The venerable Bank of Mom’s been in the headlines again. MSM outlets – TV and print (what still remains) – have been churning out copy on how parental money is the only possible way that adult spawn (many Millennials are now closing in on 40) can get a house.
Here’s an interesting quote in the weekend’s Globe, from the COO of a mortgage company. Fully 60% of clients, she says, are mooching down payments from Mom & Dad.
“They want their adult children to enter the market before it’s too late,” she said. “Parental assistance with living-inheritance giving is the number one driving factor pushing up the prices in Canada’s largest urban markets.”
Exactly. Rather than eschew what they cannot afford, thereby coaxing prices lower, the Mills just Hoover their folks, bid over asking and make the situation worse. It’s always breathtaking what hormones can do. CIBC says average down payment gifts to newbie buyers have increased 58% in two years. BMO reports it’s seeing gifts of up to $200,000. So with first-time buyers typically sucking up more than 50% of all sales in Canada, the BOMAD – not some shadowy offshoring Chinese satellite family – is a prime cause of socially-destructive real estate inflation.
But apart from the impact on real estate, what’s all this gifting of money doing to the retirement prospects and financial security of the wrinklies?
Let’s look at only one aspect: reverse mortgages. Increasingly this is the go-to way for parents to suck off some of their unearned equity to hand over to Junior. Given the meteoric rise in property values, especially since Covid came to town, it seems like this is a simple, clean, quick, low-document way to create money out of nothing. Lenders are reporting a big surge in gifted deposits coming from these things – in fact, reverse mortgage debt is apparently growing eight times faster than that of convention home loans.
What is this?
Wrinklies over 55 can borrow against the paid-off houses, receiving a lump sum which never has to be repaid (until death or sale) and on which no payments are required. Then they give it to kids, who buy more real estate. Besides making the extended family unit that much more financially dependent on the housing market (and feeding home prices), what’s the problem?
Lots.
First, of course, the parents are handing off a chunk of their net worth, represented by home equity. That might hobble them in the future when the money’s needed to pay for essential needs, or perhaps long-term care (which costs a fortune). Or, real estate might tumble years from now if interest rates swell or the economy stumbles, meaning their residential nestegg is wiped out by reverse mortgage debt.
Second, this is a damn expensive way to borrow. Reverse mortgage rates are about double (or more) those of conventional home loans, usually in the 5% to 7% range. None of this interest is deductible from taxable income, either. Bummer.
Third, unlike a regular mortgage – which is reduced with every payment – a reverse mortgage gets bigger every month. Because no regular deposits are made against it, the principal accrues interest at a rapid clip. In fact reverse mortgage debt doubles about every 11 years at current rates. For example, over just 5 years one of these suckers with a cost of 6.34% will add $55,000 to an original borrowing to $150,000. That’s a serious amount of money – all to be sucked out of the property’s ultimate sale price. Plus there are big penalties for paying off this borrowing.
Fourth, reverse mortgages are loans of last resort. They exist for poor and desperate seniors devoid of other options, income or assets to tap into home equity in order to meet basic living needs, finance essential home repairs or pay for medical expenses that would otherwise debilitate them.
They were never intended to subsidize offspring who cannot afford granite countertops and bamboo flooring on their own.
There are better options.
First, if parents really want to help the kids and themselves at the same time, sell the house. Hand over some money, invest the rest in a proper portfolio and let it pay the rent on a nice retirement-appropriate lux condo.
Or, get a HELOC instead of a reverse mortgage. The interest rate on a home equity line of credit is far less. The parents can make interest-only payments, making this a low-cost way of financing a down payment. A HELOC can be paid off at any time – so it’s a great idea to turn the gift to your adult child into a loan. Once they build up more equity, they can borrow against that and pay you back. Of course a line of credit normally comes with a floating (variable) rate, so be aware costs could (and will) rise over time.
Better still, encourage Millennial progeny to save, rent, live within their means, then buy low on the property ladder with a fatter mortgage that Mom & Dad co-sign. That way parental net worth is conserved. The kids learn discipline. The loan gets approved. And you avoid feeding the beast.
149 comments ↓
Rescue dogs are definitely the way to go.
There’s a few blogdogs that need rescuing….
Public servants that have been totally unaffected by Covid have also been feeding the beast.With unbelievable pensions they don’t require big RRSP savings so their money has been pouring into RE. Canada has close to 6 million public servants coast to coast to coast so it has been no small influence on housing prices.Eventually one would think gov’t will have to shrink(and possibly even their pensions)and that will knock RE prices for a loop.In Ontario for example with 1.8 million gov’t workers(all paid with nothing but debt–$450 billion of it)could see prices plummet when the province is forced to tackle the books.Renting is the way to go or sure.
The issue is also one of insecurity. Namely, how am I going to show off to my friends that I am a gargantuan mortgage holder? In Canada, this is the “pinnacle” of achievement…*facepalm*
Parents across the land have epically failed.
#38 Ponzius Pilatus on 05.22.21 at 3:49 pm?
It’s over says you? Try driving from BC to Nova Scotia and let us know that it’s over. You’d fold like a house of cards at the first armed checkpoint.
— Richard [email protected]
NEW – Harsh words from the CEO of movie theatre chain Cineplex who says:
“It is absurd – we are all losing the summer.” “The science and evidence is literally on Ontario’s doorstep.”
Movie theatres won’t be able to open until stage 3, likely August.
https://twitter.com/richard680news/status/1395480092948697098
https://www.bnnbloomberg.ca/treated-like-disposable-garbage-indigo-ceo-blasts-ford-government-1.1607092
Treated like ‘disposable garbage’: Indigo CEO blasts Ford government
……………….
For Dolce & Crew.
some suggest this is why Kanada is being kept continually under a declared ‘State of Emergency’?
https://labeling.pfizer.com/ShowLabeling.aspx?id=14472
EMERGENCY USE AUTHORIZATION (EUA) OF THE PFIZER-BIONTECH COVID-19 VACCINE
…………………..
More health theatre. (Remember those two US Ships, Comfort and Mercy? Sent away. Sure made for good TV)
–Operating costs of 27 million euros – but not a single patient – Berlin Corona Treatment centre (welt.de)
https://www.welt.de/politik/deutschland/article231308835/Berliner-Notfallkrankenhaus-27-Millionen-Euro-Kosten-kein-einziger-Patient.html
@32 mike from mtl yesterday on 05.23.21 at 2:30 pm
“The Privy Counsel probably expensed a Million or two on this tripe, why?”
Been pondering how to reply. Over the past 40 years, I’ve spent lumps of time in industry, in the federal government and as a contractor to it.
A big change I’ve seen; 40 years ago government Scientists were top-notch, did longer-term research, and advised the decision makers when asked to. (Canada was country #3 to put a satellite into orbit; some of the Canadian tech is still used by other makers now)
Fast forward 30 years; I see fewer Scientists, told by higher management what to research, how many recommendations to respond with, and which recommendation must be in the final report because that’s going to be the one chosen. Oh, and here’s the powerpoint slide we want in the report.
Now? I don’t think the “thinkers” downtown really know how to approach the Scientists; it’s easier to get a scientific answer from one of their colleagues via Zoom or in the little kitchens when WFH ends. Besides, scientists (of all genders) have bad hair, messy clothes, and bad BO. Why would an MBA even approach them?
In my lifetime, I’ve gone from thinking that between research and decision makers being tied to producing good outcomes to serve the public (“public servants”) to wondering just why the government needs researchers, internal libraries, scads of staff, when the decision makers just ask themselves or colleagues of equivalent level in other “friendly” governments for advice.
“Leaders in technology” – the federal governments’ no longer doing it; Universities?? They push out PhD’s like a sausage factory, no longer term commitments; (costs $$$ and the bean counters don’t like that) – Businesses? Sure, but they keep the $$$ to themselves and are not beholden to a country.
I don’t want the above to seem negative – maybe we are now in a “Post Industrial” age?? Not sure what that means for all of us down the road – maybe nirvana??
Quite an early posting this morning Garth.
I hope you are enjoying Victoria Day holiday Monday.
Millions of reports, columns, postings, barrels of ink spilled and Canadians are still doing what they like. I begin to think that real estate ownership is equivalent of Prozac on the minds of the populace. The meaning of life is achieved with mortgage and granite counters. There is no cure for crazy just a risk of contracting the same disease with prolonged exposure to this kind of thinking.
Canada became country of real estate zombies with severely altered life views and I am not sure what can be done if anything to change this.
On the other hand, what would happen if lets say 20-30 people who are looking for house and have real estate agent make offer that is 100% higher then listed price.
https://twitter.com/rCanadaHousing/status/1396844184594788357
Yep those parents.
Relative sold home several years ago (mid Toronto ~2M) to 20s couple whose parents contributed $700K. (Parents: immigrants from Iran.
I know maybe 2 Canadian born parents who can afford $700K toward their childrens’ downpayments; but interestingly, neither of them will – however they did copay about $100K.)
“Better still, encourage Millennial progeny to save, rent, live within their means, then buy low on the property ladder with a fatter mortgage that Mom & Dad co-sign. ”
That’s a quaint notion Garth, but how exactly are they supposed to do that? With rents sky-high and going higher, where is the disposable income to save for the down payment coming from? And even if they can save for a downpayment, how does that help if the so-called cheaper housing options are increasing in price $50-$100K a year? Will kids need to live 5 to a 1-bedroom apartment for 10 years to save up a downpayment?
Policymakers are being very clear that they don’t care about the plight of young people. Canada apparently wants skilled young people to pick up and move to higher income/lower cost of living jurisdictions. Who needs their tax revenue – we can get just print money now!
The average condo in Toronto is $600,000. A 5% downpayment on that is $30,000. If a couple can’t save that in a few years they have failed and are undeserving of largesse. – Garth
Since the boomers have benefited off the precipitous drop in the mortgage rates which have spurred housing prices, it seems only fair that that they pay some of it back by helping their offspring, no ?
In a hypothetical world where mortgages rates were high and housing prices low, the parents wouldn’t have to help, but then they wouldn’t have benefited from the house prices increases either.
A celebration of liberty for the Nation of Quebec…. horned dudes not welcome…..
Journée nationale des patriotes
Yesterdays topic has dwelled on my mind all morning.
The idea is just a blend of third world and underground economies. More of a rent the guy that owns the tool with the tool, and his matching skillset to for example aluminum weld or what ever, average man can’t do with or with out the tool. But some neighbour can.
But govt. wants tp crypto-ize the paper money.
