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The bank of mom and dad is operating at full capacity. How else are so many young adults affording houses these days?

But there’s more to familial financial support than parents giving their adult kids money for homes or to help support them during the pandemic and periods of underemployment or unemployment. I’m starting to hear from millennials who wonder if they’ll have to help support parents in some way when they retire.

We’ll tackle this subject in the upcoming Season Three of Stress Test, the personal finance podcast for young adults that I’m co-hosting with Globe and Mail personal finance editor Roma Luciw. We’re looking for millennials and members of Gen Z to tell us about the concerns they have about their parents’ debt, savings and overall retirement preparedness. Please email rluciw@globeandmail.com to tell your story.

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By necessity, Gen Z and millennials are pretty sharp on money matters. Rising post-secondary tuition costs, the gig economy and expensive housing have forced this generation to learn quickly about limiting debt, saving for emergencies and planning for the future. In some cases, these young adults are taking at look at how their parents handle money and seeing some less than optimum decision-making.

Helping your parents financially is a normal thing in some cultures, but we mainly have a view of boomers as a financially advantaged generation who are givers of money to their kids. Some boomers are going to need help from the bank of daughters and sons, though.


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Rob’s personal finance reading list

Goodbye, business travel

I’m including this item about the future of business travel in the age of video-conferencing because I know many people build their stock of travel rewards through work trips. Video is faster, cheaper and “not that much worse” than face-to-face meetings.

How to use a bully offer

Veteran personal finance writer Ellen Roseman offers some tips on how to navigate a housing market where buyers must compete against each other with bids above the asking price. A bully offer is where you make a pre-emptive offer so that a home never even gets to the bidding process.

‘Money has nowhere to go, so it’s doing stupid things’

A skeptical look the speculative investing trends happening in the pandemic. Not just bitcoin, but digital artwork, sports trading cards and more. Money is being made for sure – the trick is to still have some gains left when these trends end.

COVID-19 and Canada’s rental market

The housing market took off in the pandemic, while the rental market was hit hard. A full accounting of what happened to rents across the country has been assembled by the website Rentseeker.

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Guest Q&A

Our guest today is Doug Allan, author of a personal finance book for young people called Fighting Chance: The High School Finance Education Everyone Deserves. Mr. Allan is a certified public accountant (CPA) who works in commercial real estate development and investment. Here’s an edited version of our Q&A:

Q: Can you tell us about the moment when you realized that you needed to write this book to help young people?

A: It was the summer of 2020, and a friend of mine had just self-published a novel on Amazon. I hadn’t realized it was that easy to self-publish a book, and so I began to think about writing one myself. As a CPA for over ten years, the most valuable information I have is around finance. I thought to myself, ‘Here is an opportunity to help people who need financial knowledge, but never got the benefit of a formal finance education and career experience like me.’ So I set off to write a book of everything that I have learned since I left high school – during my Bachelors’ of Commerce, working in public-practice accounting and finally my current career in commercial real estate finance.

Q: What should people invest in when they are just starting out?

A: Nicely diversified, low-cost index funds. When you don’t have a lot of money, it isn’t possible to manage risk and expenses when investing in individual stocks. It is important to take risk and earn returns which exceed the destructive force of inflation. Inflation is the concept that the purchasing power and therefore value of your money decreases over time by about 2 per cent per year. If your investments do not return you more than inflation, then in “real” terms, you are getting poorer.

Q: How concerned are you about the messages young people are picking up from soaring stock markets, crypto currencies? Everyone looks like a smart investor today.

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A: I am deeply concerned about where stock market and crypto prices are right now. Just today, bitcoin took a huge beating of over US$12,000 per coin. [Crypto] is gambling, to be clear. The market cap of bitcoin is nearing the market cap of Amazon. One of them provides fundamental value to the economy, creates jobs, produces income for shareholders and so on. The other does not.

Q: What do you suggest to the young adult who wants to get started as an investor?

A: Invest in yourself first by learning. Your school clearly isn’t giving you the full toolbox of materials you need to financially succeed, hence the thesis for my book, and so it falls to you to educate yourself. Read books, listen to credible podcasters and equip yourself for success. Once you have the fundamentals down, get started by investing 10 to 15 per cent of your pay cheque in an index-tracking exchange-traded fund within your tax-free savings account and registered retirement savings plan. Be smart about where you spend your money.


Tell Rob

A column on how an expensive housing market means more people will have to rent generated this comment from Benjamin Tal, deputy chief economist at CIBC World Markets and a widely followed commentator on housing: “Totally agree. I have been saying it for a while. Renting is the future of real estate. We have to develop a mentality in which you are 35 years old, you are married, you have two kids and you are renting – nothing is wrong with you!”


The money-free zone

One of my all-time favourite running songs is Stray Paper, by Tift Merritt. The band finds a groove at the end that you have to hear.


In case you missed these Globe and Mail personal finance-related stories


More Rob Carrick and money coverage

Subscribe to Stress Test on Apple podcasts or Spotify. 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.

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Even more coverage from Rob Carrick:

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.

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