Many strive for the “Canadian dream” of owning an expensive car, having a lavish wedding, dining out frequently, and buying branded clothes. This often leads to spending more than they earn, accumulating debt, and living paycheck to paycheck. Let’s break it down:
Couple A: Earns $100k/year but finances a car with $600/month payments, plus insurance, parking, maintenance, and gas totaling $1000/month. They finance new iPhones for $160/month and take out a line of credit for a $100k wedding, adding $800/month in liabilities. Living in a one-bedroom apartment with a $2200 rent, their net income after taxes is around $6000/month. After all expenses, they have no savings after 5 years.
Couple B: Earns $100k/year but opts for Uber, bikes, TTC, and rentals, spending only $500/month on transportation. They invest their savings in real estate and stocks. After five years, they’ve purchased an investment property and built a solid stock portfolio, significantly growing their wealth.
Living modestly and investing wisely can lead to financial stability and growth.
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