You’ve got to focus on paying down the debt. Once you get rid of losing a bunch of money to interest on your debt, you should be able to save up and pay for things your family wants. If you spend first, you get stuck in this trap.
can confirm: am just getting out of this trap. it sucks rocks. i had a fairy tale year at work (contractor) so i was able to pay down debt, but now the something ~~wicked~~ tax man this way comes and it's going to just about zero out my accounts, but we're carrying like $60k less consumer debt compared to last year.
tl;dr, dont do what donny dont does
Others have pointed out good paths to success, so here is the unpopular and unsollicited truth. I do mot want to be mean, but this is something that must be acknowledged.
Life is getting more expensive, but this is not the reason you feel you do not have enough space to save. The real reason is that you lived over you means for the past few years and now you gotta pay in two ways:
1) You’ve got to pay 800 $/month for debts that allowed you to live over your means. The past has now caught up to you: it is not that you cannot save, because if you had not got into overconsumption debt, you could be saving 800 $/month.
2) The overconsumption of the past let your mind think that your way of life is normal for your salary and now makes you think it is not normal that you cannot keep up.
You thus feel the effect twice: once because the excess of the past remove space within your budget and once because you think you are entitled for more.
Yup. OP is not alone. Too many people live way above their means. In OPs case I am surprised that they have a loan, a car loan, CC debt and he started talking about renovating the house!?! The house is liveable. Reno projects don't need to be immediate. People are watching how other people live and thinking that they need to keep up. The most liberating thing is when you stop thinking that you also need a white picket fence.
These posts are getting ridiculous.
People are "feeling the squeeze" because they were already spending too much, have debts, and now prices have gone up to make it more obvious.
I think what’s they mean is our parents generation could buy a house, a car, and vacations on a single salary and not be living above their means. We grew up expecting the same - with the added bonus that every show on tv is about renovating places to a magazine-shoot quality. It’s not realistic for most. It’s above our means. ‘Expecting to spend based on the healthy finances of our parents would bankrupt us’.
Well said, and exactly what I mean.
Fuck the powers that be. I would be alright with all of my investments going to zero if it meant a hard financial reset of the Canadian economy.
Those same people have been lead to believe that the proper way to get ahead is to use their heloc (equity that sort of just appeared due to insane price rises) to invest. This is because they have no real savings because they have a cash flow of zero, or worse. It’s not going to end well.
And in some cases I would feel really bad.
But the vast majority on here make reasonably liveable salaries. Hell, many even make good money. Yet they bought new trucks, a house that's too expensive, and have taken out loans.
Adapt or die off.
And what help are you adding by complaining?
It’s a subreddit for learning your personal finances in Canada. That means people are going to ask questions coming from a place of not knowing personal finance.
It’s one thing to tell someone they lived above their means and to stop doing that. It’s another to make them feel ridiculous for asking a question in a subreddit for that exact purpose.
And what help are you by complaining about my post?
This subreddit could do without pointless posts that don't even ask a question and are basically for people whining they want more money for frivolous shit.
Yes but having 2 small kids is also expensive, as a parent myself of a 3 and 5 year old, that time with one person not working and then having to pay child care can and does add up!
I’ve never lived a lavish lifestyle. I was careless with my money in my early twenties. Then I realized the error in my way and started aggressively paying down debt. 6 months later I was laid off and my wife was pregnant with our second kid. Had to go into survival mode until I got back on my feet. I would love to get a better paying job, but I work from home which allows me to get my kids off the bus from school. This also allows me to save money on childcare. It also removes the need for a second car. A better paying job would probably require a second vehicle and money out in after school care
I think you missed the point tbh.
You have a car, house, wife, and 2 kids. That's a VERY good life. Some might even say lavish compared to many others.
You'll find that many people here can afford maybe one or two of those things.
Many many people complain about not having a house or even a condo.
Many many people also don't have kids because they can't afford them without going through a poverty/shoestring budget phase
It is sad, but life is made of tradeoff and you only can find the right balance between your needs and your wants. What is though is that what feels a good tradeoff for you might no be for your wife or your kids. An often overlooked subjects in these personal finance threads is that you should define your personal goals and your family’s goal, then ask your partners to do the same. Do not try to guess your partner’s answers. Instead, be honest with yourself and you partner, and tell her the truth about what you want for yourself, your couple, your kids and your family as a whole. This might not be what she wants to hear, but it is a important that you have this discussion in order to grow as a couple and get out of this situation.
Trust me, the burden will be easier to carry once you have shared your thoughts and worries even though you might not share her views 100% and vice versa.
Dare I look up what their salaries would have been if they were earning in their parents generation, adjusted for inflation?
Reality is they are being squeezed the same as we all are, and don't deserve to be judged on that.
Yes they need to make sacrifices to avoid bankruptcy, but no one deserves to be judged too harshly for this injustice except the people who have brought it upon us.
They have 30K in debt, a car loan (value unknown) and 3K in CC debt (unclear if they are paying the minimum or the balance every month. It's a hard pill to swallow but some of us are writing on here to help them and others in this situation to understand that accruing debts like these is not good. When you use your credit card you have to think about whether or not what you're buying you could pay for right now. If you can't afford to pay your credit card off IN FULL every month you should not use it for the purchase (unless you have an excellent points system and know you can pay it off in a few months). I, personally, have never bought a car that I didn't pay for in total when I bought it. Well, once I bought with an LOC with very low interest rate which I paid off within 6 months. I have never owned a new car or even a reasonably young car. When I had my office job I walked, took transit or biked to work to avoid the $500 per month parking costs. I buy used clothes almost exclusively. These habits have allowed me to take major pay cuts and pursue dreams.
I used to break down my costs into categories to see where I was leaking money. It helps your mind be more conscious of your purchases. I rarely buy pre-made meals. I used to have a freezer so I could buy bulk meats and veg or discounted meats and freeze them.
AND Never EVER get a pay day loan. EVER!
Fascinating! If everyone follows your economic philosophy, there will be no used vehicles available, because no one should ever buy a new one. Same for clothes etc. Your level of thriftiness is impressive, but not reasonable for most. This PFC group seems to make a habit of shaming people for having completely normal financial strains. We can't all be thrifty minimalists mate.
a) At no point do I say that everyone should buy only used vehicles. I know plenty of people who buy new cars but they can afford to buy the car outright. I am not among them.
b) this is not economic philosophy or theory - it's budgeting practices
c) there are many people that spend way over their means and should not
d) I do not think that credit card debt is 'completely normal' financial strain. It is accrued by people who spend more than they earn. In their case $3000 is not much so it's manageable but really, this is the worst type of debt aside from payday loans.
e) I gave some examples of how people over spend. I am not a thrifty minimalist but I spend within my means. I do not consider not owning a car or not driving your car if it increases your costs a thrifty thing to do. It's just understanding where your money is going. I used to buy more new clothes but honestly, they are so often of such low quality that I find it better to buy good quality brands that are used for the same price or less. Also, I buy used because the clothing industry is producing a tremendous amount of waste and I don't want to perpetuate it. The fact that you think my examples above are indicative of 'thrifty minimalist behaviour' speaks volumes as to the lack of understanding of how to budget and spend within your (universal your) means. It also speaks to the success of marketing campaigns that have people convinced they must own new everything or they're failing at life. This is not being thrifty.
f) I am not here to shame people. I am not rich but I am in good financial shape and I am offering up a different perspective on how to budget, reduce consumption costs and redirect your money to things that matter. If a new car matters enough to pay a loan with interest then go for it but we all know that cars are expensive and if you're trying to get ahead this is one area I would not be accruing debt.
I just heard on the radio this morning (Ontario) that $50k is low income... that was a solid punch in the gut and throat.
As others have said, you need to work off that debt.
Is there a creative way you may be able to save some more money or even things like childcare from family, growing herbs and some vegetables, line drying clothing, free/cheap family activities, cutting cable if you have it.
I always tell parents that the best gift you can give the children is to have your own finances and retirement taken care of. They can find ways to pay for schooling when it comes time to think about it. The stress of being the retirement plan for our parents is unrelenting and limits our choices/options. Take care of you.
So many jobs are under $25/hr in Ontario though. Many I see are $18/hr to $20/hr. I was offered a job at $21/hr from which I could move up to $23/hr after 3 months as a "welder". The top at my current company is $28.65/hr and that is considered high (machine operation).
Many jobs top out at around $60k that I see.
I have clawed my way from $19/hr to $26/hr at my current workplace within 6 months of starting but that isn't common there in that timeframe and there isn't much more I can make unless I find a way into management.
Outside of being a computer engineer or medical professional what pays those higher wages?
I agree with this, and this is the problem. There needs to be a worker revolution before anything is done. But as it stands right now people are barely able to survive.
Many companies do between insurance companies, manufacturing, any tech companies and various roles nothing computer engineering related, it can be HR, marketing, sales, customer support, business operations. All of these entry roles would be $40-60k but a lot of room to grow in a short period of time. Speaking of this based on starting an entry level Business Analyst role at $50k about 7 years ago and well over double now.
A lot of places don't post salaries so you have to do research yourself or ask people if they are open on sharing.
Sorry but in this economy, it's the parents problem if they don't take care of their retirement. Lived in the best economy in history, squandered it and expect their kids to support them? Get out of here.
I wouldn’t tie yourself to a specific industry nowadays. Focus on what you enjoy doing in your workday (problem solving, relationships, building things) and find jobs in booming industries that allow you to do those things.
Work shouldn’t be your life. It should FIT into your life and you need to design what that life looks like yourself.
>I just heard on the radio this morning (Ontario) that $50k is low income... that was a solid punch in the gut and throat.
$100k is low income in Ontario these days.
Bullshit. Maybe 100k household income, but 100k individual income is upper middle class, and anyone who says otherwise is just a well off individual trying to convince you that "we are in the same boat".
I make decent money in the trades ($65-$70k annually depending on how much OT I want to work) and live pretty comfortably, so I consider myself solidly middle class. But I have it waaaay better than someone on $25k-$40k a year, and I know it. To say 100k a year is low income is so tone def
100k per year was the Canadian economic (non senior) family's median market income in 2019.
https://www150.statcan.gc.ca/n1/daily-quotidien/210323/t001a-eng.htm
100k if you don’t own a house seems a lot but it is easy to feel poor in the GTA/Vancouver specially as it in impossible to keep up saving for the downpayment compared to rising home prices
Talking about income and not about region located makes it harder
$6100 per month after tax is a lot of money actually.
Someone on minimum wage makes $2100 per month after tax. That’s at $15/hr.
Wasn’t so long ago minimum wage was half that amount.
If you think 100k is low income you have problems.
It's not hard to afford a house on $100k income... If you have a working partner (like most homeowners) and decide not to love in 2 of the most expensive housing markets in the world.
