Author Topic: Building Wealth On Minimum Wage Triggers Backlash  (Read 26050 times)

mm1970

  • Walrus Stache
  • *******
  • Posts: 7031
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #100 on: April 18, 2017, 03:38:20 PM »
This all really boils down to an understandable, but still logically fallacious, false dilemma (or dichotomy, if you will).
According to research, most people would rightly agree with each of these statements:

#1: we have structural issues in our economy that increase the wealth gap and reduce opportunities for people to elevate themselves from poverty.
#2: many people fail to take advantage of known methods that could increase their odds of a better life.

An argument in favor of either statement is too often mistaken for a counterargument to the other, and the ensuing misguided rage undercuts the odds of a healthy and productive discussion. Every conversation should be informed by the knowledge of that tendency, in order to recognize and defuse the mistaken counterattacks.

By the way I really liked this.

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #101 on: April 18, 2017, 03:50:29 PM »
The major difference seems the 24 years old vs. 2 years of independence, Canada makes it easier to get out from under your parents earlier.

Thanks for the update on the other issues; some things have indeed changed since I left and of course there's variation between provinces.

I also recall lower tuition rates, hefty provincial subsidies (some better than others), better and more consistent scholarships (I recall the Rutherford as having been useful for getting rid of a term's worth of tuition, although it might have changed), and no requirement to purchase the university's health insurance plan (or provide proof of private health insurance) for people who are on the provincial plan.

Is it possible to discharge student loan debt in Canada through bankruptcy?
Not federal/provincial loans, too many doctors doing it ;) I would have if I could have.

Tuition varies from $6-8K for your home province to $15-20K for out of province. So a person from Alberta on loans is pretty much stuck going to an Alberta University unless they split 2 years in province with 2 years at McGill (very good Quebec School).

Student loans come with some terrific opportunities for rebates and bursaries; bursaries are scholarships for poor people.

TheGrimSqueaker

  • Handlebar Stache
  • *****
  • Posts: 2201
  • Location: A desert wasteland, where none but the weird survive
  • www.theliveinlandlord.com
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #102 on: April 18, 2017, 03:55:41 PM »
Here, for those who have an interest, is an article discussing generational poverty and some people who escaped it.

https://www.nytimes.com/2016/09/26/business/economy/millions-in-us-climb-out-of-poverty-at-long-last.html


The article focuses on three very different people.

The first person went full Mustachian and lived with in-laws, keeping expenses low in order to get by, and worked to earn a promotion from an employer. The family's choices since then have been less Mustachian than before however not totally spendypants.

The second person profiled had a high school diploma but worked as a day laborer. What made the difference, for him, was getting into the carpenter's union. He was mostly self-taught and invested a lot of time in skills acquisition. A charitable venture hooked him up with the opportunity to join the union, provided he bought his own tools. An operation like SwordGuy's idea would identify and build pre-union skills for folks like this.

The third person was deeply in debt from credit cards, bankrupt, with four kids to feed and a spouse who worked intermittently. This person received help from the Chicago Housing Authority and got a job that paid better. The extra take-home pay was automatically put into an escrow account, so there was a lot more structure available and also some small financial incentives. This was a government program that featured enforced savings and that held off what would otherwise have been automatic rent increases for a person who earned more.

So: these people had family help, charitable venture help, and government help, plus substantial hard work from all of them. Each of them got a setup of some kind, and not one of these folks bootstrapped it in a vacuum with no help from anyone. But each of them also busted rump. The first and third person had dependent children. Yet they all put forth significant proactive effort, they definitely developed financial literacy, they kept their expenses low, and they worked toward jobs that paid better. I'd say that, overall, their experience supported the original "Building Wealth On Minimum Wage" article.

human

  • Pencil Stache
  • ****
  • Posts: 791
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #103 on: April 18, 2017, 04:00:50 PM »
Weird I didn't realize kids chose their parents and their parents professions . . .
Nope. But they can choose their own professions. No excuses.

That's not what you said in reply 55.

MrMonkeyMoustache

  • Stubble
  • **
  • Posts: 197
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #104 on: April 18, 2017, 04:10:28 PM »
Weird I didn't realize kids chose their parents and their parents professions . . .
Nope. But they can choose their own professions. No excuses.

That's not what you said in reply 55.
I didn't say anything that contradicted that. I think that people definitely have quite a bit of choices, but not everyone can do ANYTHING.

human

  • Pencil Stache
  • ****
  • Posts: 791
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #105 on: April 18, 2017, 04:17:05 PM »
I just don't get why people get so offended when people say that poor people are not helpless. Obviously, there are definitely circumstances that are nearly impossible to escape. However, we're clearly not talking about the exceptions to the rule.

I still hold that the vast majority of people that are poor are poor because of bad choices. Whether it was poor parenting, being raised by a single mother, living in a bad neighborhood, or whatever, they still made the bad choices. I understand it certainly lessens the odds. I would know. I was raised by a single mother, and my only friends were drug dealers and two of my best friends ended up being murderers. So I didn't grow up in the best environment. And it definitely stunted me. But, at some point, feeling sorry for yourself, and not having an inner drive, just doesn't cut it anymore.

If you want to make something of yourself, you have to make sacrifices, and work hard. Now, I'm not one of those people that think you can do ANYTHING you want to (on topics like that, I like to defer to Mike Rowe), but there is absolutely zero reason why you should be poor for an entire 80 years in this country. It's inexcusable for anyone with an ounce of hard work in their blood.

Out of all of the things I've seen homeless people and beggars do, applying for a job is not one of them. Hell, they should be applying en masse for trade apprenticeships. The trades are severely lacking in skilled labor. So long as you can get a GED and pass a drug test, you pretty much have a $20/hr. job for 5 years (and then double or more).

Bold added - you clearly stated bad parenting - "they made the choices" kids don't choose what you list here. It's also been stated many times you can't apply for jobs when homeless. Or if you do you need a fake address. Employers don't just hire homeless people, unless the apprenticeship is tailored to homeless people and if that is the case they ain't paying 20 bucks an hour. It almost seems like you live in some fantasy utopia.

MrMonkeyMoustache

  • Stubble
  • **
  • Posts: 197
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #106 on: April 18, 2017, 04:20:47 PM »
I just don't get why people get so offended when people say that poor people are not helpless. Obviously, there are definitely circumstances that are nearly impossible to escape. However, we're clearly not talking about the exceptions to the rule.

I still hold that the vast majority of people that are poor are poor because of bad choices. Whether it was poor parenting, being raised by a single mother, living in a bad neighborhood, or whatever, they still made the bad choices. I understand it certainly lessens the odds. I would know. I was raised by a single mother, and my only friends were drug dealers and two of my best friends ended up being murderers. So I didn't grow up in the best environment. And it definitely stunted me. But, at some point, feeling sorry for yourself, and not having an inner drive, just doesn't cut it anymore.

If you want to make something of yourself, you have to make sacrifices, and work hard. Now, I'm not one of those people that think you can do ANYTHING you want to (on topics like that, I like to defer to Mike Rowe), but there is absolutely zero reason why you should be poor for an entire 80 years in this country. It's inexcusable for anyone with an ounce of hard work in their blood.

Out of all of the things I've seen homeless people and beggars do, applying for a job is not one of them. Hell, they should be applying en masse for trade apprenticeships. The trades are severely lacking in skilled labor. So long as you can get a GED and pass a drug test, you pretty much have a $20/hr. job for 5 years (and then double or more).

Bold added - you clearly stated bad parenting - "they made the choices" kids don't choose what you list here. It's also been stated many times you can't apply for jobs when homeless. Or if you do you need a fake address. Employers don't just hire homeless people, unless the apprenticeship is tailored to homeless people and if that is the case they ain't paying 20 bucks an hour. It almost seems like you live in some fantasy utopia.
It's been said numerous times ITT how you could apply for jobs as a homeless person. And again, nothing I said contradicted the bolded part.

human

  • Pencil Stache
  • ****
  • Posts: 791
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #107 on: April 18, 2017, 04:33:11 PM »
So to rephrase kids simply have to deal with their lot and John Galt themselves to a super awesome STEM job? No pity for the downtrodden, their parents mistakes aren't ours so the kids can rot? I'm not sure I follow what you are trying to say but I haven't read past post 60 or so.

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #108 on: April 18, 2017, 05:12:48 PM »
Here, for those who have an interest, is an article discussing generational poverty and some people who escaped it.

https://www.nytimes.com/2016/09/26/business/economy/millions-in-us-climb-out-of-poverty-at-long-last.html


The article focuses on three very different people.

The first person went full Mustachian and lived with in-laws, keeping expenses low in order to get by, and worked to earn a promotion from an employer. The family's choices since then have been less Mustachian than before however not totally spendypants.

The second person profiled had a high school diploma but worked as a day laborer. What made the difference, for him, was getting into the carpenter's union. He was mostly self-taught and invested a lot of time in skills acquisition. A charitable venture hooked him up with the opportunity to join the union, provided he bought his own tools. An operation like SwordGuy's idea would identify and build pre-union skills for folks like this.

The third person was deeply in debt from credit cards, bankrupt, with four kids to feed and a spouse who worked intermittently. This person received help from the Chicago Housing Authority and got a job that paid better. The extra take-home pay was automatically put into an escrow account, so there was a lot more structure available and also some small financial incentives. This was a government program that featured enforced savings and that held off what would otherwise have been automatic rent increases for a person who earned more.

