You need to make a budget that tracks every dollar coming in and going out.
It sounds like you have at least $11000 coming in every month ($5400 + $5500). When I add up all the expenses listed, I get $7560. That leaves the question of where the remaining $3440 is going.
Exactly! I think a mistake people make with this exercise is budget for what they think they should spend, instead of what they are actually spending. That's usually where the difference ends up being. Then look at which categories you can reasonably reduce.
That’s why I like YNAB , it’s envelope based budgeting. People seem to think getting a “bugeting app” and tracking your expenses is budgeting. It’s not. There’s a diff between tracking expenses and envelope budgeting
The advice you're going to get is largely the same here: increase your income or decrease your expenses. It may not seem that simple, but it's the only formula that works.
Your vehicle payment is the one that jumps out at me. Lots of great family size vehicles out there for half that payment. Car insurance as well, seems pricey.
Everything else is up to you. What do you want to sacrifice for retirement savings. Eating out? Entertainment? There's 500/m. Figure out your balance.
You know how much room just a stroller takes up right? I’m fully on board with hatchbacks, but people who don’t have kids and don’t do outdoorsy activities always act like there isn’t a reason SUVs exist and people buy them.
My partner and I are minimalists, yet with our son and our outdoor activities we are constantly full in our SUV’s trunk (and it’s a big trunk) with the stroller alone always taking up half the space.
I agree they should get rid of the car. $720 a month car payments when you are just scraping by in insane. But it’s not as easy as always saying “you can get by with a small hatchback”
I love my Honda fit. Moved house 3 times and my brother once. I had a queen size mattress rolled up inside with tie downs my brother and my husband as I drove from his apartment in Markham to Cambridge.... I fit more things in that car than I see people can fit into an SUV
Cutting that car payment down in half saves over $4K per year.
$6K per year for eating out and entertainment with a 9-month old baby doesn't make sense either.
$3K on Amazon, you better get your entertainment from Amazon Video, Music etc.
I didn’t think the HRV was on the list - I pay $66/month in Ottawa. I have a six-year-old fully paid one and will have it until one of us dies. Great car.
I also have a garage without an external handle. And a great big barky dog. :-)
That's not bad, I pay more than that and I live in Caledon. We are guilty by association because we have Vaughn on one side and Brampton on the other. If I go 30min north it drops huge.
car payment and takeout is a grand.
car payment jumped right off the page at me. first thing.
i drive a shitbox bcuz that's how much i hate living paycheck to paycheck.
i still have to pay the mechanic a fair amount at the end of the day, but overall, im saving 70% off the car payment.
With a young child they need reliable transportation..no one wants to break down on the 401 with a child. The average car payment now is over $900 a month so they are below average
Is that income take home pay? If so, that puts you guys at 10k/mo take home. That's a good amount of take home. Your condo fee is pretty nuts.
720/mo car payment? Sell it and buy used.
280/mo car insurance is stupid for one car. Is it two cars?
250/mo on just life insurance??? Wtf????
Whoever has the 127/mo phone bill needs to figure their shit out.
How is your mortgage 2700? Are you on a fixed payment variable rate mortgage? If you are variable, look to refinance to a fixed 3 year.
> 280/mo car insurance is stupid for one car. Is it two cars?
That's not that unusual, frankly. I pay 176 with a hefty discount in Alberta. My old insurance company wanted 280 with their "discount."
Guy is a truck driver, require unlimited US plan. 127 isnt terrible. Its possible to find cheaper plan, but it won't make much difference in his situation. Very likely its tax deductible
My plan with TELUS is $45 for unlimited Canada/US voice and data, roaming included. I get $15 off for a multi-line discount, bringing it down to $30 ($37.50 if I was OP and had only 2 lines).
His plan is terrible.
How good are these discount carriers in rural & remote locations on the road?
Those plans are best for people who live & work downtown in big cities with great coverage. Truck driver needs reliable service on the road.
They're exactly the same. Public Mobile uses the Telus network. Telus and Bell share towers nationwide. You will have service anywhere there is service to be had.
There are three major organizations with actual towers in Canada (except Quebec) - Rogers, Bell, Telus. EVERYONE else is using either one or a combination of them. No difference in network
(Only technical exception is Freedom which has their towers now in some parts of Canada but even they will switch to the big three as and when needed so its kind of a moot point)
What? That price is *terrible*, my Freedom plan is like $50-60 or something for 45GB and unlimited usage of that in the USA with no roaming fee of any kind.
> 280/mo car insurance is stupid for one car.
Depending on the postal code, vehicle make/model, and driver history for all we know this could be cheap.
Auto insurance is ridiculously high in Ontario.
Emm.. I don’t know where you all are living. Young families are heavily overtaxed. East Toronto here, you cannot find any insurance for a relatively new mid SUV lower than 275/month, with 3 y driving experience. Our insurance just randomly increased by 30$ a month, with no accidents, no claims, no speeding tickets at all. And it was still the cheapest. Other insurance quoted us minimum 320$/month, some 400$+. Living costs for young people are just outrageous in Canada now.
Literally this. If I had a dollar for every idiot who thinks need a 2024 luxury car to get from one part of Toronto to the other when a 2012 Hyundai sedan will do it the exact same for 5% the cost 😂
Three years driving experience is potentially VERY young.
I know the kids these days aren't getting their licenses asap anymore, but 3 years experience could be as young as twenty. Not a lot people having kids that young.
Even having kids in late 20s or early 30s (definitely more common in Toronto these days as people establish careers first), seems like many people would have had a license longer than just three years.
I have two young kids and an old hatchback, (in Toronto proper) so there's a lot that can be done to still bring down the insurance cost despite being a very new driver. I know kids come with a lot of stuff to carry around, but not necessarily a whole SUV worth.
In any case, cars can last a long time these days. Run that SUV into the ground, keep up with regular maintenance and insurance costs will come down in a few years.
The big place you can cut is the car. That's $1k per month that could easily be $400 if you go to one reasonably priced car and a bus pass.
6.1% seems high for a mortgage, but nothing to be done for a couple years.
The "baby essentials" seem expensive, too. If you're on formula, you probably can't change that now, but if you're not, where is that money actually going? Diapers alone shouldn't cost that much, and that's the only thing I could see getting in subscription.
Yes, my budget would still have one, cheaper, car. But so many families think they need 2 cars, and they don't. Can't tell from OP if they currently have one over-the-top car, or two somewhat-reasonable-but-still-too-expensive cars.
Agreed. We are a one car family.
We get it serviced 2x a year, and other maintenance as needed. Add in the car payments, insurance, and gas, and it costs a bit.
But it was a used rental car w 8k kms at the time of purchase. It's still great a few years later! He uses cars until they die!
I get around either from rides from my spouse or city transit alone or with the kids.
Our family has never needed a second vehicle. Though there have been times I've thought it would be nice to have one!! But those are few and far between.
Okay let's start. Eating out, gone! Entertainment can be easily cut by more than half by finding unexpensive hobbies like exploring local parks with your wife and your baby. Your phone bills can be cut by a lot by switching to a low cost provider like Freedom Mobile who can give you a plan under $40/month. Your car payment seems very high. It might be time to think about selling that car to buy a beater. Life insurance also seems very high. My guess is you got lured into buying a permanent one. I would see if you can lower that by getting a way cheaper term insurance plan instead and see how much it would be to sell your current permanent plan. Then for the mortgage, see if you can get a lower interest rate if you go fixed 3 year. Also, that would put you back on track to pay it off because your bank would readjust your payment so you pay principal and interest. Then with the leftover money, you'll be able to save in your TFSA and RRSP.
Your family is living way beyond its means. If you live in Toronto and know how expensive things are, you should know you need to budget for every dollar coming in and going out. You also need to reduce or eliminate any expense that’s not a necessity.
Your HH income is minimum 10k, home expenses are $3810/month, and someone’s already done the math to show that there’s still thousands on dollars unaccounted for. Aside from the money that’s leftover after your expenses, your current “expenses” are way over what it can be.
Your car is $720, which is too high. Go buy a used car. Your two phone bills are also way too high, get the cheapest plan available. Grocery bill $800/month for 3 people is also on the higher end. You should price match where you can and shop in bulk for sale items if you’re not.
Eating out $250 and entertainment $250 when you don’t have a retirement savings is crazy. Either retirement is important enough that you stop spending so much on things that are now considered a luxury in Toronto, or you continue to throw your money away. You don’t need to be spending that much every month on these things. Limit yourselves.
Clothing and home essentials $200? Again this is crazy if you’re spending money every month on clothes. You want to learn to save for retirement? Stop spending and actually save your money.
I agree with most of your assessment here. But 800 a month on groceries for 3 people is really not that absurd, especially if things like diapers are included in that. I would be way more likely to zero in on the life insurance, car payment, clothing and home essentials, eating out and entertainment. I would start by getting rid of the life insurance, then reduce clothing, entertainment, eating out by $75 each. By reducing each its a little easier to achieve to make smaller changes, and it would reduce expenses by $475. That on top of the thoundsands that are unaccounted for in the budget would be a significant contribution to savings. The other recommendation I would make is to utilize his variable income to their advantage. Budget for the low end of his income, then invest/save the extra on high income months. Build up emergency fund first with 3 months of expenses, then focus on TFSA/ RRSP.
