, it is now officially a joke. What a bunch of dumb idiots these people that gravitate around Trump are. For that matter all of those who still support this treasonous piece of work.

#88 A J on 07.16.18 at 1:11 pm

#87 James

Agreed. Republicans cannot call themselves Patriots if they watched that press conference today with Putin and Trump and don’t realize that Trump is Putin’s puppet. It was as plain as day. Open your eyes and take your country back. It’s embarrassing.

#89 A J on 07.16.18 at 1:12 pm

#86 Natwork Admin

Weed is legalizing. Do you live under a rock?

#90 jess on 07.16.18 at 2:24 pm

As Frontline reported in 2013, if you work for 50 years and receive the typical long-term return of 7 percent on your 401(k) plan and your fees are 2 percent, almost two-thirds of your account will go to Wall Street. (You can check the math in our report here.)

“U.S. Thurow wrote:

“Depression is seen as a product of systematic tendencies for the distribution of wealth to become concentrated among a few. When this happens, demand eventually sags relative to supply and long cyclical downturns commence. Unlike some cyclical analysts, Batra believes that such cycles are not inevitable and can be controlled with social policies essentially designed to stop undue concentration of wealth from developing.

“Essentially, the economic problem is like that of the wolf and the caribou. If the wolves eat all the caribou, the wolves also vanish. Conversely, if the wolves vanish, the caribou for a time multiply but eventually their numbers become too great and they die for lack of food. Producers need consumers, and if producers deprive workers of their fair share of production income they essentially deprive themselves of the affluent consumers they need to make their facilities profitable. One could think of Batra’s argument as a kind of economic ecology where there is a ‘right’ environmental balance.””

#91 robert james on 07.16.18 at 2:36 pm

87 James on 07.16.18 at 12:04 pm … Trump is not mentally fit enough to be a bathroom attendant in a sh*thole country let alone the Pres. of the US and he proved it again today.. Time for the US to remove this idiot from office before he does something really stupid like start WW3..

#92 Dissident on 07.16.18 at 2:59 pm

RE: Great Again July 6th

“Combine oil and commodity prices with President MAGA and the next decade will be nothing like the last one. It’ll feel a lot more like the Eighties. Google it, kids. And the music was way better.”

– – – – – – – –

Is that why listening to Van Halen seems relevant again??? It’s all I’ve been jamming on my Spotify/Youtube lately. David Lee Roth over Sammy Hagar all the way. Rumor is that they might tour again in 2018. It really does feel like we’re in a Neo-Regan Era, minus the Care Bears, She-Ra dolls, Pontiac Firebirds, cigarettes, mullets, high tops and acid wash jeans. Ah, the 80s.

#93 tccontrarian on 07.16.18 at 3:37 pm

“It’s a strategy. Not for everyone. But he asked.” GT
Definitely NOT for everyone!
I went ‘all the way’ by even selling my house to invest because:

a) it wasn’t our ‘dream home’, and selling was going to happen anyway
b) I felt confident enough that I could actually do it (successfully)
c) I was seeing amazing opportunities in the resource sector, which I’ve followed since 2004

I’ve now nearly tripled my net-worth in less than 3 years – but know how/when to get aggressive and how to manage risk. But it took over 10 years of making mistakes to get here. I understood that staying ignorant was probably the biggest risk!


#94 RSmith on 07.16.18 at 3:52 pm

Simply claiming tax-deductible interest is not a SM. That strategy involves using leverage you service with systematic withdrawals from investments purchased with the loan. It doesn’t work any more. – Garth


Hi Garth. The Smith Manoeuvre is indeed alive and well. On the website the last FAQ explains how the increasing efficiency of the mortgage payment services the deductible LOC interest – one does not need to redeem investments to service the interest. Thanks.

#95 Trump on 07.16.18 at 3:56 pm

the smartest guy in the room

yet again

#96 oncebittwiceshy on 07.16.18 at 4:23 pm

Soggy Shorts: “I’d love to know real numbers, but I don’t have yours, and I don’t pay CPP myself.”


Thank you for the spread sheet calculations. I doubt that I would have spent the time, otherwise. lol.

In any event the total would have been $256,300.45.