…so what you’re saying is –
a Father should take his Father’s assets over at his passing, properly steward said assets in a well-managed B&D or other incoming generating entity (commercial property anyone?), compete and earn his own way adding to his (and his growing families’ asset base), model productive lifetime behaviours of work ethic, love and compassion, making a contribution to the greater good through volunteering/charitable contri’s, and instilling in his children their right and responsibility of living their best lives – and when it’s his time, he passes familial assets (always accruing an investment return) to his well-grounded, financially independent children – and so on, and so on….
It’s called generational wealth – not necessarily Gaelen Weston-level generational wealth – but consistent, contributions to the familial good over decades by ethical, stoic-minded men and women who recognize that experience and personal skill development are more virtuous aspirations than a garage full of stuff – and a summer place with a garage full of stuff.
Of course, at some point the train derails from a weak-biological link…but, by then, I’ll be long gone – can’t control it/not worried about it.
M57BC
Millennials have strong guiding principles, if nothing else. Not all of them have house-rich parents from whom they can pry down payments for overpriced real estate.
I trust those in a position to do so will recoil at the clear hypocrisy of taking a short cut to the property ladder elitism for which they endlessly castigate their parents.
Instead, they should gather in the streets to protest for political solutions that equitably raise their cohort while stamping out the cruel system of economic privilege still clung to by greedy boomers.
#2 Big Bucks
“Canada has close to 6 million public servants coast to coast to coast”
———————————–
16 per cent of Canada’s population?
No wonder we can’t afford government fees, levies, bylaws, etc.
The workforce is 19 million. – Garth
I suggest that this blog upgrades/expands its reference material and acronyms.
Begin by reading Dr. Matthews Soules new book “Icebergs, Zombies and the Ultra Thin”.
Learn the meaning of HNWI (high net worth individual).
Quotes:
“The latest Canadian census indicates nearly 100,000 vacant or unoccupied housing units in Toronto”
#4 TurnerNation
Pfizer. I know. I posted awhile ago when all going apeshit over AZ (blood clots) that Pfizer was no screaming hell either (or Moderna).
How Pfizer & Modera remain in the minds of people the “gold standard” is beyond me other than good marketing and the gullibility of a populace when there is a clear and open, public domain source for this data, May 2021 data follows.
For the record by Gov UK, total reactions/fatalities for the drug:
Pfizer 165986/374
Moderna 4168/4
AstraZeneca 650681/786
Number of jabs different for each, more AstraZeneca vax used in the UK:
Pfizer 3.56M
Moderna 0.68M
AstraZeneca 24.5M
Do the proportionality Math by yourselves. No GOLD STANDARDS here.
——-
Reactions/Fatalities (go to the last page, interim pages show reactions/fatalities by disorder):
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/987644/AstraZeneca_analysis_print_12052021.pdf
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/987643/Pfizer-BioNTech_analysis_print_12052021.pdf
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/987645/Moderna_analysis_print_12052021.pdf
Root page for updates:
https://www.gov.uk/government/publications/coronavirus-covid-19-vaccine-adverse-reactions
Number of jabs by vaccine*:
https://www.telegraph.co.uk/global-health/science-and-disease/covid-vaccines-moderna-astrazeneca-pfizer-difference-uk-variants/
*To freak yourself out further, scroll to the right and read efficacies: transmission, vs. variants etc. – based on REAL DATA from Gov UK.
—————————-
THE BIG QUESTION FOR YOU CANADA:
Gov UK reporting for about 29M jabs. Canada jabs as of today:
21M
THUS there must be no reactions/fatalities in Canada to the above 3 vax’s?
‘Cause all I’ve read is the onesie twosie brain dead Cdn MSM reports about this and that and the near hernia Beavers had about blood clots and AZ.
Answer:
YOUR GOV IS LYING TO YOU BY OMISSION CANADA. WHERE’S THE BEEF CANADA?
Head bury in sand.
Have a nice day.
“The average condo in Toronto is $600,000. A 5% downpayment on that is $30,000. If a couple can’t save that in a few years they have failed and are undeserving of largesse. – Garth”
By the time they save 30K, the condo will have gone up to 900K.
Just rent, it is mathematically impossible for this housing inflation to continue.
There are more hidden fees when taking up a reverse mortgage to be aware of:
Costs associated with a reverse mortgage may include:
a higher interest rate than for a traditional mortgage
a home appraisal fee
a setup fee
a prepayment penalty if you pay off your reverse
mortgage before it is due
legal fees for closing costs or independent legal advice
The costs will vary depending on your lender.
Some fees may be added to the balance of your loan.
You may have to pay for others upfront.
Taken from https://www.canada.ca/en/financial-consumer-agency/services/mortgages/reverse-mortgages.html
Corollary to my prior:
WHERE’S THE BEEF CANADA?
More than certain the, can’t see the bigger picture beyond their nose cohort, will do sophisticated vax mortality %’s etc. which is like polishing the portholes on a sinking ship.
The point of the post was about TRUTH & TRANSPARENCY and there are NO GOLD STANDARD vax’s out there.
Gov UK believes in T&T and lets you decide on the Gold Standard.
But Dr. Trudeau, the King of T&T doesn’t.
Imagine that.
What a compliant & trusting nation you are Canada not even bothering to ask and answer for yourselves basic questions about these vax’s and believing the BS from the Cdn MSM and your own Govs.
Still, the ONLY CHOICE we have out this Pandemic is vax (or roll the Russian Roulette, spin the cylinder and not vax).
I’d just like Govs Canada to treat the most educated populace on Planet Earth like adults and level with them instead of lying by omission.
Roughly 16% of our population are gov’t employees?
Sounds like at least 10% too many.
In the USA it’s 1.5 % and often considered excessive.
Starve the beast. Period.
I’m sure my example isn’t rare. Got divorced at 52, ex got the house. My savings will hopefully see through my retirement. Junior may receive an inheritance with which he can put a down payment on a house. Patience is a virtue.
Roughly 33% of our population are gov’t employees?
Sounds like at least 30% too many.
In the USA it’s 1.5 % and often considered excessive.
Starve the beast. Period.
Great but sad Blog today Garth on RE in Canada.
A generational disease that leads to a life of debt servitude.
You warn with good advice.
Few will listen.
Good you keep on trying.
For me, it is what it is, accept it and as in Dr. Strangelove:
How I Learned to Stop Worrying and Love the Bomb
#14 Barb on 05.24.21 at 12:49 pm
#2 Big Bucks
“Canada has close to 6 million public servants coast to coast to coast”
———————————–
16 per cent of Canada’s population?
No wonder we can’t afford government fees, levies, bylaws, etc.
The workforce is 19 million. – Garth
****************************************
Over 30% of the workforce and growing. Oh my! It was just over 20% in 2013. I wonder if it has something to do with “because it’s 2015”?
https://en.wikipedia.org/wiki/List_of_countries_by_public_sector_size
Gonna go to my first day of government work tomorrow and declare at the first coffee break that my Uncle Crowdie thinks you’re/we’re all parasitic shitheads.
That will endear myself to my new coworkers.
Pass me the sugar will ya…
M46BC
Your post certainly spells out reverse mortgages very well. But will that stop the onslaught of “Magnum PI” from hawking them on TV and radio in the U.S. as a “safe and wise decision”
Those ‘geriatric’ Millenials are having to suck up some reality before they reach the ripe old age of 40…..wow, the world is not kind to these poor souls.
#180 crowdedelevatorfartz on 05.24.21 at 10:34 am
@#174 Dharma Bum
“You should take some of these mils on an elevator ride,”
++++
I met Trudeau about 20 years ago in a pub in Downtown Vancouver.
He was with some friends out for dinner and beers, no security.
Talked to him for a few minutes.
Nice guy one on one.
Sadly….. there were no elevators.
———
Good story.
Trudeau, the ” Champion of the Lumpenproletat”.
That’s why he is so popular.
Shoe-in for next election.
The stupidity the boomers inflicted on this country is epic.
#11 Wrk.dover on 05.24.21 at 12:38
More of a rent the guy that owns the tool with the tool, and his matching skillset to for example aluminum weld or what ever…
———
I know a guy who thought he’d save a bundle by renting a mini-ex for a weekend. Never ran one before. Just made a mess.
I needed some trenches dug years ago, hired a backhoe and operator. Minimum billing was 2 hours. He had the trenches dug in 45 minutes. I wandered around our property telling the guy to “dig that out, pile this up, shove that over there”, and still ran out of stuff for him to do before 2 hours had elapsed….
We need what will be a very painfull reset. I remember times when the average guy could make a decent buck and buy a house that could be paid off in fifteen or twenty years. When I was a kid a family friend had a bunch of paycheques under a magnet on the fridge, company used to hound him to cash them, I asked why and he said my mortgage is $54 a month no rush to cash them. He was probably making $500 a week at the time (1975 or so) and had owned the house 12 to 15 years at that point.
People making decent wages and prices that are reasonable enough to let people buy products on offer is what keeps the whole thing going. It is only credit that is keeping it going nowadays and that can’t last forever.
1961 or 2 my parents bought a 4 bedroom semi-detached in what would become Mississauga, the builder put us up in a house a few blocks away because it wasn’t completed on time, they paid $13,500. Comparable places in the same nieghbourhood are now listed at $870,000 to $899,000 it doesn’t make sense to me. The wages sure didn’t go up commensurate with the price increases. I used to get two overflowing carts at the grocery store for the same amount of money that now barely fills two bags. I wouldn’t want to be starting again now.
#10
“Patriotes” lol. Imagine if the Americans had invaded, I can guarantee you the French language would have disappeared. But Quebec is determined to kill the rights (language, religion) of people not named Tremblay or similar. Sad
#2BB “Canada has close to 6 million public servants coast to coast to coast so it has been no small influence on housing prices.”
Gotta call BS.
Do u have a link u can share? That seems excessively high. Feds are probably 300k total. Nova Scotia as an example has aprox 140k total and seems to be similar in percentage to most other provinces.
https://www.canada.ca/en/treasury-board-secretariat/services/innovation/human-resources-statistics/population-federal-public-service.html
https://etatscanadiens-canadiangovernments.enap.ca/en/nav.aspx?sortcode=2.0.2.0
#10 A celebration of 1837 on 05.24.21 at 12:38 pm
A celebration of liberty for the Nation of Quebec…. horned dudes not welcome…..
Journée nationale des patriotes
——
Celebrate it while you can. I’m gonna miss Quebec when it’s gone. PQ has a sub 1.6 fertility rate, which basically means it’s already toast. You’re currently 100% reliant on national/international immigration. Quebecois in all its forms is done like diner, just a matter of a bit more time, and I’ll likely live to see it fall. No kids, means importing people, and they come with Culture…
Too bad, those PQ ladies were always super hot. Not sure what comes next, but I always liked what came out of Quebec; so whatever it is, it’ll probably be worse.
