Mill Day

Enough clucking from the wrinklies in steerage about their fat real estate gains, dividend torrents, thirsty underwear and dangerous conservative urgings. Welcome to Millennial Wednesday here at GreaterFool. Today let’s muse on some of the things the kids are worried about, which means the oldies can spend this valuable time washing their Def Leppard T-shirts and swilling Rogaine.

First up, Patrick the urban dude. “I participated in your various surveys, so I understand the majority of your audience is much older than myself. I’m a 26 year old business professional (CPA by trade, but now working as a strategy consultant) living in downtown Toronto, and making a better-than-average pre-tax salary of just north of $100,000 with no assets and roughly $45k in my TFSA,” he reveals.

Like many younger audience members of your blog, I am renting a place for $1,350, which is a very good deal for the area that I live in. I made the choice to move downtown when I had the option of living with my parents, so that I can take advantage of the downturn in the rental market. I hope to become a homeowner – hopefully – by the time i’m in my mid-30s (which to me sounds reasonably ambitious).

My questions: (1) For higher-than-average income earning younger adults, when is the right time to open up my RRSP? Should I be allocating a good chunk of my income to RRSPs instead to get some tax benefits this year?

(2) What is the best way to manage capital allocation for different goals? Right now I have a well-diversified self-managed TFSA account. I myself am confused as to what this is for (retirement?). Does it make sense to open up a TFSA/RRSP specifically for buying a home with a less risky portfolio (assuming I’ll cash out in ~10 years)? Otherwise I would have to take a big chunk of my saving in the one TFSA account to fund a house, which I realize opens up more contribution room, but not sure if there is a better way to plan out my finances. Writing this email in between meetings, so apologies for any confusion.

First, P, if you’re living downtown for thirteen hundred bucks a month, paying nothing for a car, commuting, property tax, condo fees or property maintenance and saving most of your salary, why stop? The moment you decide to become a real estate owner will immerse you in debt, immobility, recurring costs and (sadly) adulting. Enjoy this time. Use it to build. As you are.

Now, RRSPs are meaningful and much misunderstood by the moister class. These are tax-shifting vehicles more than retirement accounts. You can chunk 18% of your earned income in there, use that to reduce taxable income, grow the money without paying a cent to Justin (even if you like him) then suck it out cheaply during a year of sabbatical, layoff or transition. Moreover, it’s the perfect thing to feed if you do end up succumbing to house lust.

The Home Buyers’ Plan allows a $35,000 withdrawal from the RSP for a deposit. No tax. You need not start making repayments for two years. Then you have a long 15 years to put the money back into the fund (if you miss a year that portion is added to income). In the year of purchase ensure you make the max contribution at least 90 days before using the HBP, so you’ll also have a tax refund to spend on new appliances.

As for establishing a separate registered, low-risk, account for a real estate buy ten years away, bad idea. You do not want to be all in bonds or wussy funds – stay balanced. Roaring Twenties, remember?

Here’s Ann. Simple question.

I am a new Ontario teacher and would like to start investing my salary since I live with my parents and I refuse to enter the crazy condo game. I have about $25,000 so far, but will add 50k every year. How do you suggest doing this for a small amount like this?

Other than hooking you up with Patrick, the first thing to do is stuff your TFSA. Teachers have enviable DB pensions (defined benefit), which means a sizeable portion of pay is directed into that plan, reducing RRSP contribution room. Besides, if a teacher retires with a sizeable RSP, when it is eventually turned into a RRIF (after age 71) the forced income can push you into a higher tax bracket. Nasty outcome.

But a giant TFSA in retirement can pump out a steady stream of cash flaw and not a single dollar will be counted as taxable income. So, start there. Load up that sucker, then spill the extra income into a non-registered account (B&D of course). In retirement this will also provide tax-efficient income, thanks to dividends and capital gains. And are you paying your parents rent, Anne? Do it.

Now, Brian is 28, works in construction, and understands the incredible benefit of the MSU. “Your blog has changed my life!” he says. “I recommend it to everyone I meet who brings up financial talk.”

My partner took my advice (all from you) and in a year went from $10,000 debt to $9,000 in a TFSA and $3,000 that’s going in an RESP for our newborn. Thank you so much! I make 55-75k a year with a net worth now of 36k.

Jan is on mat leave – she makes 45k a year now but as her seniority in her union goes up it’s 100k+ a year in 6-8 years. We just had a baby boy and rent a basement suite outside Vancouver for $1,200. I see so many people in the emails you share grovel to you and say your advice has helped them and then they ask some dumb ass question about how can they work out buying this house they NEED.

I am not gonna ask you that. I want to know how to get my partner and I’s net worth to 250k! I was wondering if everyone at my age is getting these huge mortgages and overleveraging is it not the smarter thing to try and get an investment loan? Is it smart or worth the risk for my partner and I to try and get loans to stuff our TFSAs full right now and let the gains grow while we make the payments ? And will they loan us even half of what people get in a mortgage? Thank you for your time and devotion to guiding Canadians financially.

Don’t do it, Brian. Borrowing money to invest seems seductive, but the rate on a non-secured loan would be high and using the bank’s capital would just ratchet up the stress level, maybe encourage you to seek higher gains by absorbing more risk.

Steady work, good prospects, new baby, low rent, no debt, solid relationship – you are far wealthier at this moment than so many others your age who lose their way. Be proud.

About the picture: “This is Marley,” writes blog dog Peppy Sue. “She’s our 12-year old chocolate Lab, an independent, sweet girl who loves showing off her toys to friends and strangers alike. We sometimes refer to this as ‘babies on parade’. She is much loved and adds joy to every day.”

137 comments ↓

#1 TurnerNation on 04.14.21 at 12:27 pm

There is three guarantees in life: Death, Taxes, and Air Canada bailouts.

It is Kanadian Kapitalism

— #132 End of Days on 04.14.21 at 12:20 am
Naw I already gave a small bio, here. Just a Kanadian Tax slave going to work, while a majority of people and corporations get the handouts. Teenagers given $2000/mo CERB to play video games? My pleasure.
https://www.greaterfool.ca/2021/03/20/really-7/#comment-772725

———–

Something for Dolce to chew on – IFR of ~0.15% and ~1.5

https://onlinelibrary.wiley.com/doi/10.1111/eci.13554
All systematic evaluations of seroprevalence data converge that SARS‐CoV‐2 infection is widely spread globally. Acknowledging residual uncertainties, the available evidence suggests average global IFR of ~0.15% and ~1.5‐2.0 billion infections by February 2021 with substantial differences in IFR and in infection spread across continents, countries and locations.

.Quarter of Covid deaths not caused by virus(telegraph.co.uk)

————
– You are free to leave at any time! Our leaders Do not want us healthy. No Gyms, no Sun, no parks.

.WestJet extends temporary suspension of international sun flights until June (cp24.com)

— Right on schedule for Q2…local bans. Get out now.

.COVID-19: B.C. premier says local travel ban not off the table (citynews1130.com)

#2 Matt on 04.14.21 at 12:29 pm

Home prices are expected to increase an additional 20% this year. As per Adam Vaughan, MP in charge of CMHC, the Government will NOT allow housing price to drop even 10%. Government has a lot of tools in their disposal including shared equity, amortization increase etc. Sorry folks, no correction. If you keep renting, you will continue to miss out on the capital gains. Markets can stay irrational longer than you expect.

#3 Brian Ripley on 04.14.21 at 12:31 pm

My chart of TSX INDEXES for Energy, Real Estate, Financial Services, Gold and the Bank of Canada Commodities in CAD with March data is up:
http://www.chpc.biz/tsx-indexes.html

After 12 years of ZIRP and NIRP total CPI came in at 1.1% on the February 2021 print (1 month lag) and is still in a long term downtrend keeping inflation below the BoC target.​

#4 Zoo Zoo Zoo Do on 04.14.21 at 12:36 pm

Trudeau is getting stripped naked in the international media. It looks like the progressive left is sick of the guy now that Joes no Trump. Likely the body count expectations without vaccines is too high and getting worse. Rats jumping off a sinking ship. Nobody want to be associated with the guy that killed the most citizens through incompetence.

Who’s making money in this market? I am. I bought a derivative product yesterday that spits out 15% and pays monthly. Im stoked that I don’t rely on Trudeau for Canada’s economy. Trudeau leaning on oil will yank the dollar down as OPEC pumps. That’s a big signal to beef up your US holdings.

#5 Flop... on 04.14.21 at 12:38 pm

Besides still being alive, the beauty of waking up each morning is you get to see the world in a whole new light…

M46BC

#6 Original Alex on 04.14.21 at 12:48 pm

Solid advice, like always. But whew! Have you seen the dog pic? I am completely swooning. What a pup! 10/10, would cuddle and ear scratch.

#7 Drill Baby Drill on 04.14.21 at 12:57 pm

Today’s dog photo is a perfect metaphor for the very near future. The “Mortgage Dog of Higher Interest Rates” killing the sheeple mortgage renewers.

#8 [email protected] on 04.14.21 at 1:00 pm

DELETED (Anti-vax)

#9 crowdedelevatorfartz on 04.14.21 at 1:10 pm

I’m impressed.
These Mills are getting their financial $h!t together.