So: these people had family help, charitable venture help, and government help, plus substantial hard work from all of them. Each of them got a setup of some kind, and not one of these folks bootstrapped it in a vacuum with no help from anyone. But each of them also busted rump. The first and third person had dependent children. Yet they all put forth significant proactive effort, they definitely developed financial literacy, they kept their expenses low, and they worked toward jobs that paid better. I'd say that, overall, their experience supported the original "Building Wealth On Minimum Wage" article.
I'll add my lot to these examples. Government Student Loans, government help, pulled me out.

But as Grim Squeaker pointed out, it also took my hard work to get through school. It took the better part of a decade for me to get their, it doesn't happen overnight. In hindsight preparation started at age 14, when I enrolled in my HS classes for the extra math, English, physics and chemistry that weren't required for graduation (I could have had more spares instead). Then it took years on the other side to pay off the loans, it didn't happen quickly. 

How long of a timeframe is reasonable? is 10 years too long or about right? The article didn't say it would happen quickly. It took generations and decades to get into poverty, getting out isn't a short process. Does everyone have the patience and discipline to undertake such a long process?

WhiteTrashCash

  • Handlebar Stache
  • *****
  • Posts: 1061
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #109 on: April 18, 2017, 06:13:14 PM »
Sorry, but having lived on minimum wage, anybody who thinks you can survive on it really has no idea. It's literally impossible, which is why all the taxpayers in the USA have to subsidize McDonald's and Walmart's businesses by providing SNAP and welfare programs. We would rather do that than force those cheapskates to pay living wages for some reason. It has something to do with Americans hoping they will someday find themselves in the same position as the Walton Family to exploit other people too.

MrMonkeyMoustache

  • Stubble
  • **
  • Posts: 197
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #110 on: April 18, 2017, 06:56:57 PM »
Sorry, but having lived on minimum wage, anybody who thinks you can survive on it really has no idea. It's literally impossible, which is why all the taxpayers in the USA have to subsidize McDonald's and Walmart's businesses by providing SNAP and welfare programs. We would rather do that than force those cheapskates to pay living wages for some reason. It has something to do with Americans hoping they will someday find themselves in the same position as the Walton Family to exploit other people too.
In many states, sure. In my state (WV), you can live off of minimum wage. Now, you can't live WELL, but you can live.

TheGrimSqueaker

  • Handlebar Stache
  • *****
  • Posts: 2201
  • Location: A desert wasteland, where none but the weird survive
  • www.theliveinlandlord.com
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #111 on: April 18, 2017, 07:08:31 PM »
So to rephrase kids simply have to deal with their lot and John Galt themselves to a super awesome STEM job? No pity for the downtrodden, their parents mistakes aren't ours so the kids can rot? I'm not sure I follow what you are trying to say but I haven't read past post 60 or so.

You're definitely following something, but what you're following doesn't remotely resemble what the other posters are actually writing.

TheGrimSqueaker

  • Handlebar Stache
  • *****
  • Posts: 2201
  • Location: A desert wasteland, where none but the weird survive
  • www.theliveinlandlord.com
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #112 on: April 18, 2017, 07:16:57 PM »
Sorry, but having lived on minimum wage, anybody who thinks you can survive on it really has no idea. It's literally impossible,

Except for a substantial number of people on this board who have personally managed it.

Quote
(...) which is why all the taxpayers in the USA have to subsidize McDonald's and Walmart's businesses by providing SNAP and welfare programs. We would rather do that than force those cheapskates to pay living wages for some reason. It has something to do with Americans hoping they will someday find themselves in the same position as the Walton Family to exploit other people too.

I personally think it has more to do with families such as the Waltons, and other people who make their living chiefly from stock dividends, providing a lot of grease to the palms of the lawmakers. Both sides have been thoroughly bought.

Most American people are smart enough to realize that, unless they win the mother of all lotteries (and perhaps not even then), they have exactly zero chance of living the way the Waltons do. Living in the part-time, unskilled economy sucks, which is why the people who have a chance of escaping it do so as quickly as possible. Many, however, do require aid of some sort in order to get out of that particular sub-economy.

There are also some interesting coping strategies such as teaming up with groups of people such as family members, so that multiple part-time or minimum-wage earners cooperate to be able to afford the basics and  a few small luxuries. This was actually how the majority of the working class lived throughout most of recorded history.

Paul der Krake

  • Magnum Stache
  • ******
  • Posts: 4666
  • Age: 11
  • Location: USA
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #113 on: April 18, 2017, 07:33:59 PM »
You can live on minimum wage if you are smart about your choices, accept a standard of living that's unacceptable to many, and don't make any major mistakes.

Unfortunately the skillset required to pull it off is about the same as the one required to not remain on minimum wage for very long. If you have said skillset, you get out of there ASAP because why on earth would you purposely stay at that level. This makes it difficult to control for anything in the experiment.

WhiteTrashCash

  • Handlebar Stache
  • *****
  • Posts: 1061
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #114 on: April 18, 2017, 08:10:14 PM »
You can live on minimum wage if you are smart about your choices, accept a standard of living that's unacceptable to many, and don't make any major mistakes.

Unfortunately the skillset required to pull it off is about the same as the one required to not remain on minimum wage for very long. If you have said skillset, you get out of there ASAP because why on earth would you purposely stay at that level. This makes it difficult to control for anything in the experiment.

I suppose it's possible to live on federal minimum wage if you have three minimum wage earners in your household and everyone pools their money. That's really more like making $21.75/hr, though. When I was growing up, I knew a lot of people who did illegal things on the side to supplement their minimum wage income, but that's a really bad idea for numerous reasons including the fact that it's against this forum's TOS.

sw1tch

  • Bristles
  • ***
  • Posts: 271
  • Age: 35
  • Location: Middle of no and where
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #115 on: April 19, 2017, 09:20:19 AM »
Maybe in the USA "Couldn't afford" is a thing. Here in Canada we have Student loans, <snip>

State-side, student loans work very differently. I haven't lived in Alberta these last 19 years, however I remember that Canadian student loans had the following characteristics:

* Maximum dollar amounts
* Zero interest until six months after graduation
* Backed by the government and not offered through private means such as banks, but administered by banks such as CIBC, and
* Available to high school graduates age 16 and up (that number may be up to 17 now) whose parents' income falls within a specific range
* Available to students aged 20 and over without regard to parental income or assets
* The school must be accredited

US student loans are of two types: federal, and private. For private student loans there are no rules in particular; it's a free-for-all except the loans cannot be discharged through bankruptcy.

US federal loans have the following characteristics:
* Some loans are "subsidized" meaning interest does not accrue until graduation, but most are "unsubsidized", meaning interest continues to accrue during the course of study
* Payments are deferred until six months after graduation but that doesn't stop interest from building up
* The subsidized loans max out at an amount that is enough to pay for one two-semester year at a state school if a student lives on campus (which is often mandatory for freshmen; it's a way universities make money off their real estate). However, undergraduate degree programs in the USA take four to five years. Five years is increasingly common due to the full year of mandatory remedial-level courses required for people who did not learn how to write paragraphs or multiply fractions in grade school.
* Parental income is included in all calculations until the student is 24 years of age, and subsidized loans are withheld from people whose parents earn "too much" even if the parents are not helping pay for the education

I went to school on Financial Aid and a full tuition scholarship; meaning I was literally paid to go to the local university.  I don't know what has changed as it has been 10 years since I graduated, but that was the situation.  I think it's still similar as the youngest sibling has a similar situation.  Even without the scholarship, financial aid would have paid for most if not all of my tuition.

All it took for me was getting good grades throughout K-12 (being at or near the top of your class isn't the hardest when there's a large proportion are lower class and simply don't realize that grades matter to get some of these benefits), a little bit of initiative, living at or below the poverty line (4th oldest of 9, living at home with older brother and 5 younger siblings in a small home during college - officially a 2-bed, 1-bath house; but added another bathroom as well as room to live in the basement and attic), and lastly being a minority.

There are definitely systems in place to help those in poverty get an education if they want one.  I wouldn't say it was the most personally uplifting experience as the problem with this situation is that it's still a system of "hand-outs" (taking from others while you simply exist) and does encourage un-motivation as the "system" has incentivized you to "go to college" instead of you having to be creative or motivated to make your own way.  Many in my biological family suffer from some of the psychological effects of this (doing just the minimum to gain the benefits of the system but being unmotivated/uncreative/dependent on said system as well as fear overall of deviating) - don't even get me started on lack of financial awareness as it's a very QUICK jump from poverty to lower-middle class w/o a ton of (or any) self-reflection.

I am in no way ungrateful that I was given this opportunity but do understand and am working through the shortfalls.  It's a big reason why I had to do my own self-searching and discovered FIRE and MMM.

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #116 on: April 19, 2017, 10:30:44 AM »
Sorry, but having lived on minimum wage, anybody who thinks you can survive on it really has no idea. It's literally impossible, which is why all the taxpayers in the USA have to subsidize McDonald's and Walmart's businesses by providing SNAP and welfare programs. We would rather do that than force those cheapskates to pay living wages for some reason. It has something to do with Americans hoping they will someday find themselves in the same position as the Walton Family to exploit other people too.
If its "literally impossible to survive" are you a ghost? ;)

However, why aren't you still earning minimum wage? the point of the article was to do better, with time, than minimum wage. No one disputes that living on the minimum wage is hard; hence the reason to figure out how to earn more.

The naysayers who tear down the people offering solutions, how does that improve America? Someone writes an article trying to make life better and others criticize, should we maintain the status quo? Shouldn't we all offer solutions instead of repeating the litany of complaints? Solutions require individual effort; its far easier to blame others.