#9 Alexinvestor makes a very strong point. At the end of the day all the doom and gloom hasn’t come true yet. Sure let’s all keep waiting but no one can predict real estate market. Everyone’s been wrong for 2 decades now.
#25 Flop… on 05.24.21 at 1:25 pm
Gonna go to my first day of government work tomorrow and declare at the first coffee break that my Uncle Crowdie thinks you’re/we’re all parasitic shitheads.
That will endear myself to my new coworkers.
Pass me the sugar will ya…
M46BC
…
Have you applied for LTD yet? How many years til you get the DB?
My chart of Canadian Household Debt, GDP, Foreign Direct Investment and Balance of Trade is up with latest data:
http://www.chpc.biz/household-debt.html
2020 Foreign Direct Investment data was just released (StatCan only provides public access to annual data – SIDE RANT we Canadians should really insist on better data collection and access to it so independent groups can better join in the conversations about improving public policy).
Anyways, negative net Foreign Direct Investment remains wide for the 24th year in a row. For every $1 of investment coming in to Canada, $1.40 leaves.
Also of note, the monthly Net Trade data have been negative 82% of the time in the last 12.3 years.
Here are the 10 year changes:
Household Mortgage Debt: UP 69%
Total Household Debt: UP 58%
Net Trade: DOWN 44%
FDI Out vs FDI In: UP 843%
GDP: UP 15%
Our debt obligations continue to provide more stimulus to offshore than onshore producers and the widening spread between total household debt and household mortgages means we are borrowing even more to maintain lifestyle.
@#9 alexinvestor
“In a hypothetical world where mortgages rates were high and housing prices low…”
+++
That was called the 1980’s
20% mortgage rates and houses were $80 G .
Back when Boomers were in their late 20’s early 30’s
And Mom and Dad didnt loan down payments…
Never got a dime from my parents. Even had to pay for my own post secondary education. Retired at 48. Self made millionaire. ’nuff said…..
If you were modest you’d be perfect. – Garth
@#25 Floppie.
“Gonna go to my first day of government work tomorrow and declare at the first coffee break that my Uncle Crowdie thinks you’re/we’re all parasitic shitheads.”
+++
No no no.
You must wait until you are a full time employee.
Takes about 6-12 months.
Once you are “full time”…. you are gold….
Invulnerable to the unemployment line.
Invulnerable to managers orders.
Oblivious to serving the public.
Gold…with a capital “G”
@#28 NSNG
“The stupidity the boomers inflicted on this country is epic.”
+++
Yes.
And if the generation coming up behind us is any indication….we were excellent role models.
@25 Flop;
No, but please read the following.
I was there to serve the public. When that direction was no longer possible, I left.
When I joined, my salary dropped to about 40% of what I had before. When I left, it went up 50% from my government salary. Sure, I’ve got a bit of a gov. pension so that helps make up some of the difference. Money is not my guiding light.
In my current work – if I can give the technology that may save one person’s life, or avoid injury, I’ll call my work successful.
There are lots of great public servants. Like any grouping of people, there are the givers and the takers. I worked with a lot of very talented and professional people. And some duds. Private industry has a habit of weeding once in a while.
From your “Pink Snow” posts down to your latest, I think you are a giver, not a taker, and you’ll figure out your way through.
#2 ‘Big’ I call misrepresentation. As per the mighty Google, the federal government of Canada has 300,450 total employees as of 2020 figures – that is the total for all of Canada at the federal level. As for Ontario, the figures are as follows: 88,000 in public admin (provincial government) plus 341,000 in education & 221,000 in health care. So some 650,000 employees altogether at the provincial level. The only level left is municipal. So what are you saying? That there are close to 1 million municipal workers in Ontario? I kind of doubt it, but since Ontario has the largest population of any of the provinces in Canada it may be possible.
Further to my earlier comment, as per CUPE (Canadian Union of Public Employees) for Ontario they have 80,000 members. So even if one counts ALL the federal government employees in Canada as residents of Ontario plus added all the provincial employees, health care workers & education staff plus the CUPE municipal employees the grand total is 1,030,450. And there is no way that all the federal employees reside in Ontario. For sure a considerable chunk live in Quebec plus there are definitely federal employees in all the other Canadian provinces & territories. Say half of the federals reside in Ontario. That would give Ontario about 880,000 government workers in total – the majority of which are in health care or education.
Reverse mortgages must be the answer!
#22 Billy Buoy
You think Canada should trim 30% of jobs when the economic outlook is already questionable? That’s not well thought out.
If you prefer the US numbers, you should move there so you can enjoy all the benefits that go with it.
People keep saying “oh, millennials can’t afford this and that” but we can! Part of our “affording” is getting money from our parents.
We didn’t ask to be brought into this world and parents giving money to us is a given. It just seems like sour grapes from those who didn’t get this message.
Time for the complainers to move on and find something else to complain about. Nothing to see here…
Also about reverse mortgages, many influential people promote them, Tom Selleck, Kurt Browning, Henry Winkler….
If reverse mortgages were such a scam as they are portrayed, I’m sure none of the famous people would be attaching themselves to them.
Where did anyone say they are a scam? Just a really bad place to find money to give you. – Garth
Realtors and others (“investor” types) are saying the mass Immigration coming will mitigate any potential losses over the next 24months and beyond?
Garth, as someone who is an advocate for Immigration what are your thoughts here?
Ive read there are already 200,000 applications from Hong Kong already from people looking to move to Canada.
This is not FOMO, more like a concern that high rent is permanently in my future. Unfortunately 3 levels of Gov wont let us build
Immigration levels have been consistently at 1% of the population or below for decades. Without newcomers Canada’s population will actually decline. You should wonder why people come here so happily while you grouse about things. – Garth
Haha I just now read yesterday’s weblog entry! See I do have a life outside this pathetic weblog.
I see my (in)famous mention. :-o
That’s the thing I backup all my posts with the Mainstream links – as much as possible.
Let’s see what the fine folks at the UN had a to say – a few years ago. Gee it might explain what’s going on currently.
Control over our Feeding, Breeding, Movements/Travel.
NOW do you believe them? In 2021.
https://www.youtube.com/watch?v=lhgJGPOYh7s
#CPD48 #UNPopulation
Preparing the world for important population changes
20,997 views•Apr 8, 2015
United Nations – In 2015, the world will adopt a new set of goals for the next fifteen years of sustainable development. In designing and implementing the post-2015 agenda, with sustainable development at its core, it is important to fully understand and account for the demographic changes that are likely to unfold in the future.
#47 Millennial
Tom Selleck, Kurt Browning, Henry Winkler….
They are being paid to promote it. They don’t care anything about the underlying product.
Free lapdances to get vaccinated….
The ghost of SM lives….
https://nationalpost.com/news/world/vegas-is-back-baby-dancers-and-casino-staff-are-mostly-vaccinated-restrictions-end-june-1
@#33 IHCTD9 on 05.24.21 at 2:10 pm
Anytime the Montreal hockey team comes to Calgary for a game 50% percent of the fans present are wearing Canadiens sweaters. Because they are a great team and national treasure yes, but also because there are lots of people in this city who moved west in the first exodus back in the 1977.
One wonders if its going to be ‘deja vous all over again’ with the introduction of Bill 96. Here’s an excerpt:
” You will now be subject to Francization obligations where you have 25 employees or more (down from 50) and sometimes as few as 5 employees.
Francization is an existing process imposed on Businesses with the aim of ensuring sufficient French presence in the workplace. It notably requires certain actions such as administrative and management processes, committees and reports to ensure such presence in many spheres, like internal communications, work tools, hiring, etc. Enterprises with 25 to 49 employees will now be subject to Francization …
It should also be noted that enterprises under federal jurisdiction, such as banks, airports, and marine and rail transportation companies, would be subject to the application of Bill 96. Although Québec’s constitutional authority to impose this is uncertain, the federal government has showed some openness to the proposal.”
Hmmm. It’s got a similar ring to Garth’s post yesterday ‘Canada Beyond 150’ and ‘accessing solutions’. Rewriting the playbook, so to speak.
Everything we do in life has consequences, and people have been known to vote with their feet. Companies, too.
Love it! Really interested in seeing what’s going to be the motivations/influences/instigations – lol – for Gen Z spawn? Who the hell knows? Or cares? Most readers of this blog (myself included) will be dead!! The way I look at it, my kids can buy all the houses they want…with their own money.
Parents – WTF would you gift your kids money to buy (essentially) 1 stock? BOMAD for buying real-estate? What are you teaching your kids? ah right, inadequacy! Teach them how to make money – done!!! Oh, and cry (while hugging is the best).
And when you kick it? Hopefully, your 50-60 yo kids will be rich beyond their wildest dreams – unless they think they’re entitled to it. Then, just make a large donation to mental health – its gonna need it. Lol!!!
Happy Monday!
Og
#2 Big Bucks
“Canada has close to 6 million public servants coast to coast to coast”
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16 per cent of Canada’s population?
No wonder we can’t afford government fees, levies, bylaws, etc.
The workforce is 19 million. – Garth
If these 6 and 19 million figures are accurate(I’m assuming they are) what portion of remaining 13 million are low wage? Scratching my head how this all works going forward.
Well it sounds like it’s a majority vote it’s the Boomers with the hormones issue. We all wish for what we can’t have but M&D make it look like Christmas with their gifts.
My brother’s wife and he had to use her mom’s name on the title of the house. How many are also doing that. He’s a GenXer and so is she, but her mom is a Booming 75yr old. If the ship sinks millenials’ “investments”, it may sink a few boomers, as well
” socially-destructive real estate inflation” ?? Let me see, what’s preventing the building industry from churning out affordable, spacious SFD homes or even condos? Nothing. I mean, nothing but costs. Land, building materials, construction loans, levies, wages, taxes, lawyers, agents, etc etc etc.. The government could look into lowering some of these costs (which it CAN do) and set the trend toward affordable housing. (How environmentally destructive that would be, while inviting half a million new residents every year to take their rightful place in our cities, we’ll talk another time) Instead the focus has been on the greed of the re-seller and their shady tactics to get market price (e.g. encouraging horrifying auction style bidding). So let me see, again: you have one piece real estate in a better location than what builders can provide, often higher build quality, landscaped, settled in and so on.. AND you want to buy it at a lower price because.. why, the kitchen cabinets are a bit dated? Guess what will happen to that new plywood townhome in 10 years.. .right, they don’t get any better with age. While the 100 year old brick house will be 110 years old.