I didnt start pounding money into anything until I turned 30. I’m doing ok now.
Well done folks …”freedom 55″ comes sooner than your think…

#10 Diamond Dog on 04.14.21 at 1:17 pm

#4 Zoo Zoo Zoo Do on 04.14.21 at 12:36 pm

If someone wants to run down leaders and political parties with partisan tropes void of specific critique, that’s one thing but to combine it with bragging and self glory’s, that’s quite another. It wreaks of a mindset that is insecure, easily led and thus, banal.

But enough displays of critique/compassion (sometimes the greatest gift we can give someone is one’s time), one could offer more truth and clarity should it further serve or warrant.

#11 Another Deckchair on 04.14.21 at 1:19 pm

Good for these kids. Smart, asking questions, and hopefully listening.

For the mils here – if you save a bit every year (and invest it), live life simply, before you know it, you can do whatever you want, paid or unpaid, and you’ll have an income so you don’t need to eat Kraft Dinner, unless you want to.

https://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/

I’m not saying I agree/disagree with mrmoneymustache, but boy, sometimes he hits the nail on the head.

If you’ve got enough coming in to live on, start that skateboard company, or coffee shop, or go sail the world – and enjoy every day without the stress of lack-of-money.

Please think about it – now is the time to set the standards for rest of your life.

#12 Lee on 04.14.21 at 1:19 pm

I’m calling it. Consumer discretionary stocks are up 60% from start of 2020. Expect S&P to fall 30% sometime this year. I guarantee it. Can’t keep going straight up forever.

#13 Millennial 1%er on 04.14.21 at 1:34 pm

great blog post. no doom and gloom, just good ol’ personal finance

seems like many are just living their lives despite the recurrent lockdowns

#14 Stone on 04.14.21 at 1:34 pm

I’m happy for all 3 mills. They’re at least prioritizing some of their disposable income for investing. Something must have changed though from when I was 26, 19 years ago. I made a $51,000 salary at the time (around $45,000 the year before) and had already accumulated a bit over $100,000 in investments. With 19 years of inflation since then, that $100,000 would be worth far more in today’s dollars (roughly $145,000 with 2% a inflation). What are they all spending their dough on? I’m not saying they should live like monks as that isn’t healthy. One is only paying $1350/month on rent. Another is living at home, assuming she doesn’t pay rent and maybe not groceries either. Is it instagram lifestyle expenses? I’m honestly curious. Where is their disposable income money going?

#15 ogdoad on 04.14.21 at 1:40 pm

Keep your house kids. if you live at home with your parents consider yourself lucky and take that responsibility from them when the time is right. Community. NOT independence. Keep your wealth within your family.

making 100k at 26 paying 1300$ per month? He is hacking life all over the place…join one of those swinger clubs (wear a mask – both ends) and life is GREAT! Trust me, I know!

Og

#16 Niagara Region on 04.14.21 at 1:41 pm

Article from the Globe and Mail: “Want to Cool The Housing Market? Force Banks to Shoulder More Risk”

https://www.theglobeandmail.com/business/commentary/article-want-to-cool-the-housing-market-force-banks-to-shoulder-more-risk/?utm_medium=Referrer:+Social+Network+/+Media&utm_campaign=Shared+Web+Article+Links

#17 Divv on 04.14.21 at 1:49 pm

#2 Matt on 04.14.21 at 12:29 pm

Matty, you must be leveraged HARD to spend so much time typing that out each day. “EnJoY yOuR gAiNz, BrO!”

#18 Inequity on 04.14.21 at 2:01 pm

#12 Lee

What kind of guarantee? ….like money back?
How much are you offering us if it doesn’t drop 30% in 2021?

#19 James Broden on 04.14.21 at 2:04 pm

I am hearing a 5% federal surtax above incomes of $175,000 is coming. Just my two cents.

#20 Quintilian on 04.14.21 at 2:04 pm

Matt:
“Government will NOT allow housing price to drop even 10%. Government has a lot of tools in their disposal including shared equity, amortization increase etc.”

True, government has a lot of tools, at this point, they can be used only to delay the inevitable, and in doing so can only make the problem worse.

It is now a race between the spectacular bursting of the bubble and the next election.
It doesn’t matter which political party will be in charge.

#21 Sail Away on 04.14.21 at 2:05 pm

#14 Stone on 04.14.21 at 1:34 pm

Something must have changed though from when I was 26, 19 years ago. I made a $51,000 salary at the time (around $45,000 the year before) and had already accumulated a bit over $100,000 in investments. With 19 years of inflation since then, that $100,000 would be worth far more in today’s dollars (roughly $145,000 with 2% a inflation).

———–

But you just make things up out of whole cloth, Stone.

Sure, create a story where you were doing better than them. Everyone is the hero of their own story.

#22 tbone on 04.14.21 at 2:05 pm

Got a Pfizer shot on monday . Injection site a bit sore the next day , but its better now . No side effects yet , lol .

#23 The kids are alright on 04.14.21 at 2:17 pm

Steady work, good prospects, new baby, low rent, no debt, solid relationship – you are far wealthier at this moment than so many others your age who lose their way. Be proud.

——

Wow! I think i will use this as a mantra! So well said!
I would like to add one thing. You also have time on your side!

#24 Lee on 04.14.21 at 2:27 pm

#18 Inequity,

I’ll pay you Double what you pay Garth to write this blog. But seriously, have consumer discretionarys ever done 60 % that fast?

#25 Sail Away on 04.14.21 at 2:34 pm

#23 The kids are alright on 04.14.21 at 2:17 pm

Steady work, good prospects, new baby, low rent, no debt, solid relationship – you are far wealthier at this moment than so many others your age who lose their way. Be proud.

———-

Wow! I think i will use this as a mantra! So well said!
I would like to add one thing. You also have time on your side!

———-

Exactly. For the mills, always keep this in mind. Life is long and things happen unexpectedly. The best approach is to keep learning and exploring- opportunities will crop up where you least expect.

Also, try not to be bitter or envious of others. Those are self-defeating mindsets. Recognize the success of others as education.

#26 Penny Henny on 04.14.21 at 2:40 pm

Hey Flop, what was that adhesive you mentioned the other week?

#27 Dolce Vita on 04.14.21 at 2:48 pm

#1 TurnerNation

telegraph.co.uk – I dunno TN. They haven’t been right since Sir David died. Used to be good and liked them. Same outfit today worried about the S. African variant in the UK. Grain of salt with them recently (not once though).

Heads up UK MSM:

“The Times” is read by the people who run the country (even with Rupert now in charge);

“The Telegraph” is read by the people who think they run the country;

“The Mail” is read by wives of the people who think they run the country;

“The Express” is read by the people who think it is still run as it used to be;

“The Guardian” is read by the people who think about running the country;

“The Sun” is read by the people who don’t care who runs the country as long as the girl on page three has got big ****.

————————–

Forgot, the pink paper (thank Norrköping, Sweden) reports to the people that run the country how their investments are going – even with Rupert now in charge.

No comment as to which I like.

#28 the jaguar on 04.14.21 at 2:54 pm

@ #158 The West on 14 14 21 @ 1:16 PM
Thank for your very interesting post and references.

Guessing that cute chocolate lab has more toys than most toddlers.

#29 Shortymac on 04.14.21 at 2:57 pm

At this point, my husband and I are just assuming that we’ll inherit his parent’s house and that will be our permanent abode into our retirement.

We currently rent a 4 bedroom in Toronto for 2k a month, why would we buy a house and pay 4k a month minimum at this point in time.

Hubby’s grandma’s house in Alliston could go for an easy 1 million, it’s insane.

#30 DON on 04.14.21 at 3:02 pm

#14 Stone on 04.14.21 at 1:34 pm
I’m happy for all 3 mills. They’re at least prioritizing some of their disposable income for investing. Something must have changed though from when I was 26, 19 years ago. I made a $51,000 salary at the time (around $45,000 the year before) and had already accumulated a bit over $100,000 in investments. With 19 years of inflation since then, that $100,000 would be worth far more in today’s dollars (roughly $145,000 with 2% a inflation). What are they all spending their dough on? I’m not saying they should live like monks as that isn’t healthy. One is only paying $1350/month on rent. Another is living at home, assuming she doesn’t pay rent and maybe not groceries either. Is it instagram lifestyle expenses? I’m honestly curious. Where is their disposable income money going?

********

Trendy shopping…coffee…bubble tea…weekends away partying…phones…cars…student loans and the big one eating out.

The usual youthful trends…eating out most likely a big expense.

#31 Flop... on 04.14.21 at 3:03 pm

#26 Penny Henny on 04.14.21 at 2:40 pm
Hey Flop, what was that adhesive you mentioned the other week?

////////////////////////////////////

Here’s my post from a month ago.

I must have spilled some on the contractors toilet seat.

He hasn’t given me any work since.

Must have ripped him a new one…

M46BC

———————————-

#1 Flop… on 03.16.21 at 2:02 pm

Don’t really like pimping construction material products, but I see a lot of homeowners on here, and even renters that come across as people that could do with the occasional professional help.

This product has crept into more common use in my workplace the last year or so and I think it will help a few people out.

It is a product called Instant Bond, I guess you could basically call it glorified super glue.

It’s uses are endless, as are the things around the house that can break.

This product has so many more uses than traditional super glue because of its strength factor.

We were talking about its strength at work the other day, and a guy cut two 8 inch pieces of baseboard with a mitre, he then proceeded to put the adhesive on one side, the activator on the other and pressed them together for 10 seconds.