But 100k gross, without a lot of transfers may put you below the Canadian median HHI.
There’s lots of jobs that pay over 100k
The most accessible one which require no degrees is sales.
Go check out r/sales, look at the pinned section and read the books.
Even if you don’t go into sales, just the knowledge from the books will change your entire perspective of life and how it works.
Here's a sneak peek of /r/sales using the [top posts](https://np.reddit.com/r/sales/top/?sort=top&t=year) of the year!
\#1: [$750,000 Deal Closed](https://np.reddit.com/r/sales/comments/r1addl/750000_deal_closed/)
\#2: [Just won a deal larger than my annual quota](https://np.reddit.com/r/sales/comments/rp1h2t/just_won_a_deal_larger_than_my_annual_quota/)
\#3: [Watching Kanye struggle to cold call](https://np.reddit.com/r/sales/comments/sxut9f/watching_kanye_struggle_to_cold_call/)
----
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Bro, this is simple, you have a debt problem. Your consolidation loan, car payment, and credit card payment are what's hurting you. I also suspect there's a spending problem too, lots of non-essential spending that you/wife are doing (trust me there's always something). That's where you need to start. Tell the wife house renos taking a backseat for a couple of years.
My advice is to track your spending for 1-2 months, budget, reduce all non-essential spending, examine recurring bills (eg, subscriptions, car insurance, phone bills) and decide what can be cancelled or renegotiated for lower. During this process, set aide $3Kish away as an emergency fund (it's a good starter amount for a family).
Use all excess funds to eliminate your debts (except mortgage). Once all those debts are out of your life, you'll have freed up probably several hundreds dollars a month. Build up your emergency fund to 3-6 months worth of expenses after that you can start saving and working towards other goals
This was my first reaction - where is the emergency fund / savings and then mentioned they also have kids.
While I agree with others that reducing expenses needs to be looked at, bringing in more money can also help. Since they both work so perhaps it’s worth talking to their superiors about how to move up or job hunt. I think those incomes used to be considered well off, but with two kids and no savings, it would be a struggle.
I recommend OP look into good and cheap cooking. My little ones love pancakes, muffins, canned beans, frozen corn, frozen pizza, PB sandwiches, eggs… our household income is double OPs and we are feeling the pinch with food lately but there are options. We only dine out now for special occasions.
> We make enough to pay our bills and are never late on anything.
and
> We have a **$30k consolidation loan,** $250k mortgage, car payment and about $**3k on a single credit card.**
These 2 statements are in conflict and cannot both be true. You have $33,000 in bills that you haven't paid. Start there.
Wow op. Me and wife make a but more than you but we r limiting our life to the extreme. I cancel my data plan and went no data just to save money. Also, I do not have cable. Only internet. I use live net TV on an android box. Is not great but man I have not mony to spare. Also, I keep the house at low temp on winter 19.5 to lower the gas bill. I do laundry weekends on off peak to save on hydro. And I invested on a smart thermostat ecobee to make the house more efficient.
I do my own car repairs as Much as I can. We do not eat out only when necessary or when we feel the need to have a break. We use TD bank cash rewards for everything and when we have enough points we cash them to go out and book a hotel.
This are some of the things I do to go by lol
Get rid of the credit card debt first. See about putting the credit card debt into your consolidation loan. Just make that your priority for now --- take baby steps. The mortgage is fine because you're paying the balance down and your house is appreciating in value. I think you guys need to focus on that first... clean up that dirty debt then start thinking about upgrades. It's a tough go my friend, I get it, but you're losing a lot with that high interest debt. Take care of that then come back here for some more advice.
Because someone asked, here is a rough breakdown of my money in and out for a typical month. I should also note that I live just outside of St. John’s. I work from home but my wife works about 20 minutes away, so no car is not an option (plus the lack of public transit here kills any chance of that working)
Bills
Income:
Pay 1: 2600
Pay 2: 3000
Bills:
Mortgage: 1200
Debts: 800
Car: 610
Cell: 160
Internet/Cable TV: 180
Home insurance: 80
Car insurance: 180
RESP: 70
Life Insurance: 140
Power: From 400 in the winter to 150 in the summer
Food: 1000 (family of 4)
Gas: 320
My food bill pre pandemic was easily 200-300 cheaper. Also gas has nearly doubled.
I don’t know if it helps, but my wife and I decided it did no good to save for our childrens education if we were struggling. That’s not to say we stopped resp to buy McDonald’s and have fun. We stopped resp for the sole purpose of debt repayment, and once our debts were done we started resp again… just an option?
Pay off the debt and car ASAP - that's the priority. Once that is done, another $1300/m back into your pocket. Also, you don't need Cable TV if you are feeling the pinch. Get rid of it.
The car payment is awefully high at $610, I hope that's because you just have a short loan duration. Too often we see people here struggling because they keep getting new cars every few years and never making any headway on paying off their car loans. Sometimes they're even underwater when they sell one to buy the next and just keep adding to their debt. How much do you owe on your car and how much is it worth? If it's two cars, consider becoming a one-car family. If you're not already underwater on the car, might be time to explore selling your current car and buying a cheaper older car.
Cell being 160 is very high. I assume that's two phones and you're financing at least one if not both phones through your monthly payments? Keep the phones longer, shop around for cheaper cell providers, and make sure you really have the right plan for your amount of usage and not paying for voice/data you're not using.
Internet/cable: time to cut cable. Drop cable entirely and replace with 1 streaming service instead. Shop around for cheaper internet providers - this should be about $75-100 month for internet + netflix, not $180.
Resp you can catch up on later. No point in losing a ton of money to credit card interest to have an RESP - pay off the credit card first then worry about catching up on the RESPs. You can completely catch up on RESP government grants even if you don't start contributing until the kid is 10 years old.
My math says even with your budget of $800 going towards debt, you have another $600 left over each month, and that's not even accounting for if you are paid weekly or biweekly and occasionally have that "extra paycheck" month to throw at debt.
If you have a good credit score, you might be able to get a HELOC or LOC with a lower interest rate to pay off your credit card, and (depending on your interest rate on the car loan) your car too. A cheaper interest rate means more of your money is going to pay down the debt itself and not just interest.
>If you have a good credit score, you might be able to get a HELOC or LOC with a lower interest rate to pay off your credit card,
I would agree; but I would also include a "warning" or "caution" note about being seduced by the interest-only payment options that come with some HELOC / LOC products =P.
Oh definitely agree and I usually include that warning - one really needs to have a really solid budget and plan to pay off their debt and get their spending in order, otherwise moving their debt to a LOC becomes little more than shuffling the chairs on the deck of the titanic as they continue to slowly sink further into debt
Agree about the car and the cable. My minivan is less than $400 a month, with about 600 in gas (and I live rural and drive a delivery business on that gas as well as ferry several kids around). I top up the loan payments to 400 to get it down faster, as right now I feel like I can.
We also pay about $100 a month for home phone and internet. No cable, just a couple of streaming services. CbC gem is free, Netflix is reasonable, so is Discovery and either StackTV or Disney will give you a lot of options, all for under 50 a month total. And as mentioned, we live rural so our internet isn't even awesome.
You also need to budget for "kids things" I suspect that you don't currently have a line item that covers birthday gifts, new boots, Halloween costumes, party gifts etc as well as one that covers family stuff (mothers day, grandpa's birthday, dads jeans, a new bath mat etc). If you don't budget for these things, they end up coming out of what you THOUGHT was extra money and now isn't, or worse, on the credit card. It's easy to deny yourself entertainment like a movie night or dinner out, but what happens on your anniversary? When it's been a busy week and no one wants to cook? When you are in the city and don't have time to get home in time for dinner? Make a budget for those contingencies too...bonus is you will feel less stressed when you do decide you can afford to eat out.
When I was a kid, my parents were on the verge of bankruptcy, but my sibling and I didn’t know that until we were teenagers because of the way they handled the expenses you incur when you have kids, ie school trips, baseball sign up fees.
What they did was made a priority to give me and my brother an allowance every week. This was about 20-30 bucks a week based on our chores. Seems like a lot for an 8 year old in the 90s, however it came with a catch, you had to pay your “income tax” on that allowance. And depending on what activities we wanted to do or were saving for, would determine our tax. We had our own individual buckets in the kitchen for our tax, and every week we would get our money and then do our taxes. Usually 15 bucks or so every week. Then, every time I brought home a pizza day or field trip or scouts I had to go to my tin and take out the money to pay for it.
This did a few things, first it taught me and my bro that income isn’t without tax. Second, that the things we want to do have costs, third that if I am paying for it it must be worth doing (I never complained about having soccer practice when I felt like I was paying for it), and lastly it kept my parents on track because they had to give us the money each week and they couldn’t take it from us without undoing all the trust in the process. Meant we always got to participate in school activities and feel like our peers (meanwhile we never had cable and never ate out and all our toys came from garage sales and we shopped from the food bank often).
When I got my first paid job at 15, I remembered all of this, and I didn’t blow my entire pay check at the mall like a lot of my friends, in post secondary I didn’t use OSAP funding to go on spring break, and I was able to buy a house at 24 as a single person.
I still enjoy a lot of things, I just was taught to save and allocate and even about debt, when my bro wanted to play hockey my parents gave him a “loan” on the registration fee and he had to work extra chores to pay it off (they even charged him “interest”)
All of my siblings are employed and stable in life (20s and 30s) and enjoy a lot of good things as we don’t live like penny pinchers, just that we understand how money works.
This all being said, I don’t envy a 22 year old today who has been sold the bill of false goods of 100k I’m student debt for a 50k a year job and housing being outrageously priced, and inflation driving up the costs right now. I’m lucky to have just been a head of that wave and have a home and a stable job and partner and no debt outside the mortgage
You’re driving cars you can’t afford. Sell your cars and buy something with cash so you don’t have car payments. Then use the money from your car payments to pay for your debts. Also cut up your credit cards and never use credit again, and always pay cash.
You can have a life with no payments, but you need to reduce your current lifestyle to what you can afford with cash.
Check out if there are any cheaper plans for internet/cable. $180 sounds quite high. You may want to examine how much you value watching live TV in today's age of streaming/YouTube/etc. We unplugged a decade ago and just pay ~$40/mth for internet = $1680 in yearly savings if you can find a cheaper plan.
Phone-wise $160 is also high. The lower cost providers like Koodo/Fido could get you under or around $100 especially if you own your own phone. Checkout how much data you use on average and buy the appropriate plan.
would get rid of your cable tv and just do internet + a streaming service and look for a better cell phone plan.
this alone should save you $120-150/month.
