Author Topic: Almost Rich: an examination of the true cost of city living and why rich is neve  (Read 12959 times)

MacGyverIt

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If ever mocking was in order, this is it. This article about Toronto based "making 200k, living month to month" screams "in need of MMM". You'll be shocked and amazed by the expenses of these families however the author states "They’re all comfortable, but no one is living large." Um... newsflash.... $500 for a *monthly* wine budget is in fact living beyond large, it's living GINORMOUS.

Reading this article is like witnessing a crime scene.

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http://www.torontolife.com/daily/informer/from-print-edition-informer/2012/02/15/almost-rich/

Almost Rich: an examination of the true cost of city living and why rich is never rich enough

The Western world has become chastened and frugal. The reasons are many: corporations crouched in fear of another, much worse recession; penniless governments a-toppling; and Europe, for the foreseeable future, mired in a debt debacle. But you wouldn’t know it from life in Toronto, where a luxury condo opens its doors every week and we queue for hunks of exotic chocolate at the new Maple Leaf Gardens Loblaws. We’re bouncing along in a prosperity bubble.

The exact meaning of prosperous, of course, depends entirely on one’s perspective. Last fall’s Occupy protesters were keen to demonize the so-called One Per Cent—the monocled, yacht-owning multi-millionaires who are now greed personified. However, the threshold for the top one per cent of income earners is much lower than you’d expect: $196,000, in the latest Statistics Canada numbers. That’s no small amount of money, but hardly the means for a life of leisure. In an increasingly pricy city like Toronto, where we pay a premium for everything from milk to car insurance, $196,000 can seem positively middle-class.

Break it down, and it translates to roughly $10,400 a month, after taxes. For many Torontonians, that $10,400 disappears fast. Thousands go to the mortgage. For those with young kids, daycare can cost upwards of $1,500 a month. There are the car and RSP payments, wardrobe refreshes, utility bills and something to set aside for when the furnace inevitably conks out. Plus the cost of the sushi, pad Thai and butter chicken that we order in three nights a week—because we’re all too tired to cook by the time we get home from work.

Then there’s the stuff that fills our houses—the calibre of which is the subject of intense, unspoken competition among my peers and neighbours. During my entire childhood, spent in a comfortable lower-upper-middle-class neighbourhood of Montreal, I am quite sure that my mother did not waste a single moment worrying about replacing her laminate kitchen counters with granite or marble. There was no such thing as a $1,000 Bugaboo stroller, or anything like it. You could host a casual weekend party without spending a fortune on artisanal cheeses. Living the good life simply wasn’t the full-time, across-the-retail-spectrum pursuit it has now become.

All that spending has increased our debt-to-income ratio, which reached a record high of 150 per cent in mid-2011. According to data from Environics Analytics, the average GTA household is now carrying almost $40,000 in debt on top of a mortgage. And the city’s fanciest neighbourhoods are the ones where average household debt levels are among the highest: Lawrence Park, the Kingsway, Leaside, Rosedale, the Bridle Path. Much of the debt accumulation can be explained with a single figure: 5.5. That’s the ratio of the average single-family Toronto home price to the income of its occupants. The historical average for this crucial quotient is just 3.5. Relative to income, in other words, homes are now about 65 per cent more expensive than they once were: the Moore Park gut-job semi is selling for $1.5 million instead of $900,000. The result of this unreasonable amount of debt is that even those who earn $196,000 live hand to mouth, hoping that next week’s payday will cover this week’s overspending.

As house prices steadily increase, the city becomes more and more the exclusive domain of the One Per Cent. Data published in 2010 by David Hulchanski, the associate director of the University of Toronto Cities Centre, shows that since the 1970s, wealthy Torontonians have become more densely clustered in discrete, high-profile enclaves featuring a predominance of older, more valuable, resident-owned single-family homes.

The era of the “mixed” neighbourhood, in which people of different income levels and social classes lived happily side by side in an architectural hodgepodge, is falling away. (In 1970, Hulchanski found, 66 per cent of the city was composed of “middle-income” tracts. In 2005, that figure was down to 29 per cent.) Toronto is becoming more like London, Paris, Vienna and other European capitals, where only the richest families can afford to live in the city centres and the rest of the population commutes from the inner suburbs.