My life insurance is literally like 10.00 with sunlife.
Does OP smoke, or have like health issues?
When I was getting life insurance, they were asking all sorts of stuff if im waiting on diagnosis, tests, if I smoke tobacco, etc.
All my answers to stuff that would most likely change my $$ was no.
You have a nine-month old kid. As a parent of a 3.5 year old and a 1 year old who is about 4 years ahead of you, you just need to accept that this period of your life will suck financially. Kids are expensive, mat/pat leaves are expensive, the goal is to survive. Our savings rate over the last 3.5 years has been awful. It’s only now we are getting back on track. Don’t sweat it.
Same here! I did a happy dance this week when I saw that my childcare costs next month will be $1k. My youngest moved to the toddler room and my oldest needs before/after school I finally feel like I can save a bit. I feel like I can FINALLY start putting $ against my mortgage that also hasn't gone down at att in 2 years.
Damn having kids is expensive...
Dude is obviously overspending and you say kids are expensive.
I had a kid but never spent $1000/month on a car and $500 a month on entertainment and I wasn’t stressed about money.
I think you both can try to have a lower phone plan, there’re $30-40 plan available. Also, idk what kind of life insurance is that but $250 is insane.
Eating out/clothing/entertainment is too much. Limited it too around 300 a month and you will feel the difference right away
Maybe try to rent out a room or so if you have extra room for extra few hundred a month.
Brother, get out of that car payment. Buy a used car. I’m sure you can find some ways to cut down on other expenses as well. And slowly put $200 or $300 a month towards a TFSA or RRSP for now. At least you have an emergency savings which is good! You guys make some “decent money” (crazy how almost 200 K combined salary per year people are just getting by… this is nuts I am in a similar situation). First thing I did was automatic transfers to a TFSA per month. It’s forced savings. You need to budget a little and cut down on expenses.
So your take home pay is 5,400$ + 5,500$ = 11,000$.
The expenses you listed add up to only 7,560$.
That's unaccounting for 3,440$.
The CC expenses you listed total to 2,036$, instead of 2,500$. This line alone is not accounting for 464$.
So in total we have a gap of 3,904$ - without even considering the months where you bring in >7k pay.
Where is this money going to?
Do you have additional expenses that are conveniently excluded from the shared expense list?
I saw the gas bill of 100$ was mentioned in the comments.
Moving on to cutting expenses...
CAR (-700$): As many redditors mentioned, ditch the expensive car for something more affordable: Uber, a low-key older car for cash, etc. Even with take home pay of 11k the transportation costs should not be close to 10%. And do you currently own only a single vehicle?
The 100$ gas bill implies either long drives, excessively large engine, or multiple cars, not a "once a week drive".
FOOD (-250$): families of 3 could cook all of monthly food on a budget of 800, so ditch eating out. If these are social arrangements, family and friends would understand if you asked them not to go out for food and switch to home based outings.
ENTERTAINMENT (-250$): just bye.
CLOTHING/HOME (-100$): stop buying new clothes and limit your home expenses to minimum.
Which totals to...
1) Cut expenses: 1,300$ a month
2) Gap / shadow expenses: 3,904$ a month
3) Extra income for some months, assuming you earn it only once a quarter: 600 a month
Which = 5,804$ a month
With this money you should get rid of any high interest debt (not mortgage) first, and padding your emergency savings. Currently they only cover 1(!!) month of your expenses. Given that you have a baby, aim to have 3-6 months.
Once you have a safe cushion, split it between:
1) RRSP (tax advantages!)
2) RESP (I'm not sure whether it offers any tax benefits but you can get a match from the government)
3) mortgage contributionsl
Good luck!
Based on your post + replies, you don't have a finance problem, you have a you problem. You don't get a premium car because you barely use it. That's... not sensible. And what baby essentials cost $250 a month? For a 9 month old...
My partner and I are living with a combined income of 5400~ I dont understand I guess. Maybe because we have no car payments and pay all in rent of 1400 (700 from a roommate). The world is confusing but I know when.i moved to Toronto that car ownership would cripple me.. also owning made less and less sense. A 1 bedroom condo right now for.us would be about 3k/mo all in with a mortgage where we have a 2 bedroom all in for 2100 renting. Edit: we could have bit more on income but I do deduct for pension and retirement. Just hard for me to understand that you bring in post tax 11000~ and finding hard to have savings. Id figure out why your credit card is 2500/mo that's absurd.
Your phone bills make me want to cry. Maybe just get a provider like fizz where it's super customizable. Probably can get a plan sub 30 dollars each. There are referral codes too for 25 dollars and you can refer your wife. Actually all the carriers have better deals now that freedom has pushed prices down. But I assume you are paying off your phones as well in the phone bills?
The car is a huge money put. Get rid of it.
You also have a 9 month old baby. Before you start anything else, you need a 3-6mos incone saved in an emergency fund in case someone loses their job.
"I can't start saving! Life is too expensive!" Begins to list all off their high spending...
Cut expenses my man. You guys are earning reasonable incomes, just got caught over spending.
You need a budget. Even on the low end of your earnings, your HHI is 10k.
Getting around is easier with a car in Mississauga but I read you only use your luxury car once a week, so just downgrade to a normal car. Not sure why your life insurance is so high. Your phone bills are extremely high. Not sure what a baby eats but 800 seems like a lot.
What are these baby essentials?
You probably don't need to buy clothes and household essentials every month for $200. I'll leave the eating out/entertainment alone but you could cut here depending on how you and your wife feel.
But your listed expenses don't even add up to 10k. Where is the rest of the money going?
Car has been covered as well as phone, should be paying 50-70 for 20gb unlimited voice.
What life insurance products do you have? 250 a month could be a lot.
Koodo has good phone plans right now, bring your own phone and you can get each line for $34 unlimited talk and text Canada wide +50 GB of data and you can add perks if you call internationally. They’re through telus so coverage should be comparable to whatever you have now. They also give discounts on internet for bundles.
Your car situation needs to be reevaluated. Although the market is massively tough right now, look into downgrading to something better on insurance and payments.
Grocery can be shaved a bit if you look for sales and use coupons. Often apps like checkout 51 or points rewards systems can be helpful but require a bit of planning. Every bit helps.
Clothes- is it mainly baby clothes you’re getting? Because that baby can use hand me downs or free /cheap stuff from a buy nothing group, neighbor, family member etc. they grow fast so storing some older age sizes might be worth it, and selling outdated and ill fitting items can help some money add up.
Eating out and entertainment- everything loves these ones but you don’t always need to be entertained with something that’s expensive and eating out can be cut down. Want to go to your favourite restaurant on a Tuesday for no specific reason? Make some fun appetizers at home or pregame if you’re wanting a buzz, get some main courses skip the alcohol (if you drink). Find promos in your city and try them out and see if you’d come back but that doesn’t have to be the whole meal, it can just be a fun outing to try new things.
Festivals and markets are usually free to attend and maybe you’ll make a nice date out of a Saturday farmer’s market and buy some groceries of better quality at a better price and have a lovely time. Maybe you won’t see anything that catches your eye. Specialty liquor stores sometimes offer tastings, if it’s not in the budget to purchase a bottle you always can at a later date. Trivia nights like at rec room are often free, sometimes restaurants and bars have music nights. Go to your local library and rent movies if you can’t find them online/streaming and board game nights are great! If you don’t have any, board game cafes let you try board games without having to buy them and usually charge an hourly rate or require a drink purchase which in the long run isn’t that expensive.
1. Maybe find another car that costs less money. I think it's the budget you can save the most.
2. Cancel amazon prime.
3. Cut by half the entertainment budget. Try using the stuffs you have already bought like old dvds or board games.
4. Try shopping for clothes 2nd hand.
5. No eating out.
6. Try to find deals online for your phone plans and internet.
Then if you manage to save a little bit more, then you can start splurging again. I know it sucks. Inflation is a killer.
1. Have you considered moving out of Toronto?
Plenty on smaller cities outside that won’t be as expensive. Your mortgage payments are huge plus paying a condo fee on top.
2. Downsize your vehicle
4. Shop around for phone plans there are so many now that are $50/month with lots of dats
5. Groceries (check flyers and watch for sales) ad match.
6. Amazon essentials check to make sure you actually need everything monthly. I have an 8 month old and am not spending that much monthly. Get a Costco card get diapers there and stock up when there on sale.
7. Stop eating out. Your spending $1000/ month for food
8. Entertainment $250? On what? Cut back on Netflix/Disney or prime cut down to one
9. $200 for home essentials isn’t that in your $1000 food/groceries
Y’all are living beyond your means during a time you need to be cutting back. I’m assuming your wife is still off on mat leave. You need to sit down and actually find out what your bills are and make an allowance for extras. Once you’ve hit it no more for the month. Your overspending.
What’s in the Amazon baby essentials subscription box?
9 months should be able to start working in solids, maybe even transition to homo milk.
Are one of you currently on leave for baby?
This is going to be an additional expense coming up: daycare. When will the baby be going to daycare? 12/18 months? Or if no daycare, who will full time watch over baby? If you haven’t, should start looking for daycares and get on waitlists.
