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You had your best-laid plans and then COVID-19 came along and hammered the entire economy. But you’ve got this – if you have the right information. Join Rob Carrick and Roma Luciw on Stress Test, a podcast guiding you through one of the biggest challenges your finances will ever face.

ROB: The pandemic has made a lot of things really difficult - not the least of them dating. Today we’re asking how much does it cost to be single? And how do you set up your finances for success?

THEME MUSIC

Welcome to Stress Test, a Globe and Mail podcast where we look at how the rules of personal finance have changed in the pandemic for Gen Z, and Millennials.

Story continues below advertisement

I’m Rob Carrick, personal finance columnist at The Globe and Mail

ROMA:  And I’m Roma Luciw, personal finance editor at The Globe.

So Rob, today we’re talking about being single. Do you remember being single? And if so, what were some of the big things that stick out from a money perspective?

ROB: Well, it has been a while since I was single and married for close to 30 years. But I was single for a number of years in the workforce, I sort of had those, that it’s a great period when you just get your first job, and you’ve got a steady decent income and you got your own place. And you’re thinking, what can I do you know, and matching that against being careful and thinking ahead. I was not really one to think ahead when I was young. I mean, I was smart. I didn’t get into any debt problems. But I was not a big saver. I liked to do fun stuff and that meant spending pretty much all I’ve had and I went along that way for quite a while. What about you?

ROMA: I guess the thing that really sticks out in my mind from being single was how things were more expensive from a travel and living perspective, right? So if you’re taking a trip, you have to pay for the hotel room by yourself, you have to pay for the dinner out by yourself not splitting anything, right? So the bills are the bills, and then you know, for living expenses, you’re paying for the internet for apps, for subscriptions, I didn’t know that at the time, because it just seemed like something you paid for.

ROB: I’ll come back at you with a plus of being single personal finance-wise. And that is zero compromising. You want to buy something you do. I mean, I bought a number of sports cars over and over, like I traded them in every 1, 2, 3 years for a little while there. Because I was just thinking, do I want that? I Yeah, I do. I’m gonna do that. And when you’re in a couple, you have the combined earning power and the combined financial support, which is huge. And I think that nets out as a giant plus. But there is something kind of fun and free about just deciding your you know, your finance committee has one member in it decides to make an expense or spend money, you do it.

ROMA: Are you saying your wife doesn’t let you buy a nice fancy car?

Story continues below advertisement

ROB: No, actually, no, I brought her around to enjoying the virtues of a decent automobile. But, you know, it was just it was just different. You know what it was just a little bit more, a little bit more spontaneous.

ROMA: For sure. I mean, I saw a stat somewhere that singles pay for 75 to 80% of the costs that a couple split. And so there’s no doubt that the big ticket things housing, transportation, utilities, those things are more expensive, if you are a party of one as opposed to multiple people. And so what does that mean for you, if you’re planning your finances as a single person?

ROB: Well, I mean, it makes it much harder to get into the housing market. Because rather than having two people saving and gathering up their savings to put towards a down payment, you’re on your own, affording the mortgage becomes a little trickier. I think a huge impact of being single is the importance of having a good emergency fund because you don’t have a partner or a spouse to sort of provide support. I’m out of the workforce temporarily, but my partner is still working, they’re bringing in income, they are covering the mortgage, there’s just so much more of a weight on the single individual to continue to pay for expenses when they are unable to work. And so you really do need to protect yourself. And in retirement, I mean two people saving for retirement sort of doubles your retirement savings power, one person is really got to work double-time to build up the retirement savings assets.

ROMA: So with all of this to consider the question is: how do you set yourself up for financial success as a single person?

ROB: We actually spoke to someone who’s done a pretty good job of that - and she even managed to buy a house at the start of the pandemic. We’re going to London, Ontario to hear her story -- next.

PRE-ROLL: This podcast is brought to you by CPP Investments. Take comfort knowing the Canada Pension Plan Fund will be there for you. We invest to help ensure the CPP fund remains resilient over the long term, sustainable and secure for millions of Canadians. Learn more at CPP Investments Dotcom.

Story continues below advertisement

ROMA:  For this episode we did a call out asking you what it’s been like to set up your finances as a single person.

Maya is one of the people who wrote back to us. She’s 34 years old, works in HR and lives in London, Ontario.

And she’s not originally from Canada - that’s where her story starts.

MAYA: I’m originally from Holland in Europe. And I came over when I was in my early 20s. So about just over 10 years ago.

