Skip to main content

One of the biggest dead ends in personal finance today is blaming young adults themselves for the difficulties they’re having in today’s economy.

Many people are willing to do so. I can tell you that from the surprisingly vitriolic responses from readers after writing about millennials and their challenges (the responses to this newsletter were off the charts). Here’s a milder example of the “what’s wrong with these kids?” narrative – a recent blog post about what parents can do about children who refuse to become financially independent.

As with every generation since we lived in caves, there are young adults today who are lazy and feel entitled to the good life without working for it. Dwelling on this small minority of young people means we’re not talking about much more important matters, like why today’s work force can’t supply enough full-time, career-building jobs with benefits for young people.

Story continues below advertisement

This is a multi-faceted problem: Some young people are incurring big debts as they take university courses that give them weak prospects for work, while many employers are cycling young workers through temporary contracts rather than hiring them full-time. Meanwhile, house prices keep climbing in some cities, and the cost of renting is going up as well. Parents, schools, colleges and universities, politicians and employers should be talking more about these issues than they are.

That blog post for parents of kids who have failed to launch has some suggestions for parents who want to encourage their children to be financially and socially responsible, including allowances, charging rent to adult kids living at home and paying only the cost of a first degree. Teach your children well, and then educate yourself on what young adults are up against today. Here’s a good place to start: ‘I can’t even get a job waitressing’: Gen Y on its work woes.

Subscribe to Carrick on Money

Are you reading this newsletter on the web or did someone forward the e-mail version to you? If so, you can sign up for Carrick on Money here.

Rob’s personal finance reading list …

Take CPP at age 60?

A financial planner lists some things to consider when deciding whether to take Canada Pension Plan retirement benefits early. You can start as early as age 60 with a reduced benefit, or wait as late as 70 and get additional benefits beyond the standard amount. Here’s a calculator we designed to help people decide when to take CPP.

Her income went up – so did her spending

“As my salary increased, so did my sense of entitlement,” a blogger writes. A good take on lifestyle creep – where you end up spending more as you make more.

Stop moping about Canadian stocks

An investment firm explains why you should diversify your stock-market holdings in Canada, the U.S. and internationally, even if Canada is well on its way to yet another year of sad underperformance. You never know which market will take off in 2019.

Social media is bad for your finances

A majority of young adults feel influenced to spend beyond their means by what friends and celebrities are doing on social media. Mass media – notably the internet and social media – has not been given its due in explanations of why debt levels are so high. It’s not just low interest rates.

Story continues below advertisement

Today’s financial tool/app

I get asked a lot about how to find a fee-for-service financial planner who charges a flat or hourly fee and doesn’t sell investment products. Here’s a detailed list of planners of this type.

Ask Rob

Q: My grandson, age 22, is just about to invest $15,000 in a self-directed RRSP. He will not be an active trader. Where can he learn about the different fees that might be charged annually?

A: It sounds like your grandson will be using an online brokerage account, which means he’ll have to watch out for three layers of fees:

  1. Account inactivity or admin fees: Charged to small accounts with balances up to $15,000 or $25,000; $25 per quarter is common.
  2. Trading commissions: Figure on as much as $10 or so per buy or sell transaction for stocks and exchange-traded funds.
  3. Fees charged by ETFs or mutual funds: These fees are taken off the top of gross returns, so your grandson will be seeing net returns in his account.

Do you have a question for me? Send it my way. Sorry I can’t answer every one personally. Questions and answers are edited for length and clarity.

Featured video

Here’s a briefing on how to squeeze all the useful information out of your investment statements.

What I’ve been writing about

  • Bank of Canada wants rates back to normal – here’s what that means for your mortgage, line of credit
  • What if the stock market busts just as you retire? (for Globe Unlimited subscribers)
  • ‘Is now a good time to have a five-year GIC ladder?’ (for Globe Unlimited subscribers)

More Carrick and money coverage

For more money stories, follow me on Instagram and Twitter, and join the discussion on my Facebook page. Millennial readers, join our Gen Y Money Facebook group. Send us an e-mail to let us know what you think of my newsletter. Want to subscribe? Click here to sign up.

Report an error Editorial code of conduct
Comments

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff. Non-subscribers can read and sort comments but will not be able to engage with them in any way. Click here to subscribe.

If you would like to write a letter to the editor, please forward it to letters@globeandmail.com. Readers can also interact with The Globe on Facebook and Twitter .

Welcome to The Globe and Mail’s comment community. This is a space where subscribers can engage with each other and Globe staff.

We aim to create a safe and valuable space for discussion and debate. That means:

  • All comments will be reviewed by one or more moderators before being posted to the site. This should only take a few moments.
  • Treat others as you wish to be treated
  • Criticize ideas, not people
  • Stay on topic
  • Avoid the use of toxic and offensive language
  • Flag bad behaviour

Comments that violate our community guidelines will be removed. Commenters who repeatedly violate community guidelines may be suspended, causing them to temporarily lose their ability to engage with comments.

Read our community guidelines here

Discussion loading ...

Due to technical reasons, we have temporarily removed commenting from our articles. We hope to have this fixed soon. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to feedback@globeandmail.com. If you want to write a letter to the editor, please forward to letters@globeandmail.com.
Cannabis pro newsletter