No one is claiming its easy, I think the complainers just like playing the martyr.

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #117 on: April 19, 2017, 12:56:51 PM »
Very close -- added notes below.


Maybe in the USA "Couldn't afford" is a thing. Here in Canada we have Student loans, <snip>

State-side, student loans work very differently. I haven't lived in Alberta these last 19 years, however I remember that Canadian student loans had the following characteristics:

* Maximum dollar amounts  $320/wk of school, max, plus a lifetime max.  e.g., $10,240 per year for 8 months FT, plus lifetime max.   These are somewhat like stafford loans or US fed loans

* Zero interest until six months after graduation Interest starts at graduation date but payments can be deferred 6 months.  Zero interest until graduation.  Interest after graduation is higher than typical loans, to incent people to pay off and recover some costs.  e.g. 6.5% interest rate or more

* Backed by the government and not offered through private means such as banks, but administered by banks such as CIBC, Note, no private loans are available without co-signers or parent loans or personal credit history and income and

* Available to high school graduates age 16 and up (that number may be up to 17 now) whose parents' income falls within a specific range   Actually there is a parental contribution requirement that starts at around $90k of family income that reduces the loan amount provided,  and at around $150k family income, the family contribution calc can be well over $10k per year, with student contributions starting at around $3k.  So most with family incomes over $110k living at home will not get any loans.  I believe there is no age minimum, just high school graduation.

* Available to students aged 20 and over without regard to parental income or assets  Actual calc is 2 periods of full time work of a minimum of 12 months each, or married, or parent, or more than 4 years out of high school, and then the student qualifies as an independent without family contribution expected..  if they don't work full time then the age 20 does not qualify alone.

* The school must be accredited Canada Student Loans use the term "designated", accreditation has an academic standard that is very different.  Designated has quite a low standard, and there is a huge range of schools on the list, including privately run diploma programs, bartending school, estheticians, trade programs, etc.

US student loans are of two types: federal, and private. For private student loans there are no rules in particular; it's a free-for-all except the loans cannot be discharged through bankruptcy. federal loans in Canada only, unless you are mature student, all loans can be discharged through bankruptcy, which is why they are hard to get

US federal loans have the following characteristics:
* Some loans are "subsidized" meaning interest does not accrue until graduation, this is the portion that is similar to the Canadian system, and like the USA, is limited in scope and $ size. but most are "unsubsidized", meaning interest continues to accrue during the course of study  These types of loans are not available in Canada without a co signer, so if you don't have the money, you need to work to save up, first.
* Payments are deferred until six months after graduation but that doesn't stop interest from building up  same

* The subsidized loans max out at an amount that is enough to pay for one two-semester year at a state school if a student lives on campus (which is often mandatory for freshmen; it's a way universities make money off their real estate). However, undergraduate degree programs in the USA take four to five years. Five years is increasingly common due to the full year of mandatory remedial-level courses required for people who did not learn how to write paragraphs or multiply fractions in grade school.  it's a univesal problem

* Parental income is included in all calculations until the student is 24 versus 22 in Canada years of age, and subsidized loans are withheld from people whose parents earn "too much" even if the parents are not helping pay for the education same

So key differences are:
-  the fact that tuition, mandatory fees and books in Canada cost between $5500 and $9000 per year, depending on your program and province.  (More for private universities).   e.g., the government subsidizes the remainder of the tuition fees
 with the institutions directly, or does not allow universities to charge more for domestic students.   That similar subsidy seems to occur in some state run colleges in some states, but not all. 
- AND that private universities are much more common in the USA than Canada. 
- that private loans are not available to the generic Canadian student, so if your parents are jerks, you need to wait 2 - 4 years to qualify.
- the cut off is 4 years out of high school (age 22) versus age 24 for US

From my review, accommodation and Meals costing around $10-13k per year is pretty standard in many regions in North America (some private schools excepted but many of those give scholarships to reduce costs to average levels).

Lastly -- single parents attending college full time face significantly more costs and challenges than others, no matter where they are.

Paul der Krake

  • Magnum Stache
  • ******
  • Posts: 4666
  • Age: 11
  • Location: USA
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #118 on: April 19, 2017, 01:10:29 PM »
Lastly -- single parents attending college full time face significantly more costs and challenges than others, no matter where they are.
Strikeout mine.

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #119 on: April 19, 2017, 01:57:17 PM »
So key differences are:
-  the fact that tuition, mandatory fees and books in Canada cost between $5500 and $9000 per year, depending on your program and province.  (More for private universities).   e.g., the government subsidizes the remainder of the tuition fees
 with the institutions directly, or does not allow universities to charge more for domestic students.   That similar subsidy seems to occur in some state run colleges in some states, but not all. 
- AND that private universities are much more common in the USA than Canada. 
- that private loans are not available to the generic Canadian student, so if your parents are jerks, you need to wait 2 - 4 years to qualify.
- the cut off is 4 years out of high school (age 22) versus age 24 for US

From my review, accommodation and Meals costing around $10-13k per year is pretty standard in many regions in North America (some private schools excepted but many of those give scholarships to reduce costs to average levels).

Lastly -- single parents attending college full time face significantly more costs and challenges than others, no matter where they are.
https://www.canada.ca/en/employment-social-development/services/student-financial-aid/student-loan/student-loans/needs-assesment.html

I linked the budget breakdown for loans. The amounts are less than minimum wage to live off for a single person. Typically they expect people to live off 30-32 hours of minimum wage work/week. That's the student lifestyle in Canada, if you could work full time they expect you to have an extra $80/week.

Having lived off these loans it was tough, but they were correct. I was unable to work and study, not smart/organized enough at 18, however if I had gone part time for 8 years I could have made it work. Tuition/books requires up to 900 hours/year of minimum wage to pay, going half time would be 500 (not every fee divides in half) , meaning I would have had to average 42 hours/week of minimum wage for 8 years to complete my degree according to the estimates provided by the Government of Canada.

Its not an easy route, I took the lazier way and got loans that I paid off later.

TheGrimSqueaker

  • Handlebar Stache
  • *****
  • Posts: 2201
  • Location: A desert wasteland, where none but the weird survive
  • www.theliveinlandlord.com
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #120 on: April 19, 2017, 02:57:18 PM »
Very close -- added notes below.


Maybe in the USA "Couldn't afford" is a thing. Here in Canada we have Student loans, <snip>

State-side, student loans work very differently. I haven't lived in Alberta these last 19 years, however I remember that Canadian student loans had the following characteristics:

* Maximum dollar amounts  $320/wk of school, max, plus a lifetime max.  e.g., $10,240 per year for 8 months FT, plus lifetime max.   These are somewhat like stafford loans or US fed loans

* Zero interest until six months after graduation Interest starts at graduation date but payments can be deferred 6 months.  Zero interest until graduation.  Interest after graduation is higher than typical loans, to incent people to pay off and recover some costs.  e.g. 6.5% interest rate or more

* Backed by the government and not offered through private means such as banks, but administered by banks such as CIBC, Note, no private loans are available without co-signers or parent loans or personal credit history and income and

* Available to high school graduates age 16 and up (that number may be up to 17 now) whose parents' income falls within a specific range   Actually there is a parental contribution requirement that starts at around $90k of family income that reduces the loan amount provided,  and at around $150k family income, the family contribution calc can be well over $10k per year, with student contributions starting at around $3k.  So most with family incomes over $110k living at home will not get any loans.  I believe there is no age minimum, just high school graduation.

* Available to students aged 20 and over without regard to parental income or assets  Actual calc is 2 periods of full time work of a minimum of 12 months each, or married, or parent, or more than 4 years out of high school, and then the student qualifies as an independent without family contribution expected..  if they don't work full time then the age 20 does not qualify alone.

* The school must be accredited Canada Student Loans use the term "designated", accreditation has an academic standard that is very different.  Designated has quite a low standard, and there is a huge range of schools on the list, including privately run diploma programs, bartending school, estheticians, trade programs, etc.

US student loans are of two types: federal, and private. For private student loans there are no rules in particular; it's a free-for-all except the loans cannot be discharged through bankruptcy. federal loans in Canada only, unless you are mature student, all loans can be discharged through bankruptcy, which is why they are hard to get

US federal loans have the following characteristics:
* Some loans are "subsidized" meaning interest does not accrue until graduation, this is the portion that is similar to the Canadian system, and like the USA, is limited in scope and $ size. but most are "unsubsidized", meaning interest continues to accrue during the course of study  These types of loans are not available in Canada without a co signer, so if you don't have the money, you need to work to save up, first.
* Payments are deferred until six months after graduation but that doesn't stop interest from building up  same

* The subsidized loans max out at an amount that is enough to pay for one two-semester year at a state school if a student lives on campus (which is often mandatory for freshmen; it's a way universities make money off their real estate). However, undergraduate degree programs in the USA take four to five years. Five years is increasingly common due to the full year of mandatory remedial-level courses required for people who did not learn how to write paragraphs or multiply fractions in grade school.  it's a univesal problem

* Parental income is included in all calculations until the student is 24 versus 22 in Canada years of age, and subsidized loans are withheld from people whose parents earn "too much" even if the parents are not helping pay for the education same

So key differences are:
-  the fact that tuition, mandatory fees and books in Canada cost between $5500 and $9000 per year, depending on your program and province.  (More for private universities).   e.g., the government subsidizes the remainder of the tuition fees
 with the institutions directly, or does not allow universities to charge more for domestic students.   That similar subsidy seems to occur in some state run colleges in some states, but not all. 
- AND that private universities are much more common in the USA than Canada. 
- that private loans are not available to the generic Canadian student, so if your parents are jerks, you need to wait 2 - 4 years to qualify.
- the cut off is 4 years out of high school (age 22) versus age 24 for US

From my review, accommodation and Meals costing around $10-13k per year is pretty standard in many regions in North America (some private schools excepted but many of those give scholarships to reduce costs to average levels).

