A resident of Barrie, Ont., read some of my recent columns on the housing market and decided to reach out. He’s 66 and living mortgage-free in a three-bedroom house not too far from a lake.
The house has jumped in value and life is…complicated. Read on for one of the most refreshingly candid takes I’ve seen lately on home ownership in 2021.
“I read about millennials who are struggling to afford a house and, indeed, I have a lot of sympathy for them. The value of my current house has gone up considerably over the last couple of years, so I guess I am sitting on a valuable piece of equity (as long as the current bubble doesn’t burst). However, here is the rub. The only way I could realize any of that equity would be to sell or mortgage my home.
My inflation-adjusted pension has gone up by less than 1 per cent this year, but I still have to pay my property taxes and upkeep on the house. In fact, there is not a lot else that I want to spend my money on besides maintaining my home.
My deck needs replacing, but the cost of wood has apparently gone up by something like 40 per cent and I suspect that the labour is also in great demand. I would like to install a sprinkler system, but am afraid to find out how much that has increased in price as well, now that there is a great stampede of people moving out of the cities and building swimming pools and landscaping their new back yards.
The short of it is that I don’t really feel wealthier – it is just inflation. I am debating whether to defer some needed home improvements until next year in the hope that the current housing insanity will have subsided somewhat.
My home is extremely important to me and I am in good health and not ready to move anywhere. I receive messages regularly in my mailbox from individuals who say they want to buy my house. I bought my home as a place to live, not as a commodity. So although I suppose I should be thankful that it turned out to be a good investment I have very mixed feelings about how this housing situation is playing out.”
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Rob’s personal finance reading list
‘Focus on the baby’
An excerpt from a book called Get Your $hit Together: The Rebel Mama’s Handbook for Financially Empowered Moms. I added this as a follow-up to a recent Q&A in this newsletter on how women are hurting their financial security by sacrificing for their children.
The ’30 wears rule’ for online shoppers
Tips for financially and environmentally smart online clothes shopping, including a rule that says an article of clothing must be worn 30 times to work off the carbon emissions created in production.
The future of remote work
A lot of people have reorganized their lives to work at home. Will remote work continue to be a trend after the pandemic? Here’s an argument that a hybrid model of remote and in-office work will prevail. Note the mention of an “artificial commute” a way for people working at home to create a barrier between work and home life. Maybe 15 minutes in the morning and at night to relax and reflect.
Trendy grandma
Your grandparents are downsizing and invite you over to see if you want any of their stuff. Before you say no, check out this list of old-school furnishings that are back in style.
Ask Rob
Q: What would be the best advice for the 800,000 Canadians who received word that their Canada Revenue Agency user IDs were locked [for security reasons]? Other than gaining access back to one’s account in the ways the CRA suggests, what steps would you take?
A: Here are some thoughts from Alexis Dorais-Joncas, security intelligence team lead for ESET, an IT security software company: “From what we understand from their reports, the CRA has evidence that the login and password combinations of those 800,000 accounts became available to unauthorized individuals. The CRA did the right thing by locking those accounts. If you are one of those affected by this lockout, you should first identify which other websites and online services you might have registered to with the same login and password as the one used for the CRA website, and then change those passwords immediately. Very important: remember to use a different one for each service! This is also the perfect occasion for those not already using a password manager to install one and start using it. We’ve also heard reports of people waiting for hours to speak with a CRA representative. While spending that much time on the phone to recover your account is certainly frustrating, you should remember that dealing with identity theft is much, much worse.”
Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length and clarity.
Today’s financial tool
A fascinating tool that lets you dig into income levels broken down by age levels and city. Find out, for example, how many people in your city make more than $100,000.
The money-free zone
Add to the list of great Canadian food products, even if it’s hard to find in grocery stores. Toast, slather on the butter, eat and repeat. I doubt your first loaf lasts the day.
Malt Bread for use in Carrick on Money newsletterThe Globe and Mail
Tweet of the week
Globe personal finance editor Roma Luciw recently tweeted about the percentage of home buyers getting help from parents. A lively discussion ensured.
In case you missed these Globe and Mail personal finance-related stories
- University is expensive, but an RESP shouldn’t be
- How can Rolando and Janet shift gears from saving and investing to decumulating?
- Fraud Prevention Month reminds young consumers to be cautious of online fraudsters
More Rob Carrick and money coverage
Subscribe to Stress Test on Apple podcasts or Spotify. For more money stories, follow me on Instagram and Twitter, and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group.
Even more coverage from Rob Carrick:
- 🎧 Catch up on Stress Test: How to survive the gig economy • How to get out of debt • Is now the right time to buy a house? • Crisis-proof your finances • Does investing change during a pandemic? • Can you afford to live downtown? • The cost of kids • Should you move back in with your parents?
- ✔️ A 10-point pandemic personal finance checklist: Create a "wartime" family budget; stop worrying about bank deposits; clean out your big-bank savings account; get relief on car payments; get preapproved for a mortgage; WFH? Save $1,000 a month; save, save, save; build resilience by not anxiety-buying; consider the cost of mortgage deferrals; get ready for the second wave of financial distress.
- 📈 Investing: The case for a tight portfolio of big blue chips dividend stocks; robo-advisers beat human advisors (and they’re thriving), why online banks that are better than the branch; is it time to invest your 2020 TFSA; don’t get your mortgage at a bank; why it’s so hard to invest in preferred shares; stock up on stocks to retire early; and are you following the 10-year rule with your investments?
- 💰 Saving: Food waste is wasted money; why you might regret that SUV and find out if CAA is worth it; juice your PC Optimum points; how an ex-Bay Street lawyer got out of debt; blindly easy tweak to your retirement investments to survive economic downturn; should you buy that latte?
Are you reading this newsletter on the web or did someone forward the e-mail version to you? If so, you can sign up for Carrick on Money here.