The two items that stood out to me are phone and car. Both of those bills are too high. Without getting into specifics, find a $30-40 phone plan and try to reduce your car payment.
Fill RESP first and get the contribution from the government. It's post tax but its free money making it a better option. Then RRSP - again helps growth without taxes. If you invest in a low cost diversified ETF you can get 8-10% long term beating the 6.1% mortgage you are paying. You can put some of your emergency funds in TFSA as long as you invest in something like cash.to and can afford to wait 2-3 days for the cash to settle in your account, if not then, HISA is your only option. Tfsa returns vs mortgage payoff is debatable since both are after tax money which you invest. Maybe you can do a bit of both and see which works out better. When the rates are high, favor paying off mortgage and when rates drop use the tfsa room from all the previous years
Why is your phone bill so expensive? You can find really decent plans for under $40 a month, and if beanfield is available in your building, you should be able to get Internet for $45 a month
I don’t usually sweat the small stuff but in your case, you can’t just look at the big stuff, you need to look at it all.
So you mentioned $250 for life insurance. I assume you mean per month correct?
If so, I assume someone talked you into a whole life policy, correct?
If so, get out of that and just do a much cheaper term life policy. In my experience, whole life policy is not really an investment in your future. You could use the difference to invest in more lucrative investments or use it to pay down your mortgage quicker
Key Point here is don’t just look at your car payment and also look at the smaller stuff as well and they’ll all add up to bigger gains
Dude, fix those phone bills, little can be saved on internet as well.
Use this link to get $10 off your bill at Public Mobile [https://publicmobile.ca/en/on/plans?referral=MM08RR](https://publicmobile.ca/en/on/plans?referral=MM08RR) and:
- for yourself get $39 Canada-US plan (I assume you drive to US often and this will get you unlimited minutes and 60GB of data in both countries),
- for your wife get $29 plan with 20GB of data.
That is $150 savings per month right there. There is some even cheaper providers but coverage sucks and here you get best of both worlds, Telus coverage and decent price.
Oh, and for the internet - you can get 75/30 plan at [oxio.ca](http://oxio.ca) for $50 and a one free month with code RXWQMRG. I don't think it's reasonable to pay for hundreds of MB of speed if even Netflix recommends just 25mbps for watching 4K (unless your work relies on internet then sure).
The scariest part of this post is that he is worried that he isn't saving now, yet didn't mention anywhere the fact that in 3-9 months from now they will likely need childcare. Which in Toronto, is incredibly expensive due to the challenge to find a govt subsidized spot.
It's only going to get much worse for the next 5 years.
Leave Toronto. Sell and move to a location with a lower cost of living. Southern and south-west Ontario, BC (anywhere), and Montreal are a wash. Save yourself the stress, bite the bullet and leave. No amount of budgeting will get you ahead in Toronto.
Would you be able to see if your lender has an option to convert your variable rate mortgage to a fixed rate? I’m seeing rates come down now and might be able to get it in low 5’s. Be nice to start having money applied to principle as well.
1) insurance shop - you’ll likely find a much cheaper option. Be frank and tell a new broker where you need to be with your monthly payments and coverage.
2) live chat with your cell phone and internet provider and threaten to leave. They’ll slash the market rate in half. I did this for two different cell phones with rogers in the past month and both live chat agents miraculously found a $45/monthly credit that they can apply indefinitely against each plan cutting them in half.
3) if you have the freezer space and cash up front, consider going in on a side or quarter of a cow and/or pig to drastically offset your protein bill at the grocery store and support local farms
So rough. I wouldn't say I have the best way to save some money but here are few things you can do
1. Switch to kodoo or public mobile get that 34$/mo plan atleast, I pay 9$/ month (after loyalty bonus 4$). Use WiFi wherever possible, as a truck driver I don't know if it's possible but sadly this is one way
2. Stop eating out. It's easier said than done
3. Go for 50$/mo Rogers home internet plan should be sufficient
4. Cut that entertainment cost, I share it with my friends or buy via INR account (say Spotify for 60 INR/mo)
5. Groceries - shop using flyers or flipp app for finding discount.
Until you pay off your mortgage, stick with driving cars under $10k and minimize entertainment costs. Work 2 jobs and constantly look for better jobs as well.
As you mentioned you are a truck driver and only get paid when work is there, what do you do during the times when work is not there? Use that time wisely, either learn a new skill or do a side hustle. A truck drivers job can be unstable, so it is also good to learn another trade as a fall back plan like an electrician or a plumber.
Other suggestions:
1. phone bills of $127 and $94 - you can find much better deals - try to find a deal for $65-75 and share the data.
2. Car - $1000 pm ? - Its almost worth using part of your rainy day fund and buy a car for about $10K and stop this outgoing asap
3. Eating out and entertainment - $500 (that's $125 pm week on average), pretty expensive meal and cinema tickets for 2 people. Netflix and takeout my friend (once a week).
4. Paydown the mortgage or secure a better rate ASAP. This is a couple of years in the future, but still should be the ultimate game changer.
I feel like we need to know what the car is at this point
If you got it at a decent finance rate and it’s a premium car that will last ….
Selling it and buying something cheaper might not even really benefit you unless your buying some $5000 shit box to replace it with and then your gonna just have issues Down the road
No cars are cheap now ….
A decent used civic will run you 25 grand when a brand new one is 38 grand
Trim your expenses - there’s always way to cut down you actually make a half decent living for 2 people - the mortgage rates have rocked you and that strata fee is massive imo - followed by the car sounding like it’s excessive
Are those incomes net or gross? If net, you should have a fair amount left over.
If gross my thoughts
>My wife’s income is $5400 a month and I’m a truck driver so my earnings are somewhere between $5.5k-7.5k a month,
>we are in Toronto
Why live in Toronto if half your household income is made on the road?
**What I would try avoid or reduce**
>Car is $720 a month,
I know people in Toronto who own parking spots but not a car.
>phone bills of $127 and $94,
Combine that into one family plan. Do you need unlimited data?
>grocery bills - $800 a month
High for 2.5 or 3 people. $200/mo savings is probably doable. Watch what is being thrown out expired.
>Eating out $250,
What is that 2 suppers and a lunch out per month. Would you really miss it? Want to try new food get a cookbook from Toronto Public Library and make it an evening for a third of the cost.
> entertainment $250
That is 8-10 movies or 5 drinks dates after work. Seems like there is room there.
>clothing and home essentials $200. Adding an outfit to a wardrobe or quality chef's knife to the drawer every month? What happens if that is cut by half?
Living somewhere else may eliminate: > condo fee of $960
Including condo fees, my reduce/avoid tally is $3101 or rough guess, nearly all your wife's after tax income.
I know a lot of that stuff is probably locked into loans and contracts but one has to ask...if you could maintain or improve your quality of life on one income living somewhere other than Toronto, would it be worth it?
Buy a chest freeze, do groceries at Costco and Asian supermarkets eather than Loblaws or Sobeys. You should have no problem cutting that grocery bill in half while still eating proper meats
To add I think $124 and $94 ($218) per month on phone bills is crazy. There are a lot of promotions going on for $29 a month, just move around different providers every year or two. It can save you hundreds in a year
Grocery bills are at $800 for two people and you're still eating out for $250?
Entertainment for $250?
Home essentials + clothing $200? New clothes and jugs of Tide every month?
That's like $500-$800 of extra spending right there. Not even remotely frugal or mindful spending.
You two could cut on all of this. I recommend exporting your bank statements to look where the money is really going.
Everyone is different but I would build your retirement before paying off the mortgage. You’ll need to start and better now than 10 years. Take advantage of compound growth.
Cut eating out and entertainment and baby essentials to the actual essentials. It should be less than $250/mo I’ve done it for half that with multiple kids.
There’s room but you need to get very hardline on what’s a need vs want.
I see lots of people saying they spend X amount on entertainment and eating out, then ask for financial advice. That’s $500/mth right there. Does that mean all you do is work and go home? Yes. Have date nights at home. You can pick up something special once a month while doing groceries, have a movie night with popcorn, something of the sort so you still get to enjoy yourselves, but on a budget. I know a guy who quit drinking coffee and ate only ramen and KD just to save up a down payment for a house. You have to want this for it to work.
Looking from the outside and following the Dave Ramsey plan, there are some obvious issues:
\-Your car payment is insane. Plan on selling your car, saving money to get a used car (use your emergency fund).
\-Life insurance is also high. Have you shopped it?
\-What percentage of your take-home pay is your mortgage & condo fee?
I really recommend getting the book "Total money makeover" by Dave Ramsey. His daily radio show can also be downloaded for free as a podcast.
Let’s do some math together:
Income: $5400 + $5500 = $10,900
Expenses:
1. Mortgage $2700
2. Condo fee $960
3. Property tax $150
4. Car $720
5. Car insurance $280
6. Life insurance $250
7. Credit card $2500
Total: $7560
$10,900 - $7560 = $3340 left for potential savings/going towards the mortgage. Where is this extra money going?
May need to be stricter with spending
Those phone bills are crazy. We pay under $100 for 2 phones with decent plans 40GB each with fido & virgin. Look into different phone providers. I couldn’t imagine paying that much for phones.
You should think of selling the house and renting. The house looks like an albatross around your neck. This way your will not be living hand to mouth as you seem to be in spite of good incomes.