My own Toronto neighbourhood of Playter Estates, northeast of Broadview and Danforth, provides a typical example. When my wife and I bought into the area in 2002, our neighbours were retired schoolteachers, construction workers and Greek restaurateurs. In the decade since, most of those people have died or cashed out, and they’ve been replaced by a homogenous Pleasantville of bright, successful 30- and 40-something white-collar professionals. On my block, Chevys and Toyotas have given way to BMWs and Saabs. Fancy new foodie shops save us the trip to Summerhill Market. Out with Dollarama, in with the Riverdale Mac store and about a thousand espresso bars.

Who is wealthy enough to become my neighbour? The lucky ones have family money, perhaps receiving their down payment from retired boomer parents. (“PHD,” Papa has dough, is what my real estate agent used to whisper happily when she’d spot a young couple doing an open-house walk-through with well-off parents in tow.) Or they’re the rare individuals who can support a one-income household with the fruits of hedge fund management, investment banking or real estate development. But for most Torontonians, urban life is unaffordable unless both partners are bringing in serious money.

So what does the prosperous Torontonian look like? Here are five households from across the city, each with an income hovering around the low end of rich. They’re all comfortable, but no one is living large. (<--- MacGyver Note: WTF??????)

HOW THEY SPEND IT
http://www.torontolife.com/daily/informer/from-print-edition-informer/2012/02/15/almost-rich/3/
The Lewis-Koonings
Household income: $200,000
Suzanne Lewis, a 41-year-old real estate agent at Keller Williams, and Thomas Koonings, the 45-year-old owner of the design-build company 4th Wall, bought their semi in Riverdale in 2007 for $419,000. Since then, they’ve had two kids: three-year-old Evie and 18-month-old Vaughan. At the end of the month, after all the bills are paid, they usually find they have nothing left. “We have a weakness for designer furniture,” says Suzanne. “In 2010, we spent $5,000 on a table and Eames chairs for our dining room.”

Monthly expenses | Mortgage payment for a three-bedroom house: $2,500. Utilities: $500. Gas for their Jeep Commander and Ford F-150 truck: $440. (“The Jeep was a mistake. We shouldn’t have bought it; we could have used the extra money for travel.”) Street parking and two parking permits: $200. Home and car insurance: $300. Cleaning lady: $160. Groceries: $1,000. (“We like Whole Foods and try to eat organic as much as we can. We love the new Leslieville store Hooked for fish. For everything else, Loblaws.”) Baby supplies and toiletries at drugstores: $75. Wine: $400–$500. (“We try to get the better $11 bottles, but they go fast.”) Eating out: $400. Home phone, cable, Internet and two cellphones: $280. Dry cleaning: $50. Haircuts, nails and waxing: $170. Gifts: $200. (“You have kids, you spend money on toys for other kids. That’s how it goes.”) Daycare for both kids: $2,500.

Annual expenses | Property tax: $3,800. Upgrades and maintenance on their house: $5,000. Clothes: $3,000. (“When you have young kids you really cut back on stuff for yourself.”) RRSPs and investments: $0. (“Ha! We live month to month. When we have money left over, we go out.”) Savings accounts for the kids: $1,500. (“We put money in on birthdays and special occasions.”) Hockey league fees for Thomas: $500. Gym classes for Suzanne: $900. Swimming and music lessons for the kids: $900.

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http://www.torontolife.com/daily/informer/from-print-edition-informer/2012/02/15/almost-rich/4/
The Norrises
Household income: $160,000
Doug and Shirley Norris, who are 81 and 80 years old respectively, sold their Montreal house in 1982 and moved into a $230,000 Harbourfront condo near Bay Street. When Doug retired in 1994, he sold his shares in his engineering supply company, Norman Wade, and since then the couple has lived off the proceeds—equities and securities—of their investments. “We read the business papers every morning,” says Shirley, “and Doug spends up to an hour every day on the phone with his broker.”