My CPP payments over the next 30yrs would be just over $260,000. I guess anything over age 87 is gravy. lol.

I am not discounting the fact that, even on $260,000 reasonably invested, the annual return would be $18000/yr however you can't discount the fact that the employer is "forced" to match those annual contributions.

Unless you work for an employer that would provide that kind of matching you would be looking at quite the discount on your total contributions and returns.

I'm not a huge advocate of CPP and it only provides me with 10% of my retirement income but there are way too many people that actually count on that money and who otherwise would never have the financial acumen to invest any kind of contributory money.

It reminds me of a company that I know that provides their employees with RRSP matching. According to the CEO the majority of the employees are quite young and the majority cash them out each year for Christmas.

CPP will be their retirement … and not a good one.

#97 jess on 07.16.18 at 4:44 pm

“I don’t see any reason why it would be” Russia, Trump said. “President Putin was extremely strong and powerful in his denial today.”
as = competitors that will do /say anything to WIN

Florida Republicans play starring roles in Russia hacking indictment


07/13/2018 06:37 PM EDT
maybe to make america less great mr. trump

#98 jess on 07.16.18 at 4:50 pm

money laundering?

US Indicts Russian Gun Activist Who Interacted with NRA and the Trump Campaign
Maria Butina is charged with conspiracy.
Dan Friedman and Denise CliftonJul. 16, 2018 4:13 PM

in a criminal complaint unsealed on Monday, federal prosecutors charge that Butina, 29, who enrolled as graduate student at American University in fall 2016, developed “relationships with U.S. persons and infiltrating organizations having influence in American politics, for the purpose of advancing the interests of the Russian Federation.” The complaint says the activity occurred between 2015 and February of 2017.

Prosecutors say that Butina worked at the direction of a high-level official in the Russian government who was previously a member of the legislature of the Russian Federation and later became a top official at the Russian Central Bank. Though that official is not named in court documents, the description matches that of Aleksander Torshin, who was among Russian officials sanctioned by the Treasury Department in April.

The prosecution of Butina, who was arrested in Washington on Sunday, is being overseen by the US Attorney for the District of Columbia and the Justice Department’s National Security Division, not special counsel Robert Mueller. ..”

#99 jess on 07.16.18 at 5:55 pm

As well as being a powerful banker, a leader of President Putin’s political party (United Russia)

Alexander Litvinenko: was to be a witness in spain

Litvinenko had been supplying Her Majesty’s spooks and their Spanish counterparts with hair-raising information about the Russian mafia in Spain. The mafia had extensive contacts with senior Russian politicians. The trail apparently led to the president’s office, and dated back to the 1990s when Putin, then aide to St Petersburg’s mayor, Anatoly Sobchak, worked closely with gangsters. In a week or so, Litvinenko was to testify before a Spanish prosecutor.
The formidable and powerful Taganskaya organization of which Torshin is allegedly part is recognized by the US and the EU information and intelligence services (including Europol and the FBI), according to the dossier about Torshin from the Spanish Civil Guard. Its activities include the appropriation of companies using violent or fraudulent methods, bank scams, extortion and the carrying out of contract killings.

#100 Re James on 07.16.18 at 7:58 pm

James, you constantly jeb at president Trump (the most powerful man in the world) yet, who or what are you?

And, didn’t you promise to leave if Trump got elected?

From where I see, you’re not much.

#101 crowdedelevatorfartz on 07.17.18 at 8:28 am

@#100 Re James
“you constantly jeb at president Trump…”

What is a “jeb”?
Is that like a Bubba but with less letters?

Trump is possibly the most dangerous, unstable, self absorbed idiot to ever hold the office of the President.
And the fact that he was elected says more for the publics’ opinion of the alternative choice than his “popularity”
He’s an embarrassment nationally and internationally .
He has set back democracy and what it stands for at least 150 years.

He wont seek a second term due to possible impeachment proceedings.
Lets see what the US mid Term elections bring. If its a Democrat rout……he’s toast. Lame Duck. Washed up. And thats not Fake News.

#102 Guy in Calgary on 07.17.18 at 11:23 am

If that money is going into registered accounts then not tax deductible. Also, technically, it has to be income producing.