Millennial Money

Leanne helps her family with a mortgage and groceries. Is it time to buy a place with her boyfriend?

In our Smart Money series, #MillennialMoney, the Star’s Evelyn Kwong asks people to record every penny they spend in a typical week. Then, using tips from a financial adviser, we challenge them to cut their spending the following week so they can save more money. Will they fail or succeed?

For most of Leanne’s life, she’s been a third parent to her two younger siblings, as well as a support system for her parents who “struggled with money” for a long time.

Since last year, the 31-year-old has been making $110,000 a year between her career in marketing and freelance projects. Before that, she was at $90,000 — still more than what her parents made for most of their lives. It’s why for almost a decade, she’s contributed to her parents’ mortgage for their house in Milton, along with splitting the grocery bills and providing essentials for her siblings.

But now, with her dad getting a raise, her parents can live more comfortably and Leanne can think more about herself, which means pursuing buying a condo or townhouse with her longtime boyfriend.

So what’s holding her back? First, she feels bad about leaving her parents. Secondly, she wants to know if buying is even feasible despite her and her boyfriend having a shared income of almost $200,000.

When it comes to day-to-day spending, Leanne is pretty consistent, despite driving into the office daily.

While she buys groceries for the household, she’s able to bring leftovers for lunch most days. Once in a while she’ll lunch with co-workers, or stay downtown for dinner with friends.

On weekends Leanne spends time with her boyfriend, doing free outdoor excursions or going to the mall to “window shop or watch a movie.”

We asked her to share a week of spending to get an idea of her finances.

The expert Jason Heath, managing director at Objective Financial Partners Inc. on Leanne’s situation

Leanne has recently paid off her student loan and has a good salary. I can appreciate Leanne’s desire to help her family, but it sounds like she has done a lot over the years. .

Leanne is in a 43 per cent tax bracket with an income of $110,000, so RRSP deductions will help her accelerate her savings.

In the interim, I might focus on saving up in a Tax Free Savings Account.

She and her boyfriend should do some budgeting based on their current lifestyle to figure out what they can afford. Unless they can commit to living somewhere for five years, I would be hesitant to buy given the high transaction costs associated with moving in Toronto.

How she thinks she did Leanne says that this week her spending was similar to her average, except for helping her younger sister buy a laptop.

Take-aways “It’s a huge sigh of relief to know I don’t need to feel guilty,” Leanne said.

She recently had a talk with her mother and father to explain her situation. “It became really emotional because they realized how heavy this financial weight was on me,” she said. “They actually thanked me and encouraged me to move on from this and chase my own dreams.”

Her parents assured her that they would speak with her siblings to take that burden off of her.

Following the advice, Leanne will continue to contribute to her TFSA for the “flexibility.”

The next step? Figuring out finances with her boyfriend. “We will have a chat on how to fairly organize our salaries to open a joint bank account.”

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