HOW THEY SPEND IT
Monthly expenses | Condo fees: $900. Gas for their Mercedes E320: $150. (“We buy a new Mercedes every three years; it’s our big indulgence,” says Doug. “We always pay cash. This one was $80,000.”) Groceries: $600. (“We mainly shop at Longos and Metro,” says Shirley. “Doug’s a vegetarian and eats like a rabbit: he can go through a lot of broccoli.”) Costco: $300. (“We get everything there. Prescriptions. Fruit. Laundry soap. They have great trout, too.”) Eating out: $200. (“We like Swiss Chalet and Great Chefs on Eight in The Bay.”) Rogers home phone and Internet service: $70. Skype fees: $2.50. (“We use it for long-distance calls to the kids.”) Bathing suits, T-shirts, socks and tennis shoes for the gym: $100. Gym fees at the Mayfair Club: $125. (“I’m there every morning at 7:30,” says Doug.) Newspapers, books and magazines: $70.

Annual expenses | Gifts: $1,000. (“We have two grandkids, and we give them presents for birthdays, Christmas, special occasions.”) Insurance for car and condo: $2,400. Slots at Casino Rama and Casino Niagara: $100. (“I take $50 and go with friends in our building,” says Shirley.) Four-month trip to Myrtle Beach: $15,000. A trip to visit their son Brock in Denver: $2,500. Travel insurance: $8,000. (“At our age? And with pre-existing medical conditions? It’s a huge expense. But we don’t want to be in the States and not be covered.”)
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http://www.torontolife.com/daily/informer/from-print-edition-informer/2012/02/15/almost-rich/5/
Craig Haynes
Household income: $165,000
Haynes, a 37-year-old national sales manager at TD Bank, has lived since 2009 in a rented one-bedroom on the 22nd floor of a condo tower at Yonge and Eglinton. He tries to stay debt-free, but occasionally he splurges on travel or a big-ticket toy, like the $7,500 Royal Enfield motorcycle he bought last year. “People think I make a lot of money,” he says, “but I lose so much of it in tax.”

HOW HE SPENDS IT
Monthly expenses | Rent: $1,750. Mortgage and property taxes on an Ottawa home he co-owns with his ex: $1,180. Groceries and eating out: $1,400. (“I often order pasta at Grazie or, if I’m in a celebratory mood, North 44°. I buy better cheese and other exotic ingredients at Pusateri’s, and because I cook at home a lot I pack leftovers for lunch.”) Wine: $800. (“I’ll spend anywhere from $15 on a Rhône to $100 on an Amarone, and I open a bottle almost every night. I’m one course away from sommelier certification, and they practically know my name at the Summerhill LCBO. “) Rogers Internet: $40. Clothes at Harry Rosen and shoes from online collectible sneaker stores: $1,000. (“My big buy last year was a couple of Zegna suits for $1,500 each.”) Live music: $200. (“I go to all kinds of concerts. Last year, I saw The Weeknd at Lee’s Palace as well as Gordon Lightfoot at Massey Hall.”)

Annual expenses | Lease, maintenance and insurance for a 2010 Honda Civic: $7,000. (“I’m at an age now that I don’t care as much about what kind of car I drive.”) Travel: $10,000. (“I go to Vegas three or four times a year, though not because I have a gambling problem—my perfect day in Vegas is spent poking around the city’s downtown nooks and dive bars, miles from the tourist zoo along the strip. And I’m a regular at the annual Coachella music festival in Southern California.”) RRSP contributions: $20,000.
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http://www.torontolife.com/daily/informer/from-print-edition-informer/2012/02/15/almost-rich/6/
The Jibodus
Household income: $166,000
In their native Nigeria, Margaret Jibodu, who is 49 years old, ran a printing press, and her 52-year-old husband, Oladapo, was an architect. The couple sent their sons, Emmanuel and Iyiope (pictured), to Canada for university, and joined them in Toronto in 2009. Margaret opened HD Printing Press in Vaughan, and her husband manages residential rental properties. “Life here is so much easier,” Margaret says. “We don’t need to pay for chauffeurs or security or health care; in Nigeria, you must pay for everything.”