ROMA: Maya moved to Canada for love.

MAYA: I came to Canada originally for my ex boyfriend. He is Canadian. And I was young and naive. And so I decided to move out to Canada and be with him forever. So that obviously did not work out. But I’m still here in Canada and I still really like the country itself.

Story continues below advertisement

ROMA: It isn’t easy to set yourself up in a new country. So when Maya arrived in Calgary for a new life with her boyfriend-at-the-time, she settled into living with him AND his financial situation.

MAYA: Coming to Calgary, financially, it wasn’t very complicated because my everything was in my ex’s name. He had a place that we could stay at, all the bills were in his name. He got me a copy of his credit card, but my name was never added. I was added to his car insurance as like an occasional driver. So in a way, it was very easy financially to make that transition over to a new country.

ROMA: Even though this helped her settle quickly in a new country,  it meant that she had little to no financial assets in her name and no financial history. If they were to break up - she would have to start building up her finances from scratch - which is exactly what happened.

MAYA: In hindsight, it was not smart to have everything in his name. Because when we broke up, about six years later, I had nothing in my name. I had no history, no credit history, nothing. So I had to basically start from scratch even though I’d already been here for over half a decade.

ROMA: Luckily Maya did have some savings - when she moved to Calgary she had enrolled in night school to earn her degree in HR, while using her mornings working co-ops to earn some money.

The next thing Maya needed was a credit card.

Story continues below advertisement

She had no credit history, so the best the bank could do for her was give her a secured credit card with a 1,000 dollar limit. That means YOU have to provide a cash deposit on that card.

But after all of that -  she still couldn’t catch a break.

You see, Maya was working for a company in the oil and gas industry.

And this was Calgary - in 2015.

MAYA: Anyone who is familiar with Calgary knows that 2015 was not a good year for oil and gas in Calgary. So when I graduated, my manager told me, we can give you a contract until December and then after that we can’t keep you on anymore. So just a heads up between now which was May and December, you’re going to have to find a different position.

ROMA: Maya had to scramble to find a job - so she did the obvious thing - she googled around to see what she could find

Story continues below advertisement

MAYA: I went online on LinkedIn, and I googled HR and Dutch because that’s the only thing that sets me apart from all the other thousands of new grads in the HR field and one job popped up, which was here in London, Ontario. They have an office in Amsterdam, and that’s why they needed someone who speaks Dutch. And it was kind of meant to be.

ROMA:This was such a smart move. She doubled-down on the one skill that set her apart, her ability to speak Dutch. Maya took the job and moved out to London in October. But the new job came with a pay cut - a $30,000 pay cut.

MAYA: The transition from Calgary to London is extreme. Rent was a couple 100 bucks cheaper a month. So that was great for a bigger unit. But my salary went down from $72,000 to $46,000. So I lost close to $30,000 a year in income. Now the cost of living in London is quite a bit lower as well so it evened out a bit, but it definitely changed my lifestyle.

ROMA: Even though she took a massive pay cut, Maya was in ok financial shape.  She didn’t have any debt - she had those savings we mentioned earlier and she was finally able to get a regular credit card. She also found out that the new company she worked for had a great RSP plan, which she decided to take advantage of,  on top of putting away savings to make sure she had a solid safety net.

MAYA: My company is very generous with their group RSP plan, I put in 5%, they match 7%. So it’s 12% in total. It’s hard to find nowadays, anything like that. So that’s what I put away for pension. And then I have a TFSA for any medium-term plans. And then I have what I call a safety net. And so I’ve calculated how much I need on a bare minimum basis per month, took EI off that and then came up with what do I need to keep myself so for about eight months. So that is in the TFSA as well. But it’s not something that I get to take out. And then I have a float, which is a couple thousand dollars that is in my day-to-day savings account. Just in case something happens if my car dies again, like my previous car, she needed a new alternator, and that’s over a grand and you suddenly have to cough that up and I didn’t want to put it on a credit card. So that’s what the float is for for anything that is unexpected that I can’t just take out of my regular pay. So overall, I think I think it’s going okay, I’d say I’m a I’m a self sufficient single at this point.

ROMA: Maya was actually able to use the money from the RSP to buy a house, in March 2020,  right as lockdown began.

MAYA: The downpayment was $35,000 from my group RSP. And once I told my mom that I was buying a house, she got very excited for me and they contributed 5000 euros, so about $7500 to my down payment,  So the total down payment was 42, half the total cost of the house was $271,100. I was not the highest bid. But that was the final price, it was put on the market for $230,000.