He then tugged on them profusely to try and separate them, could not, and then dropped it on the ground from six feet, no luck, stomping on it was the only way he could break the immediate bond.

It can be used without the activator to give you more time to adjust things, but with the instant bond you can just apply it to something and then if you want long term support, just fire a couple of nails in.

Up to you, you can continue to use duct tape on everything but this stuff works, is invisible and because of the 5000lb psi bonding strength can be used to do almost anything.

Do not put it on the bosses toilet seat, unless you want to work from home permanently…

M46BC

https://www.instantbond.com

#32 TurnerNation on 04.14.21 at 3:04 pm

Watching the US Equity Indexs (Indicies?) here.

What a day. COIN.US IPO’d and now this:

…..
#124 Apocalypse NOW on 04.12.21 at 9:02 pm
So, blog dogs, are you prepared for the worst-case scenario when April 14, 2021 hits?

Because here’s what it will look like on the ground…

…..

April 14.

36 Hours Away.

PREPARE

US bank profits set to outperform, beat expectations, says economist. – Garth

#33 Stone on 04.14.21 at 3:07 pm

#21 Sail Away on 04.14.21 at 2:05 pm
#14 Stone on 04.14.21 at 1:34 pm

Something must have changed though from when I was 26, 19 years ago. I made a $51,000 salary at the time (around $45,000 the year before) and had already accumulated a bit over $100,000 in investments. With 19 years of inflation since then, that $100,000 would be worth far more in today’s dollars (roughly $145,000 with 2% a inflation).

———–

But you just make things up out of whole cloth, Stone.

Sure, create a story where you were doing better than them. Everyone is the hero of their own story.

———

It’s a valid question I asked.

Unlike your escapades in Vietnam. That’s just gross. Every time you decide to do the above, I’ll remind you about it. Deal?

#34 DON on 04.14.21 at 3:09 pm

#20 Quintilian on 04.14.21 at 2:04 pm
Matt:
“Government will NOT allow housing price to drop even 10%. Government has a lot of tools in their disposal including shared equity, amortization increase etc.”

True, government has a lot of tools, at this point, they can be used only to delay the inevitable, and in doing so can only make the problem worse.

It is now a race between the spectacular bursting of the bubble and the next election.
It doesn’t matter which political party will be in charge.

*****************

Nicely stated…the race is on.

#35 Dolce Vita on 04.14.21 at 3:12 pm

Old School Me

For the Love of God take Millie DUCK HUNTING. She looks bright, eager, healthy and willing to learn. You will never see a happier dog.

News Flash for the PETA crowd:

Ducks have more of a chance at life or death during hunting season than the source of chicken nuggets you ate last night (or the Big Mac you foraged for).

Veggie crowd:

You have incisors for a reason and it is not to better tear celery.

Anti-Hunting crowd:

Hunters and the licenses they pay for has done more for preserving wetlands, prairie for ducks, geese, upland birds, etc. than the save the trees, bees, snails and whales crowd that DO NOT PUT ZERO MONEY WHERE THEIR BIG FAT MOUTHS ARE.

Don’t use Google for this search term:

“what group preserves habitat for hunting”

Use Bing instead since the milk toasts at Google would faint in an abattoir don’t like it. Here they are:

“Hunters save habitat as individuals and through organizations such as Ducks Unlimited, Rocky Mountain Elk Foundation, the Ruffed Grouse Society, Quail Unlimited, and North America Wild Sheep Foundation.”

Ducks Unlimited in Canada alone:

2.4 million ha of critical wetland habitat and influenced 19 million ha more, and has completed 8400 habitat conservation projects throughout the country.

-In total about THREE Nova Scotia’s.

Why?

In recent years growing pressure from agriculture, industry and urbanization has led to the disappearance of up to 70% of wetlands in settled areas.

————————-

Unlike the vast majority of Social Justice Warriors, Hunters put their money where their mouth is AND ask for little in return.

Next time you go to the meat or veggie counter or fast food drive in wicket chew on the above for awhile.

#36 ElGatoNerodeYVR on 04.14.21 at 3:23 pm

Impressed to see the young crowd being sane and asking the right questions. Ofcourse none of them has the cash to buy today so “invest it all” is a gimme.
My neighborhood thanks you for renting those basement suites , awesome as you get a cheap place to live in and we get to write off mortgage interest, expenses, utilities … win-win . Make Surrey proud.

For those who are not sure how RRSP contributions will impact their taxes , TurboTax has a calculator , ey.com tax calculator can be used , most banks even offer that online.
Generally speaking I would still say that contributing to an RRSP just enough so you pay no taxes then add to TFSA the leftover cash is the best approach if you can’t max out both.
Of course , do your own math , I am sharing thoughts here, not providing advice of any sort, not even implied…yes I saw the irony the other day so trying to make amends here.

On a separate note the crowd is cheerful of higher taxes on income over 175k was it? A helpful reminder that when the elders move on ,all their assets must be disposed at fair market value and the proceeds are considered income and will be taxed at that huge new tax, so basically a hidden inheritance tax,ponder on that for a moment before breaking out the 1952 Dom Perignon.

#37 Linda on 04.14.21 at 3:26 pm

Marley looks like a real sweetie:)

So nice to hear about Millennials who are actually building net worth, are not obsessed with RE to the point of financial suicide & all of whom seem to have work that actually pays more than minimum wage.

#38 Sail Away on 04.14.21 at 3:34 pm

#33 Stone on 04.14.21 at 3:07 pm
#21 Sail Away on 04.14.21 at 2:05 pm

…you just make things up out of whole cloth, Stone.

Sure, create a story where you were doing better than them. Everyone is the hero of their own story.

———

It’s a valid question I asked.

Unlike your escapades in Vietnam. That’s just gross. Every time you decide to do the above, I’ll remind you about it. Deal?

———

Whole cloth, as mentioned.

I have never been to Vietnam and have never posted anything about Vietnam on this site, or anywhere as far as I know.

You either fabricated that or have me mistaken with someone else. My guess is fabricated.

#39 dan_dare on 04.14.21 at 3:34 pm

Since it is millennial day, here is my story.

Mid 30s, finished grad school (science) in 2011. Got a decent job offer in rural Ontario shortly after, and spent five years establishing a career.

The cost of housing in rural lands is great, but the lifestyle is not my cup of tea. Further, the choice with regard to the dating pool was minimal, and faced with the prospect of living a monastic life in perpetuity, I relocated to the city and its unfortunately high housing costs.

Fast forward to today, I now live in south Etobicoke with my girlfriend. We do enjoy the amenities of the city and are ok with renting (no desire to own a condo, which would be about all we can afford these days).

Our apartment is not large but clean and renovated (and above ground) and with the rent being quite low we are able to save around $3-4k a month which is many people’s mortgage payment here.

I do credit my early career days in the hinterlands with being able to save up about $450,000, always invested in a b&d. Hoping this paves the way to a solid future and eventual retirement. Thanks for all the great advice Garth, and to many other folks here sharing their wisdom.

D

#40 Dolce Vita on 04.14.21 at 3:34 pm

So far the Boomers Commenting today, the Charlatans that they are, all giving advice to the Mills. ‘Cause they bought a house 40 years ago and now fancy themselves to be the Cdn Oracle of Omaha fountain, cornucopia of advice.

Woeful. Wretched. Lamentable. Anathematize.

MILLS:

You are all SCREWED for the better part of the next 20 years, I think you all know that and as to why.

Enough said. Or move to another country.

———————

– Admirable try and your usual unsinkable self My Liege but I am sure even you know the above is correct.

#41 Flop... on 04.14.21 at 3:37 pm

Was just checking my Notice of Assessment on my CRA account and it states that I have pay by April 30th.

That’s standard for me.

Then it says 2022.

I think it’s a typo, so I scroll down and it states again, to avoid additional interest please pay amount owing by April 30, 2022

Anyone else get this message, or did my account get hacked…

M46BC

#42 Dolce Vita on 04.14.21 at 3:42 pm

Marley? Milley?

Whatever.

It’s a Lab and a beautiful one at that.

————————-

Internally not a fan of the name “Marley” having viewed the original A Christmas Carol, 1938, and having had nightmares as a child about Jacob and his gory chains and locks.

Shake not thy gory locks at me.
-Macbeth to Banquo

[that too]

#43 ElGatoNerodeYVR on 04.14.21 at 3:52 pm

#37 Linda on 04.14.21 at 3:26 pm
So nice to hear about Millennials who are actually building net worth, are not obsessed with RE to the point of financial suicide & all of whom seem to have work that actually pays more than minimum wage.
===========
According to Wikipedia millenials are between the ages of 25-40 so I would say this:
if any of you M’s have no savings,work for minimum wage and read this blog STOP now ,you are wasting your time here , go use your time on something fun instead ,fire up that sweet gaming gig ,get a leap motion tracker for your 3D unity avatar , break up the Prada(like)ware and post some more pics on the social network of your choice..whatever floats your boat.
No need to keep reading advice you will not implement .
Alternatively maybe that particular lifeboat should sink so you can jump into a new one where you follow the advice given here.

#44 CJohnC on 04.14.21 at 3:57 pm

Today’s post was great. Good questions, thorough answers. The one thing that I find interesting is Patrick’s question(s). How is it that after the schooling required to be a CPA he doesn’t already understand the very issues that he asked the question(s) about. How can he state: “TFSA account. I myself am confused as to what this is for (retirement?)”