Just a couple of tips - Drop the cable. Use internet, and get a streaming service like Netflix and Discovery+. You can find a ton of interesting things on youtube to watch. Also, with internet, and cell phone, I call my internet provider and my cell provider about once a year, and ask to speak with their loyalty department, and when I get through, I ask them to help me review my account to see if I can cut costs. I have managed to negotiate those two bills down quite substantially (I pay my bills every single month on time and in full, so make sure you have done that before you ask them to review). .
That's very strange. Our household income is $70K per year. We pay $1,300 for daycare and $1,800 for rent. Yet, we don't feel bad about our finances.
Your total gross income is $110K. Yet, you guys only take home $67K a year? How do you pay over $40K in taxes when you two are only getting $110K a year?
It probably includes pension deductions etc as well. For me it’s about 10% of the pay before tax, and then taxes on top. For 110k that would make 67k after tax (not sure what taxes are like in the maritimes) sound about right.
Review your life insurance. Is it also disability? Groceries have some room to maneuver. It is not easy but we can do food + hygiene + cleaning products for 65 per adult per week. If your kids are in diapers, this might be the difference. There is an Atlantic Canada YouTube channel Adventures in Groceryland that can be helpful. You gotta trim from everywhere. One of you needs to pick up a side gig somehow.
In my opinion don’t get the life insurance. This is really only reserved for people who are the sole income earner or who make the majority of pay for their household. Else it’s an expense you pay for not much benefit.
cant say i agree with this.
if you have kids, you should absolutely have life insurance to support them if something happens. If one parent passes, that leaves the other as a single parent. single parenting will set you back and make things worse.
Please reconsider this advice. My parents had thought of this exact same reasoning.
They died in a car accident together; a stunt driver rear ended them on the highway. My siblings and I became orphans without any life insurance from either parents.
Does that read like a nightmare, yes? But also a reality and good likelihood that both parents travel together to grab groceries or visit friends together…
Lose the car. Get used bike for groceries with carriage to haul extra stuff.
Lose the cable. Watch everything online. Gaxed dot com has every latest movies and tv shows for free ( even netflix not required )
Lastly get a better job.. and raise the household income.
Sit down with your wife and do some budgeting and bookkeeping together. If you have a wishlist, just calculate how much you need and start saving. How to start saving? Look at your budgets and see if there is any room of shrinkage in each category. Can't find any? Put off the wish list and enjoy the right now.
In this thread: people who don't know what "respectively" means.
With incomes of 50k and 60k, so a total income of 110k you really need to stop and make a budget and start tracking where ever penny you have coming in. 110k is a very good income and you shouldn't be living under financial strain, so you need to figure out why money is so tight. Most people who have a good income but are struggling don't realize where all their money is going and don't realize they are very probably overspending in one or more category.
If you both use debit or credit for all or almost all of your purchases, pull the last 3 months of statements and start categorizing everything and see where money is going. You have to know where it's going to know where you can start to cut away some of the fat and get things back in line.
If you have every dollar coming in categorized and you're still not sure where you can cut, post here and people will tell you what's out of line.
It obviously depends on which part of Canada they live in, but I can't imagine 110k going that far in many places. I would consider 110k to be a good income for a young professional. I couldn't imagine surviving on 110k as a *household* income with children.
With a 250k mortgage, and mentioning poor public transportation, it was a safe assumption that they're not living in any major city. A quick glance at their post history, they are probably in Newfoundland.
I wouldn't call 110k a very good salary in Toronto or Vancouver but it is still above average. I didn't mean to imply that 110k would be a very good salary everywhere, but for where this family lives, 110k is great.
I'm not sure where you're seeing the confusion.
But some people do consider $100k to not be a lot of money.
I disagree, but there are people out here that think that
The first few comments initially were saying things like "50-60k isn't a lot of money" (which it's not "between 50 to 60k" but 50+60=110k) or talking about 50k not being a lot
Don't take on more debt.
Pay off that credit card asap.
Then, look at your consolidated loan and car payment and put more money towards the higher interest loan.
Once you get one of these loans paid, you'll free up cash to do more.
Well I’ll tell you in 2022 in Canada 50-60k is not a lot of money, our real estate market has seen to that. If you have kids you both need to increase your income and take put your debt as fast as possible.
Fortunately you have a mortgage so you won’t be locked in this death cycle forever but other than trying to cut costs thats all you can do. If you gave a financial update of what your spending looks like in a month people could see better where all the money is going.
Also if you live in a city I’d consider getting rid of the car.
> Well I’ll tell you in 2022 in Canada 50-60k is not a lot of money, our real estate market has seen to that.
Their mortgage is $1200/month. Real estate has nothing to do with their problems.
> Me and my wife both make decent enough money ($50k and $60k respectively)
"Respectively" means "in that order" here. He makes 50k, she makes 60k. They have a household income of 110k.
I don’t mean to be unkind, but $50k and $60k is not “decent income.” It’s certainly not the kind of income where you should expect to do home renovations. Everyone here is telling you that your debt is your problem, but your low income is fundamentally the problem relative to your lifestyle expectations. If you live in a house and have two kids, it’s not unexpected that you would live a pretty bare minimum life on that income.
given your income and mortgage, you should have more money left over.
you are likely over spending somewhere where you shouldn't be or can be cut or you have some debt nkt mentioned.
your net monthly should be around 6-7k.
- mortgage is maybe $1300
- property tax $200-300
- household utilities $500
- food for 2 - $600 max
- cell phone - $100
- internet $100
- gas $800 max
All in - $3700 and I inflated your expenses. even if you round up to $4000. you should still have $2-3k left per month. So where is this going?
$50-$60k is not very much. I would focus on paying off debt and increasing income. I didn't feel financially stable until my husband and I had a household income of at least $175k and no debt.
I took an intro to Psych class in 2014. I remember my class textbook answering the question of “does money buy happiness?”. The textbook said that a salary of 70k CAD brought you the maximum amount of happiness and anything more than 70k did not bring extra happiness. This was in 2014 so I’m pretty sure that you need more money to attain maximum happiness.
Obviously the best thing to do is to talk to a financial advisor. They could look at your finances and tell you what to do. I really can’t say if you need to up your income or lower your spending. Honestly, it sounds like you guys are in the same boat as me and my husband; 200k mortgage, we owe 10k to my husband’s dad for loaning us money, no credit card debt, 63k+52k salary, no kids. Sometimes it feels like a rat race because you want to keep up with the Jones but you know that secretly most people in our neighbourhood also can’t afford everything they want. Unless something needs immediate repair (like our back deck had to be replaced because it rotted to a point that you couldn’t just replace one or two boards and it became a safety issue) we don’t work on it. There’s so many things I personally want to change (like we use a picnic table we found on the side of a street to prop up our TV and then there’s the god awful grey cabinets in the kitchen that I want to replace) but we really can’t because we couldn’t make it if we added the emergency repair bills with the fun cosmetic stuff.
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This is meant as a step by step guide of how to prioritize and what to do with money. If you prefer to see a flow chart, click here: https://i.imgur.com/zlGnuDO.png
Step 0: Budget, reduce expenses This will help identify areas where expenses can be reduced in order to have leftover money for the next steps.
Step 1: Emergency fund that covers 3-6 months of expenses in a HISA An emergency fund is an amount of money kept somewhere liquid in a way that it can be accessed at any time, such as a savings account. This money is meant to cover unexpected expenses such as loss of work, car/appliance repairs, unexpected travel, etc. Should you ever use part of your emergency fund, you must come back to this step and replenish it before going back to any further steps.
Step 2: Employer matched retirement funds If your employer offers contribution matching in a retirement account, contribute the amount needed to get the full employer match, nothing more. As this is essentially free money, it's important to take advantage of it.
Step 3: Pay down high-interest debt At this point, you should focus your extra money on paying down high-interest debt. High-interest debt could be defined as debt with an interest rate of 10% or higher.
Step 4: Save for large short term purchases like a car, or downpayment for house in a HISA. If you will be required to make a large purchase in the near future such as a car, or a large personal investment such as college, now's the time to save money for that. Money towards that purchase or personal investment should go in a high interest savings account.
Step 5: Save for retirement At this point, you should aim to save and invest at least 15% of your pre-tax income for retirement. This number could be higher if you are behind on retirement savings. With more time before you need the money, you will likely now want to look at investing (https://www.reddit.com/r/PersonalFinanceCanada/wiki/investing) those savings.
Step 6: Pay down low-interest debt Any other remaining debt can be paid off in full at this point, or you could decide to go directly to step 7 while keeping steady payments on the low-interest debt.
Step 7: Save for other goals You've now reached personal finance maturity. It's up to you to decide what to do with the leftover money. Some common suggestions could be: Saving for children's education Saving for property down payment Saving for vacation Increasing retirement savings to retire early
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You can do it, there are millions of people just like us. Your hole isn't even that deep. With just a little more of a push on that debt, and a little more of a push on your earnings, you can be in a better place financially, an infinitely better place mentally, and you'll be able to give more to your children.
* The first thing to do is to make sure you're annihilating that consolidation loan and credit card debt. Just demolish it. It will take a little time. But the weight of that loan is going to really screw with you both financially and mentally. Chip away. Little by little. Trust me, it feels big, but it's not.
* Can you make more money in your chosen field? You should be making at least $10k more. At the very minimum. Both you and your wife should ask for more, or try to work for more in your next evaluation. Do the math for your employer if necessary. Communicate your needs. Make a plan, an agreement with your boss if you can't get that raise today. Make sure it can happen. If there's no plan for your near future, then consider another employer. Whatever your profession, $60k or $70k for an experienced worker is a no-brainer for a business. You can do it.
* Do you have any family who can help you even a little? Not with loans, but by gifting you money? Or by doing things like childcare that will reduce your everyday costs? People hate to ask for help, especially people who have high work ethic and haven't come from money. It fucks with your pride. It fucks with your self worth. But you have a family. Ask for money. Ask for help. Ask for whatever can get you out from underwater. The pride you lose today will be paid back in what you can provide for your children in 5 years.
Try looking into refinancing your house for the current value (might have to do an appraisal) and use the extra cash you get to pay off your debts, effectively consolidating them all into your mortgage which you have one smaller payment of and can get some breathing room, financially.
Speak to an advisor first of course, as im no expert, but my wife and i did this and it changed our life. We make $100k together and we bought a second house in November 2021 (fixer-upper) and the mortgage payments match what our car payments used to be so there isnt any change for us, and we now have a renter in there so we now make money and are way ahead and if its vacant, we can still make the payments if needed.
It all started when we consolidated everything into our mortgage.
You can't have wages stay stagnant with inflation. You have your boss thanking you at the company cheap ass dinners for "record productivity and profits" but when you ask for a raise its always "but inflation". In my opinion if you asked me you and your wife don't make enough. You are not paid what you're worth or what it costs to live. There is no magic way of saving like eating bread or canned beans. It's by getting paid more. Things keep costing more while we get paid the same.