ROMA: This is all really impressive and I’d say Maya is in great shape financially. At 34 years old, she bought her own home and is financially self-sufficient. And besides a small gift from her mom, -she did this all on her own. How did that feel?

MAYA: Absolutely terrifying.There’s not as much information out there as I was hoping for. A lot of the information is for couples. And they’re all talking about spousal RSPs and planning to do income splitting and oh if you go to Costco, make sure you buy in bulk. And I tried that, and a lot of food rotted away and went to waste. Not everything that is out there is actually applicable to single people, and especially single women, we make less money, we take breaks for dependent care, we don’t progress as far in the workforce as men do, just on average. And we tend to live longer. So we have a longer retirement to fund, even though we have less income to spend on saving for that retirement. So a lot of this was just I did what felt right, And so that’s what I put together. A big part of it is luck with the company that I’m working for. I don’t think that if I worked at a company that didn’t offer a group RSP, I don’t think I would be in the position that I’m at right now. Because I use the RSP for my down payment for that first time homebuyer plan. So, yeah, it’s luck, and just doing what seemed to work for me. And then hoping that eventually more information would come out that would match my particular situation.

ROMA: So that’s the story of Maya’s financial situation, from arriving in Canada until now. And she’s very committed, even as she’s in a new relationship.

MAYA:I am dating someone right now, but I’m still operating as a single household. It’s still just me and the dog in my house. He has his own house, his own dog, his own car. And so all of that is completely separate. To be honest, I don’t see that mixing anytime soon.

ROMA: Maya, thank you so much for sharing your story with us. Maya is a great example of someone who’s young and recovered Well, from a situation that could have been problematic. And I mean, lots of people do this. They let their partner take control when it comes to handling their finances, when really it should be a shared position. But the important lesson here is that she’s recovered. And she’s doing all of the good things, right? She’s a homeowner, she’s building retirement savings, she’s got a good credit score, she has an emergency fund, there’s no question that she’s really turned it around. Rob, what’s your two cents on Maya?

ROB: To me, Maya dramatizes what is possible. You know, we’ve talked a bit about and we will get into further detail on the challenges that singles face, but Maya demonstrates what you can do if you get your act together, you can own a house. I’m pretty impressed by that.

ROMA:nYeah, absolutely. Especially given how hard it is to do that. Now, here’s someone that’s done all those things. And I mean, her story is really inspiring.

ROB: It is but you know, I think what we want to do here is provide some sort of a roadmap to help other people bring their finances along like Maya does. I think our next guest, Bridget Casey, is going to have some interesting things to say on that.

MIDROLL: This podcast is brought to you by CPP Investments at CPP Investments. We never lose sight of the long term. We invest the Canada Pension Plan Fund to help provide financial security for generations of Canadians. We diversify the CPP fund across geographies and asset classes to access the best investment opportunities and generate sustainable long term returns. The fund is now more than 400 billion dollars. To learn more about our investment performance for Canadians, visit CPP Investments. Com.

ROB: Today, I’m talking to someone you might remember from season one. Bridget Casey is the founder of the personal finance site Money After Graduation, and she’s based in Calgary.

You know, Bridget, when we spoke to Maya, she said she wanted to know she was on the right track and her situation was normal. So I just want to start by looking at her story. Is it typical? What lessons could you draw out of it?

BRIDGET: She actually sounds like she’s further ahead. Many millennials and young people, but I also understand wanting to keep your finances separate. And that’s very important, I think we’re still used to in partnerships, one person might be better with money than the other, so you let them have more control over the money. And it poses two problems. First, that you end up with things often all in one person’s name. And not just savings accounts. But sometimes it can impact your credit score, you can leave a relationship and have no credit history, because all the credit was also in their name. And there’s also just a you’re behind in financial literacy, because you haven’t been managing the finances for that time. So her situation of relying on a partner where he managed most of the finances is not unusual. I see that often. And I also see people wanting to take more control over their finances when they leave those relationships.

ROB: Can you give us a picture from your point of view? What does the financial picture look like generally for Millennial singles? How are they doing with saving and investing?