HOW THEY SPEND IT
Monthly expenses | Mortgage on their four-bedroom house, purchased in 2010: $2,500. Utilities: $300. Rogers for home phone, cable, Internet and two cellphones: $350. Gas for their Chevy Equinox and Chevy Cobalt: $300. Groceries at Loblaws, Metro, Fortino’s and the Oriental Food Mart on Finch West: $1,600. (“I like to cook dishes that I used to make in Nigeria,” Margaret says. “I often make spinach and okra soup and moin-moin, which is black-eyed beans with peppers.”) Eating out: $100. (“We sometimes go to Mandarin or Mr. Greek to celebrate.”) Lunches and coffees: $50. (“I pack a lunch basket for the family almost every day,” Margaret says. “For our health, we try to avoid eating sugary snacks and drinking coffee. I do occasionally like a Timbit, however.”) White wine, usually consumed with Sunday dinner: $80. Books and magazines: $100. Hair salon: $400. Grooming products for Emmanuel and Iyiope: $75.

Annual expenses | Clothing: $3,000. (“I don’t buy as many new outfits as I used to, since I have several nice suits I haven’t worn more than once,” says Margaret. “My new weakness is shoes and bags. I have a red Coach patent leather bag I love that I got for only $379.”) Furniture and furnishings, mostly from The Brick and HomeSense: $1,000. Vacations: $0. (“We have not been on vacation since coming to Canada. It has been work-work-work.”)
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http://www.torontolife.com/daily/informer/from-print-edition-informer/2012/02/15/almost-rich/7/

The Damianis
Household income: $200,000
Anthony and Antonella Damiani, who are 41 and 39, moved from Etobicoke to a bigger house in Mississauga in 2001. They now have two kids—10-year-old Angelina and eight-year-old Marcus.Anthony, who began working in the HVAC industry as a teen, runs his own company, Furnace King, which has clients across the GTA. Antonella is a manager at Agility Logistics, a freight company. Although the kids’ expenses add up, the Damianis won’t sacrifice their big annual family vacation.

HOW THEY SPEND IT
Monthly expenses | Mortgage on their three-bedroom home: $2,000. Mortgage on their Georgian Bay cottage: $1,200. Utilities: $430. Gas for their Chevy Avalanche and BMW 328xi: $300. Groceries at Highland Farms: $1,200. Eating out, mostly at Swiss Chalet and Jack Astor’s: $840. Rogers for home phone, cable and Internet: $200. Clothes: $1,000. (“I drive across the border to Buffalo all the time on business,” says Antonella. “I shop a lot when I’m over there, mostly at stores like Guess.”) Vitamins, creams and lotions at Shoppers: $400. Books and magazines: $100. (“I get Men’s Health, new business books, and a novel now and then,” says Anthony.) Gifts: $250. (“The kids are constantly going to birthday parties. And there’s always a christening or confirmation to attend.”)

Annual expenses | Insurance for cars, house and cottage: $3,640. Kids’ RESPs: $4,000. RRSPs and blue-chip stocks: $20,000. Donations to Princess Margaret Hospital, SickKids and women’s shelters: $1,500. Vacations: $7,000. (“In February, we take the kids to an all-inclusive in the Dominican or Mexico,” Anthony says. “Sometimes my wife and I will go to the Bahamas for four days in the winter and leave the kids at home with their grandparents.”) Season tickets to the Leafs for Anthony: $2,000. Hockey league fees, tournament fees and new equipment for Marcus: $1,500. Dance classes for Angelina: $700.
« Last Edit: February 26, 2012, 10:50:50 AM by MacGyverIt »

DC

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I... uhm... I couldn't finish reading past the first two families... What's the purpose? Feel sorry for people who make more money than several families combined and are experts in throwing it away?! *read this with Mr. T's voice* I pity the fools who waste away their way out of the rats' race.

MacGyverIt

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Their cluelessness in not distinguishing "want" vs. "need". And if you look at the photos of the featured families? They should be grinning ear to ear but all look quite solemn in their month to month spending. And the kids in these photos.... what are they teaching their kids?

What the author defines as the "problem" - spending to suit their desired lifestyle leaves them with little left - is entirely wrong. The problem is their utter lack of self control. (The single guy drinking a bottle of wine a night or $400 a month for grooming.)
« Last Edit: February 26, 2012, 12:28:22 PM by MacGyverIt »

Parizade

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Narcissism is so expensive, I'm glad I don't bear that burden.

MEJG

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This makes me a little sick to my stomach

Reido

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HAHAHAHA  my favorite parts -

"$1,000 [Per Month]. (“My big buy last year was a couple of Zegna suits for $1,500 each.”)"
His clothes must be made out of bald-eagle heads and Faberge Eggs...