Must have been some great partying at CPA school.

#45 What is Even Happening? on 04.14.21 at 4:04 pm

Thank you for this post, Garth. Together with the sunny skies today, it helped lift my bitter “doom and gloom” mentality about the Canadian real estate market.

It’s great to see Millennials focusing on learning how to invest, and being thoughtful and deliberate about where to put their money. They seem smart and savvy, and will go far.

Also, Marley is really cute!

#46 Ponzius Pilatus on 04.14.21 at 4:06 pm

#31 Dolce
Very good article.
I believe the following statement is true in any country that has a “free” press.
“Tell me which newspaper you read (stream) and I tell you who you are”.

#47 Ponzius Pilatus on 04.14.21 at 4:08 pm

Americas longest war (20 years, Afghanistan) is coming to an end.
Finally.
War what is it good for?

#48 wallflower on 04.14.21 at 4:11 pm

I have just alerted my network to NOT share this photo with my niece, the shepherd named Bingo, because, as they know, she will become deeply envious and extremely agitated until she gets one of these donkey (?) fluffs for herself.

#49 Blacksheep on 04.14.21 at 4:15 pm

20 Quintilian # 20,

“It is now a race between the spectacular bursting of the bubble and the next election.
It doesn’t matter which political party will be in charge.”

*****************
Don # 34,

“Nicely stated…the race is on.”
——————————————
Your worrying about the wrong thing.

RE has not ‘gone up in value’.

Currencies are losing buying power meaning it requires more $’s to acquire a given asset. Look at Bitcoin, it’s doing what Gold should be doing, if it wasn’t so manipulated via paper trades. Sovereigns are creating $’s like never before because they have no other choice to avoid a depression.

Have a look at this M1 chart:
https://fred.stlouisfed.org/series/M1SL

It took from 1960 to 2020 to accumulate 4 trillion, but since then are showing an additional 14 trillion in US$ (hockey stick) sloshing around that has been put into the US economy in the last year. This makes Canada’s 400 billion look like chump change. Pressure to increase wages is coming and that is the only thing that may actually force rates to rise.

I would recommend putting you money anywhere, but in a bank….

#50 AM in MN on 04.14.21 at 4:21 pm

I still disagree with young people starting out their working lives and families not being married.

The statistics are clear on the long term difference in wealth accumulation between those who are long term married and those who are not.

I’ve met a lot of guys in my working life who were doing well until they got divorced (or broken up if never married in the first place) in their 40’s or so and never really recovered. Living in a small apartment, having paid for a big house.

Stay single and live alone or with room mate until you find the one that wants the lifelong deal. One way or another you will help each other and pool/share in ways that help build wealth, including with relationships with extended family, and especially business opportunities that come along with people that you can trust over the long haul.

For many of these unmarried young couples, it looks good now, let’s see where you’re at in 25 years.

#51 Dolce Vita on 04.14.21 at 4:29 pm

Have been quiet commenting [choked] about Cdn Variants for a couple of reasons.

First, mercifully the APOCALYPTIC increase from a few days ago has subsided from STRATOSPHERIC to a mere 4th order quadratic equation increase:

https://i.imgur.com/fewHkpo.png
https://i.imgur.com/9U3egIv.png

[Again, screening pioneered by the Brits EARLY THIS YEAR and works]

Second, I am WORRIED for the life blood of Canada, its YOUTH.

Young by far the largest cohort infected – tables turned, from old to young.

https://i.imgur.com/eZ6Pg6u.png

Still, the largest cohort needing hospitalization, ICU are the old but even that average age is dropping fast to my eyes:

https://i.imgur.com/MW4U6l6.png
https://i.imgur.com/sY81U6Y.png

Sources…

https://www.ctvnews.ca/health/coronavirus/tracking-variants-of-the-novel-coronavirus-in-canada-1.5296141

https://health-infobase.canada.ca/covid-19/epidemiological-summary-covid-19-cases.html#VOC

[Kudos to Gov Canada, they pull no punches]*

——————–

Let it be said as of late, if nothing, the Cdn MSM has shown restraint in reporting about the variants in light of the above DISTRESSING data.

Still waiting for the robust lady to sing.

Variants delenda est.

—————-

*For those that think Dr. Tam exaggerates go to the above Gov Canada COVID-19 daily epidemiology update and on Fig 1b click the “Relative scale” button so as to make its background dark grey.

Ya. No worries.

#52 Anna on 04.14.21 at 4:31 pm

Just wondering, is there a difference between buying VUN.TO vs converting can to usd with norberts gambit and buying VTI? For if our cad dollar drops in value?

#53 Ponzius Pilatus on 04.14.21 at 4:37 pm

#29 Shortymac on 04.14.21 at 2:57 pm
At this point, my husband and I are just assuming that we’ll inherit his parent’s house and that will be our permanent abode into our retirement.

We currently rent a 4 bedroom in Toronto for 2k a month, why would we buy a house and pay 4k a month minimum at this point in time.

Hubby’s grandma’s house in Alliston could go for an easy 1 million, it’s insane.
—————-
Shorty,
Not sure if you’re serious, or not.
But if you’re serious, this is not a solid retirement plan.
Your hubby’s parents may just decide to take out a reverse mortgage and blow it all.
Or, the horror, outlive you and your hubby.
Time for plan B.

#54 Handsome Ned on 04.14.21 at 4:48 pm

#47 Ponzious Pilatus

War, what is it good for

“It makes no difference what men think of war. As well ask men what they think of stone. War was always here. Before man was, war waited for him. The ultimate trade awaiting its ultimate practitioner. That is the way it was and will be…War is God.”

Judge Holden, Blood Meridian

#55 Reximus on 04.14.21 at 4:55 pm

Look at Bitcoin, it’s doing what Gold should be doing, if it wasn’t so manipulated via paper trades.

—-

You dont believe BTC is manipulated?…lol

#56 Dolce Vita on 04.14.21 at 5:06 pm

On Vax Canada despite what Dr. Trudeau, FREE RANGE Epidemiologist at large, says…

270,433 vax’d yesterday.

At that rate the finish date 32M ≥ 15 yrs old, incl vax’d to date, 1 & 2 doses:

Nov 4, 2021

Same rate and if Herd Immunity is 80% done by:

Sep 24, 2021

Well, at least it’s 2021 and not early 2022 (the latter estimate year occurs on weekends thanks to “dire straits” vaxing by the Provinces and not the Territories, the latter are whizzes at vax’ng).

https://health-infobase.canada.ca/covid-19/vaccine-administration/

——————-

Cdn Population ≥ 15 yrs old, 31,966,591
Total doses req’d = 2 per (not a 2-fer ON, “per”), 63,933,182

Vax’d to date, 1 & 2 jabs:

8,822,672

Only a mere:

55,110,510 jabs to go.

#57 Toronto_CA on 04.14.21 at 5:11 pm

Good lord Anne. You’re a grown ass adult with a job. Move out of your parent’s house and start living your life.

Sometimes it’s not about the financial advice.

#58 Reximus on 04.14.21 at 5:11 pm

I just realized I am sitting here for a half hour reading this stuff in the kitchen, no one else is home and I still have a mask on. The only reason I became aware of it is that I cracked a beer and it just dribbled down my shirt…

#59 Voice Of Reason on 04.14.21 at 5:12 pm

I’m reading your column and notice that Patrick is a CPA by trade. Just kind of surprised that a CPA would not be up to speed on RRSP’s, Investing etc.

#60 Dr V on 04.14.21 at 5:18 pm

154 Faron

“Who gains from that scenario? Shareholders, the higher level worker, the makers of the robot, upper management. Publicly held companies are incentivized to siphon cash out of the company at any cost. The result is inhuman and inhumane opportunities and working conditions.”

OK. So let’s extrapolate a bit. How about excavators?
Each one replaces dozens of labourers doing back breaking work , and adds better ones in manufacturing, maintenance and operation.

#61 VGRO and chill on 04.14.21 at 5:26 pm

33 yo millennial here.

I took a course in University called Engineering Economics. In that course, we learned about basic financial concepts and formulae – future value, present value, how to adjust for inflation, APR interest, amortization, etc.

They also showed us that if you started investing early, you don’t have to invest as much…

EG, assuming you made 7%/year…

if you were 20 years old and started investing $100/month, by age 65 you would have $368k.

If you didn’t start until you were 30, and decided to “catch up” by investing $200/month, by age 65 you would have… $357k. Despite making double the contributions the other person did, you would never catch up.

That really stuck with me.

My parents are boomers, grew up in the 60’s and 70’s. They say Millennials are more obsessed with money and jobs than they were. I think we may end up being better investors in the long run than a lot of generations. We’ve already lived through two “once in a generation” financial collapses and the world chugs on. Those things stick with you.

#62 Penny Henny on 04.14.21 at 5:29 pm

#31 Flop… on 04.14.21 at 3:03 pm
/////////

thanks

#63 espressobob on 04.14.21 at 5:38 pm

One thing I have to say to millenials is this, get over any considerations you have about vaccination. Be thankfull.

What us boomers got shot in the arm with is beyond painful, back in the day, for polio and small pox.