BRIDGET: I mean, they’re doing okay, they’re starting to gain some traction now, or at least they were before the pandemic. But compared to couples, they they’re far behind, they just can’t catch up. Because fundamentally, it just is easier to share costs with a partner, especially when those costs are large expenses like housing or car ownership, like splitting a vehicle with someone also relieves you of hundreds of dollars in expenses. It’s even easier, like groceries are cheaper when you’re with someone. Basically, everything is more affordable. And it’s easier to save and invest when you have a partner. So I think singles are behind the couples for sure.

ROB: What mistakes do you see Millennial singles making when it comes to financial decisions?

BRIDGET: Well, the first is also just like planning that they might have a partner later. Many people will neglect their debts or neglect saving and investing because they’re still hoping maybe that they’ll meet someone and get and often they do. Most people do eventually find a partner at some point. But you also have to plan in case that you’ll be single for the rest of your life. And in particular for women, I think they don’t realize how much they really need to save and invest for the future. Because women tend to outlive men by a significant amount, I think like eight to 10 years, they need more expensive care and later in life. But in the meantime, they’re also typically earning less than men. So you have to actually save more for a longer retirement while you’re earning less. So it’s a big challenge, especially for young millennial and Gen Z women.

ROB: How has the pandemic change the way single millennial should be thinking about their finances?

ROB:

The pandemic has made a lot of things really difficult - not the least of them dating. Today we’re asking how much does it cost to be single? And how do you set up your finances for success?

THEME MUSIC

Welcome to Stress Test, a Globe and Mail podcast where we look at how the rules of personal finance have changed in the pandemic for Gen Z, and Millennials.

I’m Rob Carrick, personal finance columnist at The Globe and Mail

ROMA:  And I’m Roma Luciw, personal finance editor at The Globe.

So Rob, today we’re talking about being single. Do you remember being single? And if so, what were some of the big things that stick out from a money perspective?

ROB: Well, it has been a while since I was single and married for close to 30 years. But I was single for a number of years in the workforce, I sort of had those, that it’s a great period when you just get your first job, and you’ve got a steady decent income and you got your own place. And you’re thinking, what can I do you know, and matching that against being careful and thinking ahead. I was not really one to think ahead when I was young. I mean, I was smart. I didn’t get into any debt problems. But I was not a big saver. I liked to do fun stuff and that meant spending pretty much all I’ve had and I went along that way for quite a while. What about you?

ROMA: I guess the thing that really sticks out in my mind from being single was how things were more expensive from a travel and living perspective, right? So if you’re taking a trip, you have to pay for the hotel room by yourself, you have to pay for the dinner out by yourself not splitting anything, right? So the bills are the bills, and then you know, for living expenses, you’re paying for the internet for apps, for subscriptions, I didn’t know that at the time, because it just seemed like something you paid for.

ROB:

I’ll come back at you with a plus of being single personal finance-wise. And that is zero compromising. You want to buy something you do. I mean, I bought a number of sports cars over and over, like I traded them in every 1, 2, 3 years for a little while there. Because I was just thinking, do I want that? I Yeah, I do. I’m gonna do that. And when you’re in a couple, you have the combined earning power and the combined financial support, which is huge. And I think that nets out as a giant plus. But there is something kind of fun and free about just deciding your you know, your finance committee has one member in it decides to make an expense or spend money, you do it.

ROMA: Are you saying your wife doesn’t let you buy a nice fancy car?

ROB: No, actually, no, I brought her around to enjoying the virtues of a decent automobile. But, you know, it was just it was just different. You know what it was just a little bit more, a little bit more spontaneous.

ROMA: For sure. I mean, I saw a stat somewhere that singles pay for 75 to 80% of the costs that a couple split. And so there’s no doubt that the big ticket things housing, transportation, utilities, those things are more expensive, if you are a party of one as opposed to multiple people. And so what does that mean for you, if you’re planning your finances as a single person?

ROB: Well, I mean, it makes it much harder to get into the housing market. Because rather than having two people saving and gathering up their savings to put towards a down payment, you’re on your own, affording the mortgage becomes a little trickier. I think a huge impact of being single is the importance of having a good emergency fund because you don’t have a partner or a spouse to sort of provide support. I’m out of the workforce temporarily, but my partner is still working, they’re bringing in income, they are covering the mortgage, there’s just so much more of a weight on the single individual to continue to pay for expenses when they are unable to work. And so you really do need to protect yourself. And in retirement, I mean two people saving for retirement sort of doubles your retirement savings power, one person is really got to work double-time to build up the retirement savings assets.

ROMA:

So with all of this to consider the question is: how do you set yourself up for financial success as a single person?