"We have not been on vacation since coming to Canada. It has been work-work-work"
I can't imagine why you have to work so much.

"Groceries at Loblaws, Metro, Fortino’s and the Oriental Food Mart on Finch West: $1,600"  I can take a family of 4 out almost every night of the month for that to an inexpensive casual diner.

"Hair salon: $400"  Are they charging you Per Follicle??

"Wine: $800. (“I’ll spend anywhere from $15 on a Rhône to $100 on an Amarone, and I open a bottle almost every night. I’m one course away from sommelier certification, and they practically know my name at the Summerhill LCBO. “)"  Someone needs to introduce this man to Yellow Tail and Gnarly Head.

"Clothes: $3,000. (“When you have young kids you really cut back on stuff for yourself.”)"
You may not believe this, but you can buy clothes at stores other than Dolce and Gabbana and Gucci!

"Season tickets to the Leafs for Anthony: $2,000"
There are 41 games in a season!! God forbid you cut back to one per week!




Do they not have ANY idea how excessive this is??  I go to hockey games every year.  I own expensive ($1K+) suits.  I can afford kids clothes.  I drink wine.  And yet somehow I manage to do ALL that for about 1/10th what they're paying!!

« Last Edit: February 26, 2012, 01:13:13 PM by Reido »

mmmsc

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The really scary part is there responses to the questions they were being asked. Its like they truly believe they are just scraping by.

Reido

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They're going to be in a world of hurt when a recession comes along and they get pink-slipped from these lucrative jobs. 

They might even have to do their own hair!!

MacGyverIt

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They're going to be in a world of hurt when a recession comes along and they get pink-slipped from these lucrative jobs. 

They might even have to do their own hair!!

Yeah! We're in the middle of a global recession, people are losing their jobs left, right and center and that still hasn't scared these folks into cutting back.

MacGyverIt

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HAHAHAHA  my favorite parts -

"Wine: $800. (“I’ll spend anywhere from $15 on a Rhône to $100 on an Amarone, and I open a bottle almost every night. I’m one course away from sommelier certification, and they practically know my name at the Summerhill LCBO. “)"  Someone needs to introduce this man to Yellow Tail and Gnarly Head.

ITA my first thought was "wine in a box if you're gonna drink that much...."

MMM

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Hilarious article! ...and especially interesting to me since I grew up in a small town about 50 miles from downtown Toronto (and I hear reports that even my small town has now become expensive because of insane stupid people who actually commute from there to TO).

At least the article was redeemed by the tone of the author, who was clearly making fun of the tragically antimustachian families in the subtext.

Hearing the descriptions of the extreme debt leveraging and the lack of saving definitely adds to my belief that Toronto will see a nice price crash someday soon. I keep telling people their to sell out while the selling is good, and buy a nicer house in a nicer part of the continent for much less money, as I have done!

Miyazaki

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Looking at these families, they all spend more on food each month than I pay for *everything* including income tax, health insurance, etc! How is this possible??

Gerard

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Wah, I just read this today and couldn't believe the numbers these folks were throwing around. But I honestly don't think the author is making fun of these people. Toronto Life magazine and its readers actually are this out of touch (or are busy convincing their advertisers that they are). Their annual "where to get stuff cheap" issue includes such whiz-bang bargains as $695 jackets and $69 prix fixe menus.

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I just played around with their numbers, and assuming I brought home CAN$196000 a year after tax (and converting it into pounds sterling), I could retire in two years.  These people don't know they're born.

Melissa

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$30,000 a year for child care?!?!
I guess I should change jobs

valueindexer

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I actually thought some of the numbers looked reasonable. Then I realized they were monthly budgets, not annual or once-in-a-lifetime. Oh well, at least they're boosting the economy so others may benefit!

upnorth

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Wow!  I can't get over the grocery and wine expenses.

Moneyisntlove

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HAHAHAHA  my favorite parts -





"Wine: $800. (“I’ll spend anywhere from $15 on a Rhône to $100 on an Amarone, and I open a bottle almost every night. I’m one course away from sommelier certification, and they practically know my name at the Summerhill LCBO. “)"  Someone needs to introduce this man to Yellow Tail and Gnarly Head.