I’ll spare you the details…

#64 OlderbutWiser on 04.14.21 at 5:43 pm

#44 CJohnC…While Patrick indicated he is a CPA, he did not tell us which “type” he is…all certified accountants now fall under the CPA banner but there is still a huge difference between CPA – CA (Chartered Accountants); CPA – CMA (Management Accountants); and, CPA – CGA (General Accountants). The first (CPA – CA) still requires a university degree, post-graduate degree/learning and articling in a CA firm. My guess is that Patrick is not a CA…

#65 Sail Away on 04.14.21 at 5:50 pm

#57 TorontoCA on 04.14.21 at 5:11 pm

Good lord Anne. You’re a grown ass adult with a job. Move out of your parent’s house and start living your life.

Sometimes it’s not about the financial advice.

———-

Who are you to judge? Leave her alone.

#66 JSS on 04.14.21 at 5:51 pm

“the oldies can spend this valuable time washing their Def Leppard T-shirts and swilling Rogaine.”

I have a def leppard record sitting in a pile of records in my basement. It is called pyromania. I saw a t shirt of it on an online site, but the t shirt is like $60 plus shipping. So it’s not just house prices that have gone up. Even old metal T-shirts have gone up in price.

#67 Blacksheep on 04.14.21 at 6:01 pm

Reximus # 55,

“Look at Bitcoin, it’s doing what Gold should be doing, if it wasn’t so manipulated via paper trades.”
—-
“You dont believe BTC is manipulated?…lol”
——————————————————–
Never claimed BTC, cannot be manipulated.

Everything can be manipulated someway, but it’s a hell of a lot harder to manipulate something with a fixed / know quantity (21 million?) that you have to exchange a given resource (computing power) for, yet carries no sovereign (US$?) liabilities.

Paper anything (PM’s for example) can be sold in infinite amounts if there is never a global audit, of the actual volume of a given commodity available.

That’s where BTC diverges….

#68 The real Kip (Ret) on 04.14.21 at 6:10 pm

Rest in Peace, Bernie Madoff, king of the ponzi.

#69 Squire on 04.14.21 at 6:12 pm

#1 TurnerNation on 04.14.21 at 12:27 pm
————————————————-
https://www.cbc.ca/news/canada/british-columbia/justin-trudeau-travel-restrictions-canada-bc-1.5986848

Why would sock boy support this if he’s that confident in the vaccine supply. Maybe larger plan in the works ? Shall we all run to the US for refuge? Maybe one day we will. Hopefully before that day the USA can arrange a change in regime in our home and native land…

#70 just a dude on 04.14.21 at 6:18 pm

Garth,

These three, clearly intelligent young people give me hope for our future. Well done you guys! Keep it up and you’ll be leaps and bounds ahead of many in your cohort, and in so many more ways than just financially speaking.

Garth, thank you for sharing and for all that you do.

By the way, Gen X here so it was the Helsinki Formula for me which, in hindsight, I’m pretty sure was just tap water. And no, it didn’t work …

#71 Upenuff on 04.14.21 at 6:19 pm

So my wife has $35 K room in her TFSA, so do we load it up with something with a solid paying dividend to work for us over the next 10 years?

Upenuff

#72 Steve French on 04.14.21 at 6:37 pm

What happened in Vietnam?

#73 Faron on 04.14.21 at 6:38 pm

#60 Dr V on 04.14.21 at 5:18 pm

154 Faron

Getting a little off track of the original argument that excess capital is allocated to shareholders via buybacks and dividends etc. when it could go to workers without negative impacts on business. That, and a stronger disincentive to offshore profit and avoid corporate tax could do wonders for funding a reasonably reliable safety net. The trade off is lower stonk prices and maybe higher interest rates to attract investment further compounding the impact on the wealthiest.

Regardless, what does the labour participation rate tell us here about job replacement? It has been dropping for decades and I’d speculate that it has more to do with available jobs than willingness to work. Either the jobs aren’t there due to offshoring or mechanization or there are jobs that simply suck to do at the wages paid to do them. Automation isn’t going to help that. I don’t have numbers, but my guess would be that McDonalds restaurants, for example, have fewer employees per burger served now than they did five years ago. Sure, that required a few more programmers and a few more people to assemble the electronics (in China) but the result is many thousands of lost jobs.

A BSc (or BA) is a bare minimum to even edge close to median wage anymore because there just aren’t as many jobs at that skill level. Trades and healthcare are sweet spots here and probably more durable. But, overall, the available work is much more split between highly skilled and just-complex-enough-that-a-robot-can’t-do-the-job-yet level.

What happens if (when) this becomes prevalent:

https://www.theverge.com/2021/2/24/22299140/nypd-boston-dynamics-spot-robot-dog

It’s not hard to extend that theme to full robocop and then to impartial assessments of breach of law and, eventually the replacement of the entire judicial system with AI and robots. They would be impartial, right? (actually, no they wouldn’t). Sentencing is already aided by machine learning.

What happens when autonomous driving gets good enough that the hundreds of thousands of truckers no longer have work? Or the people offloading the goods? Or the people working the warehouse? Flying the planes (prob sooner than the truckers)? Driving the boats (definitely sooner than the truckers)?

All of this is driven by the need to increase productivity to sustain economic growth and grow businesses and some of that goes to increasing share price and making more money for the people who own the businesses. An argument against this being in process is that productivity has declined in recent decades while increased automation should drive increased productivity.

There are ethical decisions to be made about each one of these steps. Maybe full automation is inevitable and the only people that work are those where a human touch is irreplaceable? Maybe I’m overestimating the future ubiquity and underestimating the new jobs that may spring forth. But, as profit dominates and as those profiting become more and more detached from the supporting workforce, the worse off most of us will be.

#74 Faron on 04.14.21 at 6:40 pm

PS: I’m fully aware that any redistribution of capital away from markets or divvies would have direct impacts on my portfolio. I’m more than willing to make that sacrifice.

#75 Garth's Son Drake on 04.14.21 at 6:42 pm

CPA consulting in strategy who doesn’t know how to strategize their own financial path? How ironic. Sadly, common.

A teacher who can bank 50K a year living at home? Life is good if you never have to leave the nest.

#76 David on 04.14.21 at 6:50 pm

#14

More years and time spent on getting the same degree as someone 20 years ago? Higher Taxes? Spit balling here.

Even if you pick correctly about what 4-5 year program you want to complete. You really don’t start saving much money till 23. If you pick wrong and do an extra 2 years of schooling now your 25 and just starting to make some cash.

For example my profession is in the scientific field and I make $90,000 at 29 years old. I was interested in becoming a financial planner so I reached out to some big companies to discuss. Basically was told I will have to do 2 years of schooling and then more schooling/exams to obtain my CFP to have a chance of getting that kind of job. The person I spoke to is high up and said that 30 years ago he literally walked into the field with no related experience at 19 years old.

It takes more time these days to get from A to B compared to back in the day.

Please dont tell me someone getting a 4 year biology degree in 1980 worked as hard as someone getting a 4 year biology degree now. My parents and friends of parents all think we were working way to hard. Things are more competitive now. Even becoming a professional athlete takes way more time commitment.

#77 crowdedelevatorfartz on 04.14.21 at 6:51 pm

@#65 JSS
“So it’s not just house prices that have gone up. Even old metal T-shirts have gone up in price.”

+++

Nothing sadder that a gray haired Boomer in a 40 year old rock concert T-shirt with his gut hanging out.
Unless it’s THIS!

https://www.youtube.com/watch?v=MdMTTQ9SBgk

#78 Katherine on 04.14.21 at 7:03 pm

#63 OlderbutWiser
While Patrick indicated he is a CPA, he did not tell us which “type” he is…all certified accountants now fall under the CPA banner

Patrick is only 26 so CPAs are all the same….no longer do we have CAs, CGAs, and CMAs. Back in the old days (you are correct) only CAs were required to have a university degree. It would be 30+old CPAs that may have earned the CA of old.

#79 espressobob on 04.14.21 at 7:03 pm

#70 Upenuff

TFSA is usually loaded up with global growth ETFs, minus Canadian holdings.

Those are better held in a non registered account for the capital gains and dividend tax credits.

Homework or professional management resolves these matters.

#80 kommykim on 04.14.21 at 7:04 pm

#52 Anna on 04.14.21 at 4:31 pm
Just wondering, is there a difference between buying VUN.TO vs converting can to usd with norberts gambit and buying VTI? For if our cad dollar drops in value?

========================================

No difference at all except you’ll have extra trading fees to convert to USD and back again using the gambit. Vangard can get a much better deal on FOREX than you can, so you may as well just buy VUN.TO

#81 Nonplused on 04.14.21 at 7:07 pm

Calgary schools going back on line for 7-12 starting next week….

https://www.660citynews.com/2021/04/14/cbe-ccsd-students-in-grades-7-to-12-shift-to-at-home-learning-april-19-for-two-weeks/

The province says the move was based on four criteria that include:

A chronic substitute teacher shortage.
A significant number of students and staff in quarantine or isolation.
Recent requests from the board for short-term shifts for a number of their schools.
Substantial COVID-19 cases in the community.

#82 Reximus on 04.14.21 at 7:11 pm

Paper anything (PM’s for example) can be sold in infinite amounts if there is never a global audit, of the actual volume of a given commodity available.
——
you sound like every zerohedge dingbat i have ever known. I work in PM dealing. Heard this a million times. The ‘paper’ mkt is always the the way ‘they’ control the true price…yawn

#83 Stone on 04.14.21 at 7:15 pm

#67 The real Kip (Ret) on 04.14.21 at 6:10 pm
Rest in Peace, Bernie Madoff, king of the ponzi.

