'Canadian dream' is a myth more than a reality"

[crazy_eoj]

Originally Posted by Brannigans Law

I gave up reading this thread on page 3 when people were talking about how this is just a matter of folks needing to live within their means. Talk about the ultimate in balogne. Yes people need to live within their means but when everyones wages have stagnated and the upper crust of society is enjoying all the wealth growth over several decades that's a problem. No matter how much you want to guilt people into being frugal. Farcical.

Except that's not the case?



https://twitter.com/stephenfgordon/s...262209/photo/1

[Johnny199r]

Originally Posted by darklord700

Johnny, 280K is serious dought and saving it before the age of 30 even on a good lawyer's salary is great achievement. I only wished I had done that when I was 30 years old. Hats off to you and you have nothing to worry about your future financially.

Thanks. My parents taught me the importance of money and saving. My spouse grew up in a family where she was never taught about financial responsibility. In the few years we've been together she's done a complete 360 from being in debt and spending lavishly to being excited about investing and planning for retirement. It's great to see other people making that realization while they are young.

[V]

So now she's back to spending lavishly? That's a bummer.

[MarchHare]

Originally Posted by crazy_eoj

Except that's not the case?



https://twitter.com/stephenfgordon/s...262209/photo/1

1. It's unclear if the chart you linked is adjusted for inflation. If if isn't, then your point is moot.

2. Even if the chart is adjusted for inflation, it doesn't exactly paint a rosy picture for anyone outside of the top 0.1%. According to your own link, the bottom 99.9% had average annual income growth of <= 1.5% over the last 30 years.

[Devils'Advocate]

I can't find the data source for that table crazy_eoj. I know it points to some site in France, but I can't find it on that site.

BTW - a further analysis of the STC report that came out yesterday:
http://blogs.wsj.com/canadarealtime/...reaming_stream

Which is pretty much what I said yesterday. Should housing prices ever fall, we'd be in really bad shape. Because right now that is what is driving the middle-class wealth generation at the moment. RRSPs, savings, investments... those things are certainly NOT helping the middle class.

[Johnny199r]

Originally Posted by V

So now she's back to spending lavishly? That's a bummer.

No, we split bills 50/50. She was in debt and couldn't really point to owning anything great, or really enjoying what she spent the money on to get into debt (boozing, shopping etc). She has the same spending habits as me now, we both enjoy fitness activites which are pretty cheap (biking, gym, running) as opposed to being in bars or malls.

[I_H8_Crawford]

Originally Posted by Johnny199r

Thanks. My parents taught me the importance of money and saving. My spouse grew up in a family where she was never taught about financial responsibility. In the few years we've been together she's done a complete 360 from being in debt and spending lavishly to being excited about investing and planning for retirement. It's great to see other people making that realization while they are young.

That's funny - it was the opposite for my fiancee and I - she has always been frugal and I was a big spender - 3.5 years ago i was $40K in debt - now my liquid net-worth is north of $200K - she didn't help me with any money, just with budgeting and defining what is really worth my money.

We still go on beach vacations once a year, eat out somewhat often, but only own 1 car, and rent a decent place close to the LRT for her to get to work. Last year we figured our savings rate of our after tax income was over 70%

My regret now is if I was like this when I was 22 out of Univ, instead of being 30, my net worth would likely be closer to $500K and I would be closer to getting out of the rat race.

It can be done, but it IS truly all about priorities.

[Burninator]

Originally Posted by Johnny199r

No, we split bills 50/50. She was in debt and couldn't really point to owning anything great, or really enjoying what she spent the money on to get into debt (boozing, shopping etc). She has the same spending habits as me now, we both enjoy fitness activites which are pretty cheap (biking, gym, running) as opposed to being in bars or malls.

He was joking because you said 360. That is circle and would bring you back to where you started. You meant to say 180.

[Johnny199r]

Originally Posted by Burninator

He was joking because you said 360. That is circle and would bring you back to where you started. You meant to say 180.

My bad! I'm slow today!

[bubbsy]

most of the folks speaking in this thread have knowledge about personal finance.... i am relatively dumb/new to this realm. I have been working for 10 years now, after uni, am married, have a mortgage on a condo, which will soon become a rental property as i just purchased a home, put money into my RRSP (mutual funds.. )every month since i started working (the amount increases proportionally to my pay scale), and have a limited stock portfolio which are doing ok (company stock+options, though i have very limited knowlegde on trading and how to handle this from a tax perspective)....

(sorry for the running sentence)....

My question is, how do i figure out how to best manage my personal finances. Are there courses/books out there, or how about a financial advisor? I assume the financial advisor would be a flat hourly rate type of consultant rather than a commissioned based one on the products they sell).

Being frugal/budgetting/etc, is one thing, but being smart about your money seems to be the way to truly realize your financial goals, irrespective of if you're household income..