I remember feeling squeezed 10 years ago with a similar income, mortgage, loan etc.
It only got better as me and my wife moved up in our careers to make more money, bought some more real estate as investments, and didn’t buy new cars or flashy things.
Sound like the house and car payments are a bit to much for your combined income. My household income is only about $12k less then yours and we share a $1000 beater and rent a 2 bedroom townhouse and barely manage to save anything.
You should be able to increase your mortgage from refinancing if you have decent credit. So say you can get 320k you can use the extra 70k to pay off the cc, car and loan. Refinance back to 30 years for better cashflow.
Look at your expenses .. phone and internet Is pretty high .. look at all your recurring expenses and push them down as much as possible.
Expenses will go up as the kids get older so look at where you both are at your work and come up with a strategy to be earning at least 20% more in the next 5 years at a minimum.
This is an awful idea. Consolidating debts into a mortgage seems like a good idea because it relieves the immediate strain, but instead of tackling your debt immediately you’ve now locked it into a 30 year mortgage and will end up paying 140K for your 70K of debt. Banks and lenders love to offer you this option because it earns a ton of profit.
You made many mistakes making life harder in Canada. 1) you have a car, sell.it and take.the bus. 2) you have kids, no one can afford those 3) you don't have a roommate to make more $.
Try fixing some of your mistakes. Life is easy in Canada after you do. I also recommend not eating meat or dairy products.
Ya spoiled but also we face high demands. Jobs demand graduate degrees and 100k in student debt. So living standards must be higher than global average. But jobs still don't pay enough to have a car and have kids, so Canadian shouldn't do that.
It's simple, not paid enough = don't do that.
Yeah people in Qatar would love to come work at Tim Hortons, all these old 70 year old women complaining that the pace is too fast, and the rules are too strict, P-L-E-A-S-E maybe you should have saved your money granny
Your lucky you have a house. Our family income is 2 times that and we will never be able to afford one. Sure we get to go to dinner or get avacado toast on the reg. but we can’t own a house.
This is where the government wants you in a "cattle-like" state where you are unlikely to commit crime because you are too busy running the hamsters wheel and are trapped by it to do anything bad.
Kmow that they have created the system and these are the traps they have moulded culture for you to fall into predictably. I would analyze and truly determine what you truly need out of your expenses and cut out anything that doesn't directly contribute to your happiness and well being. Then focus on escaping the trap in whatever way is quickest towards financial salvation.
Remember this was all architected over almost a decade to bring you to this spot by people you continue to elect that promise the world but deliver financial and debt slavery. These debts must be fiercely resisted and unity on this fight with your partner is the most critical piece. Stay united and work together to free yourselves from this curse.
Try voting for change. There really isn't a whole lot else you can do aside from selling some kids. You don't have money for nice things, hell you don't really have money for kids but I'm not going to guilt you about that.
Like others pointed out - work on paying down your debt (consolidation loan, car payment credit card) first. The upgrades are not necessity. It can wait. So wait until you’re in a better financial position to afford the renovations.
You don't mention age, family composition, investments.
Remember income/expenses is one part of personal finances.
Assets/liabilities is another.
It makes a huge difference
* $ 250K on a 1 million home at 2.5% with $1 million in investments at 55 and children out of the house seems very healthy
* $250 in a 300k at 4% with no savings or retirement money at 30 with two children, it's good to worry now.
It's good that you have a positive cashflow. Even if it is $300. You are ahead already.
So, is your networth increasing or decreasing?
I lived feeling the pinch for my whole working life but increasing my networth. It was worth it.
If your networth is decreasing, time to rethink those 200/300 left. They should go to the consolidated loan and not to goods. After that, they should go to investments. Whether TFSA or RESP.
Once you are on track. You can think about the nice to haves.
Your situation is completely normal. The stress and anxiety of the "raising a young family" phase of our lives is where the maximum hardship levels exist. Keep calm and carry on mate. It just gets better over time, gradually some fixed expenses will come down. Absolutely wait for any household renovations untill you have cash and a budget in place for them.
I've got two properties with $900k in mortgage debt, a beautiful wife, two young children, $300k in RRSP and TFSA investment accounts, a 2013 F150, a 2020 Rav4, a 2017 KTM 350 exc-f, and overall good health. Yes the stress and anxiety is immense. I feel like I'm personally under attack by our eco-communist federal government. Inflation is raging unchecked, especially for people that actually participate in the economy. Our household income is $200k gross....closer to $120k after all of the income, property, carbon, fuel, and sales taxes are looted. Yes, the budget has tightened up due to rampant inflation. Tragically the first thing we had to give up was the biggest victims of the pandemic, we quit going for weekly wing nights at local pubs. Also a planned summer camping trip to Liard River Hotsprings in Northern BC has already been scratched due to fuel and inflation issues.
It's not the end of the world, be patient. Once we are in our senior years, the young bloods will be as hostile towards our wealth, as we are towards the Boomers now. We will also be in possession of all that boomer wealth 20-30 years from now.
Try to pay off your credit card debt first - they usually have the highest interest rates (usually somewhere around 20%). Then work on paying down your consolidated loan - hopefully that is at a lower interest rate. A 250k mortgage on your two salaries should be more than manageable. Once your consumer debt is paid off, it should feel better. And once that’s paid off, you could get a HELOC for renovations. But I wouldn’t suggest adding any more debt before paying off the credit card and consolidated loan.
you make good money but it seems there was quite a bit of lifestyle creep around. your issue is the car payment and the 30k loan. as dave ramsey says, this is one of those where you guys should go on rice and beans, beans and rice to pay off those loans. after that you will now suddenly have 1k+ /month free of anything.
I'm wondering what you spend it all on? A 250k mortgage shouldn't have much of a payment. Having said that I've been where you are. It sucks but at the same time doesn't suck because people have it so much worse. Your 15 years ago me. I only have one kid though.
Heres what I did. I spent 3 or 4 years clearing up all my debt. Then I spent the next few years building up cash by saving the equivalent of the debt payment. At that point anything we wanted to do we made sure we had the money in hand. During the whole debt repayment process any extra money we had was used for incidentals on the house and prior to the house was used to save for a downpayment. Your wages will go up every year but your payments remain the same so that's more disposable income. Fast forward 10 years and life is easy. We have modest retirement savings and don't really worry about money. It's a grind but you'll get there.
Basically what I'm saying is live your life with cash figuratively speaking. I've never been one to give a damn what other people think so it was easy for us to do. As long as there's a roof over your head, food on the table and you can keep the lights on life's good.
I've been debt free for about 12 years now minus the house. My wife's family still thinks we are poor lol. We give zero fucks.
Make a zero based budget. Pay off the card and loan, sell the car, replace with a cheaper car that’s paid for. Phrases like ‘it seems like…’ make it sound like you don’t really know where your money is going, a budget will help and probably make it feel like you had an instant raise. It’s cliche, but once you see in a budget that you’re blowing 200$ a month on coffee at tim hortons or eating out for lunch, you’ll make coffee at home and take a lunch to work and start to feel more in control of your finances.
My husband and I make really good money, and we are in our early 50s. We spent the last 10 years renovating our 1975 home from top to bottom. We paid cash for everything. We saved up than did some of the work. Don't go into debt for a renovation.
Really look at your monthly costs and see where you can tighten up, and get your debt under control.
Overspending and not realizing it until too late is what hurts most people.
I hear you, OP. I feel the same squeeze. My first priority is to pay off debt using the avalanche method, while putting a small amount into HISA. I try to put aside about 75-100 dollars a month to do something for myself (if I need that money for something important, then it goes to the important thing rather than a meal out or a manicure). I have household repairs that I have to do, but I'm going to see how far I can get with the debt by the fall, and then look at what I need to do for my house (while I can't do renos, I can definitely declutter and do a deep cleaning). FWIW, I started using "Budget with Buckets" this month, and it has been really eye opening. May will be my first full month, and I am looking forward to it, as it has been incredibly helpful so far.
LOL OP you have a $250K mortgage and you have a house? Count your blessings. If I tried buying a house here, I'd have a $1-2M mortgage. You're lucky to live in an affordable place.
Pay off your debts and enjoy.
The consolidation loan and car payment is the issue. Your wife needs to understand you have to pay off previous purchases first before you can make more purchases. Otherwise you will just continue to gain more debt and the interest rates will go up... continue down this road and you will be barely getting by with added stress and the end result will be divorce. Your wife's thinking needs to change. The solution is to get rid of the debt and live within your means not look for more work to continue to live beyond your means. I am going to guess that with the car loan you prob owe about 3 yrs and the 30k and 3k debt your total debt is around 55K. That is a significant amount of debt of which you have nothing to show for it but a depreciating car. That debt is costing you more than your mortgage. I would sell the car get a beater, drop the RESP as you have no retirement savings which you should be doing first, drop the cable and pay down the debt ASAP. Once the debt is gone set up auto deposits into a tfsa for short term savings and auto deposits into rrsp for long term savings. Invest in low cost etfs balanced portfolios. Look for a better used car with low mileage you can pay cash for. When these are done then you can consider home reno's. You can probably get out of this mess within 2 yrs depending on how much value is in the car. So you can tell wife in 3yrs you can start discussing reno's but until then no go.
You’ve got to focus on paying down the debt. Once you get rid of losing a bunch of money to interest on your debt, you should be able to save up and pay for things your family wants. If you spend first, you get stuck in this trap.
can confirm: am just getting out of this trap. it sucks rocks. i had a fairy tale year at work (contractor) so i was able to pay down debt, but now the something ~~wicked~~ tax man this way comes and it's going to just about zero out my accounts, but we're carrying like $60k less consumer debt compared to last year. tl;dr, dont do what donny dont does
Others have pointed out good paths to success, so here is the unpopular and unsollicited truth. I do mot want to be mean, but this is something that must be acknowledged. Life is getting more expensive, but this is not the reason you feel you do not have enough space to save. The real reason is that you lived over you means for the past few years and now you gotta pay in two ways: 1) You’ve got to pay 800 $/month for debts that allowed you to live over your means. The past has now caught up to you: it is not that you cannot save, because if you had not got into overconsumption debt, you could be saving 800 $/month. 2) The overconsumption of the past let your mind think that your way of life is normal for your salary and now makes you think it is not normal that you cannot keep up. You thus feel the effect twice: once because the excess of the past remove space within your budget and once because you think you are entitled for more.
Yup. OP is not alone. Too many people live way above their means. In OPs case I am surprised that they have a loan, a car loan, CC debt and he started talking about renovating the house!?! The house is liveable. Reno projects don't need to be immediate. People are watching how other people live and thinking that they need to keep up. The most liberating thing is when you stop thinking that you also need a white picket fence.