———

Can’t confirm whether he’s resting but I can confirm where he is now is hot. Really, really, hot. Like hellfire hot.

#84 Reximus on 04.14.21 at 7:21 pm

CNN reports that Bernie Madoff showed up at the gates of heaven with some fake ID that said Bernie Sanders…

#85 Stone on 04.14.21 at 7:28 pm

#75 David on 04.14.21 at 6:50 pm
#14

More years and time spent on getting the same degree as someone 20 years ago? Higher Taxes? Spit balling here.

Even if you pick correctly about what 4-5 year program you want to complete. You really don’t start saving much money till 23. If you pick wrong and do an extra 2 years of schooling now your 25 and just starting to make some cash.

For example my profession is in the scientific field and I make $90,000 at 29 years old. I was interested in becoming a financial planner so I reached out to some big companies to discuss. Basically was told I will have to do 2 years of schooling and then more schooling/exams to obtain my CFP to have a chance of getting that kind of job. The person I spoke to is high up and said that 30 years ago he literally walked into the field with no related experience at 19 years old.

It takes more time these days to get from A to B compared to back in the day.

Please dont tell me someone getting a 4 year biology degree in 1980 worked as hard as someone getting a 4 year biology degree now. My parents and friends of parents all think we were working way to hard. Things are more competitive now. Even becoming a professional athlete takes way more time commitment.

———

Are you telling me younger people are dumber now and need more pieces of paper and acronyms? Are we not living in a time where everything has sped up, is digitized, and much more accessible? You can take online coding courses for $95 and land a $200k/year job. YouTubers online with zero skills other than handling a camera and being cute on screen making a million or 2 a year.

Are we both living in the same time now? If I had the tools available today 19 years ago, you would all be living under my crushing tyranny.

#86 Stoph on 04.14.21 at 7:35 pm

#79 kommykim on 04.14.21 at 7:04 pm
#52 Anna on 04.14.21 at 4:31 pm
Just wondering, is there a difference between buying VUN.TO vs converting can to usd with norberts gambit and buying VTI? For if our cad dollar drops in value?

========================================

No difference at all except you’ll have extra trading fees to convert to USD and back again using the gambit. Vangard can get a much better deal on FOREX than you can, so you may as well just buy VUN.TO

————————————————————

Depending in the amount invested and the account type it may make sense to have VTI rather than VUN. VTI has slightly lower MER fees and is not subject to the US withholding tax if held in an RRSP. The amount invested just has to be big enough for these savings to outweigh the extra trading fees associated with having VTI.

https://www.moneysense.ca/columns/ask-the-spud-when-should-i-use-us-listed-etfs/

#87 AM in MN on 04.14.21 at 7:36 pm

#55 Reximus on 04.14.21 at 4:55 pm
Look at Bitcoin, it’s doing what Gold should be doing, if it wasn’t so manipulated via paper trades.

—-

You dont believe BTC is manipulated?…lol

—————————————————–

The issue is who is doing the manipulating. In the case of bitcoin there’s a bit going on by big whales who can sell to push the price down before big options expiration dates, but that’s becoming a smaller issue now.

Gold (like oil) is manipulated by big global banks in partnership with central banks and futures exchanges that trade paper gold (& oil & others). Even then the discount is probably only about 20%. If BTC replaces gold more and more, expect a drop down to it’s industrial value, like silver.

Every Mill should have 10%+ in BTC if they want a long term fiat devaluation play. Still plenty of room for a 10X upside from here, just wait for it.

#88 DavidW2 on 04.14.21 at 7:39 pm

Solid advice

#89 Harrison on 04.14.21 at 7:41 pm

#52 Anna – VUN would also be subject to foreign withholding tax. This can be avoided by holding VTI in your RSP and VTI has a lower MER.

#90 DON on 04.14.21 at 7:43 pm

@Blacksheep

I have been watching the value of s Cdn buck also The fed tells us the inflation will be temporary…only way to go is diversification.

#91 VGRO and chill on 04.14.21 at 7:48 pm

Tried to post here from work today, it seems these aren’t getting through? Not sure if I did something that angered the mod(s)..

#92 pbone on 04.14.21 at 7:51 pm

DELETED

#93 polecat on 04.14.21 at 8:06 pm

More young people should get into the trades, good money and skills. Met a couple during my reno’s, driven , smart and running their own show. Refreshing.

#94 espressobob on 04.14.21 at 8:10 pm

#73 Faron

How to describe your abilities as a valuable commodity, might be the real issue at hand. No one owes another shit.

A concept that goes under the radar. Few ever get this ….

#95 Dr V on 04.14.21 at 8:16 pm

72 Faron

Jorkin: “Mr. Fezziwig, we’re good friends besides good men of business. We’re men of vision and progress. Why don’t you sell out while the going’s good? You’ll never get a better offer. It’s the age of the machine, and the factory, and the vested interests. We small traders are ancient history, Mr. Fezziwig.”

Fezziwig: “It’s not just for money alone that one spends a lifetime building up a business…. It’s to preserve a way of life that one knew and loved. No, I can’t see my way to selling out to the new vested interests, Mr. Jorkin. I’ll have to be loyal to the old ways and die out with them if needs must.”

Scrooge: “ I don’t hate them, sir, but perhaps the machines aren’t such a good thing for mankind, after all.”

Seems it’s been on people’s minds for some time.

#96 april on 04.14.21 at 8:22 pm

#2 – more realtor spin.

#97 Cici on 04.14.21 at 8:33 pm

#14 Stone on 04.14.21 at 1:34 pm
I’m happy for all 3 mills. They’re at least prioritizing some of their disposable income for investing. Something must have changed though from when I was 26, 19 years ago. I made a $51,000 salary at the time (around $45,000 the year before) and had already accumulated a bit over $100,000 in investments. With 19 years of inflation since then, that $100,000 would be worth far more in today’s dollars (roughly $145,000 with 2% a inflation). What are they all spending their dough on? I’m not saying they should live like monks as that isn’t healthy. One is only paying $1350/month on rent. Another is living at home, assuming she doesn’t pay rent and maybe not groceries either. Is it instagram lifestyle expenses? I’m honestly curious. Where is their disposable income money going?

____________________________________________

The time and monetary investment in education might be one factor. The CPA and the teacher both have university educations, which do cost much more today that than they did 10, 20 and 30 years ago. The construction guy didn’t mention any training or education, but did mention that we was in debt $9,000 and has dug himself out of the hole in just one year, so he’s changed his ways and managed to accumulate $45,000 in a very short time on average (for now) salaries. We don’t know what the source of his debt was… could very well have been a condo that he chose to sell to lock in some paper gains.

I think they are all doing great and have only been at the saving/investment game for a short time (one to two years).

I think the Millenials are getting wiser and wiser. They will do great things.

#98 David on 04.14.21 at 8:49 pm

#84

Taking a 4 year computer science degree while obtaining term experiences at places like google or amazon will land you $100,000/yr + some bonus but only at places like google or amazon. This is based on graduating in 2015. If you want to stay in Canada you’re looking at $50,000/yr to start and getting to $100,000 after 5 years of experience but only if you’re the cream of the crop. Computer Science is the only degree where you can be self taught and land a job. Nearly all other fields require credentials (please correct me if I am wrong). Regardless, $200,000/yr is not correct. My friend who did a computer science degree and a masters in AI machinery doesn’t even make that much lol.

Almost all jobs now require specific diplomas/certificates/degrees. An individual who obtains a masters in chemistry cannot apply for a technician job related to chemistry because they have not completed the 2 year program at the local community college. Their are more tools but more regulations/rules. Engineers cannot apply for technician jobs for the same reason. Technicians cannot apply for higher paying jobs because a masters is required.

If you want that higher paying job you need more letters to your name.

My point is people who are 50+ in these high paying jobs didn’t have to spend as much time in school (amount of courses and time studying) as young people now who want to get to those positions as well.

It does not surprise me that people who are 25-27 just started saving money.

Also not everyone wants to be a coder.. Sure you don’t have to love your job but you need to be able to tolerate it so you can fund the things in life you enjoy. I could not tolerate being a coder but I can tolerate being an electrical engineer.

I know a lot of 50+ individuals who make a lot of money with little education. Not saying they’re stupid just saying less education was needed to get that salary. You can’t do that in todays world in many fields.

#99 Wrk.dover on 04.14.21 at 8:49 pm

23 years old, rent in New Toronto basement apt $200 (3 stories/4 units per floor), income, $800-$1000/mo, entry level houses were $40,000.

But that was in 1976. Just add a 0 to all of the prices.

Except houses. Oops.

#100 Cici on 04.14.21 at 8:50 pm

Great post tonight, but I’m totally not bothered by the fact that the teacher’s living rent-free at her parents’ place.

It sounds like she’s very responsible and socking all her money away so she doesn’t have to hit Mommy and Daddy up for a future mortgage loan. Kuddos to her for turning her nose up at condo culture (let’s cancel that, shall we?) and kuddos to her parents for encouraging her to build up her own nest egg.

I she were my kid, I wouldn’t ask for a penny of rent, but I would expect her to be clean, tidy and respectful (as in almost invisible). She should contribute around the house (take garbage and recycling to the curb, pick up groceries, do or at least help with the dishes, vacuuming, etc.)