ROB:

We actually spoke to someone who’s done a pretty good job of that - and she even managed to buy a house at the start of the pandemic. We’re going to London, Ontario to hear her story -- next.

PRE-ROLL: This podcast is brought to you by CPP Investments. Take comfort knowing the Canada Pension Plan Fund will be there for you. We invest to help ensure the CPP fund remains resilient over the long term, sustainable and secure for millions of Canadians. Learn more at CPP Investments Dotcom.

ROMA:  For this episode we did a call out asking you what it’s been like to set up your finances as a single person.

Maya is one of the people who wrote back to us. She’s 34 years old, works in HR and lives in London, Ontario.

And she’s not originally from Canada - that’s where her story starts.

MAYA: I’m originally from Holland in Europe. And I came over when I was in my early 20s. So about just over 10 years ago.

ROMA: Maya moved to Canada for love.

MAYA: I came to Canada originally for my ex boyfriend. He is Canadian. And I was young and naive. And so I decided to move out to Canada and be with him forever. So that obviously did not work out. But I’m still here in Canada and I still really like the country itself.

ROMA: It isn’t easy to set yourself up in a new country. So when Maya arrived in Calgary for a new life with her boyfriend-at-the-time, she settled into living with him AND his financial situation.

MAYA: Coming to Calgary, financially, it wasn’t very complicated because my everything was in my ex’s name. He had a place that we could stay at, all the bills were in his name. He got me a copy of his credit card, but my name was never added. I was added to his car insurance as like an occasional driver. So in a way, it was very easy financially to make that transition over to a new country.

ROMA: Even though this helped her settle quickly in a new country,  it meant that she had little to no financial assets in her name and no financial history. If they were to break up - she would have to start building up her finances from scratch - which is exactly what happened.

MAYA: In hindsight, it was not smart to have everything in his name. Because when we broke up, about six years later, I had nothing in my name. I had no history, no credit history, nothing. So I had to basically start from scratch even though I’d already been here for over half a decade.

ROMA: Luckily Maya did have some savings - when she moved to Calgary she had enrolled in night school to earn her degree in HR, while using her mornings working co-ops to earn some money.

The next thing Maya needed was a credit card.

She had no credit history, so the best the bank could do for her was give her a secured credit card with a 1,000 dollar limit. That means YOU have to provide a cash deposit on that card.

But after all of that -  she still couldn’t catch a break.

You see, Maya was working for a company in the oil and gas industry.

And this was Calgary - in 2015.

MAYA: Anyone who is familiar with Calgary knows that 2015 was not a good year for oil and gas in Calgary. So when I graduated, my manager told me, we can give you a contract until December and then after that we can’t keep you on anymore. So just a heads up between now which was May and December, you’re going to have to find a different position.

ROMA: Maya had to scramble to find a job - so she did the obvious thing - she googled around to see what she could find

MAYA: I went online on LinkedIn, and I googled HR and Dutch because that’s the only thing that sets me apart from all the other thousands of new grads in the HR field and one job popped up, which was here in London, Ontario. They have an office in Amsterdam, and that’s why they needed someone who speaks Dutch. And it was kind of meant to be.

ROMA:

This was such a smart move. She doubled-down on the one skill that set her apart, her ability to speak Dutch. Maya took the job and moved out to London in October. But the new job came with a pay cut - a $30,000 pay cut.

MAYA: The transition from Calgary to London is extreme. Rent was a couple 100 bucks cheaper a month. So that was great for a bigger unit. But my salary went down from $72,000 to $46,000. So I lost close to $30,000 a year in income. Now the cost of living in London is quite a bit lower as well so it evened out a bit, but it definitely changed my lifestyle.

ROMA: Even though she took a massive pay cut, Maya was in ok financial shape.  She didn’t have any debt - she had those savings we mentioned earlier and she was finally able to get a regular credit card. She also found out that the new company she worked for had a great RSP plan, which she decided to take advantage of,  on top of putting away savings to make sure she had a solid safety net.

MAYA:

My company is very generous with their group RSP plan, I put in 5%, they match 7%. So it’s 12% in total. It’s hard to find nowadays, anything like that. So that’s what I put away for pension. And then I have a TFSA for any medium-term plans. And then I have what I call a safety net. And so I’ve calculated how much I need on a bare minimum basis per month, took EI off that and then came up with what do I need to keep myself so for about eight months. So that is in the TFSA as well. But it’s not something that I get to take out. And then I have a float, which is a couple thousand dollars that is in my day-to-day savings account. Just in case something happens if my car dies again, like my previous car, she needed a new alternator, and that’s over a grand and you suddenly have to cough that up and I didn’t want to put it on a credit card. So that’s what the float is for for anything that is unexpected that I can’t just take out of my regular pay. So overall, I think I think it’s going okay, I’d say I’m a I’m a self sufficient single at this point.

