Photo illustration by the Globe and Mail/SOURCE: Getty Images
Name, age: Cheryl, 22
Annual income: $41,760 (includes music gigs)
Debt: $0
Savings: $9,900 in savings account; $1,800 in TFSA; $10,000 in limited partnership with home builder
What she does: receptionist, self-employed musician
Where she lives: Guelph, Ont.
Top financial concern: “I don’t like being in debt. I’d like to support myself fully doing music.”
Paycheque Project is a non-judgmental look at how young adults in Canada are spending their money.
There were no frills when Cheryl was growing up. “My parents were my age when they married,” she says. “They had to work their way up.”
It’s an approach Cheryl is trying to emulate. She has managed to save $1,800 in a tax-free savings account and $9,900 in her chequing account, largely owing to a banner year. As a singer, she made $9,000 performing at private functions and music venues across Southern Ontario. “This year, I had three shows every weekend,” she says. “I didn’t really expect to book so many shows. I’d like to support myself fully doing music.”
To pay her expenses and make up for lost time when she was laid off during the pandemic, Cheryl currently works as a receptionist, earning $18 an hour. That job allowed her to eliminate her $7,000 student loan, for an enterprise business management course at a Toronto college, in just five months. “I graduated in April and by September I had paid it all off,” she says. “I don’t like being in debt.”
While she’s saving money to buy her own place, her parents have allowed her to live at home rent-free. They also cover most home expenses and groceries. In order to build up her down payment, she’s not travelling this year and is going to keep driving a 10-year-old car. She’s tracking her expenses using a spreadsheet.
Her parents recently began investing in a limited partnership with a home builder. While she acknowledges the investment is considered medium to high risk, Cheryl jumped at the chance to participate. The money is pooled with other investors, which the builder uses to develop properties. She says she invested $10,000 and is getting a dividend of $100 a month from the builder, which she reinvests in the limited partnership.
“I want to purchase a home down the road,” says Cheryl, ”although it’s unlikely that I’ll be able to do that alone.” She says she may settle out West – she loves British Columbia – but recognizes that real estate costs there are high. She also wants to visit Europe next year if she earns enough money.
In the meantime, she hopes to grow her music career, supported by her parents, who place a high value on saving money.
“They are very practical,” says Cheryl. “But they also believe in living your life. I am working toward being a full-time musician.”
Her typical monthly expenses:
Investment and savings: $650
$350 to savings account. “I use my chequing account to pay car insurance and for outings.”
$0 to RRSP.
$200 to TFSA. “Once the TFSA is up to $5,000, I will invest it in the limited partnership.”
$100 to limited partnership. “It’s with a home builder. It’s so that my sister and I can save and be able to afford a home.”
Household and transportation: $581
$0 to rent. She lives at home with her parents.
$156 on car insurance. “I bought a 2012 Ford Edge with new tires two years ago. I paid cash.”
$50 on car repairs. “It’s a 10-year-old car but was owned by an old lady who barely drove it.”
$300 on gas. “I had a lot of gigs in Toronto, Niagara-on-the-Lake, London. I had to fill up twice a week in the summer.”
$75 on cellphone. “I am with Freedom Mobile. I get 20G of data.”
Food and drink: $180
$40 on groceries. “We have a Zehrs down the street and a Food Basics. I get veggies, salads and frozen meals.”
$100 on eating out. “This year I’ve been a bit more social. Sometimes I’ll go to a café and work on stuff.”
$40 on alcohol. “I usually go to the LCBO and get a bottle of wine or a pack of Seagram coolers.”
Miscellaneous: $223
$25 to sports. “I play on a rec volleyball league.”
$20 on hobbies. “I like to buy paint-by-numbers projects off of Amazon.”
$100 on clothing. “I sing at a lot of events so I don’t want to wear the same outfit. I buy different pieces that I can mix and match with things. I shop at Shein a lot.”
$15 on haircuts/cosmetic services.
$25 on dental.
$10 on prescriptions. “I have insurance through my work.”
$10 on apps. “I pay for Spotify.”
$13 on cannabis.
$0 on vacations. “I want to be able to travel. My next plan is Europe – maybe in the new year.”
$5 on books.
Total $1,634
Some details may be changed to protect the privacy of the person profiled. We want to thank her for sharing his story. Are you a millennial or Gen Z who would like to participate in a Paycheque Project? Send us an e-mail.
Are you a young Canadian with money on your mind? To set yourself up for success and steer clear of costly mistakes, listen to our award-winning Stress Test podcast.