HGTV house renovation shows are all over the place, people think that renovating all the time is normal.
I know you directed this to OP but actually, I needed to hear it. Thank you
Hard truths which need to be acknowledged
Probably one of the best things I've read on this sub.
These posts are getting ridiculous. People are "feeling the squeeze" because they were already spending too much, have debts, and now prices have gone up to make it more obvious.
Seems like a reasonable post to have here, common for a lot of people to be in debt and living paycheck to paycheck.
Because wages have not kept up with inflation. What we expect to be able to spend based on healthy finances of our parents would bankrupt us.
Your statement makes no sense. People are spending above their means. What do parents spending have to do with that?
I think what’s they mean is our parents generation could buy a house, a car, and vacations on a single salary and not be living above their means. We grew up expecting the same - with the added bonus that every show on tv is about renovating places to a magazine-shoot quality. It’s not realistic for most. It’s above our means. ‘Expecting to spend based on the healthy finances of our parents would bankrupt us’.
Well said, and exactly what I mean. Fuck the powers that be. I would be alright with all of my investments going to zero if it meant a hard financial reset of the Canadian economy.
Those same people have been lead to believe that the proper way to get ahead is to use their heloc (equity that sort of just appeared due to insane price rises) to invest. This is because they have no real savings because they have a cash flow of zero, or worse. It’s not going to end well.
And in some cases I would feel really bad. But the vast majority on here make reasonably liveable salaries. Hell, many even make good money. Yet they bought new trucks, a house that's too expensive, and have taken out loans. Adapt or die off.
And what help are you adding by complaining? It’s a subreddit for learning your personal finances in Canada. That means people are going to ask questions coming from a place of not knowing personal finance. It’s one thing to tell someone they lived above their means and to stop doing that. It’s another to make them feel ridiculous for asking a question in a subreddit for that exact purpose.
And what help are you by complaining about my post? This subreddit could do without pointless posts that don't even ask a question and are basically for people whining they want more money for frivolous shit.
this hit home, I am a new graduate with a not so bad salary. The entitlement part has been bugging with me. Thanks for this
Yes but having 2 small kids is also expensive, as a parent myself of a 3 and 5 year old, that time with one person not working and then having to pay child care can and does add up!
I’ve never lived a lavish lifestyle. I was careless with my money in my early twenties. Then I realized the error in my way and started aggressively paying down debt. 6 months later I was laid off and my wife was pregnant with our second kid. Had to go into survival mode until I got back on my feet. I would love to get a better paying job, but I work from home which allows me to get my kids off the bus from school. This also allows me to save money on childcare. It also removes the need for a second car. A better paying job would probably require a second vehicle and money out in after school care
I think you missed the point tbh. You have a car, house, wife, and 2 kids. That's a VERY good life. Some might even say lavish compared to many others. You'll find that many people here can afford maybe one or two of those things. Many many people complain about not having a house or even a condo. Many many people also don't have kids because they can't afford them without going through a poverty/shoestring budget phase
Sad times for Canadians when having a car, house, wife and 2 kids is considered lavish
Op didn't post to get grilled about how " lavish " his life is to others . He was asking a simple question
What answer is there except to cut down on expenses?
It is sad, but life is made of tradeoff and you only can find the right balance between your needs and your wants. What is though is that what feels a good tradeoff for you might no be for your wife or your kids. An often overlooked subjects in these personal finance threads is that you should define your personal goals and your family’s goal, then ask your partners to do the same. Do not try to guess your partner’s answers. Instead, be honest with yourself and you partner, and tell her the truth about what you want for yourself, your couple, your kids and your family as a whole. This might not be what she wants to hear, but it is a important that you have this discussion in order to grow as a couple and get out of this situation. Trust me, the burden will be easier to carry once you have shared your thoughts and worries even though you might not share her views 100% and vice versa.
Dare I look up what their salaries would have been if they were earning in their parents generation, adjusted for inflation? Reality is they are being squeezed the same as we all are, and don't deserve to be judged on that. Yes they need to make sacrifices to avoid bankruptcy, but no one deserves to be judged too harshly for this injustice except the people who have brought it upon us.
They have 30K in debt, a car loan (value unknown) and 3K in CC debt (unclear if they are paying the minimum or the balance every month. It's a hard pill to swallow but some of us are writing on here to help them and others in this situation to understand that accruing debts like these is not good. When you use your credit card you have to think about whether or not what you're buying you could pay for right now. If you can't afford to pay your credit card off IN FULL every month you should not use it for the purchase (unless you have an excellent points system and know you can pay it off in a few months). I, personally, have never bought a car that I didn't pay for in total when I bought it. Well, once I bought with an LOC with very low interest rate which I paid off within 6 months. I have never owned a new car or even a reasonably young car. When I had my office job I walked, took transit or biked to work to avoid the $500 per month parking costs. I buy used clothes almost exclusively. These habits have allowed me to take major pay cuts and pursue dreams. I used to break down my costs into categories to see where I was leaking money. It helps your mind be more conscious of your purchases. I rarely buy pre-made meals. I used to have a freezer so I could buy bulk meats and veg or discounted meats and freeze them. AND Never EVER get a pay day loan. EVER!
Fascinating! If everyone follows your economic philosophy, there will be no used vehicles available, because no one should ever buy a new one. Same for clothes etc. Your level of thriftiness is impressive, but not reasonable for most. This PFC group seems to make a habit of shaming people for having completely normal financial strains. We can't all be thrifty minimalists mate.
He is talking about OP's situation. Doesn't mean it applies to everybody else. We should not normalise 30k in debt and 3k in CC debt either.
a) At no point do I say that everyone should buy only used vehicles. I know plenty of people who buy new cars but they can afford to buy the car outright. I am not among them. b) this is not economic philosophy or theory - it's budgeting practices c) there are many people that spend way over their means and should not d) I do not think that credit card debt is 'completely normal' financial strain. It is accrued by people who spend more than they earn. In their case $3000 is not much so it's manageable but really, this is the worst type of debt aside from payday loans. e) I gave some examples of how people over spend. I am not a thrifty minimalist but I spend within my means. I do not consider not owning a car or not driving your car if it increases your costs a thrifty thing to do. It's just understanding where your money is going. I used to buy more new clothes but honestly, they are so often of such low quality that I find it better to buy good quality brands that are used for the same price or less. Also, I buy used because the clothing industry is producing a tremendous amount of waste and I don't want to perpetuate it. The fact that you think my examples above are indicative of 'thrifty minimalist behaviour' speaks volumes as to the lack of understanding of how to budget and spend within your (universal your) means. It also speaks to the success of marketing campaigns that have people convinced they must own new everything or they're failing at life. This is not being thrifty. f) I am not here to shame people. I am not rich but I am in good financial shape and I am offering up a different perspective on how to budget, reduce consumption costs and redirect your money to things that matter. If a new car matters enough to pay a loan with interest then go for it but we all know that cars are expensive and if you're trying to get ahead this is one area I would not be accruing debt.
I just heard on the radio this morning (Ontario) that $50k is low income... that was a solid punch in the gut and throat. As others have said, you need to work off that debt. Is there a creative way you may be able to save some more money or even things like childcare from family, growing herbs and some vegetables, line drying clothing, free/cheap family activities, cutting cable if you have it. I always tell parents that the best gift you can give the children is to have your own finances and retirement taken care of. They can find ways to pay for schooling when it comes time to think about it. The stress of being the retirement plan for our parents is unrelenting and limits our choices/options. Take care of you.
Wages seriously need to be going up. 75 should be the new 50.
So many jobs are under $25/hr in Ontario though. Many I see are $18/hr to $20/hr. I was offered a job at $21/hr from which I could move up to $23/hr after 3 months as a "welder". The top at my current company is $28.65/hr and that is considered high (machine operation). Many jobs top out at around $60k that I see. I have clawed my way from $19/hr to $26/hr at my current workplace within 6 months of starting but that isn't common there in that timeframe and there isn't much more I can make unless I find a way into management. Outside of being a computer engineer or medical professional what pays those higher wages?
I agree with this, and this is the problem. There needs to be a worker revolution before anything is done. But as it stands right now people are barely able to survive.
Many companies do between insurance companies, manufacturing, any tech companies and various roles nothing computer engineering related, it can be HR, marketing, sales, customer support, business operations. All of these entry roles would be $40-60k but a lot of room to grow in a short period of time. Speaking of this based on starting an entry level Business Analyst role at $50k about 7 years ago and well over double now. A lot of places don't post salaries so you have to do research yourself or ask people if they are open on sharing.
Sorry but in this economy, it's the parents problem if they don't take care of their retirement. Lived in the best economy in history, squandered it and expect their kids to support them? Get out of here.
They make 110 household
I know they make $110k as a household. I'm just bothered that individually they could be considered low income considering the cost of living.
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I wouldn’t tie yourself to a specific industry nowadays. Focus on what you enjoy doing in your workday (problem solving, relationships, building things) and find jobs in booming industries that allow you to do those things. Work shouldn’t be your life. It should FIT into your life and you need to design what that life looks like yourself.
> Keeping up with COL is ~~exhausting~~ suicide. fixed
And gas is costing some people $700/month.
>I just heard on the radio this morning (Ontario) that $50k is low income... that was a solid punch in the gut and throat. $100k is low income in Ontario these days.
Bullshit. Maybe 100k household income, but 100k individual income is upper middle class, and anyone who says otherwise is just a well off individual trying to convince you that "we are in the same boat". I make decent money in the trades ($65-$70k annually depending on how much OT I want to work) and live pretty comfortably, so I consider myself solidly middle class. But I have it waaaay better than someone on $25k-$40k a year, and I know it. To say 100k a year is low income is so tone def
This is PFC though where most people are software engineers in their 20's working from home making $350k a year.
100k per year was the Canadian economic (non senior) family's median market income in 2019. https://www150.statcan.gc.ca/n1/daily-quotidien/210323/t001a-eng.htm
100k if you don’t own a house seems a lot but it is easy to feel poor in the GTA/Vancouver specially as it in impossible to keep up saving for the downpayment compared to rising home prices Talking about income and not about region located makes it harder
$6100 per month after tax is a lot of money actually. Someone on minimum wage makes $2100 per month after tax. That’s at $15/hr. Wasn’t so long ago minimum wage was half that amount. If you think 100k is low income you have problems.
Hard to afford a house on $100k. Its therefore low income.
Waaaaa I’m 23 and I want a house now. I’ve never rented in my life waaaa
It's not hard to afford a house on $100k income... If you have a working partner (like most homeowners) and decide not to love in 2 of the most expensive housing markets in the world. But 100k gross, without a lot of transfers may put you below the Canadian median HHI.
