How this Torontonian achieved her goal of owning a house in the city


Welcome to My Bottom Line, a series where we dive into the net worth, spending, and saving habits of real Canadians.

This month, we talk to a 39-year-old diversity, equity, and inclusion manager from Toronto, who brings in $6,435 a month.

Financial Breakdown

Monthly income after tax - $6,300

Passive income - $135

A chart detailing debts and assets. Debts - $220,000 Assets - $139,000A chart containing monthly spending breakdown. Expenses - $6,920 Savings Contributions - $800 Discretionary spending - $500

Debt

Mortgage - $220,000

Assets

Retirement Savings Plan (RSP) - $139,000

Monthly expenses

Mortgage payments - $1,400

Uber - $100

Public transportation - $50

Cellphone - $60

Internet - $60

Groceries - $500

Everyday items - $200

Condo fees - $400

Municipal taxes - $200

Hydro - $50

Vet costs (includes annual visit costs) - $1,600

Condo painting - $2,300

Savings Contributions

Savings contributions - $800

Discretionary spending

Dining out - $500

Tell us a bit about yourself

The budget this month is a little bit different just because I bought a house, and I’m selling my current place. This ended up meaning that there’s no money in my TFSA because I needed it for my down payment. It usually wouldn’t be empty! Also, since I’m selling my current place, there’s an inherent cost to that. I wasn’t planning on moving so I didn’t really budget for it. I honestly thought I was going to live in my condo for the next ten years.

I think the biggest thing for me is because I live in downtown Toronto, I don’t own a car. I’ll walk, bike, take transit, sometimes I’ll take Ubers. I’m not that big of a cook, probably because I’m only really cooking for one and I’ve never been into cooking. There are certain things I do that I’m unapologetic about. I get sushi once a week, every week. (Pre-pandemic it was $15. Post-pandemic it’s like, $23.) Outside of that, my other expenditures are books and some clothes, but overall, I’m not that big of a spender. Pre-pandemic, something I spent a lot of money on was travel which is kind of starting up again.

The additional $135 isn’t really a side hustle so much as it is passive income. My current condo has a parking spot and I don’t have a car so that’s just $135 that I get every month. At peak I used to charge $150 but I gave the renters a pandemic deal. It’s just a little bit of money that hits my bank account and every time I get it, I’m grateful. I don’t really do anything for it, and it just shows up. $135 bucks per month over a year is like, my monthly mortgage payment. Now I understand why people have side hustles!

What’s your money strategy?

That’s a good question! I wish I were more of a saver. I save more than the average Canadian, but I would still consider myself more of a spender than a saver. It’s something that I’ve worked to shake. I know software engineers who save 50% of their income. It’s also because they also make … all the money. *laughs* But I also know people who make very little and save a large chunk of their income. I’m not in either of those positions. But I do save money every month, I pay my bills every month, and then I also have spending money, but I know I could always save more. If I had saved more in the past two years, I’d feel a lot more comfortable now with what I have going on this month.

Pre-pandemic, something I would splurge on is travel. Even when I made significantly less money than I do now, I would always travel and live even more frugally. If I could get a deal on a plane ticket, or figure out cheap accommodations, I optimized my life for travel. Now, things are obviously a bit different but if I want to go for dinner, I just go for dinner. If I want to get drinks, I just go for drinks. My biggest thing about money (and this is a very privileged place to be) is I just don’t want to think about it. What I mean by that is I save what I need to save, I pay my mortgage and my bills, and then if I want to do something I want to be able to do it. I don’t want to have to think about if I can afford to rent a car. But now that I literally just emptied out my TFSA, I am kind of in that place.

And my tastes aren’t fancy either! I just bought a four-dollar croissant and that felt fancy. I’m not trying to buy a Prada bag or a Tesla, but if I want to get some high fibre bread this week, I want to be able to do it. When my dog needed surgery, I was very grateful to have been able to pay for it. Some people need to make the tough decision and say goodbye to their dog in that situation. (And no shame – it’s expensive!) For me, it was the choice and commitment I made.

If there’s something I don’t really need, I try to buy it on sale or find a coupon. I’ll research those purchases or wait until they’re cheaper. I’m on the cheapest phone plan I can be on with the most amount of data. I really am a cheapo at heart – it’s the by-product of having refugee parents. It’s culturally ingrained. I don’t want to pay more than I have to.

Do you feel confident in your finances?

I felt more confident before I bought a house! [laughs] I met with a portfolio manager last fall, and we talked all about my future and he put together a plan for me. We talked about retirement and assuming nothing really changed, I could retire at 56. His biggest feedback to me, based on my goals was that I wasn’t saving enough in my RSP and to contribute more. Before, it made more sense for me to put more money into my TFSA. So I changed my strategy and started putting more money into my RSP. I’ve been adding money to my RSP since I was 24 – not a lot of money, probably $25 every two weeks at that time – but it did help create that habit of long-term saving. That was my first job and I made $30K a year. My company had a matching program so I took advantage of it. Even at 24, when I learned about half of my company didn’t take advantage of that, it didn’t make sense to me. It’s literally free money. But it’s on you to take advantage of it.

