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Name, age: Jessica, 34
Annual income: $80,000
Debt: $2,000 on credit card, $1,500 on line of credit, $280,000 mortgage
Savings: $95 in savings account, $7,730 in registered retirement savings plan (RRSP)
What she does: Proposal manager at a large company
Where she lives: Burlington, Ont.
Jessica lives with her pet Dachshund in a 600-square-foot condo she owns in Burlington. “I love giving people tours: It’s like, ‘Welcome to my home, you can see it all from here,” she says.
But despite making about $80,000 annually, plus benefits, she says the monthly struggle to cover her mortgage and other expenses means she’s still essentially living paycheque to paycheque. She takes home about $2,430 every two weeks after taxes.
“One of my paycheques is dedicated to housing and the other is for everything else,” she says. “Housing is like 50 to 60 per cent of my income.”
Jessica bought the place in 2020 with help from her family. She’d saved up about $21,000 in her RRSP, partially thanks to maxing out matching contributions at a past job, and her mom passed along $60,000 in inheritance after the death of her grandmother. She combined both for her down payment. Her father co-signed her mortgage.
“That $80,000 down payment brought the monthly payments down to something I could afford,” says Jessica, whose mortgage has a fixed interest rate of 2.5 per cent until 2025. “It was incredible timing. I am nervous that if interest rates don’t come down, I will have to sell my place.”
Jessica has a masters degree in English and no remaining student debt. She lived with her parents during her undergraduate degree to save money, and finished her masters, which was in a different city, owing about $5,000 on her line of credit. She moved back in with her parents after that – they charged her “ridiculously cheap rent” of $300 per month – and she saved aggressively in order to pay off her debts.
Now that she’s funneling so much money into her condo, including repaying money she borrowed from her RRSP under the new home buyer’s plan, she doesn’t have much extra for savings and is hit hard by unexpected expenses.
“There were some expenses last year that I never recovered from. My brakes went on my vehicle and my dog needed surgery.”
With her tight budget, she finds it hard to think about retirement.
“If I can afford to retire, it’s going to be great, but somehow I doubt that’s going to happen.”
Her typical monthly expenses:
Investment and savings: $270
$20 to savings account. “Every time I need extra money to cover my credit card bill I take it out of that account.”
$250 to RRSP. “I’m paying back the Home Buyers’ Plan.”
Servicing debt: $500
$0 to student debt. “I lived with my parents during my undergrad and worked 30 hours a week.”
$500 in credit card payments. “The amount fluctuates based on my spending.”
Household and transportation: $3,310
$1,362 to mortgage and property taxes
$676 for condo fees and water
$34 for home insurance
$500 to furniture and housewares “I’m aware that I have a HomeSense problem.”
$100 for electricity
$250 on gas. “It ranges from $150 to $400 a month.”
$143 on car insurance
$100 on car repairs. “My brakes went on my vehicle last year and that cost something ridiculous to fix.”
$0 on car payment. “My car has been paid off since February.”
$40 on transit. “I take the GO train to get to work and I don’t go more than twice in a month.”
$54 on cellphone
$51 on internet
Food and drink: $540
$200 on groceries. “I’m a vegetarian so my groceries are already less expensive.”
$75 at coffee shops
$220 on eating out
$45 on alcohol
Miscellaneous: $850
$140 on entertainment and going out. “Usually concerts or theatre. I like going to Stratford or the theatres in Toronto to see plays.”
$20 on cannabis
$12 on Spotify
$150 on clothing
$48 on gym membership
$250 on her dog. “My dog is a special flower and he’s basically allergic to the world so he’s on special vet food that costs $150 a bag.”
$100 on hobbies. “I like painting and pottery.”
$30 on haircuts. “I go to a barber and do my own dye job.”
$10 on cosmetics
$50 on personal services. “Massage, which is partially covered by benefits, as well as pedicures and eyebrow waxing.”
$10 on prescriptions
$30 on other medical expenses. “Chiropractor and osteopath.”
Some details may be changed to protect the privacy of the person profiled. We want to thank her for sharing her story. Are you a millennial or Gen Z who would like to participate in a Paycheque Project? Send us an e-mail.