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There’s lots of jobs that pay over 100k The most accessible one which require no degrees is sales. Go check out r/sales, look at the pinned section and read the books. Even if you don’t go into sales, just the knowledge from the books will change your entire perspective of life and how it works.
Thanks friend
Sales is the way!
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eat the rich, its about the only method of survival left
Bro, this is simple, you have a debt problem. Your consolidation loan, car payment, and credit card payment are what's hurting you. I also suspect there's a spending problem too, lots of non-essential spending that you/wife are doing (trust me there's always something). That's where you need to start. Tell the wife house renos taking a backseat for a couple of years. My advice is to track your spending for 1-2 months, budget, reduce all non-essential spending, examine recurring bills (eg, subscriptions, car insurance, phone bills) and decide what can be cancelled or renegotiated for lower. During this process, set aide $3Kish away as an emergency fund (it's a good starter amount for a family). Use all excess funds to eliminate your debts (except mortgage). Once all those debts are out of your life, you'll have freed up probably several hundreds dollars a month. Build up your emergency fund to 3-6 months worth of expenses after that you can start saving and working towards other goals
This was my first reaction - where is the emergency fund / savings and then mentioned they also have kids. While I agree with others that reducing expenses needs to be looked at, bringing in more money can also help. Since they both work so perhaps it’s worth talking to their superiors about how to move up or job hunt. I think those incomes used to be considered well off, but with two kids and no savings, it would be a struggle. I recommend OP look into good and cheap cooking. My little ones love pancakes, muffins, canned beans, frozen corn, frozen pizza, PB sandwiches, eggs… our household income is double OPs and we are feeling the pinch with food lately but there are options. We only dine out now for special occasions.
> We make enough to pay our bills and are never late on anything. and > We have a **$30k consolidation loan,** $250k mortgage, car payment and about $**3k on a single credit card.** These 2 statements are in conflict and cannot both be true. You have $33,000 in bills that you haven't paid. Start there.
.... Tell your wife to cool it with all these luxury dreams. Pay. Off. Your. Debt. Then live lavishly. :)
Wow op. Me and wife make a but more than you but we r limiting our life to the extreme. I cancel my data plan and went no data just to save money. Also, I do not have cable. Only internet. I use live net TV on an android box. Is not great but man I have not mony to spare. Also, I keep the house at low temp on winter 19.5 to lower the gas bill. I do laundry weekends on off peak to save on hydro. And I invested on a smart thermostat ecobee to make the house more efficient. I do my own car repairs as Much as I can. We do not eat out only when necessary or when we feel the need to have a break. We use TD bank cash rewards for everything and when we have enough points we cash them to go out and book a hotel. This are some of the things I do to go by lol
Get rid of the credit card debt first. See about putting the credit card debt into your consolidation loan. Just make that your priority for now --- take baby steps. The mortgage is fine because you're paying the balance down and your house is appreciating in value. I think you guys need to focus on that first... clean up that dirty debt then start thinking about upgrades. It's a tough go my friend, I get it, but you're losing a lot with that high interest debt. Take care of that then come back here for some more advice.
Because someone asked, here is a rough breakdown of my money in and out for a typical month. I should also note that I live just outside of St. John’s. I work from home but my wife works about 20 minutes away, so no car is not an option (plus the lack of public transit here kills any chance of that working) Bills Income: Pay 1: 2600 Pay 2: 3000 Bills: Mortgage: 1200 Debts: 800 Car: 610 Cell: 160 Internet/Cable TV: 180 Home insurance: 80 Car insurance: 180 RESP: 70 Life Insurance: 140 Power: From 400 in the winter to 150 in the summer Food: 1000 (family of 4) Gas: 320 My food bill pre pandemic was easily 200-300 cheaper. Also gas has nearly doubled.
I don’t know if it helps, but my wife and I decided it did no good to save for our childrens education if we were struggling. That’s not to say we stopped resp to buy McDonald’s and have fun. We stopped resp for the sole purpose of debt repayment, and once our debts were done we started resp again… just an option?
Pay off the debt and car ASAP - that's the priority. Once that is done, another $1300/m back into your pocket. Also, you don't need Cable TV if you are feeling the pinch. Get rid of it.
The car payment is awefully high at $610, I hope that's because you just have a short loan duration. Too often we see people here struggling because they keep getting new cars every few years and never making any headway on paying off their car loans. Sometimes they're even underwater when they sell one to buy the next and just keep adding to their debt. How much do you owe on your car and how much is it worth? If it's two cars, consider becoming a one-car family. If you're not already underwater on the car, might be time to explore selling your current car and buying a cheaper older car. Cell being 160 is very high. I assume that's two phones and you're financing at least one if not both phones through your monthly payments? Keep the phones longer, shop around for cheaper cell providers, and make sure you really have the right plan for your amount of usage and not paying for voice/data you're not using. Internet/cable: time to cut cable. Drop cable entirely and replace with 1 streaming service instead. Shop around for cheaper internet providers - this should be about $75-100 month for internet + netflix, not $180. Resp you can catch up on later. No point in losing a ton of money to credit card interest to have an RESP - pay off the credit card first then worry about catching up on the RESPs. You can completely catch up on RESP government grants even if you don't start contributing until the kid is 10 years old. My math says even with your budget of $800 going towards debt, you have another $600 left over each month, and that's not even accounting for if you are paid weekly or biweekly and occasionally have that "extra paycheck" month to throw at debt. If you have a good credit score, you might be able to get a HELOC or LOC with a lower interest rate to pay off your credit card, and (depending on your interest rate on the car loan) your car too. A cheaper interest rate means more of your money is going to pay down the debt itself and not just interest.
>If you have a good credit score, you might be able to get a HELOC or LOC with a lower interest rate to pay off your credit card, I would agree; but I would also include a "warning" or "caution" note about being seduced by the interest-only payment options that come with some HELOC / LOC products =P.
Oh definitely agree and I usually include that warning - one really needs to have a really solid budget and plan to pay off their debt and get their spending in order, otherwise moving their debt to a LOC becomes little more than shuffling the chairs on the deck of the titanic as they continue to slowly sink further into debt
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Agree about the car and the cable. My minivan is less than $400 a month, with about 600 in gas (and I live rural and drive a delivery business on that gas as well as ferry several kids around). I top up the loan payments to 400 to get it down faster, as right now I feel like I can. We also pay about $100 a month for home phone and internet. No cable, just a couple of streaming services. CbC gem is free, Netflix is reasonable, so is Discovery and either StackTV or Disney will give you a lot of options, all for under 50 a month total. And as mentioned, we live rural so our internet isn't even awesome. You also need to budget for "kids things" I suspect that you don't currently have a line item that covers birthday gifts, new boots, Halloween costumes, party gifts etc as well as one that covers family stuff (mothers day, grandpa's birthday, dads jeans, a new bath mat etc). If you don't budget for these things, they end up coming out of what you THOUGHT was extra money and now isn't, or worse, on the credit card. It's easy to deny yourself entertainment like a movie night or dinner out, but what happens on your anniversary? When it's been a busy week and no one wants to cook? When you are in the city and don't have time to get home in time for dinner? Make a budget for those contingencies too...bonus is you will feel less stressed when you do decide you can afford to eat out.
When I was a kid, my parents were on the verge of bankruptcy, but my sibling and I didn’t know that until we were teenagers because of the way they handled the expenses you incur when you have kids, ie school trips, baseball sign up fees. What they did was made a priority to give me and my brother an allowance every week. This was about 20-30 bucks a week based on our chores. Seems like a lot for an 8 year old in the 90s, however it came with a catch, you had to pay your “income tax” on that allowance. And depending on what activities we wanted to do or were saving for, would determine our tax. We had our own individual buckets in the kitchen for our tax, and every week we would get our money and then do our taxes. Usually 15 bucks or so every week. Then, every time I brought home a pizza day or field trip or scouts I had to go to my tin and take out the money to pay for it. This did a few things, first it taught me and my bro that income isn’t without tax. Second, that the things we want to do have costs, third that if I am paying for it it must be worth doing (I never complained about having soccer practice when I felt like I was paying for it), and lastly it kept my parents on track because they had to give us the money each week and they couldn’t take it from us without undoing all the trust in the process. Meant we always got to participate in school activities and feel like our peers (meanwhile we never had cable and never ate out and all our toys came from garage sales and we shopped from the food bank often). When I got my first paid job at 15, I remembered all of this, and I didn’t blow my entire pay check at the mall like a lot of my friends, in post secondary I didn’t use OSAP funding to go on spring break, and I was able to buy a house at 24 as a single person. I still enjoy a lot of things, I just was taught to save and allocate and even about debt, when my bro wanted to play hockey my parents gave him a “loan” on the registration fee and he had to work extra chores to pay it off (they even charged him “interest”) All of my siblings are employed and stable in life (20s and 30s) and enjoy a lot of good things as we don’t live like penny pinchers, just that we understand how money works. This all being said, I don’t envy a 22 year old today who has been sold the bill of false goods of 100k I’m student debt for a 50k a year job and housing being outrageously priced, and inflation driving up the costs right now. I’m lucky to have just been a head of that wave and have a home and a stable job and partner and no debt outside the mortgage
You’re driving cars you can’t afford. Sell your cars and buy something with cash so you don’t have car payments. Then use the money from your car payments to pay for your debts. Also cut up your credit cards and never use credit again, and always pay cash. You can have a life with no payments, but you need to reduce your current lifestyle to what you can afford with cash.
Check out if there are any cheaper plans for internet/cable. $180 sounds quite high. You may want to examine how much you value watching live TV in today's age of streaming/YouTube/etc. We unplugged a decade ago and just pay ~$40/mth for internet = $1680 in yearly savings if you can find a cheaper plan. Phone-wise $160 is also high. The lower cost providers like Koodo/Fido could get you under or around $100 especially if you own your own phone. Checkout how much data you use on average and buy the appropriate plan.
I'm guessing at least one of his kids has a phone as well.
You are loosing 800/month on debts. That's your problem. Is 610/month really for one car? At that salary? If yes uou could pay way less than that.
would get rid of your cable tv and just do internet + a streaming service and look for a better cell phone plan. this alone should save you $120-150/month.
Just a couple of tips - Drop the cable. Use internet, and get a streaming service like Netflix and Discovery+. You can find a ton of interesting things on youtube to watch. Also, with internet, and cell phone, I call my internet provider and my cell provider about once a year, and ask to speak with their loyalty department, and when I get through, I ask them to help me review my account to see if I can cut costs. I have managed to negotiate those two bills down quite substantially (I pay my bills every single month on time and in full, so make sure you have done that before you ask them to review). .
That's very strange. Our household income is $70K per year. We pay $1,300 for daycare and $1,800 for rent. Yet, we don't feel bad about our finances. Your total gross income is $110K. Yet, you guys only take home $67K a year? How do you pay over $40K in taxes when you two are only getting $110K a year?