There should be a time limit on this deal though. If she really is putting $50,000 aside per year, four years/$200,000 should be the limit. Then Mom & Dad get their house back and can enjoy retirement with no Bank of Mom debt burden.

#101 David on 04.14.21 at 8:52 pm

#96

Totally agree with you.

#102 crowdedelevatorfartz on 04.14.21 at 9:00 pm

@#75 David
” Even becoming a professional athlete takes way more time commitment.”

++++

I guess thats why they sign $10, 20, 50 Million dollar a year contracts for 10, 20 years now unlike the dismal contracts of yesteryear for 1 and 2 years….or is it their agents?

#103 Canada has disdain for millennials on 04.14.21 at 9:01 pm

Truly smart millennials should leave Canada and take their talents to a meritocracy that will nurture and reward their hard work and innovation. Not screw them over royally like this virtue signalling joke of a country that produces nothing and offers them highly taxed low paying jobs and has boomers sticking it to them with $2 million dumps.

#104 mike from mtl on 04.14.21 at 9:08 pm

#75 David on 04.14.21 at 6:50 pm

More years and time spent on getting the same degree as someone 20 years ago? Higher Taxes? Spit balling here.
////////////////////////////////////////////////////////////

Welcome to life and you’re not off.

Wages have not kept up with real inflation for a long time and that is no secret. When I started working part time in tech I made something like 8/hr however everything real to live on was a fraction of today. 1br Rent was ~500/mo, two-handed bags of groceries could break a 20, gas was half, 1mb ADSL (wow 5x as fast as 56k!) was pretty much the same as what is acceptable today, slick mobile phones (remember Startac?) were not that far off from ‘smartphones’ of today.

Obviously depending on the job the papers matter, some require it to get a foot in the door, others optional to real world experience. You choose your battles.

Personally my best life decision was to immediately start working. At 20+ years in the industry I am grateful (in this case) real working experience getting things done matters more than some letters to your name. Will I be ultimately some Corpo c-suite slime ball, probably not, but who cares?

You’re doing alright all considered, could be always much worse.

Now I feel old :(

#105 Stone on 04.14.21 at 9:11 pm

#96 Cici on 04.14.21 at 8:33 pm
#14 Stone on 04.14.21 at 1:34 pm
I’m happy for all 3 mills. They’re at least prioritizing some of their disposable income for investing. Something must have changed though from when I was 26, 19 years ago. I made a $51,000 salary at the time (around $45,000 the year before) and had already accumulated a bit over $100,000 in investments. With 19 years of inflation since then, that $100,000 would be worth far more in today’s dollars (roughly $145,000 with 2% a inflation). What are they all spending their dough on? I’m not saying they should live like monks as that isn’t healthy. One is only paying $1350/month on rent. Another is living at home, assuming she doesn’t pay rent and maybe not groceries either. Is it instagram lifestyle expenses? I’m honestly curious. Where is their disposable income money going?

____________________________________________

The time and monetary investment in education might be one factor. The CPA and the teacher both have university educations, which do cost much more today that than they did 10, 20 and 30 years ago. The construction guy didn’t mention any training or education, but did mention that we was in debt $9,000 and has dug himself out of the hole in just one year, so he’s changed his ways and managed to accumulate $45,000 in a very short time on average (for now) salaries. We don’t know what the source of his debt was… could very well have been a condo that he chose to sell to lock in some paper gains.

I think they are all doing great and have only been at the saving/investment game for a short time (one to two years).

I think the Millenials are getting wiser and wiser. They will do great things.

———

I’ll agree that some, yes, are doing well for themselves. Most though are messing up their financial futures. Same as Gen X, Same as the Boomers. Winners and losers for each of them. What are we at now? 53% of adults $200 away from insolvency? I hear it’s a new all time high. What happens when inflation kicks into high gear? I think this might well be an instagram moment.

#106 crowdedelevatorfartz on 04.14.21 at 9:17 pm

Well, I’ve heard of politicians giving the shirt off their back but…. butt….. but

https://www.cp24.com/news/liberal-mp-caught-stark-naked-during-house-of-commons-video-conference-1.5387827

#107 kommykim on 04.14.21 at 9:50 pm

RE:#105 crowdedelevatorfartz on 04.14.21 at 9:17 pm
Well, I’ve heard of politicians giving the shirt off their back but…. butt….. but

========================================

“Will the honourable member please cover his member…”

#108 crowdedelevatorfartz on 04.14.21 at 9:55 pm

@#102 Disdainful Millennial
“Not screw them over royally like this virtue signalling joke of a country that produces nothing and offers them highly taxed low paying jobs and has boomers sticking it to them with $2 million dumps.”

++++

You sound like my Boomer friends………

#109 Bk on 04.14.21 at 9:58 pm

Wow sad. Young people with great jobs yet no money saved. Shame on Canada for doing this to them.

#110 DON on 04.14.21 at 10:04 pm

#105 crowdedelevatorfartz on 04.14.21 at 9:17 pm
Well, I’ve heard of politicians giving the shirt off their back but…. butt….. but

https://www.cp24.com/news/liberal-mp-caught-stark-naked-during-house-of-commons-video-conference-1.5387827

**************

All the Saturday Night Live skits playing out in real time. Hard to make this up. That is a stupid MP.

#111 Russ on 04.14.21 at 10:30 pm

Dolce Vita on 04.14.21 at 4:29 pm

Have been quiet commenting [choked] about Cdn Variants for a couple of reasons.

First, mercifully the APOCALYPTIC increase from a few days ago has subsided from STRATOSPHERIC to a mere 4th order quadratic equation increase:

https://i.imgur.com/fewHkpo.png
https://i.imgur.com/9U3egIv.png

[Again, screening pioneered by the Brits EARLY THIS YEAR and works]

Second, I am WORRIED for the life blood of Canada, its YOUTH.

Young by far the largest cohort infected – tables turned, from old to young.
======================================

Hey Dol,

We are constantly being bombarded by the news, variants this, variants that, case count blah blah blah.

Have a look at B.C. CDC data.
Case counts, OMG!! Panic!!

But look a the little red line. We got this thing licked man. A nothingburger now.

https://bccdc.shinyapps.io/covid19_global_epi_app/

I will wait a week but expect it to be not much different. The death rate is half of what it was in September and is dropping every day.

None of the MSM reports good news anymore.

Cheers, R

#112 Vanreal on 04.14.21 at 10:41 pm

What CPA doesn’t know about RRSPs and TFSAs? This doesn’t bode well for the future.

#113 Jon B on 04.14.21 at 11:14 pm

Looks like members of the Woke Brigade are in the audience.

#114 Sail Away on 04.14.21 at 11:37 pm

#71 Steve French on 04.14.21 at 6:37 pm

What happened in Vietnam?

——-

I’m not sure. Stone is very interested in their brothels for some reason. Maybe part of his balanced and diversified portfolio?

Enlighten us Stone. It’ll be tough for you, but let’s try to stick with facts, please.

#115 Lead Paint on 04.15.21 at 12:13 am

#38 Sail Away on 04.14.21 at 3:34 pm

#33 Stone on 04.14.21 at 3:07 pm
#21 Sail Away on 04.14.21 at 2:05 pm

———
I have never been to Vietnam and have never posted anything about Vietnam on this site, or anywhere as far as I know.
—-

Whatever you didn’t do in Vietnam, Stone has done it better by a wide margin, by his own estimation.

Queue Whooshy to chime in saying he knows Stone and can vouch Stone’s done it better.

#116 Nonplused on 04.15.21 at 12:38 am

Think of it this way millennials; Homer Simpson has a job, a house, a car and a family. Certainly if Homer can do it, you can too!

#117 Lee Bee on 04.15.21 at 12:51 am

Strange that Adam Vaughan is basically protecting the crazy people paying $500,000 over asking. How crazy is that ?

#118 The Military Industrial Complex on 04.15.21 at 1:35 am

#47 Ponzius Pilatus:

– increased profitability of the war machine
– population control
– overreach by the military into the political system
– development of further technologies to control citizenry
– destroying the youth as to leave them confused and reliant on the bureaucracy
– controlling the world’s energy supply
– keeping other countries down
– extending political power over a captured state

#119 BillyBob on 04.15.21 at 6:19 am

Well, at least it isn’t just the Trudeau Liberals™ embarrassing the country. The Olympic committee is doing their part too.

https://www.theguardian.com/sport/2021/apr/15/cancel-the-olympics-fashion-outcry-as-canada-brings-back-jean-jackets-for-tokyo

I’m picking Bank of Canada for the gold in Olympic Printing.

#120 Do we have all the facts on 04.15.21 at 7:00 am

Adam Vaughn would be wise to read what the Department of Finance and the OSFI proposed to implement in 2020 just before Covid 19 became a priority and what the OSFI announced for implementation in June 2021.

For uninsured mortgages the floor rate to be applied to each stress test required for mortgage approval will increased to 5.25%. What this means is that in June debt servicing ratios will be based on a higher interest rate to reduce the possible risk of default in the future.

In essence the Government of Canada seems concerned that even 20% equity may not be sufficient to protect financial institutions from losses if the housing market was to correct.

When the Government of Canada implements measures to
reduce the risk attached to uninsured mortgages with at least 20% equity in place the posturing of Adam Vaughn has minimum value. There is little doubt that CMHC will adopt similar changes for NHA insured mortgages in the near future.