Lastly -- single parents attending college full time face significantly more costs and challenges than others, no matter where they are.

Thanks! Like I said, I haven't lived in Alberta since 1998 and all my experiences with student loans were prior to that. I'd be astounded if the system hadn't seen at least a few adjustments. When I left, there was a grand total of one private university in Canada authorized to offer a 4-year baccalaureate degree. Everything else was a public university.

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #121 on: April 19, 2017, 05:12:20 PM »
Lastly -- single parents attending college full time face significantly more costs and challenges than others, no matter where they are.
Strikeout mine.

Yep,  my original thought was "Single parents attending college are screwed"...   but I watered it down to a PC line that fits all single parents, everywhere (because many single parents have significant challenges but are not screwed).

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #122 on: April 19, 2017, 05:16:05 PM »
So key differences are:
-  the fact that tuition, mandatory fees and books in Canada cost between $5500 and $9000 per year, depending on your program and province.  (More for private universities).   e.g., the government subsidizes the remainder of the tuition fees
 with the institutions directly, or does not allow universities to charge more for domestic students.   That similar subsidy seems to occur in some state run colleges in some states, but not all. 
- AND that private universities are much more common in the USA than Canada. 
- that private loans are not available to the generic Canadian student, so if your parents are jerks, you need to wait 2 - 4 years to qualify.
- the cut off is 4 years out of high school (age 22) versus age 24 for US

From my review, accommodation and Meals costing around $10-13k per year is pretty standard in many regions in North America (some private schools excepted but many of those give scholarships to reduce costs to average levels).

Lastly -- single parents attending college full time face significantly more costs and challenges than others, no matter where they are.
https://www.canada.ca/en/employment-social-development/services/student-financial-aid/student-loan/student-loans/needs-assesment.html

I linked the budget breakdown for loans. The amounts are less than minimum wage to live off for a single person. Typically they expect people to live off 30-32 hours of minimum wage work/week. That's the student lifestyle in Canada, if you could work full time they expect you to have an extra $80/week.

Having lived off these loans it was tough, but they were correct. I was unable to work and study, not smart/organized enough at 18, however if I had gone part time for 8 years I could have made it work. Tuition/books requires up to 900 hours/year of minimum wage to pay, going half time would be 500 (not every fee divides in half) , meaning I would have had to average 42 hours/week of minimum wage for 8 years to complete my degree according to the estimates provided by the Government of Canada.

Its not an easy route, I took the lazier way and got loans that I paid off later.

That is great work. I think very few could do what you did.

I just did the in depth dive for kids approaching school now, and if they are to do the 4 year degree (instead of 5) thing, I think very very few could work during school, so without parental support, they would need to put in 1-2 years of working full time first, then work (at above minimum because they have experience) in the summers, and squeak in some Canada Student Loans as well,  to make it work with modest loans upon graduation..

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #123 on: April 19, 2017, 06:36:45 PM »
I just did the in depth dive for kids approaching school now, and if they are to do the 4 year degree (instead of 5) thing, I think very very few could work during school, so without parental support, they would need to put in 1-2 years of working full time first, then work (at above minimum because they have experience) in the summers, and squeak in some Canada Student Loans as well,  to make it work with modest loans upon graduation..
Did you remember to tell them to make the deal to transfer tuition credits? $8000/year tuition is worth a $1,200 refund (check my math), a 4 year course could get $4,800 back; another source of money for school. If parents are willing you can transfer them and they can give you the refund while still in school.

Living at home, if possible, is the single best way to save money. My province is getting big on transferring credits between institutions and in offering correspondence or computer based courses for remote areas. Even if you don't live in a university town its getting easy to take a full first year and live at home.

There's also the 20% bonus for RESP contributions if the kid starts working at 16, the catch is the parents have to kick in a few hundred a few years before to make it a pre existing plan. Its one of the worst bits of legislation ever; if a child saves $5000 from the age of 16 they don't get any bonus. If a wealthy family starts an education savings plan they can get a bonus $1000 on the $5000 the child saves. My nephew has this problem, his parents refused to get him a SIN until 16 years old, now he's working and saving (hopefully for school). He's poor but will get  loans, that he will need to pay back. The Moral is to get the SIN early, kick in the required amounts (a few hundred) and then you can get free money.

WhiteTrashCash

  • Handlebar Stache
  • *****
  • Posts: 1061
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #124 on: April 19, 2017, 07:39:19 PM »
Sorry, but having lived on minimum wage, anybody who thinks you can survive on it really has no idea. It's literally impossible, which is why all the taxpayers in the USA have to subsidize McDonald's and Walmart's businesses by providing SNAP and welfare programs. We would rather do that than force those cheapskates to pay living wages for some reason. It has something to do with Americans hoping they will someday find themselves in the same position as the Walton Family to exploit other people too.
If its "literally impossible to survive" are you a ghost? ;)

However, why aren't you still earning minimum wage? the point of the article was to do better, with time, than minimum wage. No one disputes that living on the minimum wage is hard; hence the reason to figure out how to earn more.

The naysayers who tear down the people offering solutions, how does that improve America? Someone writes an article trying to make life better and others criticize, should we maintain the status quo? Shouldn't we all offer solutions instead of repeating the litany of complaints? Solutions require individual effort; its far easier to blame others.

No one is claiming its easy, I think the complainers just like playing the martyr.

I can't tell you some of the things I did to survive because it would violate this forum's TOS. Sorry.

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #125 on: April 19, 2017, 09:11:50 PM »
Sorry, but having lived on minimum wage, anybody who thinks you can survive on it really has no idea. It's literally impossible, which is why all the taxpayers in the USA have to subsidize McDonald's and Walmart's businesses by providing SNAP and welfare programs. We would rather do that than force those cheapskates to pay living wages for some reason. It has something to do with Americans hoping they will someday find themselves in the same position as the Walton Family to exploit other people too.
If its "literally impossible to survive" are you a ghost? ;)

However, why aren't you still earning minimum wage? the point of the article was to do better, with time, than minimum wage. No one disputes that living on the minimum wage is hard; hence the reason to figure out how to earn more.

The naysayers who tear down the people offering solutions, how does that improve America? Someone writes an article trying to make life better and others criticize, should we maintain the status quo? Shouldn't we all offer solutions instead of repeating the litany of complaints? Solutions require individual effort; its far easier to blame others.

No one is claiming its easy, I think the complainers just like playing the martyr.

I can't tell you some of the things I did to survive because it would violate this forum's TOS. Sorry.
Sorry for what? I'm not asking you to prove yourself. I'm pointing out that there are a great many people who lived off less than minimum wage on this forum. Collectively we all did stuff to change the situation and ended up with extra income. Most of us followed the articles advice, the one that triggered backlash.

My call to ask why you weren't still earning minimum wage is rhetorical. Obviously you did something to change the situation, maybe you gained an education, moved, moonlighted, started a small business, cut expenses in a drastic fashion or some other means. Did you sit around complaining or did you do something? I'm pretty sure the complainers will still be broke in 10 years, the ones who take the advice will be much better off.

Lets recap the advice people mocked:
1) Move to a cheaper city - don't live in NYC and try to make it on minimum wage
2) Pay less than $600/month in rent
3) Eliminate your commute
4) Cancel your cable
5) Don't eat out
6) Don't skip medical insurance
7) Shop at thrift stores and mend things
8) Rediscover the fact the best things in life are free
9) Invest your remaining money
10) invest in yourself

Which advice do you thing is worthy of backlash? If you were living on minimum wage again, which bit of advice wouldn't you follow?

I apologize for the literal crack, literally is literally an overused word. Literally should be banished from English for being used incorrectly.

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #126 on: April 22, 2017, 02:46:21 AM »
I just did the in depth dive for kids approaching school now, and if they are to do the 4 year degree (instead of 5) thing, I think very very few could work during school, so without parental support, they would need to put in 1-2 years of working full time first, then work (at above minimum because they have experience) in the summers, and squeak in some Canada Student Loans as well,  to make it work with modest loans upon graduation..
Did you remember to tell them to make the deal to transfer tuition credits? $8000/year tuition is worth a $1,200 refund (check my math), a 4 year course could get $4,800 back; another source of money for school. If parents are willing you can transfer them and they can give you the refund while still in school.

Living at home, if possible, is the single best way to save money. My province is getting big on transferring credits between institutions and in offering correspondence or computer based courses for remote areas. Even if you don't live in a university town its getting easy to take a full first year and live at home.

There's also the 20% bonus for RESP contributions if the kid starts working at 16, the catch is the parents have to kick in a few hundred a few years before to make it a pre existing plan. Its one of the worst bits of legislation ever; if a child saves $5000 from the age of 16 they don't get any bonus. If a wealthy family starts an education savings plan they can get a bonus $1000 on the $5000 the child saves. My nephew has this problem, his parents refused to get him a SIN until 16 years old, now he's working and saving (hopefully for school). He's poor but will get  loans, that he will need to pay back. The Moral is to get the SIN early, kick in the required amounts (a few hundred) and then you can get free money.