ROMA: Maya was actually able to use the money from the RSP to buy a house, in March 2020,  right as lockdown began.

MAYA:

The downpayment was $35,000 from my group RSP. And once I told my mom that I was buying a house, she got very excited for me and they contributed 5000 euros, so about $7500 to my down payment,  So the total down payment was 42, half the total cost of the house was $271,100. I was not the highest bid. But that was the final price, it was put on the market for $230,000.

ROMA: This is all really impressive and I’d say Maya is in great shape financially. At 34 years old, she bought her own home and is financially self-sufficient. And besides a small gift from her mom, -she did this all on her own. How did that feel?

MAYA: Absolutely terrifying.There’s not as much information out there as I was hoping for. A lot of the information is for couples. And they’re all talking about spousal RSPs and planning to do income splitting and oh if you go to Costco, make sure you buy in bulk. And I tried that, and a lot of food rotted away and went to waste. Not everything that is out there is actually applicable to single people, and especially single women, we make less money, we take breaks for dependent care, we don’t progress as far in the workforce as men do, just on average. And we tend to live longer. So we have a longer retirement to fund, even though we have less income to spend on saving for that retirement. So a lot of this was just I did what felt right, And so that’s what I put together. A big part of it is luck with the company that I’m working for. I don’t think that if I worked at a company that didn’t offer a group RSP, I don’t think I would be in the position that I’m at right now. Because I use the RSP for my down payment for that first time homebuyer plan. So, yeah, it’s luck, and just doing what seemed to work for me. And then hoping that eventually more information would come out that would match my particular situation.

ROMA: So that’s the story of Maya’s financial situation, from arriving in Canada until now. And she’s very committed, even as she’s in a new relationship.

MAYA:I am dating someone right now, but I’m still operating as a single household. It’s still just me and the dog in my house. He has his own house, his own dog, his own car. And so all of that is completely separate. To be honest, I don’t see that mixing anytime soon.

ROMA: Maya, thank you so much for sharing your story with us. Maya is a great example of someone who’s young and recovered Well, from a situation that could have been problematic. And I mean, lots of people do this. They let their partner take control when it comes to handling their finances, when really it should be a shared position. But the important lesson here is that she’s recovered. And she’s doing all of the good things, right? She’s a homeowner, she’s building retirement savings, she’s got a good credit score, she has an emergency fund, there’s no question that she’s really turned it around. Rob, what’s your two cents on Maya?

ROB: To me, Maya dramatizes what is possible. You know, we’ve talked a bit about and we will get into further detail on the challenges that singles face, but Maya demonstrates what you can do if you get your act together, you can own a house. I’m pretty impressed by that.

ROMA:

Yeah, absolutely. Especially given how hard it is to do that. Now, here’s someone that’s done all those things. And I mean, her story is really inspiring.

ROB:

It is but you know, I think what we want to do here is provide some sort of a roadmap to help other people bring their finances along like Maya does. I think our next guest, Bridget Casey, is going to have some interesting things to say on that.

MIDROLL: This podcast is brought to you by CPP Investments at CPP Investments. We never lose sight of the long term. We invest the Canada Pension Plan Fund to help provide financial security for generations of Canadians. We diversify the CPP fund across geographies and asset classes to access the best investment opportunities and generate sustainable long term returns. The fund is now more than 400 billion dollars. To learn more about our investment performance for Canadians, visit CPP Investments. Com.

ROB: Today, I’m talking to someone you might remember from season one. Bridget Casey is the founder of the personal finance site Money After Graduation, and she’s based in Calgary.

You know, Bridget, when we spoke to Maya, she said she wanted to know she was on the right track and her situation was normal. So I just want to start by looking at her story. Is it typical? What lessons could you draw out of it?

BRIDGET: She actually sounds like she’s further ahead. Many millennials and young people, but I also understand wanting to keep your finances separate. And that’s very important, I think we’re still used to in partnerships, one person might be better with money than the other, so you let them have more control over the money. And it poses two problems. First, that you end up with things often all in one person’s name. And not just savings accounts. But sometimes it can impact your credit score, you can leave a relationship and have no credit history, because all the credit was also in their name. And there’s also just a you’re behind in financial literacy, because you haven’t been managing the finances for that time. So her situation of relying on a partner where he managed most of the finances is not unusual. I see that often. And I also see people wanting to take more control over their finances when they leave those relationships.

