My co-tenant in working on Hydro sites, away from home most of the time with crazy per diems (not taxable) and makes a lot of overtime, so he has a pretty high revenue. He has pretty much zero responsabilities (no wife, no kids, no house to mentain, etc.) and is pretty young. The perfect time to build a 'stach, in my opinion.
Not so long ago, he told me he had more than 35K$ in his checking account. I tried to explain him that this was kind of dumb, that over time it loses value with inflation and that he could put it somewhere accessible and at least get some low, but better than nothing, interests or even invest part of it.
Instead, couple months after, he bought a used (at least) 2013 BMW 328 Xi for 22000$+ 15% taxes (CAN$) for a total of 25K$. And he paid CASH, even if I explained him he could get a low interest loan and invest his capital with higher expected return. And now he brags that his new tires (yes the tires were shot at that price) and installation + oil change ONLY cost him 1100$. The 1.5K$ yearly insurance fees are also ''not so bad'' according to him. On top of that, he traded his perfectly good 2007 Mazda 3 with around 150K kms (around 93K miles), for 500$. Yes, 500$. It's worth at least 2000$ here, but he didn't want to deal with having to sell it by himself. And I know he's not buying it because he particularly enjoys cars. He bought it for the status and to tell people he drives a BMW.
He also bought a brand new 3.5K$ downhill bike as a first mountain bike and probably rode it only 3 times in the last 9 months.
A brand new camera with top of the line technology (I know nothing about cameras) for a couple grand I think.
And everytime his one week off work is done, and he's got to drive back 8 hours to go work in the middle of nowhere for 4 consecutive weeks on night shifts, he seems a little depressed... What's sad is I think he's buying all this stuff the get some comfort from his lifestyle. Once he buys something, and it's usually something big (from my point of view at least), almost immediately after he starts talking about he's next purchase. Now he's thinking about buying a new laptop, because the one provided by the company apparently isn't enough. Pretty sure he's going to buy something with top specs, but will pretty much only use it to browse videos on the web. After that, I guess it's going to be an overpriced condo in an overvalued area of a HCOL city...
It kind of drives me crazy because this guy is an engineer, but it seems like he can't do simple maths. He seems confortable with his 2% RRSP + 4% company match and no more, even if he's probably paying close to 50% of taxes on a big part of his salary and many government benefits could bring back a lot of money in his pocket. At that rate of spending and saving, he's going to be working and dependant on his job for a looong time. At least if it was a YOLO philosophy thing or something like that, I could understand. But I really think it's a lack a knowledge and interest mixed by the dopamine high of the next big thing.
Still it could be worse. I mean, he's still young and he has zero debt, so he's in a OK situation if he what's to make a change. Maybe I should be more insistent and try harder to make him see the impact of his choices. I have a hard time telling people what they should do though..
Topic: Relatives who just don't get it (Read 3660380 times)