You bet on the transfer credits! I also added in student savings from summer jobs... I even had them (the parents in the class I taught) go back and circle the full first year tuition amount after explaining that these tax credits are great, but it is a pay tuition first, get money credits later deal.     e.g., that they need to save at least the full cost of the first year in advance.

Living at home, lots of summer work after 1st year, and applying the tuition credits--> the costs for education start dropping dramatically.  For some of them (with local, low cost school), all they needed to save was a full first year's costs, then the nearly all the rest is paid via credits and student wages.

The down part is that the Federal education amounts are removed for 2017 and beyond, and this was worth 15% x $4800 in credits, so removed a chunk for all of us going forward.

Interesting questions came up about separated / divorced parents and who claims the credits.   I reminded them that in the absence of legal documents stating what to do, the credits are actually appearing on an ADULT CHILD's tax return, and it is the kid that has the final say in where the credit are used.   Most parents said if they were the ones paying, they would claim the credits.


Can you provide me the link to this?  I had never heard of a credit tied to the kid working, only the non-taxable account in kid's name (up to $11k per year of kid income is not taxed) or the RESP for parents / others to contribute to.    QUOTE 20% bonus for RESP contributions if the kid starts working at 16,

WhiteTrashCash

  • Handlebar Stache
  • *****
  • Posts: 1061
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #127 on: April 22, 2017, 01:46:54 PM »
Let me revise what I said before. It's not literally impossible to survive on minimum wage. It's also not literally impossible to win the Powerball jackpot. It's not literally impossible to stumble across a buried treasure chest from Blackbeard the Pirate hidden in your backyard. It's not literally impossible to be struck by lightning three times by accident. All of them have about the same likelihood, though.

SwordGuy

  • Walrus Stache
  • *******
  • Posts: 6042
  • Location: Fayetteville, NC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #128 on: April 22, 2017, 05:58:36 PM »
I just did the in depth dive for kids approaching school now, and if they are to do the 4 year degree (instead of 5) thing, I think very very few could work during school, so without parental support, they would need to put in 1-2 years of working full time first, then work (at above minimum because they have experience) in the summers, and squeak in some Canada Student Loans as well,  to make it work with modest loans upon graduation..

What degree program?  I say this because most colleges today in most academic programs (in the USA) spend a great deal of the student's time for the first two years covering material that the students should have learned in high school.

So, if your high school students actually take the time to learn well what they are supposed to learn in high school, they will have an easy time in most programs in most colleges.      And, if they do that -- and pay PERSONAL attention to the list of classes they have to take to graduate and take them as early as possible to avoid scheduling issues at the last minute -- they should be able to graduate in 4 years.

TheGrimSqueaker

  • Handlebar Stache
  • *****
  • Posts: 2201
  • Location: A desert wasteland, where none but the weird survive
  • www.theliveinlandlord.com
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #129 on: April 22, 2017, 09:57:22 PM »
What degree program?  I say this because most colleges today in most academic programs (in the USA) spend a great deal of the student's time for the first two years covering material that the students should have learned in high school.

Indeed. Mandatory remedial classes are how universities make most of their money... that, and fees for mandatory dorm living. That includes the not-for-profit state schools.

The dumbing-down of the freshman and sophomore content is related to the rather farcical idea that "everybody" should be studying college preparatory material. Heavy tuition subsidies are also a factor because they allow colleges and universities to lower their entrance requirements until anyone with a pulse and a diploma can get in. There's no longer a distinction between many kinds of IEP (Individualized Education Program) diplomas and what used to be called the matriculation diploma, because of "stigma" and the fear that too many little snowflakes' self esteem might be damaged by being put in a course that's passable based on the potential they've displayed so far (and receiving a credential that says so) or receiving a grade proportionate to the effort they put in.

There's no noticeable difference between a Special Ed diploma and a mainstream one. So universities have to assume that every fresh crop of high school graduates will contain a majority of students that cannot perform basic algebra or write a coherent paragraph, much less handle a college curriculum.

College, for most students in the US, is taking five years due to all the mandatory rehashing of junior high and high school material. The best students bypass the mandatory spoon-feeding by taking AP (Advanced Placement) courses in high school. These used to replace college level calculus or history courses in real college, but now the AP designation is given to what used to be matriculation high school content.

The end result is that today's 2-year associate's degree is roughly equivalent to a high school diploma from 20 years ago. Today's bachelor's degree is roughly equivalent to what used to be the associate's, and the master's is on par with the old bachelor's degree.

SwordGuy

  • Walrus Stache
  • *******
  • Posts: 6042
  • Location: Fayetteville, NC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #130 on: April 22, 2017, 10:46:22 PM »
What degree program?  I say this because most colleges today in most academic programs (in the USA) spend a great deal of the student's time for the first two years covering material that the students should have learned in high school.

Indeed. Mandatory remedial classes are how universities make most of their money... that, and fees for mandatory dorm living. That includes the not-for-profit state schools.

The dumbing-down of the freshman and sophomore content is related to the rather farcical idea that "everybody" should be studying college preparatory material. Heavy tuition subsidies are also a factor because they allow colleges and universities to lower their entrance requirements until anyone with a pulse and a diploma can get in. There's no longer a distinction between many kinds of IEP (Individualized Education Program) diplomas and what used to be called the matriculation diploma, because of "stigma" and the fear that too many little snowflakes' self esteem might be damaged by being put in a course that's passable based on the potential they've displayed so far (and receiving a credential that says so) or receiving a grade proportionate to the effort they put in.

There's no noticeable difference between a Special Ed diploma and a mainstream one. So universities have to assume that every fresh crop of high school graduates will contain a majority of students that cannot perform basic algebra or write a coherent paragraph, much less handle a college curriculum.

College, for most students in the US, is taking five years due to all the mandatory rehashing of junior high and high school material. The best students bypass the mandatory spoon-feeding by taking AP (Advanced Placement) courses in high school. These used to replace college level calculus or history courses in real college, but now the AP designation is given to what used to be matriculation high school content.

The end result is that today's 2-year associate's degree is roughly equivalent to a high school diploma from 20 years ago. Today's bachelor's degree is roughly equivalent to what used to be the associate's, and the master's is on par with the old bachelor's degree.

The reason that I made that observation was that a student who properly prepared themselves in k-12 CAN work in college AND make good grades.   

I worked 30 hours a week during college and more during the summers or winter break.  I did that and worked as a grad assistant in grad school.   (And still had time for fun.)

Of course, students who never learned to study in k-12 will have trouble learning to study later -- assuming they even try to do so.    A lot of professor friends assure me that most don't try at all.

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #131 on: April 22, 2017, 10:58:26 PM »
I just did the in depth dive for kids approaching school now, and if they are to do the 4 year degree (instead of 5) thing, I think very very few could work during school, so without parental support, they would need to put in 1-2 years of working full time first, then work (at above minimum because they have experience) in the summers, and squeak in some Canada Student Loans as well,  to make it work with modest loans upon graduation..

What degree program?  I say this because most colleges today in most academic programs (in the USA) spend a great deal of the student's time for the first two years covering material that the students should have learned in high school.

So, if your high school students actually take the time to learn well what they are supposed to learn in high school, they will have an easy time in most programs in most colleges.      And, if they do that -- and pay PERSONAL attention to the list of classes they have to take to graduate and take them as early as possible to avoid scheduling issues at the last minute -- they should be able to graduate in 4 years.

I don't think that is the case here.  If you don't get a very strong mark in high school in your required subjects, you need to take other pre-req's or upgrading courses before starting the 4 year program, and the content is very different.    those student actually need 5 or even 6 years to graduate...  this includes a lot of ESL foreign students that need upgrading.  Examples - First year biology or physics or math content is very different from high school, especially the labs, etc.  They don't teach calculus here in high school, unless you take the AP classes.   Even English lit (as opposed to basic English, has a grade 12 and an AP course that are quite different in standards / content.

There does seem to be some leeway in the arts degrees, who only take 5 classes a term, especially for students that are fast readers -- e.g., there are not many essays, one mid term and one final, students can bundle homework into batches and have free time to work -- but only if you are fast at reading and keep up with it.  For them, IDK if what you say holds true....


Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #132 on: April 22, 2017, 11:06:37 PM »
Grim:

The best students bypass the mandatory spoon-feeding by taking AP (Advanced Placement) courses in high school. These used to replace college level calculus or history courses in real college, but now the AP designation is given to what used to be matriculation high school content.


I am not too sure about that.   My daughter is taking a few AP classes, and the content for her AP Psych was definitely the classic Psych 100.first year class..Biology was so different that taking AP was not even an option given to the grade 12 class...

...and we never learned calculus in high school in grade 12 back in the 1980's unless you were taking AP or IB courses....  was calculus standard in your high school?

I agree that too many of the regular Grade 12 classes involve spoon feeding and that AP is a way to escape that, but not that AP classes are significantly watered down now.   I can't comment if AP tests are marked easier, or are on a bell curve...

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #133 on: April 22, 2017, 11:24:33 PM »
Okay,
I just read a few articles on AP classes and the problems with offering them to too many students...  that is very different from what happens here.

  In DD's school, students are permitted to study outside of their assigned grade 12 class, extra course content in order to write the AP exam, which is why only a few are offered, where there may be some overlap with grade 12.  e.g., Psych, History, English Lit, Math, Art.  Maybe Physics.

In all cases, there is a large amount of extra work after school or lunch time classes with a teacher, and only 2-8 students write a specific AP exam each year.