#54 Arcticfox The way it works is like this: Government hires new people they pay them X amount of dollars, than take back 75% (conservatively) in income taxes, sales taxes, user fees, levies, property taxes, licenses etc.. etc..etc.. It’s a thing of beauty.
Just to show how insane the housing bubble has become following is a link for a Twitter quick video showing Canada housing prices vs. 6 major advanced countries since year 2000. It boggles the mind.
https://twitter.com/JamesEagle17/status/1377353707478601729?s=20
#54
It doesn’t work going forward that’s why Ontario has a $450 billion debt.The problem is Covid has revealed a lot of holes in healthcare in particular so that is expected to more than double(spending that is)over the next 8 years.Eventually the rating agencies will be calling the shots and Ontario will see cuts to services and they will be huge.A public servant making $75-$150k a year will probably fin him/herself on the UBI at around $24k a year so the province will save $billions that way.Public sector pensions will aso become DC plans instead of the current unaffordable DC plans(another huge saving n the 10’s of bllions)
millenlial on 05.24.21 at 3:22 pm
We didn’t ask to be brought into this world and parents giving money to us is a given. It just seems like sour grapes from those who didn’t get this message.
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Well, what does that even mean? No one asked to be brought into this world, and yet here we are dealing with it, most of us without parental cash infusions after we leave the nest. It’s called being an adult and generally means being self sufficient.
#47 millenlial on 05.24.21 at 3:25 pm
Also about reverse mortgages, many influential people promote them, Tom Selleck, Kurt Browning, Henry Winkler….
If reverse mortgages were such a scam as they are portrayed, I’m sure none of the famous people would be attaching themselves to them.
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Incredibly naive thinking, that. Have you not seen the crap that Gwynth Paltrow hucks? It seems you live a sheltered existence – helicopter parents?
Garth, with all due respect, I very strongly take exception with yesterday’s fear monger about the privy council’s report. That blog post yesterday and the responses were some serious red meat for the pearl clutching 50+ set. There’s too much in the blog post and the actual imagined future economy described in the report to address, but I’ll say this:
As noted above, millennials are nigh 40 y.o. Between them, gen x and the zoomers, it’s their/our world now. These generation has been handed a system that benefited massively from the exploitation of globalized labour (read the doc, globalized wages are at the heart of this) in a surge of wealth generation that will not be seen again. That wealth and ease of simply getting by is gonzos and the result of younger generations trying to attain that same level of well being sees Canadians sitting on all-time high wealth inequality and indebtedness. Because of the above, it’s younger generations damn right to recognize where the economy is headed and propose change to meet those needs and alleviate those problems.
Second, the language in the document is extremely equivocal. There are a lot of uncertain qualifiers in the language that make it very clear that they are proposing one potential way of meeting a future that may or may not come to pass.
W/re the access economy. Settle down. For one, it’s here. For another it has some very good implications. Another aspect: no one is going to take your pearls, or your tractors or your beemers or your 3000 sq ft homes or your RVs or your tactical black grizz. Stop white-knuckling them so hard, it’s okay, you are safe. The bogey man is not out for you nor has it ever been out for you.
Your generation will pass on, your capital goods will be sold to settle your estate and the generations that have zero interest in owning any of those things won’t give a hoot. And if future gen AAers (or whatever the gen after zoomers is called) want an RV, or pearls, or a boat or a 3000 sq ft house, they will be able to buy it, but they probably wont want to. Their rights will be fully intact as will your be. Chill.
Pretty funny reading how no one can even figure out who all are employed by the government. No wonder we’re doomed.
To further comment on yesterday’s blog about millennial’s future vision and today’s, I think that there definitely is another side to millennial expectations. You mentioned blockchain technology and digital wallets in a system that very much seems like big brother/1984. However, I think many will advocate that technology to be used in a decentralized way.
Using blockchain technology today I’m able to take out a permission-less loan in the form of USD backed stablecoins, using ether as collateral. No application is needed, no forms to fill out, all done on the blockchain with smart contracts.
I can also deposit those stablecoins on other decentralized platforms and have been earning anywhere from 3-15% interest, with no volatility. Granted, there is smart contract risk, but with many protocols having billions in total value locked (for example AAVE has over 16 billion in TVL), I think this risk will decrease in the future. No government can shut it down, and anyone that has an internet connection has the opportunity for these services (including millions of unbanked in many third world countries).
I think these applications will eventually become more commonplace, with easier access to more people, and will eventually be used by many to replace mortgages, loans, and other nonfinancial applications (yes also using NFTs).
I know your opinions on crypto, and know you feel it is backed by nothing, but would really like to hear your opinion on decentralized finance applications in a future blog or in the comments. Thank you for all of your great advice over the years.
Agree with you Garth on the reverse mortgages.
Your recommendation for parents to take a HELOC and then loan this to kids is an issue though, hence why you are seeing so many gifts. If the loan is documented then then the bank will take that into account when looking at little Johnny or Suzy’s debt servicing ability and, compared to if it were a gift, would qualify for a lower mortgage.
Of course they could all lie and say it’s a gift and then have a back door loan but that would be mortgage fraud. And we know that never happens here in Canada!
It’s all a bit crazy right now regardless. Just rent if you can’t afford!
#57 Tudval on 05.24.21 at 4:27 pm
#54 Arcticfox The way it works is like this: Government hires new people they pay them X amount of dollars, than take back 75% (conservatively) in income taxes, sales taxes, user fees, levies, property taxes, licenses etc.. etc..etc.. It’s a thing of beauty.
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It’s the bobbing bird that eventually stops.
Bill 96 really?
In the US the shelters are already full of dogs dumped by people who started going back to the office. :-(
Unfortunately nothing one can do about it – it just proves again how egotistical most of the people are. The poor dogs…
I find it odd that there are so many millennials whining like the world is going to end because they can’t afford real estate.
If it’s something that’s that important to your happiness, why not buy somewhere where it’s affordable? An hour outside of Montreal, the second largest city in the country, a detached is still attainable at around $400k. Girlfriend and I bought three years ago and the place isn’t perfect, but we managed to do 20% down without excess parental largesse and paying for our own post-secondary studies (my parents gifted me $1,000 as a housewarming present, we benefitted from some hand-me-down household items, Dad helps with home improvement projects that are over my head, and we lived in their basement rent-free for 5 weeks between the expiry of our lease and the possession date).
I do have friends and acquaintances who took big cash gifts from their parents. My own parents offered to finance our entire mortgage, with us making payments to them. (This would not involve a reverse mortgage or HELOC for them; they’ve been mortgage-free since probably the late 80s.) I’m much happier not having gone that route.
#62 Ed on 05.24.21 at 4:49 pm
Pretty funny reading how no one can even figure out who all are employed by the government. No wonder we’re doomed.
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Of course, we know how many people are employed by Gubernments.
But, blogdogs are not interested in facts.
They google until they find a number that fits their confirmation bias.
#180 crowdedelevatorfartz on 05.24.21 at 10:34 am
@#174 Dharma Bum
“You should take some of these mils on an elevator ride,”
++++
I met Trudeau about 20 years ago in a pub in Downtown Vancouver.
He was with some friends out for dinner and beers, no security.
Talked to him for a few minutes.
Nice guy one on one.
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I guess it was the famous “Jolly TaxPayer” pub.
He must have gotten his ideas there.
Anyone read this?
Wilful Blindness: How a Criminal network of narcos, tycoons and CCP agents infiltrated the West
By Sam Cooper
“In 1982 three of the most powerful men in Asia met in Hong Kong. They would decide how Hong Kong would be handed over to the People’s Republic of China and how Chinese business tycoons Henry Fok and Li Ka-Shing would help Deng Xiaoping realize the Chinese Communist Party’s domestic and global ambitions. That meeting would not only change Vancouver but the world. Billions of dollars in Chinese investment would soon reach the shores of North America’s Pacific coast. B.C. government casinos became a tool for global criminals to import deadly narcotics into Canada and launder billions of drug cash into Vancouver real estate. And it didn’t happen by accident.”
https://www.amazon.ca/Wilful-Blindness-Criminal-network-infiltrated/dp/0888903146
#60 Nottamill on 05.24.21 at 4:46 pm
millenlial on 05.24.21 at 3:22 pm
We didn’t ask to be brought into this world and parents giving money to us is a given. It just seems like sour grapes from those who didn’t get this message.
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Well, what does that even mean? No one asked to be brought into this world, and yet here we are dealing with it, most of us without parental cash infusions after we leave the nest. It’s called being an adult and generally means being self sufficient.
#47 millenlial on 05.24.21 at 3:25 pm
Also about reverse mortgages, many influential people promote them, Tom Selleck, Kurt Browning, Henry Winkler….
If reverse mortgages were such a scam as they are portrayed, I’m sure none of the famous people would be attaching themselves to them.
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Incredibly naive thinking, that. Have you not seen the crap that Gwynth Paltrow hucks? It seems you live a sheltered existence – helicopter parents?
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The clue is in the name: millenlial.
Someone who wants to smear millenlials; in short you got trolled or “pwned”
#59 ‘Big’ – so let me see – we eliminate all those pesky $75K to $150K government employee jobs – which BTW pay income taxes back into government coffers including EI – & in return we start paying all those former income tax generating & economy supporting folks $24K per annum UBI out of what, exactly? Why would anyone work if they can just sit at home & collect UBI? Especially why would anyone work if by doing so they simply are punished financially by paying more than everyone else? And spare me the argument that ‘our taxes pay their salaries’. Yes, they do. Can you name any industry or sector that has NOT been subsidized by said taxpayer dollars which means anyone employed by said industry or sector has also been paid with taxpayer dollars? Good luck with that.
Nottamill on 05.24.21 at 4:46 pm
Well, what does that even mean? No one asked to be brought into this world, and yet here we are dealing with it, most of us without parental cash infusions after we leave the nest. It’s called being an adult and generally means being self sufficient.
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What you said is EXACTLY why you and many others are crying the blues: “…most of us without parental cash infusions after we leave the nest. It’s called being an adult and generally means being self sufficient.”
It’s called familial money – “self sufficient” in our circle of community means the FAMILY.. “self” is so selfish actually. We think as a family and community. Therein lies your problem – selfishness!!
If your parent and their parents so selfish, you wouldn’t be crying the blues. My ancestors came to Canada with almost nothing and they worked their butts off to build a business and net worth to pass on. I will do the same. I would be so foolish to expect my kids – if/when I have any – to be “self sufficient”.