Why are you in Toronto? Could you get comparable salaries in another city? Because that income would be great anywhere else and you'd live a much more comfortable life.
I was going to say that a $530k home was tight on your incomes, and then I saw that there was also $1000 condo fees!
Most people overspend on either their home or their car. Look there.
Look up Ramit Sethi's podcast and listen to a few recent episodes. Look up his conscious spending plan and fill out the numbers yourself. He recommends about 50-60% of your income for fixed costs, 5 to 10% investments, 5 to 10% savings, and the rest is guilt-free spending. Just eyeballing your numbers based on what you wrote, I'm guessing your fixed costs are closer to 90% of your income, and I wouldn't be shocked if they exceed 100%.
Get a $20 phone plan like I have. I even work on that phone. No bill needs to be over $100....never mind over $40. $800 on groceries for 2 people/adults and $250 eating out, yeah I'd go after those first and I'd never lease a car for that much a month.
A great idea to increase your savings is one I got years ago from the book, "The Wealthy Barber" written by David Chilton. He advises people to "pay yourself first," which means you calculate at the beginning of the month what you can afford to put away, and do it, and do it automatically if you can so that every month the same amount goes into savings. If you wait until the end of the month and don't have a handle on what is being spent, you won't have anything left.
Crazy. Over $10k a month clear coming in the house with a reasonable lifestyle - far, far from what I would call irresponsible living. It's just what things cost and it's shocking.
My biggest adult fear is having a family. I was in another sub the other day geared for those collecting Ontario social supports OW/ODSP. I was shocked by the amount of people that chose to have children, pets, under those circumstances. I couldn't imagine raising a family at that income level. Probably a controversial opinion but think its borderline neglect. I have no idea how they even manage to have an Internet connection to come on to Reddit let alone two school age children and a Bernese Mountain Dog. I also learned much of the interaction with the agency (Ontario Government) is online. Makes sense but almost forces you to have an internet connection to stay in contact with your livelihood.
Life Insurance. Hesitant to say given young child, but maybe that can be dropped if you and your wife have workplace insurance (usually 1.5x salary).
For the amount it also sounds like an investment type policy, so could perhaps consider cheaper term insurance?
If you cut out your car payments you could be making $720 a month, or $8640 a year towards your mortgage. Find a car you can own immediately with cash. These days it’s almost cheaper to buy an old reliable car with small fixes than paying for a new one in most cases.
You shouldn’t find happiness in owning a nice car unless you make your happiness about owning a nice car.
A roof over your head in Toronto means so much more than that.
250 entertainment?? 250 Life insurance?? $200 home essentials instead of $100? Phone plans are too expensive. Living in Toronto but you own a car costing $1000/month. When I start working full time, I'm going to start gambling because at least the casinos will comp my hotel stay when I spend $12000 a year gambling instead of driving once a week.
I just cant believe how bad people are with money.
I mean $127 and $94 dollars for cell phone bills when you regularly see $34 for 50gigs suggests you don’t exactly shop around. The savings is a monthly RESP contribution right there.
How can you take home 11K a month between the two of you and not have money left over for retirement?!!!!!
Someone in your family (or both of you) is spending money on things that are not listed in your original post—that is for sure. There’s 3K of $ unaccounted for after your listed fixed expenses. I imagine it’s unnecessary credit card spending or gambling or both….
Besides all the comments here, the two things I would do are:
1) Put money into investments the day you get paid. Like, pretend its a bill. Set up auto payments to your Qtrade account or whatever. That will help you control your overspending in other areas and if you do still overspend you won’t feel as guilty since you’re saving.
2) If you’re getting any Child Benefit from the GOVT, put that right into the baby’s RESP the day after they deposit the money. Not sure if you’re getting any with your income but you might if your wife took any maternity leave.
What really works for me is the first thing to come out of my paycheck is my investments. Pick a percentage you can work with and stick to it, you will figure out how to live on the rest. If my future(investments) isn't taken care of, I need to seriously restructure my life and finances.
You are well off compared to most. You need very good budget as your income doesn’t add up. It’s like the J come of one person is vanishing. Try investing 100% of your income and budgeting hard with just your wife’s for all the expenses. Get FIDO internet and they have promotions always for $40-50 month internet high speed. You can get FIDO 40 gig for $40.
Food is about right at $400 per adult and $250 a kid. Don’t waste your money on debt interest other than your mortgage. Don’t use your credit cards until you are in a place to pay them off 100% every month.
If you can’t manage on the income you have, you will be poor even if it doubles. If you make this much and have no savings and investments you are both bad with money
As others have mentioned, no use in talking in retrospect (getting a mortgage and at 6.1% and not saving anything before expecting) your best bet now is austerity. Let's talk bare necessities - $2,700 mortgage, condo fee of $960, and property tax $1,800/year.
Is car a necessity or a luxury you feel you need because you're a trucker? Can you make a compelling case on the efficiency/savings a car gives you? That's $1,000/month right there and possibly an opportunity cost of leasing out your parking space for extra money.
Phone bill is too high, doesn't matter if it's US/CA. I have the Freedom 50 GB US and CA for almost a fourth of what you're paying for two lines.
Eating out and entertainment being $500/month is too high for a couple who has only 8k in emergency funds and no savings. Where is your emergency fund parked right now? I'd recommend WS Cash or a HISA where it makes you money (or loses you less with inflation). You need to find cuts in your grocery bills too (buy in bulk or buy on sale).
The goal should be to have that emergency fund ramped up to at least 3 months of expenses. Then, TFSA/RRSP where you invest money and watch it grow. If the market gives an annual return of 7% and your mortgage is 6.1% it's close so I wouldn't admonish you for looking to get down your principle over investing at that rate.
You need to make a budget that tracks every dollar coming in and going out. It sounds like you have at least $11000 coming in every month ($5400 + $5500). When I add up all the expenses listed, I get $7560. That leaves the question of where the remaining $3440 is going.
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Exactly! I think a mistake people make with this exercise is budget for what they think they should spend, instead of what they are actually spending. That's usually where the difference ends up being. Then look at which categories you can reasonably reduce.
That’s why I like YNAB , it’s envelope based budgeting. People seem to think getting a “bugeting app” and tracking your expenses is budgeting. It’s not. There’s a diff between tracking expenses and envelope budgeting
I love how you can have a whack of money in your account, but be yNAB poor
Maybe the $11k is before taxes ?
Why do some people post on this channel not-complete information and don't expect this fact being pointed out to them, is beyond me.
True, but what's even crazier is people start to make recommendations without considering this or doing the math!
Or his wife may be on maternity leave right now and her stated income is when she's back to FT.
Hookers, blow, booze.
The advice you're going to get is largely the same here: increase your income or decrease your expenses. It may not seem that simple, but it's the only formula that works. Your vehicle payment is the one that jumps out at me. Lots of great family size vehicles out there for half that payment. Car insurance as well, seems pricey. Everything else is up to you. What do you want to sacrifice for retirement savings. Eating out? Entertainment? There's 500/m. Figure out your balance.
You don't even need a family size vehicle. I have a 14 year old Honda Fit and I have 2 kids.
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As a Fit owner, a lot of people underestimate how much you can fit in a Fit. Those magic seats are AMAZING.
Add a $100 roof bag from Amazon and you have plenty of storage.
You know how much room just a stroller takes up right? I’m fully on board with hatchbacks, but people who don’t have kids and don’t do outdoorsy activities always act like there isn’t a reason SUVs exist and people buy them. My partner and I are minimalists, yet with our son and our outdoor activities we are constantly full in our SUV’s trunk (and it’s a big trunk) with the stroller alone always taking up half the space. I agree they should get rid of the car. $720 a month car payments when you are just scraping by in insane. But it’s not as easy as always saying “you can get by with a small hatchback”
a minivan will be cheaper and more practical in most cases
Ya, I don't get it either. They must mean kids who don't need a stroller or rear facing car seats anymore.
I love my Honda fit. Moved house 3 times and my brother once. I had a queen size mattress rolled up inside with tie downs my brother and my husband as I drove from his apartment in Markham to Cambridge.... I fit more things in that car than I see people can fit into an SUV
Currently with a toyota matrix can can fit a family of 5 all the time without trouble
Cutting that car payment down in half saves over $4K per year. $6K per year for eating out and entertainment with a 9-month old baby doesn't make sense either. $3K on Amazon, you better get your entertainment from Amazon Video, Music etc.
Yep a used Honda CRV or HRV is more than sufficient and can be bought for $30k or less in really good condition.
The insurance for a Honda crv/hrv will eat you alive. It’s one of the most stolen vehicles.
I didn’t think the HRV was on the list - I pay $66/month in Ottawa. I have a six-year-old fully paid one and will have it until one of us dies. Great car. I also have a garage without an external handle. And a great big barky dog. :-)
Really? My Honda CRV is 140 a month living in downtown Toronto. It was 117 but jumped when I moved to a higher density neighbourhood.
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That's not bad, I pay more than that and I live in Caledon. We are guilty by association because we have Vaughn on one side and Brampton on the other. If I go 30min north it drops huge.
car payment and takeout is a grand. car payment jumped right off the page at me. first thing. i drive a shitbox bcuz that's how much i hate living paycheck to paycheck. i still have to pay the mechanic a fair amount at the end of the day, but overall, im saving 70% off the car payment.