Someone needs to introduce this man to Alcoholics Anonymous!


ch12

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Looking at these families, they all spend more on food each month than I pay for *everything* including income tax, health insurance, etc! How is this possible??

I know that this topic is old, but I found it while searching the site. I couldn't help myself from posting my own piece.

The Nigerian family spends more on food than I live on in a month. $1,600 on food?! Listen, my family eats ethnic food, and I can assure you that it's possible to eat the food from "the old country" for less than $1,600/month. When I was growing up, we spent around $100/week for the four of us or $400/month. There was ONE guy saving 20k in his RRSP. One.

Albert

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The old couple is probably all right since they are already retired and unlikely to live more than another 10-15 years. Others are living very precariously, one big recession or unexpected job loss and they'll be in a world of hurt... Not that I feel particularly sorry for them.

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This is the quote that got me:  Living the good life simply wasn’t the full-time, across-the-retail-spectrum pursuit it has now become.

I do agree that today's world offers us many, many more opportunities to spend, whereas previous generations didn't have those choices . . . but I don't see that our free will has disappeared.  Who's forcing us to buy $500 of wine a month?  Would we be social rejects if we fail to "refresh" our wardrobes annually?  Does Canada have no equivalent to our American $10-walk-in-haircut places?  I work, and I'm not too tired to cook dinner, or at least toss a Stouffer's lasagna into the oven (after all that wine, who'd know the difference?):  Is working harder up North?  A four-month trip to the beach? 

Nope, no sympathy for this over-spending group.  They've failed to realize that happiness doesn't come from owning all the right stuff, and they've voluntarily entered into this deal with the devil.  No sympathy. 
« Last Edit: October 20, 2013, 03:06:31 PM by MrsPete »

swiper

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My favorite: “We buy a new Mercedes every three years; it’s our big indulgence,” says Doug. “We always pay cash. This one was $80,000.”

wtf people!

Peter

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^^^ Those ARE the 80 year olds though, that are swimming in cash, and most of their other expenses are perfectly reasonable.

If I'm in that position at 80 I will also likely be buying a luxury car every 3 years to cruise in comfort, style, and safety.

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If you're ever watching a movie set in the French Revolution and can't understand why the peasants and townsfolk would yell "Guillotine!  Guillotine!" with such verve, remember this article.  It might help set the mood.

MgoSam

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I have two impressions from the article.

A. It is really conceited to show a couple that are living fairly extravagantly and call it "paycheck to paycheck." My company's receptionist is living paycheck to paycheck as her husband just got laid off. These guys are choosing to live without a safety net.

The second is, I completely support the 80 year old couple. They know what they are doing and having scraped savings for so long, if they want to splurge then more power to them.

MrsPete

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$30,000 a year for child care?!?!
I guess I should change jobs
Yeah!  If you have two children and assume that they're in day care 50 weeks a year, you're talking about $300/week.  You'd have to have a pretty good job to afford that day care. 


A. It is really conceited to show a couple that are living fairly extravagantly and call it "paycheck to paycheck." My company's receptionist is living paycheck to paycheck as her husband just got laid off. These guys are choosing to live without a safety net.
I'm not sure they realize that they're making that choice.  I have the impression they think they MUST spend this way, that everyone they know spends this way, that it's essentially mandatory.   


grmagne

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Does Canada have no equivalent to our American $10-walk-in-haircut places?

Yes such places exist in Toronto because, shockingly, not everybody likes to spend $400/month for hair grooming (or $200,000/year on other indulgences, for that matter).  My barber just raised her price 10%, up to $11, but she’s still within my budget. She’s in a sketchy area and I get to meet all sorts of interesting characters there that I don’t normally meet in my day-to-day life.

I've become so accustomed to reading MMM reader budgets during the past 4 months that I couldn't help but laugh out loud when I read some of the budgets in this article. Don't these people worry about what would happen if they lost their jobs? Do those thoughts ever enter into their heads? Even before I discovered MMM I was obsessed with saving money so that I could overcome an extended period of unemployment, or any other financial disaster. I can't imagine going through my working career spending recklessly without any concern for the future.