Yes everyone works, everyone contributes but we all pass things down to relatives. You have imprisoned yourself to being a financial cripple unfortunately. Maybe you have time to change it for your kids and pass on something to them.
Are young people soft? Do they expect handouts as a part of their privileged life? Have we contributed to their expectations of a certain lifestyle?
I worked a lot of factory jobs when I was young – how many small factories even exist in this country anymore? The factories are gone and replaced by “Barista” work – how do you afford a house on barista pay ? What will this Country look like in 20 years time with the kids taking the steering wheel ?
Stay tuned
Immigration levels have been consistently at 1% of the population or below for decades. Without newcomers Canada’s population will actually decline. You should wonder why people come here so happily while you grouse about things. – Garth
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A roof over ones head is worth Griping about, no need to be rude. I don’t have a Bank (like you) I could throw a Blow up Mattress
Envy kills. – Garth
DANCING THE NIGHT AWAY!
If I was dancing out on the stock or real estate dance floors I might be inclined to dance a little bit closer to the exit door. Dancing out in the middle of the floor for all the world to see, just a twistin and a shoutin with a ton of leverage to glide your nimble feet along. You’ve never missed a step before, so lets Fred Astaire the night away. The thought of missing a step never crosses your mind. Besides you’ve been taking dancing lessons down at the bank, they seem to fancy your nifty foot moves. You can call me a dreamer, but I’m not the only one.
#61 Faron on 05.24.21 at 4:48 pm
I agree with your analysis on the privy council report. There is a generational shift happening here that will really change how we buy and consume, and what we see as “valuable”.
My mum and grandma insisted on buying me china for birthdays and Christmas when I was a young adult. I did a big move last year and retrieved it from my sister’s place – she had stored it for me for a couple of years and it was time to get rid of it.
A ten place setting of Royal Doulton, coffee pot, tea pot, fruit nappies, the lot. Thousands of dollars worth when purchased new. I finally found someone to sell it to and was lucky to get $350 cash for the lot.
My kids don’t want stuff like that. I don’t either. Brown furniture, china, cut glass, ornamental plates. Decorative pianos. Multiple bookcases full of books. Royal Doulton ladies. Hummel figurines. China cabinets, beer fridges, touring motorcycles.
Two of my kids, in their late 20s, don’t have cars. They live quite nicely, having chosen to live in places where they have access to transit, biking, walking, car sharing, and borrowing family vehicles. The one kids who lives in a more rural area has a solid Honda Civic they paid cash for and plans to keep it until it dies.
As for practical stuff, why not share? My parents and grandparents used to do it. Grandpa had the rototiller and in the spring it travelled to all the gardens to get them ready for planting, strapped in the trunk of the old Acadian. Every family didn’t need to have a rototiller. Same with pressure cookers, big canning kettles, specialty tools, camping equipment. If you only use it once a year, why not share it around to the family and the neighbours? Sharing does not necessarily mean monetizing.
I’m reminded of a story by Frederik Pohl called “The Midas Plague”. It’s worth a read. I think we may be there as a society. Maybe we are getting to the point where we can finally stop being labelled as “consumers” and become “citizens” again.
‘live within their means’…HA!..come on Garth.. imagine todays snowflakes had to save for a Starter Home..and then work their way up to bigger homes?????? not with the ‘entitled generation’
Financially illiterate Mom and Dad should seek out a Real Estate investor. Do a sell and leaseback. Mom and Dad then have loads of cash and still get to live in their home. Now kids get the cash and of course they buy their home and mom and dad invest the rest. Investment Advisors, you know there is added business for you when your clients (present or future) do this maneuver.
My latest tenant is now enjoying a happy retirement and has no financial worries. Happy tenant makes for a happy RE Investor / landlord.
My previous comments:
https://www.greaterfool.ca/2020/01/14/mom-money/comment-page-1/?unapproved=683410&moderation-hash=596ec40051a391be9367943cbfddf788#comment-683410
Obviously I am a big fan of rescue dogs (and cats). Well done Pierre. Also a fan of agility training. My wife did two rounds of that with Remus. It makes a big difference even if you have no plans to enter contests.
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BOMAD using reverse mortgages to helicopter their kids into real estate? That doesn’t seem to be a very good idea. Do we have any actual stats on how much of this is going on?
I could sort of see giving my kids down payment money if at that point I thought I had more than enough money to stay out of their pockets for the rest of my life. But it is a complicated issue if there is no prenup because the house is normally considered a marital asset by the courts, so you may have just gifted a large amount of money to someone who isn’t going to be around in a few years. Something to consider.
Also, I believe in the concept of “fairness” as meaning “equal opportunity”, not “equal outcomes”, so for me if I start handing out money I need to take the amount and multiply by 3. That gets pretty expensive pretty quickly.
I recently heeded the advice of this blog and sold one of my rentals at the peak of the housing lust. It was a multiple offer situation, and the winning bid? Came from the tenant’s mom herself. No conditions attached and a very quick close. Yet another generous BOMAD at work. In our culture there’s a saying: It’s not whether you picked the right stocks, it’s whether you picked the right parents.
I still don’t think anyone believes that we’re going to see a 90+ cent $CAD again. Makes me think it will happen.
#73
Seriously?Government employees are paid out of tax revenue and the province obviously has a problem with that.We have way too many on the gov’t payroll thus the $450 billion debt.
#73
With your reasoning why don’t we pay the 1.8 million civil servants in Ontario a cool mill a year,you know so they can pay even more taxes and EI and you know support the economy?
“You should wonder why people come here so happily while you grouse about things. – Garth”
A very good point. I guess there could be a few people that emigrate from Canada, but those who do go mostly to the US.
“But the wealth gap!” Sure, it is enormous. But the standard of living has never been higher than right now in all of human history. We have to stop looking at notional numbers set on the margin in spreadsheets. If you had the choice of where and when to be born, this is the time and here is the place.
I’ve met some of these so-called “poor” millennials. You know where? At the ski resort. (Although a high percentage of them board, something Gen-X considers kind of silly. Why tie your feet together?) Anyway the point is they paid $100 for a lift ticket, $1,000 for gear, and $40 for lunch once you include beer, plus the gas for the car. And the car.
The key to understanding millennials is that for them, lifestyle is not negotiable. “Experience” is invaluable. Time is the only asset. They complain about the cost of housing while smoking weed outside a pub in Banff where they are paying $150 a night to stay in a hotel. Maybe more if it the Banff Springs or Rimrock.
But the strange thing is that once they get back from their cat-skiing adventure or 4 week hike through Nepal they wonder why they don’t have any money left.
Pretty well everyone I know in a house under 40 had some of the downpayment covered by parents.
Many of these BOMAD parents are from the old country. It doesn’t matter which old country, in most cases it was someplace where there weren’t too many investment options outside of RE and junk gold/silver.
Let’s never take it for granted how necessary political stability is for having safe, universal access to tax shelters and financial instruments like ETFs.
#46 millenlial on 05.24.21 at 3:22 pm
…We didn’t ask to be brought into this world and parents giving money to us is a given.
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Surely, if you’re over twelve, you realize saying something so juvenile cannot lead anyone with even limited life experience to take you seriously.
M57BC
#2 Big Bucks on 05.24.21 at 11:37 am said:
“Public servants that have been totally unaffected by Covid have also been feeding the beast.With unbelievable pensions they don’t require big RRSP savings so their money has been pouring into RE.” … blah, blah, etc….
Wow, Covid must be nearing the end of its run, vaccines are proving to be very useful and being delivered in a timely fashion, provinces are starting to talk about opening up a little, people are starting to go back to work, Trudeau may not be as intellectually disabled once thought, Biden seems to be doing a good job, Trump is nowhere to be seen….
This is the first comment I have seen in a long time that is back to blaming public servants and their “unbelievable” pensions for everything that is wrong with everything in Canada. Obviously “Big Bucks” doesn’t understand the public service pension plan. Anybody that works for 35 years can have a very similar pension to a public servant if they follow all the rules that Garth talks about and if they contribute the same amount of money as a percentage of their gross income into a pension fund as the public servants do. There is a reason why 60 year old public servants have no accumulated RRSP room even if they have never contributed a cent to an RRSP. Working as a public servant you contribute the equivalent of about 16% of your gross income into your pension plan. After 30 years of working you get 60% of your 5 year average salary, after 35 years, 70%. If you retire at 60 you stop getting CPP at age 65.
The reason it seems like it is so lucrative is that it is a non-profit group plan and there are a couple of hundred thousand people in the group. The pension contributions and benefits are calculated based on providing a pension for the average lifespan of Canadians that make it to 65, currently around about 85 or thereabouts. If you have your individual retirement plan you likely have a group of one, you may be dealing with a bank that charges up to 3% of your RRSP per year to “manage” it for you, and you may not be as financially literate as the highly trained and experienced “public servants” that manage the PSPP.
That is why it is very important that everyone follows all the rules that Garth tells you about. He is providing you with financial literacy and the ability to flourish financially no matter who is PM and what disease is killing everybody, whether you have to wear a mask or get a vaccine
#89
Nobody is blaming them —anyone would take it if offered but everything else you have stated is 100% false.
#41 Another Deckchair
Thank you for this:
“There are lots of great public servants. Like any grouping of people, there are the givers and the takers. I worked with a lot of very talented and professional people. And some duds. Private industry has a habit of weeding once in a while.”
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I’m not a public employee but I’m doing a short contract with the government right now and it has been amazingly refreshing to work with such a talented, rigorous and hardworking group. Most of them have been at it for at least 18 years and they often work late nights and even weekends. There really are no slackers on that team. I wish I could say that about the private-sector employees I’ve worked with in the recent past. Don’t get me wrong… some were EXCELLENT, but there were also a ton a schmoozer-slackers.
And thanks also for pointing out to our friend Flop that he’s obviously a giver and will figure out his way through. I’m confident that if he finds the work valuable, he’ll stay on and give it his all. If it’s a snore/slackfest, he’ll most likely move on to something more interesting.
#89 George S on 05.24.21 at 7:52 pm
#2 Big Bucks on 05.24.21 at 11:37 am said:
“Public servants that have been totally unaffected by Covid have also been feeding the beast.With unbelievable pensions they don’t require big RRSP savings so their money has been pouring into RE.” … blah, blah, etc….
Wow, Covid must be nearing the end of its run, vaccines are proving to be very useful and being delivered in a timely fashion, provinces are starting to talk about opening up a little, people are starting to go back to work, Trudeau may not be as intellectually disabled once thought, Biden seems to be doing a good job, Trump is nowhere to be seen….