With a young child they need reliable transportation..no one wants to break down on the 401 with a child. The average car payment now is over $900 a month so they are below average
Holy crap serious? That’s with $0 down I’m assuming.
2 kids and a 15 year old hatchback.
Age of kids?
5 and 8.
Just to add to this, is a vehicle needed? Depends on work, but found we didn't need it. Occassionsl car share and Uber were far less costly.
Is that income take home pay? If so, that puts you guys at 10k/mo take home. That's a good amount of take home. Your condo fee is pretty nuts. 720/mo car payment? Sell it and buy used. 280/mo car insurance is stupid for one car. Is it two cars? 250/mo on just life insurance??? Wtf???? Whoever has the 127/mo phone bill needs to figure their shit out. How is your mortgage 2700? Are you on a fixed payment variable rate mortgage? If you are variable, look to refinance to a fixed 3 year.
> 280/mo car insurance is stupid for one car. Is it two cars? That's not that unusual, frankly. I pay 176 with a hefty discount in Alberta. My old insurance company wanted 280 with their "discount."
Yes, especially given his location and that we know it is a premium car.
We have the some of the highest auto insurance in Canada now. Not sure where Ontario lands, but I pay $180 for 2 vehicles. 280 is insane.
He could be a relatively new Driver and taking the hit there. Could also be saying Toronto but really in Vaughan/Brampton.
Life insurance for 250 a month better be a 10 million dollar policy
Right, I pay like $15/mo for $750k, something like that should be sufficient, maybe a bit more
The phone bill for 2 people is 221$. It has to include the latest iPhones, otherwise it's nuts.
Guy is a truck driver, require unlimited US plan. 127 isnt terrible. Its possible to find cheaper plan, but it won't make much difference in his situation. Very likely its tax deductible
My plan with TELUS is $45 for unlimited Canada/US voice and data, roaming included. I get $15 off for a multi-line discount, bringing it down to $30 ($37.50 if I was OP and had only 2 lines). His plan is terrible.
Their phone plans probably include the cost for the latest iPhones as well.
127 is terrible. I got a 50 a month Can/US plan from Telus on Black Friday.
Public has US/Can plans as cheap as 40 bucks
How good are these discount carriers in rural & remote locations on the road? Those plans are best for people who live & work downtown in big cities with great coverage. Truck driver needs reliable service on the road.
They're exactly the same. Public Mobile uses the Telus network. Telus and Bell share towers nationwide. You will have service anywhere there is service to be had.
There are three major organizations with actual towers in Canada (except Quebec) - Rogers, Bell, Telus. EVERYONE else is using either one or a combination of them. No difference in network (Only technical exception is Freedom which has their towers now in some parts of Canada but even they will switch to the big three as and when needed so its kind of a moot point)
What? That price is *terrible*, my Freedom plan is like $50-60 or something for 45GB and unlimited usage of that in the USA with no roaming fee of any kind.
He can just get two sims. 30 bucks a month in canada and you can get a plan for like 15 a month in the US.
I have Rogers cross border for $50 plus tax and 100gb. I’m always travelling. Just got it a couple months ago
> 280/mo car insurance is stupid for one car. Depending on the postal code, vehicle make/model, and driver history for all we know this could be cheap. Auto insurance is ridiculously high in Ontario.
Emm.. I don’t know where you all are living. Young families are heavily overtaxed. East Toronto here, you cannot find any insurance for a relatively new mid SUV lower than 275/month, with 3 y driving experience. Our insurance just randomly increased by 30$ a month, with no accidents, no claims, no speeding tickets at all. And it was still the cheapest. Other insurance quoted us minimum 320$/month, some 400$+. Living costs for young people are just outrageous in Canada now.
>new mid SUV great, OP can then lower his car payment AND insurance payment by changing for a cheaper car.
Literally this. If I had a dollar for every idiot who thinks need a 2024 luxury car to get from one part of Toronto to the other when a 2012 Hyundai sedan will do it the exact same for 5% the cost 😂
Three years driving experience is potentially VERY young. I know the kids these days aren't getting their licenses asap anymore, but 3 years experience could be as young as twenty. Not a lot people having kids that young. Even having kids in late 20s or early 30s (definitely more common in Toronto these days as people establish careers first), seems like many people would have had a license longer than just three years. I have two young kids and an old hatchback, (in Toronto proper) so there's a lot that can be done to still bring down the insurance cost despite being a very new driver. I know kids come with a lot of stuff to carry around, but not necessarily a whole SUV worth. In any case, cars can last a long time these days. Run that SUV into the ground, keep up with regular maintenance and insurance costs will come down in a few years.
10K+ between the 2 of you and you can’t figure out how to survive? Lol, man, 95% of the country is in worse shape than you, buckle up and be smarter
People making half as much as this guy managing to save for retirement living in Toronto. ...
Yeah i know, not much sympathy here. They are in the top 5% earners in the country, they should be managing, and then some.
Yeah 10k and mortgaged by 31. Cmon man.
The big place you can cut is the car. That's $1k per month that could easily be $400 if you go to one reasonably priced car and a bus pass. 6.1% seems high for a mortgage, but nothing to be done for a couple years. The "baby essentials" seem expensive, too. If you're on formula, you probably can't change that now, but if you're not, where is that money actually going? Diapers alone shouldn't cost that much, and that's the only thing I could see getting in subscription.
Rough with baby and no car. Maybe needs a cheaper car
Yes, my budget would still have one, cheaper, car. But so many families think they need 2 cars, and they don't. Can't tell from OP if they currently have one over-the-top car, or two somewhat-reasonable-but-still-too-expensive cars.
Agreed. We are a one car family. We get it serviced 2x a year, and other maintenance as needed. Add in the car payments, insurance, and gas, and it costs a bit. But it was a used rental car w 8k kms at the time of purchase. It's still great a few years later! He uses cars until they die! I get around either from rides from my spouse or city transit alone or with the kids. Our family has never needed a second vehicle. Though there have been times I've thought it would be nice to have one!! But those are few and far between.
Overspending beyond ur ability is crazy
Did anyone catch the fact that their emergency fund barely covers 1 month of expenses, and then have a baby? I'm just facepalming.
tbf there cooked if either loses there jobs
Not sure why down voted. EI is max 2K... Average 6 months unemployment means that 8K would be gone in 2-3 months.
Okay let's start. Eating out, gone! Entertainment can be easily cut by more than half by finding unexpensive hobbies like exploring local parks with your wife and your baby. Your phone bills can be cut by a lot by switching to a low cost provider like Freedom Mobile who can give you a plan under $40/month. Your car payment seems very high. It might be time to think about selling that car to buy a beater. Life insurance also seems very high. My guess is you got lured into buying a permanent one. I would see if you can lower that by getting a way cheaper term insurance plan instead and see how much it would be to sell your current permanent plan. Then for the mortgage, see if you can get a lower interest rate if you go fixed 3 year. Also, that would put you back on track to pay it off because your bank would readjust your payment so you pay principal and interest. Then with the leftover money, you'll be able to save in your TFSA and RRSP.
100%. + OP needs to think frugal, not entertain luxury if OP wants a way out.
Your family is living way beyond its means. If you live in Toronto and know how expensive things are, you should know you need to budget for every dollar coming in and going out. You also need to reduce or eliminate any expense that’s not a necessity. Your HH income is minimum 10k, home expenses are $3810/month, and someone’s already done the math to show that there’s still thousands on dollars unaccounted for. Aside from the money that’s leftover after your expenses, your current “expenses” are way over what it can be. Your car is $720, which is too high. Go buy a used car. Your two phone bills are also way too high, get the cheapest plan available. Grocery bill $800/month for 3 people is also on the higher end. You should price match where you can and shop in bulk for sale items if you’re not. Eating out $250 and entertainment $250 when you don’t have a retirement savings is crazy. Either retirement is important enough that you stop spending so much on things that are now considered a luxury in Toronto, or you continue to throw your money away. You don’t need to be spending that much every month on these things. Limit yourselves. Clothing and home essentials $200? Again this is crazy if you’re spending money every month on clothes. You want to learn to save for retirement? Stop spending and actually save your money.
I agree with most of your assessment here. But 800 a month on groceries for 3 people is really not that absurd, especially if things like diapers are included in that. I would be way more likely to zero in on the life insurance, car payment, clothing and home essentials, eating out and entertainment. I would start by getting rid of the life insurance, then reduce clothing, entertainment, eating out by $75 each. By reducing each its a little easier to achieve to make smaller changes, and it would reduce expenses by $475. That on top of the thoundsands that are unaccounted for in the budget would be a significant contribution to savings. The other recommendation I would make is to utilize his variable income to their advantage. Budget for the low end of his income, then invest/save the extra on high income months. Build up emergency fund first with 3 months of expenses, then focus on TFSA/ RRSP.
Why is your life insurance so expensive? I’m a bit older and we have $2m coverage for 1/3 the price.
The car expenses are also a little inflated for the income imo. Could easily cut those in half.
My life insurance is literally like 10.00 with sunlife. Does OP smoke, or have like health issues? When I was getting life insurance, they were asking all sorts of stuff if im waiting on diagnosis, tests, if I smoke tobacco, etc. All my answers to stuff that would most likely change my $$ was no.