Now that I'm beginning to fully comprehend that even well-educated middle/high-income earners are reckless with their finances, all the things I see around me every day are starting to make sense.  I used to wonder how it was that:
  • The Toronto Maple Leafs sell out every game even though the average ticket price is $375 (according to StubHub)!  No wonder people just shrug their shoulders over the $25 parking costs, the $180 official jerseys, and the astronomical food & beer prices.
  • Modest-looking homes are listed for $700,000 and then quickly sold.
  • There are an endless sea of construction cranes in the downtown core, and yet each and every one of these luxury condos get snapped up.  Some of the 3-bedroom condos have ridiculous prices close to $1M with condo fees + taxes around $2,000/month (no I’m not exaggerating) and yet people keep buying more and more and more of them.
  • Restaurants, bars & nightclubs seem to be able to charge whatever insane price they want and yet people will still go in droves.

But somehow the public transportation system is underfunded because “taxpayers need a break”. Can the madness continue?  I have no idea, but I’m pretty sure I won’t be retiring in this city ;)

No Name Guy

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I'm not sure they realize that they're making that choice.  I have the impression they think they MUST spend this way, that everyone they know spends this way, that it's essentially mandatory.

Bold mine.  See MMM's post of today in re "the rules".  Sadly, some folks just don't get it...that they don't HAVE to follow "the rules".


cbgg

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  • Location: Vancouver, BC
Holy macaroni, I can't believe how many people are spending triple digit numbers on wine each month.  I know wine is expensive in Canada, but at a certain point you've got to say that enough is enough. 

About 20 years ago my dad started making his own wine with his brothers and friends.  When you drink as much as an Italian man does, you just have to make the switch at some point!  What started as a money saving opportunity has turned into a life long hobby and a great way of spending time with buddies.   Of course, you have to have the space and equipment to do it (they all have ginormous 1990's houses with full basements anyways), but at this point they are able to produce award winning wines for ~$3-4/bottle of variable cost.  This of course doesn't include labour or equipment - but the equipment can be shared amongst the group and re-used for years, and it's a fun hobby so labour doesn't really count.

I'm so tired of everyone thinking they are a friggin' wine expert and "foodie" by spending an arm and a leg on groceries.  Real foodies know how to make their own food out of basic ingredients!

cats

  • Handlebar Stache
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$30,000 a year for child care?!?!
I guess I should change jobs
Yeah!  If you have two children and assume that they're in day care 50 weeks a year, you're talking about $300/week.  You'd have to have a pretty good job to afford that day care. 

Well, they are earning $200k/year.  If that's split relatively evenly between the two parents, the $30k for childcare may make sense. Not sure what kind of a chunk they're losing to taxes, but if it's similar to the US, a post-tax paycheck for a $100k salary should be well over $2500/month.  I'm not saying they couldn't be creative and figure out how to do it for less, but that cost is not outrageous for two kids in a major metropolitan area and there are definitely other parts of their spending that I would consider WAY more problematic/extravagant (like their expensive furniture habit...our table and chairs came off Craigslist and cost <$100, works just as well as the set they dropped thousands on!).

MrsPete

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Don't these people worry about what would happen if they lost their jobs? Do those thoughts ever enter into their heads? Even before I discovered MMM I was obsessed with saving money so that I could overcome an extended period of unemployment, or any other financial disaster. I can't imagine going through my working career spending recklessly without any concern for the future.
I think we all have little "money related phrases" that echo in our heads.  One that I developed very early on -- I'll say college -- is, You have no guarantee that tomorrow will be better than today. 

I don't think most people think this way.  Rather, I think most people assume that they'll continue in their job; in fact, that they'll get the maximum expected raise next year.  That their health will hold out, that they will not give birth to surprise twins, or have a spouse or parent who falls ill.  Most people assume that their ability to pay tomorrow will be equal or better than today's.  

I've never bought into that
, and I could list MANY examples of how that philosophy has saved my bacon over the years!   


are definitely other parts of their spending that I would consider WAY more problematic/extravagant (like their expensive furniture habit...our table and chairs came off Craigslist and cost <$100, works just as well as the set they dropped thousands on!).
Yeah, and when that toddler draws on that $$$$ dining room set with a red crayon, they're going to wish they'd only spent $100 on a Craigslist dining set!  Or, even worse, they'll deny the children the chance to use crayons and other art supplies because they might destroy the expensive furniture.
« Last Edit: October 24, 2013, 06:02:40 PM by MrsPete »