A correction is unavoidable folks and the Government of Canada has sounded the warning bell. Time to listen.

#121 the Jaguar on 04.15.21 at 8:12 am

Garth’s least favourite economic forecaster featured in this morning’s NP. He quotes ” Bob Farrell’s Rule No. 9: “When all the experts and forecasts agree, something else is going to happen.”

Oh boy. This could be my first ‘delete’, but here is a link for those who enjoy being contrarians.

https://pressreader.com/article/281968905511914

#122 crowdedelevatorfartz on 04.15.21 at 8:16 am

@#115 Nonplused
“Think of it this way millennials; Homer Simpson has a job, a house, a car and a family. Certainly if Homer can do it, you can too!”

++++

But you’ll need lots of “DOH!”

#123 the Jaguar on 04.15.21 at 8:19 am

Rosenberg:
‘But once this so-called “pent up” demand is filled in the four per cent of GDP known as the Covid-19-affected “consumer services” sector, and once these short-term stimulus cheques run out, the economic emperor becomes disrobed, as was the case in last year’s fourth quarter. By July-august, the markets, both stocks and bonds, will start to see what I already see around the bend. Why? Because “something else is going to happen.”

What on earth do you think he means by ‘something else is going to happen’, GT? Mercy.

#124 crowdedelevatorfartz on 04.15.21 at 8:22 am

@#118 Billybob

https://www.theguardian.com/sport/2021/apr/15/cancel-the-olympics-fashion-outcry-as-canada-brings-back-jean-jackets-for-tokyo

++++

Yep.
10,000 govt bureaucrats typing 10,000 emails in 10,000 meetings for 10,000 years couldnt have evoked their “Inner Boomer” better that a grubby jean jacket.

Canada…the worlds “woke joke” and the Liberals still dont get it.
I cant wait to see what our genderfluid empowerment budget brings…..

#125 Greg on 04.15.21 at 11:16 am

Love hearing from the blog dogs!

Question about your advice for Anne, Garth:

What about the tax refund Anne would get from putting into RRSPs? Would that not offset the taxes paid in the future if she also uses the tax refund to invest each year?

No. The PA due to the DB pension diminishes the room. Not worth it. – Garth

#126 Faron on 04.15.21 at 11:19 am

Good take on housing poochedness:

https://betterdwelling.com/canadas-property-bubble-is-now-so-large-a-soft-landing-would-take-19-years/amp/

Luckily, this bag I bought has very good neighbours and a nice back yard!

#127 Dharma Bum on 04.15.21 at 11:40 am

Whatever decision one makes involving real estate ownership or investing, just make sure you always have flexibility.
One never knows what mayhem lurks around the corner.
Never underestimate the power of doom.
Always have a significant amount of liquidity available in your back pocket.
Just in case.
Cash, is KING!

#128 enthalpy on 04.15.21 at 11:42 am

what does a 26 yr old know about strategy?
lol

#129 IHCTD9 on 04.15.21 at 11:58 am

Interesting stuff going on in the US, particularly in big Metros. Folks have been bailing out of these states/cities for years, following them more recently are some of the worlds highest profile entrepreneurs, Banks, Hedge Funds, and tech companies. The big exits are LA and NYC, heading to Texas, Florida, Tennessee, and Arizona. Now we have Biden cranking taxes on high earners and corps on top of this existing trend.

But really, people and businesses are moving all over, the USA – from high cost, locked down, crime ridden permissive metros to low cost southern red states – some of which have zero sate taxes. These big expensive cities just can’t seem to get enough $$ to satisfy, and you can only bleed so much from the wealthy before they skip on down the road.

NJ lost a single billionaire taxpayer (David Tepper), and had to amend their state budget. You know taxes might be a little too concentrated on too few taxpayers when stuff like this happens – and that was years ago. What about today with Biden adding to the pain? Goldman Sachs is considering moving a big chunk of their business to Florida from NYC as well. Some local politicians are on record literally begging these big corporations not to leave.

Keep an eye on it. What’s actually happening right now is the draining of these big cities’ souls. Especially NYC. CV is killing off what made NYC, NYC, and what’s left ain’t worth the cost anymore.

All this could well end up driving WFH into the mainstream, and if it happens in the USA, it will happen here too. If it does, it will have huge implications on the real estate market – and wages.

#130 Do the right thing on 04.15.21 at 11:58 am

Is government bullshitting you stupid when they announce inflation at 2%?

Barron’s thinks so :

https://www.barrons.com/articles/rising-inflation-may-not-be-a-sure-thing-but-it-is-a-good-bet-51618435112

More like 20%. Trudeaus going to flush another 100 billion towards funding his election.

#131 WTF on 04.15.21 at 1:05 pm

#116 Lee

Adam Vaughn

This MP is a former Toronto Councilor. His profession is Journalist. Nowhere is there any indication he is any more qualified to speak on RE than the average schmuck. Kinda like the average “Realtor”

There isn’t much to glean from his musings on the housing debacle. He may however be an excellent fart catcher for PM Rocket Scientist.

#132 B on 04.15.21 at 1:14 pm

With the run up in house prices im now looking at 300-350k in net “equity”. Considering I also have 450K liquid invested, is there a case to be made for the Smith maneuver now?

#133 Canada has disdain for millennials on 04.15.21 at 1:16 pm

#107 crowdedelevatorfartz on 04.14.21 at 9:55 pm
@#102 Disdainful Millennial
“Not screw them over royally like this virtue signalling joke of a country that produces nothing and offers them highly taxed low paying jobs and has boomers sticking it to them with $2 million dumps.”

++++

You sound like my Boomer friends………

—————————————

Except that I’m late Gen X ;)

#134 G on 04.15.21 at 1:46 pm

One of the Best thing my Dad ever did for me was teach me I should max out my RRSP contribution every year.

In my 20’s the big news papers like the Toronto Sat Star occasionally had articles on the value of early savings for retirement and the magic of compound growth, it’s better the sooner you get started.
I didn’t read the star, but my Dad did and point out the article, said I should read this or that.

In fact I worked of a company that I could transfer money from my pay check to mutual funds for retirement. They even gave you extra up to 2.5% pay raise if you saved at least 5% in an RRSP on your own.
They organized investment company to invest in and covered the management fee I think, which helped lots.

You could max 18% to RRSP. I had limit to max due to there “profit sharing plan”. (When they sold division I was in that didn’t work out that well. at lease new owners keep investing in the company until they moved off shore.)

You never see the money going into RRSP so never mist it. It’s still yours. And that magic compound growth thing. The sooner you start the better it is!

And Dad made me pay rent right after I finished going to school! Not going to school you need to get a job and pay rent.
Having summer jobs to have on resume did help to find a full time job. And have a bit of your own money to have a bit of fun when your young.

Additionally maxing out RRSP it was nice to get a tax refund check, a bit like getting a carrot once a year.

And since some very smart MP (how can we find more of them?) helped start the TFSA thing ;) And our host pointed out the Exchange traded fund have lower management fees that mutual fund… (You still need to pick the type best for your growth risk tolerance.
and that B&D 60%-40% weighting of assets thing.)

I wish I had invested the money from the paper route I had in high school instead of wasting it!!

And thinking back instead of buying a couple lottery tickets each week, if I had invested that at [email protected] instead.
Put the money in a jar and invest it every once and a while.
By doing so you know you’ll be a big winner in the end for sure! Unfortunately I wasn’t that smart. (Maybe something in the water LOL)

Some other people spend/blow much, a bit each week, it doesn’t seem like much but adds up, eating out instead of bringing a home made sandwich to work, or money blown on cigarettes and drink. Imagine the magic of compound growth if they invested some or all of that moneys instead.

I’m not saying don’t sped a bit to have some fun once and while, on a hobby, or things you like to do, or an adventure/trip, go to museum, park, movie… stop watch so much TV or video games.

You only get one shot at life, as far as we know for sure. So don’t forget to live a little along the way, if you are able to. Unfortunately for to many live is not always fortunate given personal circumstance and tragedy. Some times circumstances can change on a dime, like being involved in a bad car accident for example or find some lump. You get the idea.

Butter to plan to live a long life and be able to pay for it. Than not having a bit of cash to use when you might need some extra help. Best to at least try for that if you can. IMO. Investing sooner seems to be the best tool for the average person to get to that place.

I even tried the school bus driver thing for couple years when company did that move to off shore thing.

I always told the high school kids on my bus about http://www.GreaterFool.ca For the Dog picture and other useful info they don’t teach them in school for some reason.

If there were teenaged guys I’d point out women find guys that can retire at fourth will a million buck hotter than guys without. A bit of a carrot for motivation them to look at the Dog pictures here.

#135 George on 04.15.21 at 6:50 pm

https://toronto.ctvnews.ca/ontario-considers-stricter-measures-as-models-show-up-to-18-000-covid-19-cases-per-day-by-end-of-may-sources-1.5388838

our govt has a clue, remember?

resignations should have occured months ago. Folks just tuning them out at this point.

#136 Trojan House on 04.15.21 at 6:55 pm

@TurnerNation

Ford is apparently considering more restrictions in Ontario including extending the current “stay-at-home” order past the original May 6th date, curfews, more fines and better police enforcement.

#137 Only Observer on 04.16.21 at 12:11 pm

Very interesting, thank you for this article.