For the universities, you only get credit with a "4" or sometimes only "5" mark.  The credit you get is for an elective credit, and it may qualify as a pre-req.  But the school encourage students who major in a subject to not take the AP credit in that subject, because they need to learn the basic (e.g., how physics labs work) at their school by taking "Physics 100".

I would place the quality of the AP classes with on-line courses covering similar content, (it is just one big exam with a firehose of content) or a bit better because they have highly interested teachers in the subject teaching only a few students at a time.

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #134 on: April 24, 2017, 11:11:35 AM »
Can you provide me the link to this?  I had never heard of a credit tied to the kid working, only the non-taxable account in kid's name (up to $11k per year of kid income is not taxed) or the RESP for parents / others to contribute to.    QUOTE 20% bonus for RESP contributions if the kid starts working at 16,
The kid can contribute to the RESP with their earned wages (the other category). The caveat is if the RESP is set up prior to them turning 16 though, with the minimum contributions to make it eligible:

1.At least $2,000 must have been contributed to an RESP for the beneficiary before the end of the calendar year the beneficiary turned 15 and not withdrawn.
2.At least $100 must have been contributed to an RESP for the beneficiary in each of any four years before the end of the calendar year that the beneficiary turned 15 and not withdrawn.

So if a hard working kid wants to go to university they should save some money within their RESP. My understanding is the money pulled from the RESP will be deemed to be parental contribution when applying for loans, the loans don't consider the source of the initial RESP money.

If you have lazy parents though who don't set up the account you can't access the 20% top-up. The contributions can be back dated 1 year so some kids can have $7,500 in room (ages 15,1and 17, the program ends the year they turn 17). This can get them a cool $1,500 on to of their hard earned $7500. IMO $9,000 is a lot for your first year, its a lofty goal saving $7,500 in HS but achievable by many.

If I had known this I could have used my Student loan money to fund my RESP at age 17. Then I could have pulled it back out the next year with an extra $1000 attached (except I didn't have an RESP set up). It evens the playing field between middle class and poor class; they were getting the money all along and the poor kid is trying to catch up.

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #135 on: April 26, 2017, 01:26:45 AM »
^^  Prairie stash.  Thanks for clarifying that you just meant that a kid can contribute to a standard RESP.   The way that you stated it, it read like additional money specific to a student's working income.


Quote that I found confusing...

There's also the 20% bonus for RESP contributions if the kid starts working at 16, the catch is the parents have to kick in a few hundred a few years before to make it a pre existing plan.

e.g.  There is no "additional bonus for a working student" at all.  Just the basic 20% match for any contribution, coming from anyone, working or not, as long as the RESP was set up, and the maximum CESG doesn't increase either.    I think the "age 16" about working age is a red herring, too.   You can get the match if you contribute regardless of age of the contributor (beneficiary has to be 17 or under).

BIG BUT -- the contributions are owned by the person putting the funds in -- so can a student actually contribute to their own plan?   The money becomes the ownership of whatever adult (parent) started the RESP, and that parent can take it and run, if they want, no?  it would be like giving money to your parent, and hoping that they let you use it for your education.   How does someone under the age of 18 set up their own RESP?

from CRA:
Who can be a subscriber?
Except for family plans, generally, there are no restrictions on who can be the original subscriber under an RESP:

You and your spouse or common-law partner can be joint original subscribers under an RESP.
A primary caregiver of the beneficiary
- names a sequence of adults that can be the original subscriber, but not minors, because of the contract that exists between the bank and the subscriber... --


Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #136 on: April 26, 2017, 01:36:14 AM »

If I had known this I could have used my Student loan money to fund my RESP at age 17. Then I could have pulled it back out the next year with an extra $1000 attached (except I didn't have an RESP set up). It evens the playing field between middle class and poor class; they were getting the money all along and the poor kid is trying to catch up.

I need to point out that the middle income kid does not often get access to student loans, but the poor kid gets both student loans and bursaries, and grant money during the school and some even after graduation.

Did you ever get a bursary given with your loan, or grant money or a reduction of your loan upon timely graduation?

RESP's grants were created at about the time that the government reduced tuition funding (1998), and CESG's and they increased the matching 20% grants and created more bursaries and grants for loan recipients. The thought was that middle class and above parents should pay for their kids' college directly, and the CESGs were designed to encourage parents to do that from when the kids were small, not just in the 2 years before college.

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #137 on: April 26, 2017, 09:50:52 AM »

If I had known this I could have used my Student loan money to fund my RESP at age 17. Then I could have pulled it back out the next year with an extra $1000 attached (except I didn't have an RESP set up). It evens the playing field between middle class and poor class; they were getting the money all along and the poor kid is trying to catch up.

I need to point out that the middle income kid does not often get access to student loans, but the poor kid gets both student loans and bursaries, and grant money during the school and some even after graduation.

Did you ever get a bursary given with your loan, or grant money or a reduction of your loan upon timely graduation?

RESP's grants were created at about the time that the government reduced tuition funding (1998), and CESG's and they increased the matching 20% grants and created more bursaries and grants for loan recipients. The thought was that middle class and above parents should pay for their kids' college directly, and the CESGs were designed to encourage parents to do that from when the kids were small, not just in the 2 years before college.
Let me clarify there are two types of bursaries; there are bursaries from the university that resemble scholarships and blend academic/poverty, these are for bright but poor students. The ones you are referring to are more needs based; its insulting to say all bursaries are for poor kids, some kids work really hard for theirs just like the kids who get scholarships. You didn't insult me, I received both, I'm just clarifying that some bursaries are for gifted kids from poor families. If you continue to insinuate that it was all charity though, that's crossing the line, its a competition that some kids win and others don't (just like scholarships). That said, I think you only meant the government bursaries or grants that only look at income (you didn't specify, you may not have been aware there was a difference).

My complaint is the caveat that a responsible child, of irresponsible parents, could lack access to the RESP. Its a needless restriction that inhibits the youth from saving. The workaround is a child of 12 needs to save $100/year for 4 years in the RESP. The problem still is the requirement that the parent must obtain a SIN and setup the account. I have a nephew in this boat and it frustrates me, he's a hard working kid but his parents couldn't be bothered to get a SIN card.

In removing the restriction the low income kid would require lower financial aid, reducing the amount of grants/bursaries. You said that parents should be encouraged to save, isn't that unfair to children that want to save? If a 16 year old child wants to behave like an adult, shouldn't everyone get behind them?

Lets look at it the other way, if the restriction was lifted what harm would occur? Please note that having RESP reduces the amount you obtain from Student Loans; dollar for dollar. So any money saved reduces bursaries, grants, loans and comes directly from the child who works for it. Potentially the child may not receive a loan at all, they would be treated like any middle class student.

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #138 on: April 26, 2017, 11:07:52 PM »

If I had known this I could have used my Student loan money to fund my RESP at age 17. Then I could have pulled it back out the next year with an extra $1000 attached (except I didn't have an RESP set up). It evens the playing field between middle class and poor class; they were getting the money all along and the poor kid is trying to catch up.

I need to point out that the middle income kid does not often get access to student loans, but the poor kid gets both student loans and bursaries, and grant money during the school and some even after graduation.

Did you ever get a bursary given with your loan, or grant money or a reduction of your loan upon timely graduation?

RESP's grants were created at about the time that the government reduced tuition funding (1998), and CESG's and they increased the matching 20% grants and created more bursaries and grants for loan recipients. The thought was that middle class and above parents should pay for their kids' college directly, and the CESGs were designed to encourage parents to do that from when the kids were small, not just in the 2 years before college.
Let me clarify there are two types of bursaries; there are bursaries from the university that resemble scholarships and blend academic/poverty, these are for bright but poor students. The ones you are referring to are more needs based; its insulting to say all bursaries are for poor kids, some kids work really hard for theirs just like the kids who get scholarships. You didn't insult me, I received both, I'm just clarifying that some bursaries are for gifted kids from poor families. If you continue to insinuate that it was all charity though, that's crossing the line, its a competition that some kids win and others don't (just like scholarships). That said, I think you only meant the government bursaries or grants that only look at income (you didn't specify, you may not have been aware there was a difference).


I was saying that bursaries are often a form of government grants, not charities. Government money is NOT charity, it is "sharing the wealth" and why we have taxes.  Further my point is that CESG's are similar to Buarsaries from the government  - -money for school provided in different forms, so if you are "shorted" one type by economic circumstance, you would qualify for the other - not too much unfair about it, just different.

I have not found any bursaries that are academic scholarships (and DD has review 100 so far this year).  Some private ones are tied to specific criteria - like being a softball player PLUS need, or writing an essay PLUS need.   The key is that the NEED is the primary criteria for most, as usually proven by the Canada Student Loan, then it is given to the student with the top essay that qualifies for the CSL..  Other bursaries are handed out on a decreasing / prioritied need basis solely on the total need identified.


My complaint is the caveat that a responsible child, of irresponsible parents, could lack access to the RESP.
  Having Dick parents knows no bounds of income, and the middle income kid has even fewer fallback options if so.

The issue for everyone, I think, is that a minor can not hold a contract in their own name, and therefore can not open an RESP / investment account which is a form of contract.

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #139 on: April 27, 2017, 11:18:25 AM »
I was saying that bursaries are often a form of government grants, not charities. Government money is NOT charity, it is "sharing the wealth" and why we have taxes.  Further my point is that CESG's are similar to Buarsaries from the government  - -money for school provided in different forms, so if you are "shorted" one type by economic circumstance, you would qualify for the other - not too much unfair about it, just different.