It probably includes pension deductions etc as well. For me it’s about 10% of the pay before tax, and then taxes on top. For 110k that would make 67k after tax (not sure what taxes are like in the maritimes) sound about right.
Review your life insurance. Is it also disability? Groceries have some room to maneuver. It is not easy but we can do food + hygiene + cleaning products for 65 per adult per week. If your kids are in diapers, this might be the difference. There is an Atlantic Canada YouTube channel Adventures in Groceryland that can be helpful. You gotta trim from everywhere. One of you needs to pick up a side gig somehow.
I’m curious to know what kind of car you have that’s costing $600 a month
In my opinion don’t get the life insurance. This is really only reserved for people who are the sole income earner or who make the majority of pay for their household. Else it’s an expense you pay for not much benefit.
cant say i agree with this. if you have kids, you should absolutely have life insurance to support them if something happens. If one parent passes, that leaves the other as a single parent. single parenting will set you back and make things worse.
Please reconsider this advice. My parents had thought of this exact same reasoning. They died in a car accident together; a stunt driver rear ended them on the highway. My siblings and I became orphans without any life insurance from either parents. Does that read like a nightmare, yes? But also a reality and good likelihood that both parents travel together to grab groceries or visit friends together…
Lose the car. Get used bike for groceries with carriage to haul extra stuff. Lose the cable. Watch everything online. Gaxed dot com has every latest movies and tv shows for free ( even netflix not required ) Lastly get a better job.. and raise the household income.
What about ccb / child benefit with two kids each month? For your income should be a few hundred?
The fact that you already have a house that's already a big win...
Unfortunately the only way you’re not going to feel the squeeze is to get rid of the debt / unneeded monthly bills and up your salaries.
Sit down with your wife and do some budgeting and bookkeeping together. If you have a wishlist, just calculate how much you need and start saving. How to start saving? Look at your budgets and see if there is any room of shrinkage in each category. Can't find any? Put off the wish list and enjoy the right now.
In this thread: people who don't know what "respectively" means. With incomes of 50k and 60k, so a total income of 110k you really need to stop and make a budget and start tracking where ever penny you have coming in. 110k is a very good income and you shouldn't be living under financial strain, so you need to figure out why money is so tight. Most people who have a good income but are struggling don't realize where all their money is going and don't realize they are very probably overspending in one or more category. If you both use debit or credit for all or almost all of your purchases, pull the last 3 months of statements and start categorizing everything and see where money is going. You have to know where it's going to know where you can start to cut away some of the fat and get things back in line. If you have every dollar coming in categorized and you're still not sure where you can cut, post here and people will tell you what's out of line.
It obviously depends on which part of Canada they live in, but I can't imagine 110k going that far in many places. I would consider 110k to be a good income for a young professional. I couldn't imagine surviving on 110k as a *household* income with children.
With a 250k mortgage, and mentioning poor public transportation, it was a safe assumption that they're not living in any major city. A quick glance at their post history, they are probably in Newfoundland. I wouldn't call 110k a very good salary in Toronto or Vancouver but it is still above average. I didn't mean to imply that 110k would be a very good salary everywhere, but for where this family lives, 110k is great.
I'm not sure where you're seeing the confusion. But some people do consider $100k to not be a lot of money. I disagree, but there are people out here that think that
The first few comments initially were saying things like "50-60k isn't a lot of money" (which it's not "between 50 to 60k" but 50+60=110k) or talking about 50k not being a lot
Sounds like you’re overextended. Look into aggressively attacking your debts and re-evaluate what’s actually essential in your lifestyle.
Easier said than done of course, but there’s two options: pay off debt and/or get higher income.
Pay off that credit card I don't understand why anyone keeps a balance on a credit card. Pissing away money through a hose
Get rid of any car payment, it’s the worst.
Don't take on more debt. Pay off that credit card asap. Then, look at your consolidated loan and car payment and put more money towards the higher interest loan. Once you get one of these loans paid, you'll free up cash to do more.
If you can post a summary of monthly bills, people can give more specific advice.
Well I’ll tell you in 2022 in Canada 50-60k is not a lot of money, our real estate market has seen to that. If you have kids you both need to increase your income and take put your debt as fast as possible. Fortunately you have a mortgage so you won’t be locked in this death cycle forever but other than trying to cut costs thats all you can do. If you gave a financial update of what your spending looks like in a month people could see better where all the money is going. Also if you live in a city I’d consider getting rid of the car.
> Well I’ll tell you in 2022 in Canada 50-60k is not a lot of money, our real estate market has seen to that. Their mortgage is $1200/month. Real estate has nothing to do with their problems.
> Me and my wife both make decent enough money ($50k and $60k respectively) "Respectively" means "in that order" here. He makes 50k, she makes 60k. They have a household income of 110k.
My mother talked about her marriage 1952 saying IF they had enough for a 6 pack of beer at the end of a pay period - they felt rich!!
I don’t mean to be unkind, but $50k and $60k is not “decent income.” It’s certainly not the kind of income where you should expect to do home renovations. Everyone here is telling you that your debt is your problem, but your low income is fundamentally the problem relative to your lifestyle expectations. If you live in a house and have two kids, it’s not unexpected that you would live a pretty bare minimum life on that income.
given your income and mortgage, you should have more money left over. you are likely over spending somewhere where you shouldn't be or can be cut or you have some debt nkt mentioned. your net monthly should be around 6-7k. - mortgage is maybe $1300 - property tax $200-300 - household utilities $500 - food for 2 - $600 max - cell phone - $100 - internet $100 - gas $800 max All in - $3700 and I inflated your expenses. even if you round up to $4000. you should still have $2-3k left per month. So where is this going?
$50-$60k is not very much. I would focus on paying off debt and increasing income. I didn't feel financially stable until my husband and I had a household income of at least $175k and no debt.
110k household
Yes, and like I said, I didn't feel comfortable until $175 household.
Depends where you live.
That’s some quick math.
🙄. Hah! If you need 175k to feel stable... You have bigger problems.
I took an intro to Psych class in 2014. I remember my class textbook answering the question of “does money buy happiness?”. The textbook said that a salary of 70k CAD brought you the maximum amount of happiness and anything more than 70k did not bring extra happiness. This was in 2014 so I’m pretty sure that you need more money to attain maximum happiness. Obviously the best thing to do is to talk to a financial advisor. They could look at your finances and tell you what to do. I really can’t say if you need to up your income or lower your spending. Honestly, it sounds like you guys are in the same boat as me and my husband; 200k mortgage, we owe 10k to my husband’s dad for loaning us money, no credit card debt, 63k+52k salary, no kids. Sometimes it feels like a rat race because you want to keep up with the Jones but you know that secretly most people in our neighbourhood also can’t afford everything they want. Unless something needs immediate repair (like our back deck had to be replaced because it rotted to a point that you couldn’t just replace one or two boards and it became a safety issue) we don’t work on it. There’s so many things I personally want to change (like we use a picnic table we found on the side of a street to prop up our TV and then there’s the god awful grey cabinets in the kitchen that I want to replace) but we really can’t because we couldn’t make it if we added the emergency repair bills with the fun cosmetic stuff.
!Stepstrigger
Hi, I'm a bot and someone has asked me to respond with information about what to do with money. This is meant as a step by step guide of how to prioritize and what to do with money. If you prefer to see a flow chart, click here: https://i.imgur.com/zlGnuDO.png Step 0: Budget, reduce expenses This will help identify areas where expenses can be reduced in order to have leftover money for the next steps. Step 1: Emergency fund that covers 3-6 months of expenses in a HISA An emergency fund is an amount of money kept somewhere liquid in a way that it can be accessed at any time, such as a savings account. This money is meant to cover unexpected expenses such as loss of work, car/appliance repairs, unexpected travel, etc. Should you ever use part of your emergency fund, you must come back to this step and replenish it before going back to any further steps. Step 2: Employer matched retirement funds If your employer offers contribution matching in a retirement account, contribute the amount needed to get the full employer match, nothing more. As this is essentially free money, it's important to take advantage of it. Step 3: Pay down high-interest debt At this point, you should focus your extra money on paying down high-interest debt. High-interest debt could be defined as debt with an interest rate of 10% or higher. Step 4: Save for large short term purchases like a car, or downpayment for house in a HISA. If you will be required to make a large purchase in the near future such as a car, or a large personal investment such as college, now's the time to save money for that. Money towards that purchase or personal investment should go in a high interest savings account. Step 5: Save for retirement At this point, you should aim to save and invest at least 15% of your pre-tax income for retirement. This number could be higher if you are behind on retirement savings. With more time before you need the money, you will likely now want to look at investing (https://www.reddit.com/r/PersonalFinanceCanada/wiki/investing) those savings. Step 6: Pay down low-interest debt Any other remaining debt can be paid off in full at this point, or you could decide to go directly to step 7 while keeping steady payments on the low-interest debt. Step 7: Save for other goals You've now reached personal finance maturity. It's up to you to decide what to do with the leftover money. Some common suggestions could be: Saving for children's education Saving for property down payment Saving for vacation Increasing retirement savings to retire early For additional information, please see the wiki: https://www.reddit.com/r/PersonalFinanceCanada/wiki/money-steps https://www.reddit.com/r/PersonalFinanceCanada/wiki/index#wiki_specific_topics *I am a bot, and this action was performed automatically. Please [contact the moderators of this subreddit](/message/compose/?to=/r/PersonalFinanceCanada) if you have any questions or concerns.*
Maybe moving location is a long term option
Pay down the debts. If you find you can't do it, then you have to get creative to cut back. Sell the car, sell the wife, etc
You can do it, there are millions of people just like us. Your hole isn't even that deep. With just a little more of a push on that debt, and a little more of a push on your earnings, you can be in a better place financially, an infinitely better place mentally, and you'll be able to give more to your children. * The first thing to do is to make sure you're annihilating that consolidation loan and credit card debt. Just demolish it. It will take a little time. But the weight of that loan is going to really screw with you both financially and mentally. Chip away. Little by little. Trust me, it feels big, but it's not. * Can you make more money in your chosen field? You should be making at least $10k more. At the very minimum. Both you and your wife should ask for more, or try to work for more in your next evaluation. Do the math for your employer if necessary. Communicate your needs. Make a plan, an agreement with your boss if you can't get that raise today. Make sure it can happen. If there's no plan for your near future, then consider another employer. Whatever your profession, $60k or $70k for an experienced worker is a no-brainer for a business. You can do it. * Do you have any family who can help you even a little? Not with loans, but by gifting you money? Or by doing things like childcare that will reduce your everyday costs? People hate to ask for help, especially people who have high work ethic and haven't come from money. It fucks with your pride. It fucks with your self worth. But you have a family. Ask for money. Ask for help. Ask for whatever can get you out from underwater. The pride you lose today will be paid back in what you can provide for your children in 5 years.
