Vancouver's waterfront with condos in the background
Far from having their heads buried in the financial sand, twenty– and thirty-something Canadians are feeling anxious, angry and scared about their futures.
In December, we asked The Globe's millennial readers to send us their biggest financial fears. More than 1,200 of them did. The answers varied but certain themes emerged: skyrocketing house prices, an inability to save for retirement, crippling levels of debt, a tough job market and worries about the affordability of having kids, as well as general concerns about making ends meet, have Canada's young people losing sleep.
"Our wages are not going up, the world is falling apart and my family – child included – is stuck in a condo because housing prices are completely insane," says JM, a mom in her thirties living in Toronto.
"Where will I raise my child? How can I afford a home without bankrupting us all? How long can a family last in 600 square feet? How can anyone trying to raise a family afford a $600,000-plus mortgage? It keeps me up at night."
Not surprisingly, fears about expensive housing were most pronounced among readers from Vancouver and Toronto, with some saying they have abandoned all hope of ever owning real estate. Even those with good jobs are having a tough time affording a family home.
"When I first bought my condo, we borrowed six times my annual income to buy it and the mortgage payments were crippling," says JF from Vancouver.
Although he has since doubled his income and makes his mortgage payments "more comfortably," a move up the property ladder seems unfeasible.
"I doubt I will be doubling my income again," JF says. "I worry [interest] rates will go up in that situation to mess me up. My only hope is a [housing] collapse/correction but that will take the economy with it."
SW, a woman in her 20s who lives in Guelph, is struggling with student debt. Entry-level positions you get after graduating don't pay nearly enough to cover living expenses and allow for debt repayment, she says. "Post-secondary education is a financial black hole."
There is plenty of job-related angst among Globe readers who responded to our callout.
LD, a young woman from Calgary, says she can't find a permanent full-time job. "I'm currently working on precarious contracts and it's incredibly difficult to secure something stable, even with an MBA and eight years of work experience."
"I have a post-graduate degree, six-plus years of professional experience, but can't find a job that pays more than $13 an hour," says AC from Thunder Bay, Ont. "How do you live off that? How do you pay off your student loan debt, buy a house, and start a family? I can barely pay my rent."
MG, a thirty-something from Edmonton, says she and her partner worry about their lack of an emergency fund in the event of a layoff. "If one of us loses our jobs during a recession, how will we pay the mortgage on the house we just bought - which cleaned out our savings? Can we have another child while we're still in low-physical-risk years, without putting ourselves at high fiscal risk?"
One young woman from Petawawa, Ont., wrote in to tell us that having a family is something she and her partner feel they cannot afford, despite the fact that they own a home and have government pensions. "I'm 30 and feel like having kids would bring me too close to financial hardship at this point, particularly with the cost of daycare and the mommy tax on my career in a male-dominated environment."
Surprisingly, retirement was high on the list of financial worries for young people. The word "balance" also came up frequently, with many millennials saying they are having a tough time deciding where to allocate their scarce dollars – and where to turn for financial advice.
KL, a young man in his twenties living in Charlottetown, says balancing all his saving needs is difficult. He would like to maximize the power of compounding by saving for retirement now, but that would leave him with no money for an emergency fund, a down payment for a home, or for things like travel.
"The idea of 37 more years of working is unfathomable. How can I save enough now to retire early and still have a life?" he asks.
Balancing buying a house and having kids with saving for retirement seems overwhelming to DO, a woman in her twenties from Ottawa. "Whenever I add daycare costs for even one kid into my projected budgets, I start to realize how rough it'll be to be a homeowner and save for retirement at the same time."
Although hers is a two-income household, she foresees "a tough juggling act and I worry about how we'll manage it all and ever manage to retire, since neither of us have any kind of pension."
SK, another woman in her twenties from Ottawa, says that while she has some money to invest, the stock market intimidates her. "I don't completely understand it and I'm scared of losing money. Why wasn't this stuff taught in high school?"
Anxiety over "how little I know about finances in all categories" was a concern for LG, a young Toronto woman. "No one talks about how difficult it is to fulfill being a 'young person,' travelling, enjoying your twenties, having fun, seemingly at the same time as becoming a 'fiscally savvy adult.' They seem to contradict, and figuring it all out on your own is confusing and daunting."
A young Globe reader, LD from Edmonton, said her biggest financial concern was "not being able to afford the traditional trappings of life." In the eight years since she graduated from university, even temporary lower-paying jobs with no benefits and zero pension have been hard to find. "How can I even begin to think about saving for retirement when I can't even see how I'm going to afford rent, let alone save for a down payment on a house?"
As a single young woman, LD says the idea of raising a child – potentially on her own – is financially unfeasible.
"People say that my generation wants everything and we want it all right now, that our goals far outstrip realistic expectation. When, at any time in our history as a country, has having a steady source of income, raising a child and having a house been beyond common expectation?"