I have not found any bursaries that are academic scholarships (and DD has review 100 so far this year).  Some private ones are tied to specific criteria - like being a softball player PLUS need, or writing an essay PLUS need.   The key is that the NEED is the primary criteria for most, as usually proven by the Canada Student Loan, then it is given to the student with the top essay that qualifies for the CSL..  Other bursaries are handed out on a decreasing / prioritied need basis solely on the total need identified.


My complaint is the caveat that a responsible child, of irresponsible parents, could lack access to the RESP.
  Having Dick parents knows no bounds of income, and the middle income kid has even fewer fallback options if so.

The issue for everyone, I think, is that a minor can not hold a contract in their own name, and therefore can not open an RESP / investment account which is a form of contract.
[/quote]
I received academic bursaries in Canada (more than one). They're issued by universities, corporations and institutions. You have to hustle to find them, its not easy. If writing an essay is too difficult, no one said being poor is easy and there's always hoops to jump through.

In practice the RESP approach can be used to assist anyone who works starting at 16 (rich or poor). Its completely merit based, if the teenager is hard working they have the option to save money for school. In no ways does the role of the parent, good or bad, matter.

The one problem is you need responsible parents, or a responsible adult in your life, you need $400 starting at age 12, to get access to the CESG plus full loans (regardless of class). Its a petty rule being a very small threshold, the rule is irrespective of middle/poor class. There are kids who fall on either side of this rule, with $400 separating them from being allowed grants of $1500 if they contribute from their earned money. Parents of all classes are Dicks, agreed. I'm advocating that the control of the parents be reduced in situations where they are being obstinate or lazy and not willing to sign the form for the SIN card.

I assume more poor kids get screwed by this rule than middle class kids; but kids are neither middles class or poor; its the parents that are and they're just kids. Do you feel that's a safe assumption?

To open a RESP all you need is a SIN and anybody over 18. Once you start working, you have a SIN, in my province they now grant them alongside birth certificates. Then you need to ask an Uncle, Aunt, Cousin, Grandparent or even a family friend over 18 (official rules allow for a friend to set up the RESP). I think most 16 year olds can find someone over 18 to help out, you could ask your boss if you were on good terms. The process takes under an hour at any of the banks, the logistics are easier than applying for university.

https://myuniversitymoney.com/can-i-contribute-to-my-own-resp/
I found this link (to help approach this from another angle), its discussing how using the RESP is the best approach for a teenager to save money for school. Its not class based, its based on how hard working the teenager is and completely merit based.

Please note, your daughter could employ this strategy if she's under 17. I assume you raised a hard working child, she can get a substantial boost to her savings. She can withdraw all the money next year when she starts school. 

joleran

  • Stubble
  • **
  • Posts: 177
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #140 on: April 28, 2017, 02:30:14 PM »
I lived on minimum wage ($5.15/hr) for 2 years growing up. Rent was $600 split two ways for a one bedroom apartment and I couldn't afford anything of note, certainly not luxuries like health insurance or fancier food than beans, rice, and "manager special (reduced for quick sale)" meat. I had an old car gifted to me, so that helped a lot.  Constant worrying about money, buying a $1 box of mac and cheese was a treat (hey, it's comfort food).  I once bumped into a fence backing up in an alley and had to pay for it, a $400 check that represented my savings.  I was trembling writing that, but better than getting sued. 

That said, I was lucky and privileged to have the car (20 year old dodge) and not having health issues or dependents.  Never did food stamps or other government assistance, though in retrospect that was stupid.  I did manage to contribute $150 and $350 each year respectively to a ROTH IRA though.

It's very much possible to live on minimum wage, it just sucks and if you get unlucky with health etc. it can become impossible very quickly.  I saw plenty of people spend their money on meth, coke, and cigarettes though and they were constantly broke, so don't do that.

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #141 on: April 29, 2017, 03:36:42 PM »

Please note, your daughter could employ this strategy if she's under 17. I assume you raised a hard working child, she can get a substantial boost to her savings. She can withdraw all the money next year when she starts school.

I don't think you realize that just because the kid earned the money, and then put the money (with the help of an adult) into an RESP for themselves -- that the money actually belongs to the adult that set up the RESP.

Only the person who set up the RESP can take out the money, or direct it to be given to the kid. 

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #142 on: May 01, 2017, 10:36:56 AM »

Please note, your daughter could employ this strategy if she's under 17. I assume you raised a hard working child, she can get a substantial boost to her savings. She can withdraw all the money next year when she starts school.

I don't think you realize that just because the kid earned the money, and then put the money (with the help of an adult) into an RESP for themselves -- that the money actually belongs to the adult that set up the RESP.

Only the person who set up the RESP can take out the money, or direct it to be given to the kid.
Would you take the money your daughter saved and spend it on yourself? Of course not, any decent person would direct it to the child who earned the cash. If the entire problem is the logistic of releasing the money, I'm not seeing much issue at all. You don't need an adult to transfer money in, you just need an adult to set it up, the rules say anybody can contribute. At withdrawal time you need the adult to sign off once. Its the same problem faced if you contribute to a relatives plan, if my sibling set up a plan I could contribute to my niece/nephews school. If my sibling withholds the money then they will effectively torpedo their parental relationship and the kid is probably better off; its a valuable lesson to never trust that person again. In practice, does it seem like it would happen often?

It does raise a weird possibility, could the child sue the adult for RESP monies they withhold? If you refused to release the money or instead directed it into your RRSP, could your daughter just sue you? It wouldn't damage your relationship beyond the original damage of withholding the money (I'm pretty sure my children would hate me if I withheld their contributions). 

TheGrimSqueaker

  • Handlebar Stache
  • *****
  • Posts: 2201
  • Location: A desert wasteland, where none but the weird survive
  • www.theliveinlandlord.com
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #143 on: May 01, 2017, 10:55:53 AM »

Please note, your daughter could employ this strategy if she's under 17. I assume you raised a hard working child, she can get a substantial boost to her savings. She can withdraw all the money next year when she starts school.

I don't think you realize that just because the kid earned the money, and then put the money (with the help of an adult) into an RESP for themselves -- that the money actually belongs to the adult that set up the RESP.

Only the person who set up the RESP can take out the money, or direct it to be given to the kid.
Would you take the money your daughter saved and spend it on yourself? Of course not, any decent person would direct it to the child who earned the cash. If the entire problem is the logistic of releasing the money, I'm not seeing much issue at all. You don't need an adult to transfer money in, you just need an adult to set it up, the rules say anybody can contribute. At withdrawal time you need the adult to sign off once. Its the same problem faced if you contribute to a relatives plan, if my sibling set up a plan I could contribute to my niece/nephews school. If my sibling withholds the money then they will effectively torpedo their parental relationship and the kid is probably better off; its a valuable lesson to never trust that person again. In practice, does it seem like it would happen often?

It does raise a weird possibility, could the child sue the adult for RESP monies they withhold? If you refused to release the money or instead directed it into your RRSP, could your daughter just sue you? It wouldn't damage your relationship beyond the original damage of withholding the money (I'm pretty sure my children would hate me if I withheld their contributions).

I've put the key problem in boldface. Most parents think they're basically decent, reasonable individuals but when it really comes down to whether or not to try to use money to control people, the vast majority of humans have no problem with it if the child is making a decision they don't agree with, such as studying toward a career deemed inappropriate by the parents.

One of the reasons I had some difficulty early on is because I stupidly allowed my parents to manage the money I worked for and saved starting at age 13. Although it was ostensibly "for education" and I did make most of the decisions as to whether or not to invest in a particular stock, when I needed money for tuition and particularly for private tutoring due to a specific shortfall related to the major I wanted, they refused to allow me to access my money. I believe it was in order to keep me at home and under their thumb: they had a work-in-lieu-of-rent situation in mind. One of the jobs I had to work to put myself through school cost me the effective use of my right arm for a year. They eventually released the money when I turned 25 because the law forced them to do that. By that point I had left the country to avoid further control.

The trouble with suing for the RESP monies is that a minor frequently cannot bring a suit due to lack of resources to pay for legal fees and lack of access to lawyers. Very, very few minors are gutsy enough to do it "pro se" and not all the relevant case law is available online.

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #144 on: May 01, 2017, 01:10:34 PM »
any decent person would direct it to the child who earned the cash.

I've put the key problem in boldface. Most parents think they're basically decent, reasonable individuals but when it really comes down to whether or not to try to use money to control people, the vast majority of humans have no problem with it if the child is making a decision they don't agree with, such as studying toward a career deemed inappropriate by the parents.

One of the reasons I had some difficulty early on is because I stupidly allowed my parents to manage the money I worked for and saved starting at age 13. Although it was ostensibly "for education" and I did make most of the decisions as to whether or not to invest in a particular stock, when I needed money for tuition and particularly for private tutoring due to a specific shortfall related to the major I wanted, they refused to allow me to access my money. I believe it was in order to keep me at home and under their thumb: they had a work-in-lieu-of-rent situation in mind. One of the jobs I had to work to put myself through school cost me the effective use of my right arm for a year. They eventually released the money when I turned 25 because the law forced them to do that. By that point I had left the country to avoid further control.

The trouble with suing for the RESP monies is that a minor frequently cannot bring a suit due to lack of resources to pay for legal fees and lack of access to lawyers. Very, very few minors are gutsy enough to do it "pro se" and not all the relevant case law is available online.
[/quote]
I don't think you're looking for sympathy, I'll refrain. Its a phenomenal case study of what life is like when you lack control of your finances or personal choice. I'm not sure I would consider your parents to be decent, I'll let you be the jury on that question.