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George, you obviously dran the Kool-Aid. Big Bucks is quite accurate in his take on public sector pensions. If you weren’t aware, these pensions are disappearing quickly. They are a huge burden to society and the tax paying public. It’s a complex topic but because it’s government, the people that are attracted are not necessarily top tier. Many get in, realize how good they have it, and coast for three decades. Motivation and desire to accomplish fade over the years because of a lack of oversight. And the pension benefits can be attrocious. Regardless of how the economy does, pensioners come out shiny side up.
I spent many years in public service, commuted a 15 year pension which is paying me more than most pensioners get after 35 years. Plus I get to spend the principal at some point. All i had to do is be smarter than my boss, which was a low threshold.
The whole public service thing is a sham.
Interesting feedback the last few days.
I’m under no illusions that when I go to work tomorrow, I’m going to be fighting for my financial future.
I’m not going to be worried about when my next coffee break is, my main concern is finding a way to coax my body not to betray me before they discover my value as a worker.
As with everything else that has happened in my life financially since I have been on this blog, I will find my own way to intermittently document the experience on here as it unfolds.
I’m gonna fight like a tiger.
A Tasmanian Tiger…
M46BC
Interesting.
The blog dogs who are complaining that there are too many public employees, are the first to complain that they can’t get in touch with anyone when something’s wrong with their pension payment.
#86 Nonplused Well said about the Mill’s.
#94
That’s right ……. they can’t get in touch with anyone because they are on a “flux” day off lmao
I guess if Garth allows it to be posted it must be the truth. Hurr, hurr!
For such sturdy and intelligent conservative mostly men it amazes me that you have so much vitriol for those who work to provide all the services we mostly take for granted in Canada.
If you spent 1/2 the time on your elected officials as you do on your fellow countrymen who simply go to work every day, fewer and fewer with the kind of pension you moan about each year, we might see change.
You know who has gold plated pensions with little actual work put it? Elected or appointed officials.
That there are those of you ignorant enough to feel the problem is a policeman or a hospital technician or a fisheries officer dumbfound me. Turn on one another, ignore where the problem emanates from and you get what we got.
The amount of outright stupid spewed on these pages over the past few days is, I guess, indicative of why the Conservative Party of Canada is in the shape its in.
#74 millenlial on 05.24.21 at 6:04 pm
Nottamill on 05.24.21 at 4:46 pm
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What you said is EXACTLY why you and many others are crying the blues: “…most of us without parental cash infusions after we leave the nest. It’s called being an adult and generally means being self sufficient.”
It’s called familial money – “self sufficient” in our circle of community means the FAMILY.. “self” is so selfish actually. We think as a family and community. Therein lies your problem – selfishness!!
If your parent and their parents so selfish, you wouldn’t be crying the blues. My ancestors came to Canada with almost nothing and they worked their butts off to build a business and net worth to pass on. I will do the same. I would be so foolish to expect my kids – if/when I have any – to be “self sufficient”.
Yes everyone works, everyone contributes but we all pass things down to relatives. You have imprisoned yourself to being a financial cripple unfortunately. Maybe you have time to change it for your kids and pass on something to them.
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M’kay, interesting. Obviously there are cultural differences. You just came across as a naive, entitled millennial is all. I don’t see why it is foolish to expect adults to be self sufficient.
My ancestors also came to Canada with nothing, worked hard and built lives for themselves and then lost it all in the Great Depression. Don’t worry about me though, I’m doing just fine, and my adult ‘kids’ are doing even better. They certainly don’t need my money, lol.
Canada used to have a lot to offer, but today the offer is extended to a slimmer demographic than ever before. Kids are going to have to work their asses off, think way out of the box, leave the country, or take some good advice from the right older dude/ette.
The way Trudeau has bungled things up, the kids just end up being punching bags for the rest of the country. The “beyond 150” civil servant idealists seem to understand that the kids are toast. They’re right. Trudeau has now cast their private sector peers’ fate in iron.
Canada is a great country to live in if you are unemployed, mastered by vice, shortchanged by Mother Nature, a 1%’er, or old enough to have lived and got set up in the “old Canada” where most folks had an even shot.
Post Trudeau Canada is not for the young up and coming average peoplekind. Nor for the standard issue newcomer. A colossal mountain of debt now needs to be serviced. Houses average 600k+. Wages stagnate in once great industries. Real Estate is now a stupidly huge slice of our GDP. The Trudeau Liberals have taken a once great country and ****** it like a two dollar *****.
Careful consideration must be given to committing to post Trudeau Canada. I mean, our own public service claims we might need to rent our own ******* clothing in the future – and that this is somehow a good thing. There’s no going back to what we had prior to October 2015, so think long and hard kids, looong and hard…
#16 Dolce Vita
Well doing the math, yes, Moderna is the Gold standard.
:-)
The best option for any young couple is to team up with their parents to buy a nice walkout house where both can live in separate living quarters under the same roof.
One living quarter on upper level and one on main level.
This enables you to help take care of your parents when they need it, do all the physical yard work and upkeep and split the costs, including all the bills and the cash up front to obtain a place. Unless of course your parents already have an awesome house in a good neighborhood – then just move right in.
The title and everything should go in the kids name. Why? Saves probate. This biggest transfer is typically ones property. Any accountant will tell you that dealing with this stuff when people are healthy is smart. Don’t wait until something happens.
Pull the inheritance ahead. Think and through and understand how the changes affect beneficiary, including with any splits, divorces, etc. Put it in an agreement so the parents have a guaranteed place to live.
Lay out all the finances so you can plan affordability of the entire family unit.
And remember, once elders pass, that big house now becomes a partial rental / income opportunity. Such an easy strategy to build wealth while living in your dream home and in my opinion getting to spend more quality time with your parents.
So many people are already doing this. Some have never left the nest and it is genius. Focus on a career and making lots of money doing by being close to the corporate centers. Forget about expensive housing and displacement due to not being able to afford it – team up with the parents and get on with it. Stable housing in the right location allows people to thrive – how it should be.
Oh, and the whole thing about missing out…that already happened. That boat sailed for the last time this past year. Anyone buying now has missed out, but if you can still afford to do something, then do it – price is irrelevant when you can afford something. Just don’t wait until you can’t afford something to make moves.
Anyways, Garth, you buy the crypto dip on the weekend? Cramer from Mad Money said today that he gets paid 6% just for holding bitcoin. Now this is what you call a preferred with fat dividend payout.
Garth, I have to say I find this unbefitting someone of your IQ and stature, Garth. I notice a lot of conservatives, those well off, seem to trot out this tired old argument whenever people complain about inequality.
Inequality has many, many root causes. Just ask Jordan Peterson or Brett Weinstein.
#76 BC Renovator on 05.24.21 at 6:23 pm
Immigration levels have been consistently at 1% of the population or below for decades. Without newcomers Canada’s population will actually decline. You should wonder why people come here so happily while you grouse about things. – Garth
_____
A roof over ones head is worth Griping about, no need to be rude. I don’t have a Bank (like you) I could throw a Blow up Mattress
Envy kills. – Garth
#97 Ustabe
Thank you for this post, and for your post last night too. It’s nice to hear a calm, logical and rational viewpoint.
However, there were a few very worrisome elements in that Canada Beyond 150 paper, which #119 Nonplused summarized very eloquently. I guess it all depends on how far they go in terms of implementing the recommendations.
But mostly I agree with you and #70 MDQ. Most of the rest just seemed like crazed hype and paranoia.
#97 Unstable
Well that certainly was an “amount of outright stupidity spewed “ right there indeed lol
Garth; you forgot the craziest part of this BOMAD thing. the parents borrow against their house, the kids buy a house they really can’t afford, and when house prices fall, it is a double whammy. Both houses lose value, and both parents and kids risk going under water.
#16 Dolce Vita on 05.24.21 at 1:00 pm
Surprised you didn’t post the CDC data from the US. Almost 4,000 Moderna/Pfizer/J&J deaths out of 164 million people with jabs. Relatively a miniscule number until you realize in 2019 there were 168 deaths and 160 million jabs. 4,000 deaths is more than the last 20 years combined CDC has recorded this information.
No idea what the data is coming out of Canada other than AZ deaths. Highly doubt given mRNA deaths in UK and US that Canada is zero. Must have much better PR in Canada.
What am I missing here? In yesterday’s post, OMG, the idea than an access economy where you rent more things you need was seen as an evil thing, but now I get the impression from reading today’s post that renting a house or condo you can’t afford may actually be a good thing. Well, is renting anything good or is it not?
@Ponzius Pilatus, post #94:
At long, long, long last someone here who actually understands how economics works much like the laws of thermodynamics. You don’t get something for nothing.
You know what’s the funniest thing? There are some smart people out there that think things can continue to go up forever. Silly children!! We adults will let them have their fun though.
Can I invest in bankruptcy lawyers?
#30
1961 or 2 … they paid $13,500. … are now listed at $870,000 to $899,000 it doesn’t make sense to me.
That’s less than 4% annual rate of return.
A 1961 $2/hr wage with 4%/year would equal $14.21/hr today.
Anyone who knows what a wage was in 1961 can correcty my example.
Can this week be the week of acronym named posts?
Pretty please? JFM! Just Four More!
And what about those of us who do not have parents who own real estate because of divorce, or parents who rented because they could never afford to own, etc? Do we just not count to the rest of the country because we were born to the wrong people? Too bad, we got ours?
It is a surprising mentality from a now far-left leaning country that is very concerned about various special interest groups, often far from home …
Anyways, shout out to the reddit group https://www.reddit.com/r/canadahousing/. They are the ones who organized the recent billboards. I have to say it is nice to see someone actually ‘doing’ something vs shaking their fist at the clouds.
First time I have joined a reddit group in my life. I am 40 and fine, but I am honestly worried about my kids. For the sake of those who are outside the landed gentry, maybe take a look at what this group is doing and lend a hand.
Or shake your fist. Same same.
Something’s consistently overlooked in the fine print if a ‘reverse mortgage’ is the maintenance clause(s) . They very specifically state that the house and property must be maintained in good order according to their standard of care. You’ll need to fix the roof from your own funds etc if need be. Lawns and gardens, window upgrades, furnace replacement, yup. Learn to read both sides of the contract before signing. Many companies contracts differ significantly. Dr Jordan Peterson has the best advice for Mills, get a life.
#71 Faron, I was briefly introduced to Henry Fok mid 70’s in Hong Kong. A “red capitalist” banned from the USA. He was a stocky little bald guy. This was the story I was told. He had one old junk. Worked it as a fisherman/trader. He married a women whose family brought in 3 more junks, starting up his fleet. During the Korean war he ran supplies to the the reds. After the war Mao gave him exclusive rights to gravel in red China as Hong Kong & Kowloon didn’t have any. Gravel was what put him in the big time. Gravel & limestone to make cement. Add fly ash from some coal burning generator & you can build an empire.
