Family Formation & Housing

For young couples starting families, buying their first home and/or other real estate. Covers mortgages, credit cards, interest rates, children’s education savings plans, joint accounts for couples and the like.

Young, saving, and hopefully one day buying a house

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IMG_7264By Helen Chevreau

Hub Staff

The cover story of this month’s Toronto Life magazine caught my eye straight away. “Young, Rich, and Totally Not Buying a House” it boldly claims.

As a young, not-yet-rich millennial who has no immediate plans to get into the housing market, I was intrigued. The article is written by 31-year-old Tony; a pharmacist who lives with his parents and eschews the traditional rites of passage of his peers, like home ownership.

Before I actually read the article, I was sure I wouldn’t like Tony, wouldn’t relate to him. Growing up in Toronto I’ve seen his type countless times. Money is no object, and he’s not shy to show it. A common defence from this kind of person is that ‘normal’ or ‘rational’ people who are judging him are jealous or boring (or both).

What I found interesting about this piece is that Tony seems very self-aware about his spending and lifestyle choices. He’s accepting of his friends who do choose to be “shackled to a monstrous mortgage for the next 30 years,” and he understands that sometimes it just isn’t possible to have it all.

Though much of what Tony talks about in this article is out of reach for most normal millennials (last minute trips to Asia, $200 bottles of wine), I appreciate the sentiment. Continue Reading…

How to switch a mortgage to another bank

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Large luxury brick home in suburban settingBy Albert Krav

Special to the Financial Independence Hub

If you’re not satisfied with your current mortgage lender, it may be in your best interest to switch to a different bank. In order to accomplish this, you’re going to need to refinance your mortgage, as banking institutions (in the United States) won’t simply take over your existing mortgage. The key difference here is that you already own the house and may have an established payment history.

Is Refinancing worth the effort?

While going through the mortgage process a second time may seem like a hassle, the reality is that seeking out a better rate is often a prudent financial strategy that can be well worth the time spent. After all, even a slight improvement is going to make a significant difference when you consider the long term. Fortunately, according to US News & World Report, the mortgage process is far easier and more straightforward these days than it was before the recession. Here’s a quick rundown on how to set the wheels in motion.

1.) Look into early termination fees

If you refinance your mortgage, the new bank is going to pay off your existing mortgage so you can start with a clean slate. Before you proceed, Continue Reading…

The four Ds to buying your first home

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An old wooden house in Dalarna, SwedenBy Sheila O’Hearn, Zoocasa

Special to the Financial Independence Hub

 “If a monkey can be taught to salt away money by sticking it in a sock, so can we.”

That’s what my partner and I told each other the day we decided to start saving for a home. Real estate can be tough, so we started our plan early. In some ways, it was madness. We still had to pay monthly rent and a first baby was on the way. It meant cutting back on activities we enjoyed, little extras and big extras.

But what we had going for us were the four D’s: the dream, the drive, the discipline, and a deadline.

Eventually we hit our target and moved to a small town where houses still cost less than they do in a city. Ours was a modest, century-old farmhouse that would require work, just right for my partner’s creative outlet. It was a cozy fit for our two additional children, but it was home and has been for 28 years.

How a person or couple saves for their first home is not a question of doing it one way, but of having knowledge of the options to make informed choices and a solid plan.

The dream

Continue Reading…

Millennial Blog Wrap: Budgeting now to be debt-free later

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Business desk concept - BUDGETBy Helen Chevreau, Hub Staff

As a millennial, it’s important that we begin to create good financial habits to govern our lives, starting with budgeting.

From a healthy morning routine, to being grown-up about money, as we get into this new stage in our lives, we need to make sure to put ourselves on the right track, or risk ending up in serious financial trouble.

From the blog Making Sense of Cents comes a new post that touches on some common bad money habits that are extremely easy to fall into. Whether you’re of the “out-of-sight-out-of-mind” or the “it’ll-never-happen-to-me” mindset, or any of the other bad money habits mentioned, this post is here to help you change your ways before it’s too late.

Now, Not Later

Along the same lines, it seems that the bad habit of paying down debts more slowly to reap the rewards of ‘more cash in hand how’ is springing up, and Bridget Eastgaard of ‘Money After Graduation’ is here to tell us why that’s such a terrible idea. Continue Reading…

Leave an inheritance of cottage relaxation, not taxation

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Cottage On The Carpenter Lake, CanadaBy Tarsem Basraon, TD Wealth 

Special to the Financial Independence Hub

The summer is quickly approaching and for many Canadians that means one thing: cottage season.

While many parents envision leaving the family cottage as part of their inheritance one day, with the value of cottages often appreciating since purchase, there’s also the risk of bestowing the legacy of a large tax bill.

To help make sure you’re leaving an inheritance of cottage relaxation and not taxation, here are three strategies you can discuss with your financial advisor when planning your cottage legacy. These strategies are available to you while you are alive, and there are various other strategies that can be implemented on your death in your will.

• Co-own with your Kids

Adding your children to the deed and making them co-owners of your cottage could help defer capital gains tax and save money. For example, if your cottage value has increased over time, it would trigger a capital gain on the portion of the cottage that your children now own and you would pay the tax on that now. Down the road, your kids would only pay tax on the capital gains owing on the remaining portion of the cottage you own when you die. There is,  however, a risk with this approach. Continue Reading…