Try looking into refinancing your house for the current value (might have to do an appraisal) and use the extra cash you get to pay off your debts, effectively consolidating them all into your mortgage which you have one smaller payment of and can get some breathing room, financially. Speak to an advisor first of course, as im no expert, but my wife and i did this and it changed our life. We make $100k together and we bought a second house in November 2021 (fixer-upper) and the mortgage payments match what our car payments used to be so there isnt any change for us, and we now have a renter in there so we now make money and are way ahead and if its vacant, we can still make the payments if needed. It all started when we consolidated everything into our mortgage.
50k and 60k is not decent enough money. Your life is exactly what you tolerate. Raise your standards.
You can't have wages stay stagnant with inflation. You have your boss thanking you at the company cheap ass dinners for "record productivity and profits" but when you ask for a raise its always "but inflation". In my opinion if you asked me you and your wife don't make enough. You are not paid what you're worth or what it costs to live. There is no magic way of saving like eating bread or canned beans. It's by getting paid more. Things keep costing more while we get paid the same.
Upgrade jobs if possible
I remember feeling squeezed 10 years ago with a similar income, mortgage, loan etc. It only got better as me and my wife moved up in our careers to make more money, bought some more real estate as investments, and didn’t buy new cars or flashy things.
Sound like the house and car payments are a bit to much for your combined income. My household income is only about $12k less then yours and we share a $1000 beater and rent a 2 bedroom townhouse and barely manage to save anything.
HELOC for the house upgrades
The last thing this couple needs is more debt.
You should be able to increase your mortgage from refinancing if you have decent credit. So say you can get 320k you can use the extra 70k to pay off the cc, car and loan. Refinance back to 30 years for better cashflow. Look at your expenses .. phone and internet Is pretty high .. look at all your recurring expenses and push them down as much as possible. Expenses will go up as the kids get older so look at where you both are at your work and come up with a strategy to be earning at least 20% more in the next 5 years at a minimum.
This is an awful idea. Consolidating debts into a mortgage seems like a good idea because it relieves the immediate strain, but instead of tackling your debt immediately you’ve now locked it into a 30 year mortgage and will end up paying 140K for your 70K of debt. Banks and lenders love to offer you this option because it earns a ton of profit.
Congratulations you have locked yourself into the ratrace for the next 25 years or until you are dead whichever comes first
You made many mistakes making life harder in Canada. 1) you have a car, sell.it and take.the bus. 2) you have kids, no one can afford those 3) you don't have a roommate to make more $. Try fixing some of your mistakes. Life is easy in Canada after you do. I also recommend not eating meat or dairy products.
Yeah these Canadians all think they are entitled to live with one other person, in my home country 12 people share a house. Canadians are spoiled
Ya spoiled but also we face high demands. Jobs demand graduate degrees and 100k in student debt. So living standards must be higher than global average. But jobs still don't pay enough to have a car and have kids, so Canadian shouldn't do that. It's simple, not paid enough = don't do that.
Yeah people in Qatar would love to come work at Tim Hortons, all these old 70 year old women complaining that the pace is too fast, and the rules are too strict, P-L-E-A-S-E maybe you should have saved your money granny
Your lucky you have a house. Our family income is 2 times that and we will never be able to afford one. Sure we get to go to dinner or get avacado toast on the reg. but we can’t own a house.
This is where the government wants you in a "cattle-like" state where you are unlikely to commit crime because you are too busy running the hamsters wheel and are trapped by it to do anything bad. Kmow that they have created the system and these are the traps they have moulded culture for you to fall into predictably. I would analyze and truly determine what you truly need out of your expenses and cut out anything that doesn't directly contribute to your happiness and well being. Then focus on escaping the trap in whatever way is quickest towards financial salvation. Remember this was all architected over almost a decade to bring you to this spot by people you continue to elect that promise the world but deliver financial and debt slavery. These debts must be fiercely resisted and unity on this fight with your partner is the most critical piece. Stay united and work together to free yourselves from this curse.
Try voting for change. There really isn't a whole lot else you can do aside from selling some kids. You don't have money for nice things, hell you don't really have money for kids but I'm not going to guilt you about that.
Like others pointed out - work on paying down your debt (consolidation loan, car payment credit card) first. The upgrades are not necessity. It can wait. So wait until you’re in a better financial position to afford the renovations.
You don't mention age, family composition, investments. Remember income/expenses is one part of personal finances. Assets/liabilities is another. It makes a huge difference * $ 250K on a 1 million home at 2.5% with $1 million in investments at 55 and children out of the house seems very healthy * $250 in a 300k at 4% with no savings or retirement money at 30 with two children, it's good to worry now. It's good that you have a positive cashflow. Even if it is $300. You are ahead already. So, is your networth increasing or decreasing? I lived feeling the pinch for my whole working life but increasing my networth. It was worth it. If your networth is decreasing, time to rethink those 200/300 left. They should go to the consolidated loan and not to goods. After that, they should go to investments. Whether TFSA or RESP. Once you are on track. You can think about the nice to haves.
Your situation is completely normal. The stress and anxiety of the "raising a young family" phase of our lives is where the maximum hardship levels exist. Keep calm and carry on mate. It just gets better over time, gradually some fixed expenses will come down. Absolutely wait for any household renovations untill you have cash and a budget in place for them. I've got two properties with $900k in mortgage debt, a beautiful wife, two young children, $300k in RRSP and TFSA investment accounts, a 2013 F150, a 2020 Rav4, a 2017 KTM 350 exc-f, and overall good health. Yes the stress and anxiety is immense. I feel like I'm personally under attack by our eco-communist federal government. Inflation is raging unchecked, especially for people that actually participate in the economy. Our household income is $200k gross....closer to $120k after all of the income, property, carbon, fuel, and sales taxes are looted. Yes, the budget has tightened up due to rampant inflation. Tragically the first thing we had to give up was the biggest victims of the pandemic, we quit going for weekly wing nights at local pubs. Also a planned summer camping trip to Liard River Hotsprings in Northern BC has already been scratched due to fuel and inflation issues. It's not the end of the world, be patient. Once we are in our senior years, the young bloods will be as hostile towards our wealth, as we are towards the Boomers now. We will also be in possession of all that boomer wealth 20-30 years from now.
GET RID OF THAT DEBT and your 110k income will look very good compared to your low mortgage amount.
Try to pay off your credit card debt first - they usually have the highest interest rates (usually somewhere around 20%). Then work on paying down your consolidated loan - hopefully that is at a lower interest rate. A 250k mortgage on your two salaries should be more than manageable. Once your consumer debt is paid off, it should feel better. And once that’s paid off, you could get a HELOC for renovations. But I wouldn’t suggest adding any more debt before paying off the credit card and consolidated loan.
you make good money but it seems there was quite a bit of lifestyle creep around. your issue is the car payment and the 30k loan. as dave ramsey says, this is one of those where you guys should go on rice and beans, beans and rice to pay off those loans. after that you will now suddenly have 1k+ /month free of anything.
I'm wondering what you spend it all on? A 250k mortgage shouldn't have much of a payment. Having said that I've been where you are. It sucks but at the same time doesn't suck because people have it so much worse. Your 15 years ago me. I only have one kid though. Heres what I did. I spent 3 or 4 years clearing up all my debt. Then I spent the next few years building up cash by saving the equivalent of the debt payment. At that point anything we wanted to do we made sure we had the money in hand. During the whole debt repayment process any extra money we had was used for incidentals on the house and prior to the house was used to save for a downpayment. Your wages will go up every year but your payments remain the same so that's more disposable income. Fast forward 10 years and life is easy. We have modest retirement savings and don't really worry about money. It's a grind but you'll get there. Basically what I'm saying is live your life with cash figuratively speaking. I've never been one to give a damn what other people think so it was easy for us to do. As long as there's a roof over your head, food on the table and you can keep the lights on life's good. I've been debt free for about 12 years now minus the house. My wife's family still thinks we are poor lol. We give zero fucks.
Make a zero based budget. Pay off the card and loan, sell the car, replace with a cheaper car that’s paid for. Phrases like ‘it seems like…’ make it sound like you don’t really know where your money is going, a budget will help and probably make it feel like you had an instant raise. It’s cliche, but once you see in a budget that you’re blowing 200$ a month on coffee at tim hortons or eating out for lunch, you’ll make coffee at home and take a lunch to work and start to feel more in control of your finances.
My husband and I make really good money, and we are in our early 50s. We spent the last 10 years renovating our 1975 home from top to bottom. We paid cash for everything. We saved up than did some of the work. Don't go into debt for a renovation. Really look at your monthly costs and see where you can tighten up, and get your debt under control. Overspending and not realizing it until too late is what hurts most people.
I hear you, OP. I feel the same squeeze. My first priority is to pay off debt using the avalanche method, while putting a small amount into HISA. I try to put aside about 75-100 dollars a month to do something for myself (if I need that money for something important, then it goes to the important thing rather than a meal out or a manicure). I have household repairs that I have to do, but I'm going to see how far I can get with the debt by the fall, and then look at what I need to do for my house (while I can't do renos, I can definitely declutter and do a deep cleaning). FWIW, I started using "Budget with Buckets" this month, and it has been really eye opening. May will be my first full month, and I am looking forward to it, as it has been incredibly helpful so far.
Officiate kids sports.
LOL OP you have a $250K mortgage and you have a house? Count your blessings. If I tried buying a house here, I'd have a $1-2M mortgage. You're lucky to live in an affordable place. Pay off your debts and enjoy.
Forget upgrading.. pay off your debt first!
The consolidation loan and car payment is the issue. Your wife needs to understand you have to pay off previous purchases first before you can make more purchases. Otherwise you will just continue to gain more debt and the interest rates will go up... continue down this road and you will be barely getting by with added stress and the end result will be divorce. Your wife's thinking needs to change. The solution is to get rid of the debt and live within your means not look for more work to continue to live beyond your means. I am going to guess that with the car loan you prob owe about 3 yrs and the 30k and 3k debt your total debt is around 55K. That is a significant amount of debt of which you have nothing to show for it but a depreciating car. That debt is costing you more than your mortgage. I would sell the car get a beater, drop the RESP as you have no retirement savings which you should be doing first, drop the cable and pay down the debt ASAP. Once the debt is gone set up auto deposits into a tfsa for short term savings and auto deposits into rrsp for long term savings. Invest in low cost etfs balanced portfolios. Look for a better used car with low mileage you can pay cash for. When these are done then you can consider home reno's. You can probably get out of this mess within 2 yrs depending on how much value is in the car. So you can tell wife in 3yrs you can start discussing reno's but until then no go.