@Faron, get a grip man. All this shared economy comes down to the fact that most cannot afford to own certain things so they rent them. It has nothing to do with not wanting to own them, human nature never changes we like stuff. If the money was there the people would buy it not rent it. If it wouldn’t cost me $200 a month to store a boat I would buy one not rent it. All my millennial friends are jealous of us being able to afford a car in downtown Vancouver. They love car share but would not say no to a free car, same as the would love to own a home but cannot afford to so they rent. Shared economy is mostly about being broke from what I see from all those who use it not about not wanting to own them.
#61 Faron on 05.24.21 at 4:48 pm
I agree with your analysis on the privy council report. There is a generational shift happening here that will really change how we buy and consume, and what we see as “valuable”.
My mum and grandma insisted on buying me china for birthdays and Christmas when I was a young adult. I did a big move last year and retrieved it from my sister’s place – she had stored it for me for a couple of years and it was time to get rid of it.
A ten place setting of Royal Doulton, coffee pot, tea pot, fruit nappies, the lot. Thousands of dollars worth when purchased new. I finally found someone to sell it to and was lucky to get $350 cash for the lot.
My kids don’t want stuff like that. I don’t either. Brown furniture, china, cut glass, ornamental plates. Decorative pianos. Multiple bookcases full of books. Royal Doulton ladies. Hummel figurines. China cabinets, beer fridges, touring motorcycles.
____________________________________
I hang around auctions here in Britain and fine china is hot due to TV series like the Crown and Downtown Abbey. Having a high tea for your friends with real china and fancy table linen is hot and on trend. Look at all the global home decorating magazines.
A full 10 place Royal Doulton in a popular pattern would auction for about $1500. In the Crown on Netflix the Queen uses Royal Albert in Country Roses. This would auction for $2000 plus right now providing all the pieces were perfect and there were no seconds in the set. What goes around, comes around.
It looks like the millennials have to get wacked real hard by a real estate market crash that makes prices go down and stay down for a long time and financially ruins all property owners or buyers since they will not be corrected by sound advice. Something like or worse than what happened to the stock markets between 1929 and1946.
Then again anything that bitch slaps the real estate market effectively is going to bankrupt and do the same to that other collection of super debtors namely the governments and may be that would be a very good thing.
Needed to till the garden, wife wanted to rent a tiller.
It was the thirty mile round trip to fetch and another trip to return it that made me balk at the total expense of renting twice a year.
So, we split the $800 cost of a then ten year old Troy Horse Tiller. The Hummer of tillers. Our first major together toy purchase.
Now, forty years since then, it is re-saleable at $2,000.
With the original sparkplug, it still starts on the first or second pull! I replaced some output seals once.
All properly stored tools function like that. Canada 150 wants people to live cheque to cheque with no long term plan, like the govt does on legal weed.
And, Canada 150 wants me to rent the tiller to all in the community too? (with a cut of the action going to rev-can of course)
#117 Wrk.dover
I, hereby, grant you the right to own your tiller. Just present this permit to the commissars during their weekly inspections.
You fellows are exaggerating the importance of this 150 thing. It was tried before and it failed. On the other hand, we already see a lot of rent, sharing and part-ownership happening.
Come on. Boomers and time share in Mexico are like peas and carrots. This is inevitable, embrace it. Have no fear of the future.
@#102 covidbc
“A 1961 $2/hr wage with 4%/year would equal $14.21/hr today.
Anyone who knows what a wage was in 1961 can correct my example.”
++++
A friend bought a house in East Vancouver in 1970 for $17,000 and his mortgage payments were a quarter of his and his wife’s take home pay…..The mortgage was $125 per month.
I was earning minimum wage at a part time job in 1979 that paid $2.00/hr so Im pretty sure wages in 1961 were lower than that.
@#115 Jane24
“A full 10 place Royal Doulton in a popular pattern….”
++++
Yes . I see so many advertisements on tv for 10place Royal Doulton china settings.
My god.
The ads today offer people credit terms to buy a fricken toaster……..
Do you really think Millennials want OR need a 10 piece China setting to serve tea and crumpets?
That being said.
I recall our family owning an antique 4 piece Doulton set that came into the family back in the 1800’s before Doulton became “Royal”.
I think dear old Ma tossed it out because it was so “dated”.
#101 I did that for 12 years. I do not recommend it. The meddling SIL and MIL made my life miserable. Hubby travelled for work and was not home to deal with it. I was the bad guy when I said no more. We moved them into their own condo. FIL blamed MIL and they almost divorced. Was a huge mess. IF your going to live like that at least make sure their is no direct door between your space and their space otherwise they just come up into your space whenever they want. But I still do not recommend it. We had to buy a larger house to accommodate all of us for the walk out basement to be large enough. We would have been better off if we stayed in our starter home.
#106 Neo on 05.24.21 at 10:36 pm
#16 Dolce Vita on 05.24.21 at 1:00 pm
Surprised you didn’t post the CDC data from the US. Almost 4,000 Moderna/Pfizer/J&J deaths out of 164 million people with jabs. Relatively a miniscule number until you realize in 2019 there were 168 deaths and 160 million jabs. 4,000 deaths is more than the last 20 years combined CDC has recorded this information….
….Here is why that is total nonsense:
https://sciencebasedmedicine.org/the-covid-19-vaccine-holocaust-the-latest-antivaccine-messaging/
#78 New West
My kids don’t want stuff like that. I don’t either. Brown furniture, china, cut glass, ornamental plates. Decorative pianos. Multiple bookcases full of books. Royal Doulton ladies. Hummel figurines. China cabinets, beer fridges, touring motorcycles.
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You are so right about “kids” today (under 50’s) not wanting the stuff that their parents and grandparents cherished so dearly.
Outside of a select few “valuable” and “antique” items that sold for decent money at my parents’ contents sale, I had to “garage sale” the remainder (or individually hawk them on Kijiji and the like) for real chump change. That included a lot of Royal Doulton stuff that the folks paid big bucks for back in the day.
I gave a beautiful custom made mahogany chest of drawers to my son and daughter in law when they moved into their first home a couple of years ago. They just sold that place and asked me if I want that furniture back, because “they don’t want it”. Hmmmmm. Tastes change.
I was thinking about whether it’s worth the hassle to U-Haul that sucker back to the GTA from Ottawa. A nice big hunk of “brown” furniture that the young folk want no part of.
I’m thinking of just letting it go. Buh -bye.
The thought of that well crafted beautifully finished piece of craftsmanship being replaced by some soulless hunk of junk from Ikea kind of bugs me, though. Gotta admit.
But, I’m hanging onto my Harley.
Parents need to think long and hard about this one. My mother helped my eldest brother with a “loan” and it never got paid back. This action can ruin not only the parents financial situation, but cause irreparable harm to family relationships. Our “family” is in shreds over this, and it will never be the same.
#16 Dolce Vita
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Dolce,
I have to tell you, I appreciate the data and links first.
I’ll tell you what the real issue is: I DON’T THINK PEOPLE KNOW WHO TO TRUST ANYMORE. And I also think they are relatively correct in their confusion in this area.
Who’s to say that the data posted in these UK Government links is trustworthy? Who’s to say there isn’t nationalistic pride at play since AZ was developed in Oxford? Suddenly one government is trust worthy and the other is not? I’m not going to go into it but UK Government has done some big misplays and really questionable things that they are starting to have to answer for. I have a notebook. I took notes. I remember some things that they would like to be forgotten. Don’t you?
This whole thing has been one giant train-wreck from day 1.
From Tam making big misplays about danger and letting this spread, to planes flying, to late declaration that it is a danger while planes were still flying, to the clearly compromised and politicized WHO that is a lapdog to a certain country, to science being clearly politicized to mask advice not at all aligning to tons of peer reviewed science, to politicians become scientists, to scientists wanting to become politicians wanting to be heroes and take the spotlight, to information we have today, to information that is still lacking today, to information that continues to be withheld, to lack of context for the data we have been given….it just goes on and on and on.
Let me ask you one general question Dolce – just one.
On a scale of 1 – 10, how trustworthy would you say the information, communication, advice, has been regarding Covid from broad range of governments and sources during this pandemic start till now?
And as you ponder you answer, tell me, at this point do you expect the masses to trust one source over another?
I posted this in the previous article, it was meant for this one…
So much for in Tom Selleck you can trust…
https://www.youtube.com/watch?v=O4FKPcLnd3Y
@#125 Auditor
++++
“On a scale of 1 – 10, how trustworthy would you say the information, communication, advice, has been regarding Covid from broad range of governments and sources during this pandemic start till now?”
++++
As Ponzie would say.
https://www.youtube.com/watch?v=q5pESPQpXxE
While I was eating supper yesterday I was thinking to myself about why the carrying charges on a reverse mortgage are so high and the portion of the value of the house is so low as compared to a HELOC.
It is because it is kind of like an annuity funded by the future sale of a piece of property. The financial institution protects itself from future disaster by charging an insurance-like premium on the value of a reverse mortgage. The whole deal has to be arranged by actuaries, accountants, and real estate specialists to try and get an idea of the future value of the property. It is a huge gamble for the financial institution, hence the high interest rate they charge.
A HELOC is a much better choice, although you do have to make monthly payments and all of the risk is transferred onto you.
If you look at buildings you can get a pretty good idea of whether they are charging too much for their services. If their building looks like a castle covered with 10,000 square metres of granite counter top material installed on a vertical surface, like most bank buildings and casinos, you can rest assured that they are protecting themselves.
As for you people telling me that I don’t know what I am talking about WRT government pensions, you should actually read factual information about it and use a spreadsheet program like Microsoft Excel to calculate it out instead of relying on your personal biases and misinterpretation of the situation.
The difference between a DB and a DC pension is really in who is handling the money. With a DB pension the entity providing it is holding the money so it has to be a trustworthy entity, unlike most businesses which go bankrupt, change owners, etc.
A DC pension is handled by a third party entity like a financial institution or insurance company, or even an individual. Usually there is a management fee that can be as high as 3%, usually it is much lower, often less than 1%, sometimes much less.
Because some, possibly most DB pension plans are not actually funded by a giant savings account held on your behalf there is no management fee but you can get screwed out of your pension pretty easily, the bankruptcy settlements put pensions somewhere down the list of creditors (Sears for example).
I suspect that quite a few of the loans or gifts of money that parents give to their children to help with buying a house are to avoid the CMHC insurance premium for a down payment less than 20%. On a $400k house it is about $10k, not an insignificant amount of money.