Thoughts?

[darklord700]

Originally Posted by I_H8_Crawford

Last year we figured our savings rate of our after tax income was over 70%

Wow, saving 70%. That is sick man in a good way.

[crazy_eoj]

Originally Posted by Devils'Advocate

I can't find the data source for that table crazy_eoj. I know it points to some site in France, but I can't find it on that site.

BTW - a further analysis of the STC report that came out yesterday:
http://blogs.wsj.com/canadarealtime/...reaming_stream

Which is pretty much what I said yesterday. Should housing prices ever fall, we'd be in really bad shape. Because right now that is what is driving the middle-class wealth generation at the moment. RRSPs, savings, investments... those things are certainly NOT helping the middle class.

I believe the data is from Cansim but not 100% sure.

Dealing in 'what ifs' is really rather counterproductive. If the economy as a whole collapsed, or another world war happened, we'd certainly be worse off than if housing prices fell.

The fact remain that the average Canadian has seen great increases in personal wealth, both through housing AND pension/investments. That in itself cannot be ignored.

[kevman]

Holy upper class thread derailment!

From the article "middle income" is defined as 75% to 150% of the median income. Median being $50k/year or so? If you're putting away $50k a year in savings you're not middle income. Nobody in the "middle income" range is saving 70% of their take home pay cheques either.

It's pretty easy to live within your means when you're means is among the top in the country. Congratulations!

You guys all sound boring.

Edit:
If you earn $125k/year you're considered "very high income" which according to page 15 shows an income growth of ~$24 to $42 from 1993 to 2007 compared to the middle income growth of ~$19 to ~$20. No part of the article discusses concern about the rich being able to live within their means after seeing substantial wage growth in the last 15 years.

[HockeyIlliterate]

Originally Posted by bubbsy

My question is, how do i figure out how to best manage my personal finances. Are there courses/books out there, or how about a financial advisor? I assume the financial advisor would be a flat hourly rate type of consultant rather than a commissioned based one on the products they sell).

Being frugal/budgetting/etc, is one thing, but being smart about your money seems to be the way to truly realize your financial goals, irrespective of if you're household income..

Thoughts?

Aside from the general (and very dumbed-down) Wealthy Barber book(s), I found this website to be helpful:

http://www.finiki.org/wiki/Main_Page

The forum can be found here:

http://www.financialwisdomforum.org/forum/

If you want an expanded (and US-focused) website that gets a lot more traffic, go here for the wiki:

http://www.bogleheads.org/wiki/Main_Page

And here for the forum:
http://www.bogleheads.org/forum/

I'd stay away from financial advisors; just read a few select books and you'll be fine. The concepts are pretty easy: pay yourself first, live below your means, keep your expenses low, be diversified, stay the course, and be boring. Slow and steady wins the race.

[HockeyIlliterate]

Originally Posted by kevman

It's pretty easy to live within your means when you're means is among the top in the country.

And it is pretty easy to live within your means when you don't have a lot of means either.

It all boils down to priorities.

[tvp2003]

Originally Posted by I_H8_Crawford

That's funny - it was the opposite for my fiancee and I - she has always been frugal and I was a big spender - 3.5 years ago i was $40K in debt - now my liquid net-worth is north of $200K - she didn't help me with any money, just with budgeting and defining what is really worth my money.

Cutting a 40k debt and saving another $200k in only 3.5 years? That's like $68k per year, or over $100k per year before tax (I'm assuming none of the $200k is in RRSP's). My question isn't how you saved, but what the **** where you spending your money on before?!?

[Wormius]

Originally Posted by tvp2003

Cutting a 40k debt and saving another $200k in only 3.5 years? That's like $68k per year, or over $100k per year before tax (I'm assuming none of the $200k is in RRSP's). My question isn't how you saved, but what the **** where you spending your money on before?!?

An Asian fiancee / wife can do amazing things to the betterment of your financial situation.

[kirant]

Originally Posted by Wormius

An Asian fiancee / wife can do amazing things to the betterment of your financial situation.

What about Asian husbands?

Ladies...

[Muta]

I would hope that by age 60, I'm working a job that I just don't want to retire from. I would hope that by that age, I'm traveling / making money / making an impact that is just as much fun as it is work.

Retiring is great, I'm sure... but imagine doing what you love everyday for the rest of your life, and getting paid for it. That would be the way to go IMO. Wouldn't even seem like work.

[darklord700]

Originally Posted by Muta

Retiring is great, I'm sure... but imagine doing what you love everyday for the rest of your life, and getting paid for it. That would be the way to go IMO. Wouldn't even seem like work.

That would be my goal as well. Not doing a thing after retirement just isn't fun for me. I still would like to earn and to stay relevant after retirement. I won't work full time hour or 12 months a year. But I need something to get me out of bed everyday and allow me to interact with people.