ROB: Can you give us a picture from your point of view? What does the financial picture look like generally for Millennial singles? How are they doing with saving and investing?

BRIDGET: I mean, they’re doing okay, they’re starting to gain some traction now, or at least they were before the pandemic. But compared to couples, they they’re far behind, they just can’t catch up. Because fundamentally, it just is easier to share costs with a partner, especially when those costs are large expenses like housing or car ownership, like splitting a vehicle with someone also relieves you of hundreds of dollars in expenses. It’s even easier, like groceries are cheaper when you’re with someone. Basically, everything is more affordable. And it’s easier to save and invest when you have a partner. So I think singles are behind the couples for sure.

ROB: What mistakes do you see Millennial singles making when it comes to financial decisions?

BRIDGET: Well, the first is also just like planning that they might have a partner later. Many people will neglect their debts or neglect saving and investing because they’re still hoping maybe that they’ll meet someone and get and often they do. Most people do eventually find a partner at some point. But you also have to plan in case that you’ll be single for the rest of your life. And in particular for women, I think they don’t realize how much they really need to save and invest for the future. Because women tend to outlive men by a significant amount, I think like eight to 10 years, they need more expensive care and later in life. But in the meantime, they’re also typically earning less than men. So you have to actually save more for a longer retirement while you’re earning less. So it’s a big challenge, especially for young millennial and Gen Z women.

ROB: How has the pandemic change the way single millennial should be thinking about their finances?

BRIDGET: I think it emphasized for all of us how important an emergency fund is and how important it is to invest.  And I think we also never pictured a scenario where people would experience income interruption like childcare interruption. I know that was a big one for me. And also the stock market crash when it happened. Everything happened all at once. And I think it brought to light vulnerabilities that you might have in your financial picture and in your budget. So I hope it inspired people really just to save and invest more because you never know what can happen.

ROB: Let’s talk a bit about the emergency fund. How much bigger should it be? Because we talked about how singles have to bear a bigger financial load and couples. How much bigger should a single’s emergency fund be than someone who’s in a couple?

BRIDGET: Well, you’re still aiming for three to six months, well, now, since the pandemic, I now tell people six to 12 months of essential expenses. So it’s the same number, it’s just for a couple 12 months of expenses is lower per person than it is for a single person. But ideally, you should be aiming for that. And I know people listening to this are probably horrified at the prospect of saving up 12 months of essential expenses could because it is a significant financial burden. But an emergency fund of that size is not something that you accumulate in a few months or a year, this really has to be a dedicated effort that you should be contributing to as long as it takes to build one. So I even tell people to start with as little as $25 or $50 a week, in a high interest savings account. Doing it weekly makes it a little bit easier to swallow the cost and still at the end of the year, I mean, you can end up with over $1,000 or $2,000, even with small amounts like that.

ROB: As a general rule of thumb: how much should singles be saving on an ongoing basis compared to couples?

BRIDGET: The general rule of thumb that I tell people is it should be 10% of your net income should be going into retirement accounts, either the TFSA or the RSP. Or both. When you’re younger, you can get away with a slightly lower percentage, just because you have more time to save. But you should, you should aim to say between 6% and 10%. And more is always better. So you definitely want to shoot for like 12% or 15%, if you can afford it and your budget

ROB: A lot of single Millennials are one houses just as much as millennials and couples, but they have half the earning power and half the down payment savings parcel. How do you juggle I want a house with I know I nee d to save for retirement if I’m a single?

BRIDGET: I mean, the unaffordability in most Canadian cities is just crazy. If homeownership is really a goal for you, then you have to seriously consider moving. Otherwise, your best defense is just saving and investing in the stock market. For many people though, homeownership is part of their retirement plan. And in that case, I understand why you value it and why you might stretch your budget in order to get into house. But I mean, you know me personally, I really don’t like it. I would rather people focus on accumulating cash assets rather than stunt their retirement savings for years because they’ve stretched themselves to get into a house they couldn’t really afford.

ROB: Bridget, no one has tried harder to open people’s minds to not owning homes in Canada than I have, and it is not going well! I don’t know how your campaign is going but mine is mine is slow work.