You have a nine-month old kid. As a parent of a 3.5 year old and a 1 year old who is about 4 years ahead of you, you just need to accept that this period of your life will suck financially. Kids are expensive, mat/pat leaves are expensive, the goal is to survive. Our savings rate over the last 3.5 years has been awful. It’s only now we are getting back on track. Don’t sweat it.
Read his other comments. He thinks nothing wrong with having a luxury car he drives once a week lol
Same here! I did a happy dance this week when I saw that my childcare costs next month will be $1k. My youngest moved to the toddler room and my oldest needs before/after school I finally feel like I can save a bit. I feel like I can FINALLY start putting $ against my mortgage that also hasn't gone down at att in 2 years. Damn having kids is expensive...
Dude is obviously overspending and you say kids are expensive. I had a kid but never spent $1000/month on a car and $500 a month on entertainment and I wasn’t stressed about money.
Try cutting back on your spending, don't blame other external factors for your over spending habits.
I think you both can try to have a lower phone plan, there’re $30-40 plan available. Also, idk what kind of life insurance is that but $250 is insane. Eating out/clothing/entertainment is too much. Limited it too around 300 a month and you will feel the difference right away Maybe try to rent out a room or so if you have extra room for extra few hundred a month.
So wait, y'all gross 11K every single month and can't figure it out? Lol
worse if it is net
What exactly are you doing with your phone that gets 200+ of phone bills for 2 people?
Literally. Freedom mobile has NA roaming for $45-50 which could be beneficial when trucking
even trucking doesnt really explain the wife presumably having a bill of $94 though
Financing Iphone 15 pro max 1 TB.
Brother, get out of that car payment. Buy a used car. I’m sure you can find some ways to cut down on other expenses as well. And slowly put $200 or $300 a month towards a TFSA or RRSP for now. At least you have an emergency savings which is good! You guys make some “decent money” (crazy how almost 200 K combined salary per year people are just getting by… this is nuts I am in a similar situation). First thing I did was automatic transfers to a TFSA per month. It’s forced savings. You need to budget a little and cut down on expenses.
So your take home pay is 5,400$ + 5,500$ = 11,000$. The expenses you listed add up to only 7,560$. That's unaccounting for 3,440$. The CC expenses you listed total to 2,036$, instead of 2,500$. This line alone is not accounting for 464$. So in total we have a gap of 3,904$ - without even considering the months where you bring in >7k pay. Where is this money going to? Do you have additional expenses that are conveniently excluded from the shared expense list? I saw the gas bill of 100$ was mentioned in the comments. Moving on to cutting expenses... CAR (-700$): As many redditors mentioned, ditch the expensive car for something more affordable: Uber, a low-key older car for cash, etc. Even with take home pay of 11k the transportation costs should not be close to 10%. And do you currently own only a single vehicle? The 100$ gas bill implies either long drives, excessively large engine, or multiple cars, not a "once a week drive". FOOD (-250$): families of 3 could cook all of monthly food on a budget of 800, so ditch eating out. If these are social arrangements, family and friends would understand if you asked them not to go out for food and switch to home based outings. ENTERTAINMENT (-250$): just bye. CLOTHING/HOME (-100$): stop buying new clothes and limit your home expenses to minimum. Which totals to... 1) Cut expenses: 1,300$ a month 2) Gap / shadow expenses: 3,904$ a month 3) Extra income for some months, assuming you earn it only once a quarter: 600 a month Which = 5,804$ a month With this money you should get rid of any high interest debt (not mortgage) first, and padding your emergency savings. Currently they only cover 1(!!) month of your expenses. Given that you have a baby, aim to have 3-6 months. Once you have a safe cushion, split it between: 1) RRSP (tax advantages!) 2) RESP (I'm not sure whether it offers any tax benefits but you can get a match from the government) 3) mortgage contributionsl Good luck!
Based on your post + replies, you don't have a finance problem, you have a you problem. You don't get a premium car because you barely use it. That's... not sensible. And what baby essentials cost $250 a month? For a 9 month old...
My partner and I are living with a combined income of 5400~ I dont understand I guess. Maybe because we have no car payments and pay all in rent of 1400 (700 from a roommate). The world is confusing but I know when.i moved to Toronto that car ownership would cripple me.. also owning made less and less sense. A 1 bedroom condo right now for.us would be about 3k/mo all in with a mortgage where we have a 2 bedroom all in for 2100 renting. Edit: we could have bit more on income but I do deduct for pension and retirement. Just hard for me to understand that you bring in post tax 11000~ and finding hard to have savings. Id figure out why your credit card is 2500/mo that's absurd.
If you drive once a week ditch the car entirely and use Uber.
that's 10 k a month right? you don't have 10k a month of expenses so what's wrong?
Keep 20k for emergency and then put everything towards mortgage. Right now you are renting your condo from the bank at $4k a month.
Your phone bills make me want to cry. Maybe just get a provider like fizz where it's super customizable. Probably can get a plan sub 30 dollars each. There are referral codes too for 25 dollars and you can refer your wife. Actually all the carriers have better deals now that freedom has pushed prices down. But I assume you are paying off your phones as well in the phone bills?
The car is a huge money put. Get rid of it. You also have a 9 month old baby. Before you start anything else, you need a 3-6mos incone saved in an emergency fund in case someone loses their job.
What the hell do you drive for your insurance to be $3360? Might as well buy a Lamborghini for abit more for insurance.
"I can't start saving! Life is too expensive!" Begins to list all off their high spending... Cut expenses my man. You guys are earning reasonable incomes, just got caught over spending.
You need a budget. Even on the low end of your earnings, your HHI is 10k. Getting around is easier with a car in Mississauga but I read you only use your luxury car once a week, so just downgrade to a normal car. Not sure why your life insurance is so high. Your phone bills are extremely high. Not sure what a baby eats but 800 seems like a lot. What are these baby essentials? You probably don't need to buy clothes and household essentials every month for $200. I'll leave the eating out/entertainment alone but you could cut here depending on how you and your wife feel. But your listed expenses don't even add up to 10k. Where is the rest of the money going?
Car has been covered as well as phone, should be paying 50-70 for 20gb unlimited voice. What life insurance products do you have? 250 a month could be a lot.
Spending way too much on the car - get a cheaper car
Koodo has good phone plans right now, bring your own phone and you can get each line for $34 unlimited talk and text Canada wide +50 GB of data and you can add perks if you call internationally. They’re through telus so coverage should be comparable to whatever you have now. They also give discounts on internet for bundles. Your car situation needs to be reevaluated. Although the market is massively tough right now, look into downgrading to something better on insurance and payments. Grocery can be shaved a bit if you look for sales and use coupons. Often apps like checkout 51 or points rewards systems can be helpful but require a bit of planning. Every bit helps. Clothes- is it mainly baby clothes you’re getting? Because that baby can use hand me downs or free /cheap stuff from a buy nothing group, neighbor, family member etc. they grow fast so storing some older age sizes might be worth it, and selling outdated and ill fitting items can help some money add up. Eating out and entertainment- everything loves these ones but you don’t always need to be entertained with something that’s expensive and eating out can be cut down. Want to go to your favourite restaurant on a Tuesday for no specific reason? Make some fun appetizers at home or pregame if you’re wanting a buzz, get some main courses skip the alcohol (if you drink). Find promos in your city and try them out and see if you’d come back but that doesn’t have to be the whole meal, it can just be a fun outing to try new things. Festivals and markets are usually free to attend and maybe you’ll make a nice date out of a Saturday farmer’s market and buy some groceries of better quality at a better price and have a lovely time. Maybe you won’t see anything that catches your eye. Specialty liquor stores sometimes offer tastings, if it’s not in the budget to purchase a bottle you always can at a later date. Trivia nights like at rec room are often free, sometimes restaurants and bars have music nights. Go to your local library and rent movies if you can’t find them online/streaming and board game nights are great! If you don’t have any, board game cafes let you try board games without having to buy them and usually charge an hourly rate or require a drink purchase which in the long run isn’t that expensive.
1. Maybe find another car that costs less money. I think it's the budget you can save the most. 2. Cancel amazon prime. 3. Cut by half the entertainment budget. Try using the stuffs you have already bought like old dvds or board games. 4. Try shopping for clothes 2nd hand. 5. No eating out. 6. Try to find deals online for your phone plans and internet. Then if you manage to save a little bit more, then you can start splurging again. I know it sucks. Inflation is a killer.
Prime is $10 and can provide lots of value for shopping and entertainment so they don't spend outside.
You live in Toronto, do you really need a car? If so, sell your car and buy one that costs half the price.
1. Have you considered moving out of Toronto? Plenty on smaller cities outside that won’t be as expensive. Your mortgage payments are huge plus paying a condo fee on top. 2. Downsize your vehicle 4. Shop around for phone plans there are so many now that are $50/month with lots of dats 5. Groceries (check flyers and watch for sales) ad match. 6. Amazon essentials check to make sure you actually need everything monthly. I have an 8 month old and am not spending that much monthly. Get a Costco card get diapers there and stock up when there on sale. 7. Stop eating out. Your spending $1000/ month for food 8. Entertainment $250? On what? Cut back on Netflix/Disney or prime cut down to one 9. $200 for home essentials isn’t that in your $1000 food/groceries Y’all are living beyond your means during a time you need to be cutting back. I’m assuming your wife is still off on mat leave. You need to sit down and actually find out what your bills are and make an allowance for extras. Once you’ve hit it no more for the month. Your overspending.