#84/85 ‘Big’ – I notice you are not answering my question as to how to pay for UBI. Or defending your estimate of 1.8 million public sector workers in Ontario when the public figures available don’t support that estimate. Or providing any explanation as to why paying public service workers out of taxpayer dollars is worse than subsidizing private business with taxpayer dollars, which BTW means the workers of said business are paid via – wait for it – taxpayer dollars. Bottom line is those jobs exist for a reason. People want services. The government provides those services. Whether those services are provided directly via public servants or whether those services are provided via a 3rd party contractor arrangement (with hefty sums being handed over to any agency that supplies said contractors) both are paid via taxpayer dollars. As for public pensions, bottom line is that membership in those plans is a condition of employment. The workers pay into said plans & it is one hefty chunk of change, enough to ensure that the pension adjustment reduces RRSP contribution room to the diddly of squat. Will those DB plans become DC plans? Very likely & in not a few cases that transformation process has already begun or is well on the way. Still being funded by taxpayer dollars regardless of the outcome.
#123 Dharma Bum on 05.25.21 at 9:27 am
#78 New West
My kids don’t want stuff like that. I don’t either. Brown furniture, china, cut glass, ornamental plates. Decorative pianos. Multiple bookcases full of books. Royal Doulton ladies. Hummel figurines. China cabinets, beer fridges, touring motorcycles.
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You are so right about “kids” today (under 50’s) not wanting the stuff that their parents and grandparents cherished so dearly.
_____
Same thing again with the kids of the “under 50’s kids”.
My Gen-Z’s taught me pretty quick that none of the stuff I liked when I was their age applies.
Far as I can tell, they like a device, decently fast access to the internet, a PS4, and that’s pretty much it. They can go months without spending any money at all. There has been no talk of a significant purchase since they both combined funds to buy themselves a PS4 years ago.
#187 Immigrant man on 05.25.21 at 9:37 am
If no one owns it – no one looks after it.
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My neighbour owns his house.
His backyard is a garbage dump.
The grass gets cut twice a year.
#130 IHCTD9 on 05.25.21 at 10:32 am
Far as I can tell, they like a device, decently fast access to the internet, a PS4, and that’s pretty much it.
_____________________________________
Then don’t worry be happy about the country going into the crapper.
It will never effect them!
All good!
#129
Not a big fan of UBI but it will provide some kind of temporary support for the 100’s of thousands of civil servants that are going to lose their jobs.UBI it is a hell of a lot less costly so no worries with how to pay for it—we will have some extra to reduce taxes and bring back private sector jobs and promote small businesses who have really been taking it on the chin to support the massive ,bloated,overpaid bureaucracy.All ublic sector workers should have been reduced to $2000 a month during the pandemic because as they like to say we’re all in this together.It is outrageous they got to keep full pay and go RE shopping while those in the private sector lost jobs,homes,marriages,food etc etc.
#130 IHCTD9 on 05.25.21 at 10:32 am
My Gen-Z’s taught me pretty quick that none of the stuff I liked when I was their age applies.
Far as I can tell, they like a device, decently fast access to the internet, a PS4, and that’s pretty much it. They can go months without spending any money at all.
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Yes, likewise for our 21yo son at uni. He works part time and we take RESP distributions to max tax advantage, but he doesn’t ever seem to spend anything. The recent precedent giving TFSA recognition for dual citizens finally made sense to fund his 3 years’ room and with decent returns, he’s sitting in nice financial shape.
A quick RESP note: when he started Uni, the family plan held around $300k. After two full years school, withdrawing around $25k/yr, the RESP holds… around $300k. It’s like magic.
119 Fartz
“I was earning minimum wage at a part time job in 1979 that paid $2.00/hr so Im pretty sure wages in 1961 were lower than that.”
OK I’ll have to disagree with you on them min wage.
I recall $3/hr in 76. Worked Groceries. Cant recall min wage in 79 as I was above it by that time.
We’ll need some others to share their memories.
People need to get it into their heads that they don’t own the house they just bid $700k over asking (real example in my neighbourhood). But for most people they are buying an interest in (starting at 20%) and paying the mortgage lender rent in the form of interest. Reverse mortgages are just the reflection that our ‘ownership’ of real estate is only fleeting, as is the actual wealth associated with it.
#129
DC plans are absolutely not funded by taxpayers by the way.What the person contributes that is it —no matching dollar for dollar at taxpayers expense.Yes some companies get corporate welfare and that is bad but believe me there are lots of little guys out there that make the country run that get nothing,nada zero and that should be promoted not big gov’t.As per 1.8 million we had 1.4 in 2014 when Hudak wanted to cut 100,000(shit he could have cut 700,000)and heard through reporting it is closer to or even above 2 million now.We have 300,000 on the sunshine list alone for ontario.Gov’t is massive and front line workers are generally very good but there are layers upon layers of bureaucrats who would not be missed at all.
BOMAD spelled backwards is…..
Da Mob!
Don’t ask mom for cash. Come to us.
We’ll make you an offer you can’t refuse ;)
#129
Db plans work 2% of your best 5 years times yrs service so 35 years at 100,000 would give the person $70,000 a year indexed for life with survivor pension at 60%.Dc plan may still have gov’t(taxpayers contribute some) but formula would be scrapped saving $billions of dollars on behalf of the taxpayer.Under DC what goes in has to be rationed according to actuarial calculations so it is no where near as generous and tax payers ore largely off the hook.Hope that clarifies it.
Garth,
Suggestions for blog names rest of the week perhaps?
GIGO – Today
KISS – Wednesday
FUBAR – Thursday
and on Friday – TGIF!
You already did FOMO and WTF so I won’t replay old favourites.
#134 Sail Away on 05.25.21 at 11:07 am
#130 IHCTD9 on 05.25.21 at 10:32 am
My Gen-Z’s taught me pretty quick that none of the stuff I liked when I was their age applies.
Far as I can tell, they like a device, decently fast access to the internet, a PS4, and that’s pretty much it. They can go months without spending any money at all.
———-
Yes, likewise for our 21yo son at uni. He works part time and we take RESP distributions to max tax advantage, but he doesn’t ever seem to spend anything. The recent precedent giving TFSA recognition for dual citizens finally made sense to fund his 3 years’ room and with decent returns, he’s sitting in nice financial shape.
A quick RESP note: when he started Uni, the family plan held around $300k. After two full years school, withdrawing around $25k/yr, the RESP holds… around $300k. It’s like magic.
…
Did USA change rules on recognizing TFSA’s?? I know there was a bill going through… has it been implemented?
Did he invest the covid checks from Trump and Biden!
I was making 2.50 an hour in 1974 working in a box factory. Top pay was 4.00 for a press operator .
Went to college for 2 years and ended up making a lot more in technical sales .
#135 Dr V on 05.25.21 at 11:22 am
119 Fartz
“I was earning minimum wage at a part time job in 1979 that paid $2.00/hr so Im pretty sure wages in 1961 were lower than that.”
OK I’ll have to disagree with you on them min wage.
I recall $3/hr in 76. Worked Groceries. Cant recall min wage in 79 as I was above it by that time.
We’ll need some others to share their memories.
Xxxxxxx
Here ya go, no memory required.
http://www.edsc.gc.ca/ouvert-open/labour-travail/WD-datatable-histminwage-20200310-ENG.csv
Am I the only one who thinks that affordability is a function of supply and demand, and can’t be improved by eliminating a particular source of funding?
For example, you legislate away the BOMAD somehow, or convince most of M and D not to act like a bank. Outcome: affordability will get worse for those who could use BOMAD, and better for those who didn’t have it anyway. On average, affordability will not change.
Reducing demand brings price relief. That’s how it works. Garth
#141 Dual steerage on 05.25.21 at 12:11 pm
Did USA change rules on recognizing TFSA’s?? I know there was a bill going through… has it been implemented?
Did he invest the covid checks from Trump and Biden!
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Nothing officially legislated on TFSA’s yet, but legal precedent in a number of cases has upheld that TFSAs are not trusts and not subject to penalties for nonreporting as such:
https://polaristax.com/an-update-on-form-3520-3520-a-for-the-tfsa/
basically, confirmation of this position:
http://citizenshipsolutions.ca/2018/05/26/canada-u-s-tax-treaty-why-the-5th-protocol-of-the-canada-us-tax-treaty-clarifies-that-the-tfsa-is-a-pension-within-the-meaning-of-the-canada-u-s-tax-treaty/
My wife and I have unfunded TFSAs and are using the kids as guinea pigs to see if there are any IRS repercussions before going all-in on our own, haha.
No US stim checks for the kids since they take foreign exclusion on US filings rather than deductions so are ineligible (I think) for US taxpayer relief.
@#143 Phylis
I couldnt open the link but I googled Historical Minimum wage in Canada and up it came
Nova Scotia Min wage 1965 was $0.90 Hr
Min wage in 1970 was $1.05 Hr
Boomers had it so easy.
#123 Dharma Bum on 05.25.21 at 9:27 am
The thought of that well crafted beautifully finished piece of craftsmanship being replaced by some soulless hunk of junk from Ikea kind of bugs me, though. Gotta admit.
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A succinctly apt parallel to the entire transition from generation “Garth” to generation “Faron”. I think it bugs a lot of people.
#145 Sail Away on 05.25.21 at 1:03 pm
#141 Dual steerage on 05.25.21 at 12:11 pm
Did USA change rules on recognizing TFSA’s?? I know there was a bill going through… has it been implemented?
Did he invest the covid checks from Trump and Biden!
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Nothing officially legislated on TFSA’s yet, but legal precedent in a number of cases has upheld that TFSAs are not trusts and not subject to penalties for nonreporting as such:
https://polaristax.com/an-update-on-form-3520-3520-a-for-the-tfsa/
basically, confirmation of this position:
http://citizenshipsolutions.ca/2018/05/26/canada-u-s-tax-treaty-why-the-5th-protocol-of-the-canada-us-tax-treaty-clarifies-that-the-tfsa-is-a-pension-within-the-meaning-of-the-canada-u-s-tax-treaty/
My wife and I have unfunded TFSAs and are using the kids as guinea pigs to see if there are any IRS repercussions before going all-in on our own, haha.
No US stim checks for the kids since they take foreign exclusion on US filings rather than deductions so are ineligible (I think) for US taxpayer relief.
…
Interesting…. thx for the info… it’s the potential paperwork hell I’ve always been most worried about….
If somebody didn’t give me a pile of money and put this teleprompter in front of me I wouldn’t be here. Exactly, we’d be skating.