Originally I was thinking of advocating for children to have better access to savings, then thought that would be too extreme (it would have been useful for myself, I thought it was too narrow of a sample). When you're born poor the rules aren't capable of protecting you from your parents; the very people who brought you into the life of poverty. Hence the risk of generational poverty, you learn your parents habits. My solution is to open up savings programs and eliminate the requirement to have decent, responsible parents.

When discussing poverty people often think of poor kids/rich kids. Its much more nuanced, a kid isn't poor, their family is, or more accurately their parents. When I was taunted for poverty at an early age the irony struck me then, none of these kids were rich, just their parents. When you turn 18 and can walk away from their dysfunction, you can build your own life, until then you're trapped by the system in place, except for emancipation cases.

As an anecdote for GS; when I left my parents didn't stop me, they still received child benefit cheques. I've always thought it was a stupid system that would send money to parents, to use for the child, when the child lived separate (the rules are still the same today). Since I was a minor without rights the system didn't care, but at least I got student debt though! In fairness my parents were required to report their income (parental involvement) to the loans officer, which is funny since it was already in the government records how much they earned. The same people that determined eligibility for children aid (child cheques were income based) needed confirmation that I needed student aid, if they withheld the already public information I would have been denied. That's the hoops that you need to jump through when you're poor though, its indefensible.

TL/DR In summary we have these points about being born poor in Canada:
1) The government requires parental release of tax information to determine loan eligibility (information already on file and used to determine child benefits)
2) The government requires your parents to be responsible in order for a child to benefit from university savings encouragement (CESG top up), a child's behavior is not a consideration
3) Children aid cheques go to parents, even in situations of children living separate and independent
4) Lest anyone think student loans are great, the monthly living allowance is set for 30 hours/week of minimum wage earnings (varies with province). Students in Canada are expected to live off part time minimum wage while on loans for 4-5 years. All money earned will reduce loan eligibility. Summer jobs are required and have set savings targets regardless of actual savings.
5) Parents can legally cash a minors cheque and keep the money, provided they confirm the money will be spent in the child's interest which includes paying the rent or groceries

TheGrimSqueaker

  • Handlebar Stache
  • *****
  • Posts: 2201
  • Location: A desert wasteland, where none but the weird survive
  • www.theliveinlandlord.com
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #145 on: May 01, 2017, 01:57:16 PM »
I don't think you're looking for sympathy, I'll refrain. Its a phenomenal case study of what life is like when you lack control of your finances or personal choice. I'm not sure I would consider your parents to be decent, I'll let you be the jury on that question.

They're not just decent, they're pillars of the community. Of course, had they been in a lower income bracket and lived in a less upscale part of town, my brother and I would have been taken away by Child Protective Services for neglect and occasional abuse long before the financial chicanery. At least I did eventually get control of my money, and at least it was reasonably well managed until that point. Most people whose parents do the money grab aren't that lucky.

After I left the country I was gradually able to build a relationship of sorts with them, using the "minimum safe distance" approach. In some respects I must credit them for making me Mustachian: had I not had the wit to start banking independently at age 15 using an account they didn't know about a few years before it was technically legal for me to do so, I'd have been in a very poor position later.

Wealth does insulate people from the consequences of their negative behavior.

Quote
Originally I was thinking of advocating for children to have better access to savings, then thought that would be too extreme (it would have been useful for myself, I thought it was too narrow of a sample). When you're born poor the rules aren't capable of protecting you from your parents; the very people who brought you into the life of poverty. Hence the risk of generational poverty, you learn your parents habits. My solution is to open up savings programs and eliminate the requirement to have decent, responsible parents.

I concur.

Also, I've noticed that most of the constraints and limitations are put on kids from the poor end of the family income spectrum. The time and resources they spend jumping through hoops is phenomenal. Privilege is real.

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #146 on: May 01, 2017, 06:03:36 PM »

Quote
Originally I was thinking of advocating for children to have better access to savings, then thought that would be too extreme (it would have been useful for myself, I thought it was too narrow of a sample). When you're born poor the rules aren't capable of protecting you from your parents; the very people who brought you into the life of poverty. Hence the risk of generational poverty, you learn your parents habits. My solution is to open up savings programs and eliminate the requirement to have decent, responsible parents.

I concur.

Also, I've noticed that most of the constraints and limitations are put on kids from the poor end of the family income spectrum. The time and resources they spend jumping through hoops is phenomenal. Privilege is real.
Its a partial fall out from the desire to have adults "earn" welfare or other handouts. A lot of generous people compromise with others when crafting the rules to impose limitations on the amount that a poor kid can receive. Its seen as justice to make it hard; since they're getting something for nothing they need to work for it.

Justice for being born poor, its a grotesque concept.

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #147 on: May 02, 2017, 01:12:25 AM »

Please note, your daughter could employ this strategy if she's under 17. I assume you raised a hard working child, she can get a substantial boost to her savings. She can withdraw all the money next year when she starts school.

I don't think you realize that just because the kid earned the money, and then put the money (with the help of an adult) into an RESP for themselves -- that the money actually belongs to the adult that set up the RESP.

Only the person who set up the RESP can take out the money, or direct it to be given to the kid.
Would you take the money your daughter saved and spend it on yourself? Of course not, any decent person would direct it to the child who earned the cash. If the entire problem is the logistic of releasing the money, I'm not seeing much issue at all. You don't need an adult to transfer money in, you just need an adult to set it up, the rules say anybody can contribute. At withdrawal time you need the adult to sign off once. Its the same problem faced if you contribute to a relatives plan, if my sibling set up a plan I could contribute to my niece/nephews school. If my sibling withholds the money then they will effectively torpedo their parental relationship and the kid is probably better off; its a valuable lesson to never trust that person again. In practice, does it seem like it would happen often?

It does raise a weird possibility, could the child sue the adult for RESP monies they withhold? If you refused to release the money or instead directed it into your RRSP, could your daughter just sue you? It wouldn't damage your relationship beyond the original damage of withholding the money (I'm pretty sure my children would hate me if I withheld their contributions).

Any decent person would also set up an RESP before their kid were 16, and put a little money into it, or sign up for the CLB's (free money) if quite low income.

I do not believe the rules say that anyone can contribute money -- the RESP contract is between the bank and the primary adult(s) who set it up.   It does say that any adult can set up an RESP for anyone else, but that would normally be a separate account, otherwise, they need to give the owner of the RESP the money.  (Even if they direct deposit to the RESP, it is considered to be a contribution by the person who set up the RESP).

I don't think that a child could sue a parent for money, or it would be hard to do.... e.g.,   Could my kid sue me for not reimbursing them $50 cash, as I said I would at that time, when they gave me their Christmas gift card which I used to buy a ski pass for them?   Interesting question.   

Without emancipation, It would be hard for the courts to say that the parent took more money from the kid than the kid received, net, from the parent, or that the parent withholding the money was not doing so in the kids' best interest and the parent knows best how to build character.. etc..   The fact that the parent put the money (provide by kid) into an RESP and then withdrew it is irrelevant, as the RESP is just between the adult and the bank.   The only relevant terms here are that:  kid gave parent money (cash), Parent agreed to return money, parent decided not to return money (for whatever reason).
« Last Edit: May 02, 2017, 01:20:24 AM by Goldielocks »

Prairie Stash

  • Handlebar Stache
  • *****
  • Posts: 1809
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #148 on: May 02, 2017, 09:53:20 AM »
RESP rules state: Anyone can be the subscriber (plan holder). This includes a 16 year old, who can also be the beneficiary. So a single person can be making contributions and withdrawals.
Source: Canada Registered Education Savings Program - I received verbal confirmation as well from the rep, she had to put me on hold since it was a unique question.

The next issue is the requirement for a youth to sign a contract. Having signed many legal contracts as a minor (rental agreements and university loans), I looked into it (the second line applies to RESP).
"If you are under 18, you may also be able to contract with others, but you are generally limited to:
◾contracts that may benefit you; and
◾contracts for the necessities of life. This usually includes things such as food, shelter, education and medical services, but can also include other things, depending on the circumstances."
http://www.law-faqs.org/alberta-faqs/youth-and-the-law-in-alberta/how-old-do-i-have-to-be/youth-faqs-financial-and-legal/
I'm waiting for CRA to phone back on confirmation.

Interestingly, a minor can also set up an RRSP, why would an RESP be different? You need to be 18 for a TFSA, the room doesn't accumulate until then.
http://www.theglobeandmail.com/globe-investor/retirement/never-too-young-how-rrsps-can-benefit-children-later-in-life/article16727793/

So the only problem is the requirement to have contributed for 4 years, $100 each, for a total of $400. $400 separates a teenager from receiving $1500 in government aid! That's the difference between being born poor or well off, in both scenarios though the child needs to be hard working and save $7,500, but some kids get a reward of $1500 and some don't.

I learned a lot throughout this post, thank you for all the responses.
« Last Edit: May 02, 2017, 01:14:25 PM by Prairie Stash »

Goldielocks

  • Walrus Stache
  • *******
  • Posts: 6555
  • Location: BC
Re: Building Wealth On Minimum Wage Triggers Backlash
« Reply #149 on: May 05, 2017, 11:51:44 AM »
Good research.


Now if we can get the banks to agree that a minor can sign the contract to be the subscriber....!