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Tuesday, 24 November 2015

brokeass poet's financial advice

One of my retirement guilty pleasures is browsing the 'rants & raves' section of Craigslist. Last night I read the plight of a student in Toronto who dropped out of university and was very concerned about his financial future. I posted this dubious advice, and surprisingly received a couple of compliments on the posting. So herewith:

another 2 cents for 'dropped out of skool' (outta Hogtown)

There's some excellent advice in the other postings offering advice to this ex-student. My 2 cents worth is to GET THE HECK OUT OF TO and buy a cheap house in a place like Peterborough or Belleville. You can still buy nice houses there which are huge by TO's standards for well under $200K - maybe even under $150. Pool your money with your roomie and your girlfriend. Doesn't matter if you have to take shit menial jobs, you'll still be earning over $12 an hour, and you should have no probs financing a decent house among several of you. Jeez, even dare to be entrepreneurial & rent out some extra bedrooms to students at Trent U or Loyalist College.

Build some equity - stop making landlords rich & start looking after yourselves by securing a home base. I was in my early 30s, earning $12K a year, when I started studying how native Canadians manage to become middle class & secure. I read Garth Turner, who had a column in the TO Scum paper, & bought his book on investing. The dude is still giving free financial advice online in a blog I discovered tonight when I couldn't remember his first name ; )- I mortgaged myself to the hilt to buy a semi in a rough part of TO, took in a selection of roomies over the 4 years I lived there, fixed the shack up, & sold it in the boom of the late 1980s for triple what I'd paid.

Then I moved out of TO, which I loved & still miss but I do manage to visit time to time. I haven't had a mortgage in over a quarter century since. Not having a mortgage has freed me to follow my life's artistic passions (5 or 6 legit books published) and to also pursue careers and credentials in several varied & interesting occupations (chef's papers, real estate license, provincial library management certificate plus lots of free time to read, write & explore nature in rural Ontario).

Sadly, beautiful & multicultural as TO is, it can be a trap for younger people like you & your friends. Our Canadian tax system is structured so you don't pay tax on any profit made when you sell your primary residence. Buying an affordable house is by far the best investment you can make for your futures. Tough it out for a few years building your initial equity in a smaller center like Pborough or Bville (Hamilton is already too popular & publicized), & then sell to get the equity for your own houses. Or become an investor and buy multi residences like triplexes. A friend from a very poor family did this, & he now has a net worth in the multi millions.

Me, I'm happy to have lived rent & mortgage free for over 25 years, my little house has doubled rather than tripled like my lucky TO starter, but I figure I've saved spending at least $60 or $70K in rent or mortgage payments each decade by cashing out of the TO boom & buying a smaller (but far nicer house).

Good luck to you ; )- and consider buying and/or reading Garth Turner's financial advice

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