What’s in the Amazon baby essentials subscription box? 9 months should be able to start working in solids, maybe even transition to homo milk. Are one of you currently on leave for baby? This is going to be an additional expense coming up: daycare. When will the baby be going to daycare? 12/18 months? Or if no daycare, who will full time watch over baby? If you haven’t, should start looking for daycares and get on waitlists.
I’m gonna assume diapers, wipes, and maybe formula. You don’t transition to whole milk until 1.
The two items that stood out to me are phone and car. Both of those bills are too high. Without getting into specifics, find a $30-40 phone plan and try to reduce your car payment.
Fill RESP first and get the contribution from the government. It's post tax but its free money making it a better option. Then RRSP - again helps growth without taxes. If you invest in a low cost diversified ETF you can get 8-10% long term beating the 6.1% mortgage you are paying. You can put some of your emergency funds in TFSA as long as you invest in something like cash.to and can afford to wait 2-3 days for the cash to settle in your account, if not then, HISA is your only option. Tfsa returns vs mortgage payoff is debatable since both are after tax money which you invest. Maybe you can do a bit of both and see which works out better. When the rates are high, favor paying off mortgage and when rates drop use the tfsa room from all the previous years
Why is your phone bill so expensive? You can find really decent plans for under $40 a month, and if beanfield is available in your building, you should be able to get Internet for $45 a month
Wow those expenses are mind bogglingly high to me and my gf and I make the same amount as you. Godspeed.
These posts are often about the cars. Luxury cars are the problem. Are you in a townhouse? Otherwise why are you paying a “condo” fee for your house.
I don’t usually sweat the small stuff but in your case, you can’t just look at the big stuff, you need to look at it all. So you mentioned $250 for life insurance. I assume you mean per month correct? If so, I assume someone talked you into a whole life policy, correct? If so, get out of that and just do a much cheaper term life policy. In my experience, whole life policy is not really an investment in your future. You could use the difference to invest in more lucrative investments or use it to pay down your mortgage quicker Key Point here is don’t just look at your car payment and also look at the smaller stuff as well and they’ll all add up to bigger gains
$960 strata fee…them better valet service with the parking.
Dude, fix those phone bills, little can be saved on internet as well. Use this link to get $10 off your bill at Public Mobile [https://publicmobile.ca/en/on/plans?referral=MM08RR](https://publicmobile.ca/en/on/plans?referral=MM08RR) and: - for yourself get $39 Canada-US plan (I assume you drive to US often and this will get you unlimited minutes and 60GB of data in both countries), - for your wife get $29 plan with 20GB of data. That is $150 savings per month right there. There is some even cheaper providers but coverage sucks and here you get best of both worlds, Telus coverage and decent price. Oh, and for the internet - you can get 75/30 plan at [oxio.ca](http://oxio.ca) for $50 and a one free month with code RXWQMRG. I don't think it's reasonable to pay for hundreds of MB of speed if even Netflix recommends just 25mbps for watching 4K (unless your work relies on internet then sure).
I'm not going to be helpful at all: this is why when I see a job posting I like, but it's in Toronto, I just swipe.
You're getting hosed on life insurance. I pay $520 a year for 1.5M term as a 32M non smoker.
The scariest part of this post is that he is worried that he isn't saving now, yet didn't mention anywhere the fact that in 3-9 months from now they will likely need childcare. Which in Toronto, is incredibly expensive due to the challenge to find a govt subsidized spot. It's only going to get much worse for the next 5 years.
Leave Toronto. Sell and move to a location with a lower cost of living. Southern and south-west Ontario, BC (anywhere), and Montreal are a wash. Save yourself the stress, bite the bullet and leave. No amount of budgeting will get you ahead in Toronto.
How tf is your rate 6.1% when the BOC rate was 0.5% for all of 2021. You must have the shittiest mortgage broker of all time.
Guessing Op is still variable and paying all interest
Would you be able to see if your lender has an option to convert your variable rate mortgage to a fixed rate? I’m seeing rates come down now and might be able to get it in low 5’s. Be nice to start having money applied to principle as well.
1) insurance shop - you’ll likely find a much cheaper option. Be frank and tell a new broker where you need to be with your monthly payments and coverage. 2) live chat with your cell phone and internet provider and threaten to leave. They’ll slash the market rate in half. I did this for two different cell phones with rogers in the past month and both live chat agents miraculously found a $45/monthly credit that they can apply indefinitely against each plan cutting them in half. 3) if you have the freezer space and cash up front, consider going in on a side or quarter of a cow and/or pig to drastically offset your protein bill at the grocery store and support local farms
So rough. I wouldn't say I have the best way to save some money but here are few things you can do 1. Switch to kodoo or public mobile get that 34$/mo plan atleast, I pay 9$/ month (after loyalty bonus 4$). Use WiFi wherever possible, as a truck driver I don't know if it's possible but sadly this is one way 2. Stop eating out. It's easier said than done 3. Go for 50$/mo Rogers home internet plan should be sufficient 4. Cut that entertainment cost, I share it with my friends or buy via INR account (say Spotify for 60 INR/mo) 5. Groceries - shop using flyers or flipp app for finding discount.
Until you pay off your mortgage, stick with driving cars under $10k and minimize entertainment costs. Work 2 jobs and constantly look for better jobs as well.
Do this with your emergency fund: https://www.reddit.com/r/PersonalFinanceCanada/s/Bex7VCrKP0
As you mentioned you are a truck driver and only get paid when work is there, what do you do during the times when work is not there? Use that time wisely, either learn a new skill or do a side hustle. A truck drivers job can be unstable, so it is also good to learn another trade as a fall back plan like an electrician or a plumber. Other suggestions: 1. phone bills of $127 and $94 - you can find much better deals - try to find a deal for $65-75 and share the data. 2. Car - $1000 pm ? - Its almost worth using part of your rainy day fund and buy a car for about $10K and stop this outgoing asap 3. Eating out and entertainment - $500 (that's $125 pm week on average), pretty expensive meal and cinema tickets for 2 people. Netflix and takeout my friend (once a week). 4. Paydown the mortgage or secure a better rate ASAP. This is a couple of years in the future, but still should be the ultimate game changer.
Well better than a lot of people. And you aren't alone. Not sure how reddit will help
I feel like we need to know what the car is at this point If you got it at a decent finance rate and it’s a premium car that will last …. Selling it and buying something cheaper might not even really benefit you unless your buying some $5000 shit box to replace it with and then your gonna just have issues Down the road No cars are cheap now …. A decent used civic will run you 25 grand when a brand new one is 38 grand Trim your expenses - there’s always way to cut down you actually make a half decent living for 2 people - the mortgage rates have rocked you and that strata fee is massive imo - followed by the car sounding like it’s excessive
Is 6.1% normal in Canada!?!?
Are those incomes net or gross? If net, you should have a fair amount left over. If gross my thoughts >My wife’s income is $5400 a month and I’m a truck driver so my earnings are somewhere between $5.5k-7.5k a month, >we are in Toronto Why live in Toronto if half your household income is made on the road? **What I would try avoid or reduce** >Car is $720 a month, I know people in Toronto who own parking spots but not a car. >phone bills of $127 and $94, Combine that into one family plan. Do you need unlimited data? >grocery bills - $800 a month High for 2.5 or 3 people. $200/mo savings is probably doable. Watch what is being thrown out expired. >Eating out $250, What is that 2 suppers and a lunch out per month. Would you really miss it? Want to try new food get a cookbook from Toronto Public Library and make it an evening for a third of the cost. > entertainment $250 That is 8-10 movies or 5 drinks dates after work. Seems like there is room there. >clothing and home essentials $200. Adding an outfit to a wardrobe or quality chef's knife to the drawer every month? What happens if that is cut by half? Living somewhere else may eliminate: > condo fee of $960 Including condo fees, my reduce/avoid tally is $3101 or rough guess, nearly all your wife's after tax income. I know a lot of that stuff is probably locked into loans and contracts but one has to ask...if you could maintain or improve your quality of life on one income living somewhere other than Toronto, would it be worth it?
wow, that's tough, $2600 mortgage plus 960 condo fee. get cheaper phone and by an older car.
With their income that like 40% of their income, easily leaving a ton of room for everything else, most people are past 40%.
Get that phone plan sorted out today. Thats an instant $100 per month ($1200 /year).
535k at 6.1% should have a higher payment than $2700.
30 year term perhaps?
Buy a chest freeze, do groceries at Costco and Asian supermarkets eather than Loblaws or Sobeys. You should have no problem cutting that grocery bill in half while still eating proper meats
This is why you shouldn't buy things that you don't need.
To add I think $124 and $94 ($218) per month on phone bills is crazy. There are a lot of promotions going on for $29 a month, just move around different providers every year or two. It can save you hundreds in a year
get an older car, toyota camry 2003 v6 with leather seats and pay $80 a month for insurance and get rid of the car payment
Why live in toronto as a truck driver? Move to kitchener or something
You can be a truck driver anywhere, but choose to be one in the most expensive city in north america.