Did you negotiate your salary? Tell us about how that went.

We’re really talking about money here! My last salary was $90K and now I make $115K, so that’s a pretty substantial bump. I had to ask for that, that didn’t just come to me. I also knew that if they went to market, they would have to pay someone else more. I was being underpaid in my role. It was a bit easier because they knew the market data – they knew I was being underpaid. That was a year ago, and my salary hasn’t changed since, so I did ask for an increase which is currently being negotiated. My biggest takeaway here is you won’t get anything you don’t ask for. To think that you’re living in a world where you’re just going to get a salary increase – that’s not a thing. Someone recently gave me the advice of “just work hard and you’ll be seen”. That’s not true for everyone.

You also have to be smart about it. I work in tech, and the company I work for has been doing well. If you’re seeing half your team get cut and you’re thinking it’s a good time to ask for a raise, you might want to rethink your strategy. This could demonstrate that you have no idea what is going on in your business. You have to take into account the reality of your people managers, your team leads, the tough decisions people are making. You have to be smart about it. But no one is telling you that. All you’re reading in magazines is “ask for things”. Your ask has to be based in reality.

What are your future plans for housing?

The place I bought definitely isn’t a strategic real estate “play” of any kind. The biggest thing for me is, I don’t want to work at my kitchen counter anymore, and my dog needs a backyard. That’s it. I needed more space. I save for retirement, so I don’t look at my house as a piggy bank. I know a lot of Canadians do, but I also know that I’m saving for retirement, and the market is really changing.

I was able to buy my first condo because I had subsidized rent for five years. I lived with family for five years and they gave me the “family rate” on rent. So through that, I was able to live my life, save, and travel. My parents also helped me with the down payment for my first condo, and I took advantage of the Home Buyers’ Plan. In my circumstance, I was definitely not self-made. My family helped me get there. It makes me skeptical when people say they did everything alone. If you really have, incredible. I can be honest about the support I’ve received.

What do you wish you’d been taught about money earlier in life?

My mom’s money advice, which I think about all the time was “it’s not how much you make, it’s how much you spend”. I think about that a lot – it’s a voice I hear in my head. I’m not really driven by money. It’s not my primary motivating factor. I want to have enough of it to live a good life, whatever that means, but I’m not chasing it. I work hard, not for bonuses, but because I really do care about the work that I’m doing.

Definitely “live within your means” is another one. There are people who will buy a brand-new car instead of a used car because they don’t want to worry about fixing it. They’ll pay a bit more but keep the car for a decade. It’s not splashy in any way, but you definitely pay more for those bigger expenses that will pay off over time. Again, you need to be in a pretty privileged position to be able to do that. But I also look at my parents and the reason they’re able to do these things is they don’t eat out. Ever. They don’t have any brand name stuff. You know when you’re like “I can have it all!” They don’t desire it all.

I don’t have any generational wealth coming my way so if I want anything in the future, it’s me. I have to make that happen. I’m driven by a sense of security and safety, and the ability to provide for myself. I’m boring – I’m not interested in tracking the market and stressing out about it. I personally just can’t live like that. I don’t have that space for stress and anxiety about money. Life is already hard. Money, as we know, is one of the most stressful things … I’m not trying to make my life more stressful. I’m trying to optimize for ease. I want to be able to sleep at night.

This month, spending wise, is a messed-up month. It’s been all house expenses, which are not discretionary. I emptied out my TFSA to pay for these things and I was like “cute, now I have no money”. It actually makes me uncomfortable – I’ve never not had money in some kind of flexible space and this is the first time this has happened in my life. It feels very different.

I was talking about roofs recently with my parents. The row house that I bought needs a roof – it’s at the end of its life. I’ve gotten some advice from friends and the consensus from them is to not get the cheapest option, get the middle of the road. My parents disagreed and told me to get a metal roof because it’ll have a lifetime warranty. Great, but it’s three times the price. My parents got theirs 15 years ago and it was $20K. Imagine with inflation … I don’t even want to know what they would pay for this roof now.

I’ll be honest, if this were a different time, I probably would buy a metal roof that would last me a lifetime. But this is probably the first time in my life where I’m probably going to make a choice that is less of a long-term sustainable solution because I feel a bit more pressed than ever before.

What did you learn about your spending habits from this exercise?

I think it was a good reminder – filling out the spreadsheet and seeing [the empty fields like] car, car insurance … it’s been a true choice. I live downtown Toronto, I don’t need a car. But I’m one of the few people I know who doesn’t have a car. I’ve never had a car. I take transit, bike or walk everywhere I go. Even though a car would be easy, the economics don’t make sense for me, so I’ve just never done it. The cost savings of not having a car all these years has been substantial. I feel like I’ve gotten ahead in part by not having a car.

How is EQ Bank helping you reach your money goals?

I do all of my banking with digital FIs. I opened an EQ Bank TFSA Savings Account for a rainy-day fund and it ended up being the down payment for my place. Everything is accessible online, and I don’t pay monthly fees. Honestly, find it obscene that people still pay bank fees.

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Certain identifying details of individuals may have been changed to protect their privacy.

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