BRIDGET: It’s not going well [laughs]

ROB: You I touched on this topic a few minutes ago, but I want to return to because I think it’s super important. It’s about Millennial women, and the special care they need to take with their finances that are maybe a little bit different than men. Can you help single Millennial women understand what they’re up against and what that means for their for their saving and investing.

BRIDGET: I think a single Millennial women first just have to accept that they need more, more savings and investments, and it’s going to be harder to accumulate them. It’s also true that women tend to carry more student loan debt than men. And then what happens for many women and is that their childbearing years coincide with like, they’re just when they’re getting started in their career. So many women end up between like 28 to 35, where they still have student loan payments, and they’re taking time away from the workforce to raise children. And you really just have to be aware, first of all the tax benefits that are out there, like understand how the TFSA and the RSP work for reducing your taxable income and tax sheltering your investments for the long term, because that will help you get the most bang for the buck for the money that you put away. Understand, like how important it is to negotiate your salary, like try to make up for that gender pay gap as much as you can, and try to just over save and invest any extra money that you have, throw it into your investment accounts.

ROB: As the pandemic presses on, what should singles do to protect themselves from the changes that keep happening? Job layoffs, the housing market gets more expensive. You know, I know that we’re looking at head to a stronger economy when finally enough of us are vaccinated that we can open up the economy. But I’m not sure it’s gonna be a smooth ride. Some people have been furloughed or may not be called back to work companies may be taking advantage of current terminal to restructure. We’ve got a lot of uncertainty ahead. How can the single millennial best prepare for it?

BRIDGET: One of the most important things and what I’m like pushing young people to do so much of is please like get started investing. One of the nice things about all of this, and the technology developments that we’ve had recently is it’s easier than ever to access the stock market, you can literally open an account with $100 on your phone and start investing. So take advantage of these robo-advisors, and these accounts, and really just start with like, $50. If that’s all you have.

ROB: Bridget, what, what are some positives financially? Speaking of being single? Are there any?

BRIDGET: Yeah, oh, man, there’s a lot. And I say that as a single person. So one of the nicest things is that you’re totally in control of all your money. You are saving and investing exactly how you want to do. When you’re part of a couple, there’s a lot of negotiations that have to happen in the investments that you choose how you spend your money, What’s an appropriate budget, how you manage your debt, like, I’ve seen many of my friends, relationships, these are big challenges of like, should we pay off our student loans or invest? Should we buy weed stocks or ETFs? So being single, and being entirely in control of your finances is really empowering and really satisfying, because no one’s gonna mess it up.

ROB: What’s your number one piece of advice to the single millennial like you if you could give them one sentence worth of do this and this will be the difference maker. What would it be?

BRIDGET: Max out your TFSA in the stock market. That’s the single thing that will ensure the most financial security and I know you’ve done this math, and I’ve shown this math as well. But if you just max out your TFSA, starting in your 20s, or 30s, it’s gonna be over a million-dollar asset, it will generate a tax free income in retirement, you’re done. So if you can only do one thing, it’s max out your TFSA in the stock market.

ROB: Great. That’s a great way to leave it off. Thanks, Bridget.

BRIDGET:You’re welcome.

ROB: That was Bridget Casey. She is the founder of the personal finance site, Money After Graduation based in Calgary. You can check out her website at www dot money after graduation dot com.

Here are my takeaways from this episode. One: Start investing even if it’s a small amount, you will thank yourself later. As much as you can add money to TFSA and RRSPs. Two: Make full use of any retirement plans your company might have like a pension or a group RRSP. Three: Emergency funds are mandatory for singles. Start adding money to yours as soon as you can. Four: And finally, even if you do end up in a couple keep some control over your own money.

ROMA: Thank you for listening to Stress Test.

This show was produced by Latifa Abdin and Hannah Sung.

Audio post-production by Kyle Fulton and Carlay Reem-Neal.

Our executive producer is Kiran Rana.

Thank you to Maya in London, Ontario for sharing your story with us.

ROB: If you like what you heard, let the world know! Leave us a rating and review at Apple Podcasts.

And if you know someone who wants to figure out how to stay on top of their finances, send them this show.

Our next episode is going to be all about negotiating your salary - it’s easy to save money- when you have money - so how do you get more of it?

ROMA: You can find Stress Test at Apple Podcasts, Google Play, Spotify or your favourite podcast app.

And find us at the GlobeandMail.com, where we cover all things financial. Singles, couples, we love you all.

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