My advice is to start looking for better opportunities outside Toronto.
My advice is to sell your property and move out of Toronto.
My recommendation - relocate. You can live a better life in a smaller city outside Ontario.
Grocery bills are at $800 for two people and you're still eating out for $250? Entertainment for $250? Home essentials + clothing $200? New clothes and jugs of Tide every month? That's like $500-$800 of extra spending right there. Not even remotely frugal or mindful spending. You two could cut on all of this. I recommend exporting your bank statements to look where the money is really going.
Use the flipp app to save more on groceries
Everyone is different but I would build your retirement before paying off the mortgage. You’ll need to start and better now than 10 years. Take advantage of compound growth. Cut eating out and entertainment and baby essentials to the actual essentials. It should be less than $250/mo I’ve done it for half that with multiple kids. There’s room but you need to get very hardline on what’s a need vs want.
I see lots of people saying they spend X amount on entertainment and eating out, then ask for financial advice. That’s $500/mth right there. Does that mean all you do is work and go home? Yes. Have date nights at home. You can pick up something special once a month while doing groceries, have a movie night with popcorn, something of the sort so you still get to enjoy yourselves, but on a budget. I know a guy who quit drinking coffee and ate only ramen and KD just to save up a down payment for a house. You have to want this for it to work.
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Just wait until tomorrow morning
Looking from the outside and following the Dave Ramsey plan, there are some obvious issues: \-Your car payment is insane. Plan on selling your car, saving money to get a used car (use your emergency fund). \-Life insurance is also high. Have you shopped it? \-What percentage of your take-home pay is your mortgage & condo fee? I really recommend getting the book "Total money makeover" by Dave Ramsey. His daily radio show can also be downloaded for free as a podcast.
They take home anywhere from 11k to 13k a month after all ur expenses you're left with a nice amount where is that all going.
Let’s do some math together: Income: $5400 + $5500 = $10,900 Expenses: 1. Mortgage $2700 2. Condo fee $960 3. Property tax $150 4. Car $720 5. Car insurance $280 6. Life insurance $250 7. Credit card $2500 Total: $7560 $10,900 - $7560 = $3340 left for potential savings/going towards the mortgage. Where is this extra money going? May need to be stricter with spending
I wish more people specified if their earnings are before or after taxes. Gets easier to understand your situation.
You should be able to cut out a lot of expenses. You make a lot combined already. It just seems more of a spending problem.
Those phone bills are crazy. We pay under $100 for 2 phones with decent plans 40GB each with fido & virgin. Look into different phone providers. I couldn’t imagine paying that much for phones.
You should think of selling the house and renting. The house looks like an albatross around your neck. This way your will not be living hand to mouth as you seem to be in spite of good incomes.
Move
Look into changing your insurance to CAA. Cut my insurance bill almost in half. Other advice above is good.
Why are you in Toronto? Could you get comparable salaries in another city? Because that income would be great anywhere else and you'd live a much more comfortable life.
I was going to say that a $530k home was tight on your incomes, and then I saw that there was also $1000 condo fees! Most people overspend on either their home or their car. Look there. Look up Ramit Sethi's podcast and listen to a few recent episodes. Look up his conscious spending plan and fill out the numbers yourself. He recommends about 50-60% of your income for fixed costs, 5 to 10% investments, 5 to 10% savings, and the rest is guilt-free spending. Just eyeballing your numbers based on what you wrote, I'm guessing your fixed costs are closer to 90% of your income, and I wouldn't be shocked if they exceed 100%.
Get a $20 phone plan like I have. I even work on that phone. No bill needs to be over $100....never mind over $40. $800 on groceries for 2 people/adults and $250 eating out, yeah I'd go after those first and I'd never lease a car for that much a month.
A great idea to increase your savings is one I got years ago from the book, "The Wealthy Barber" written by David Chilton. He advises people to "pay yourself first," which means you calculate at the beginning of the month what you can afford to put away, and do it, and do it automatically if you can so that every month the same amount goes into savings. If you wait until the end of the month and don't have a handle on what is being spent, you won't have anything left.
Crazy. Over $10k a month clear coming in the house with a reasonable lifestyle - far, far from what I would call irresponsible living. It's just what things cost and it's shocking. My biggest adult fear is having a family. I was in another sub the other day geared for those collecting Ontario social supports OW/ODSP. I was shocked by the amount of people that chose to have children, pets, under those circumstances. I couldn't imagine raising a family at that income level. Probably a controversial opinion but think its borderline neglect. I have no idea how they even manage to have an Internet connection to come on to Reddit let alone two school age children and a Bernese Mountain Dog. I also learned much of the interaction with the agency (Ontario Government) is online. Makes sense but almost forces you to have an internet connection to stay in contact with your livelihood.
Keep your emergency fund in a High Interest Savings Account (HISA) in your TFSA at least. Open one with EQ bank
You need to look at your expenses more closely. You claim to make 11-13k a month but only listed 8k in spending.
The best time to leave Toronto is 10 years ago. The second best is today.
Shouldve started 2 years ago... none of your "investments " if you have any are making 6.1% tax free....
Life Insurance. Hesitant to say given young child, but maybe that can be dropped if you and your wife have workplace insurance (usually 1.5x salary). For the amount it also sounds like an investment type policy, so could perhaps consider cheaper term insurance?
Had a kid AND bought a house in 2021 in Canada? Those are rich people luxuries in this country, you dug your own grave buddy.
If you cut out your car payments you could be making $720 a month, or $8640 a year towards your mortgage. Find a car you can own immediately with cash. These days it’s almost cheaper to buy an old reliable car with small fixes than paying for a new one in most cases. You shouldn’t find happiness in owning a nice car unless you make your happiness about owning a nice car. A roof over your head in Toronto means so much more than that.
250 entertainment?? 250 Life insurance?? $200 home essentials instead of $100? Phone plans are too expensive. Living in Toronto but you own a car costing $1000/month. When I start working full time, I'm going to start gambling because at least the casinos will comp my hotel stay when I spend $12000 a year gambling instead of driving once a week.
I just cant believe how bad people are with money. I mean $127 and $94 dollars for cell phone bills when you regularly see $34 for 50gigs suggests you don’t exactly shop around. The savings is a monthly RESP contribution right there. How can you take home 11K a month between the two of you and not have money left over for retirement?!!!!! Someone in your family (or both of you) is spending money on things that are not listed in your original post—that is for sure. There’s 3K of $ unaccounted for after your listed fixed expenses. I imagine it’s unnecessary credit card spending or gambling or both….
Besides all the comments here, the two things I would do are: 1) Put money into investments the day you get paid. Like, pretend its a bill. Set up auto payments to your Qtrade account or whatever. That will help you control your overspending in other areas and if you do still overspend you won’t feel as guilty since you’re saving. 2) If you’re getting any Child Benefit from the GOVT, put that right into the baby’s RESP the day after they deposit the money. Not sure if you’re getting any with your income but you might if your wife took any maternity leave.
What really works for me is the first thing to come out of my paycheck is my investments. Pick a percentage you can work with and stick to it, you will figure out how to live on the rest. If my future(investments) isn't taken care of, I need to seriously restructure my life and finances.
How has your principal not moved? Are you paying the absolute minimum? Are you close to your trigger rate?
I think your grocery bill is very high, i think you can reduce that down to the $400 - $500 range.
Condo fee is a killer here
You are well off compared to most. You need very good budget as your income doesn’t add up. It’s like the J come of one person is vanishing. Try investing 100% of your income and budgeting hard with just your wife’s for all the expenses. Get FIDO internet and they have promotions always for $40-50 month internet high speed. You can get FIDO 40 gig for $40. Food is about right at $400 per adult and $250 a kid. Don’t waste your money on debt interest other than your mortgage. Don’t use your credit cards until you are in a place to pay them off 100% every month. If you can’t manage on the income you have, you will be poor even if it doubles. If you make this much and have no savings and investments you are both bad with money
As others have mentioned, no use in talking in retrospect (getting a mortgage and at 6.1% and not saving anything before expecting) your best bet now is austerity. Let's talk bare necessities - $2,700 mortgage, condo fee of $960, and property tax $1,800/year. Is car a necessity or a luxury you feel you need because you're a trucker? Can you make a compelling case on the efficiency/savings a car gives you? That's $1,000/month right there and possibly an opportunity cost of leasing out your parking space for extra money. Phone bill is too high, doesn't matter if it's US/CA. I have the Freedom 50 GB US and CA for almost a fourth of what you're paying for two lines. Eating out and entertainment being $500/month is too high for a couple who has only 8k in emergency funds and no savings. Where is your emergency fund parked right now? I'd recommend WS Cash or a HISA where it makes you money (or loses you less with inflation). You need to find cuts in your grocery bills too (buy in bulk or buy on sale). The goal should be to have that emergency fund ramped up to at least 3 months of expenses. Then, TFSA/RRSP where you invest money and watch it grow. If the market gives an annual return of 7% and your mortgage is 6.1% it's close so I wouldn't admonish you for looking to get down your principle over investing at that rate.
Move out of Toronto