Give Me Back My Five Bucks

We will never be homeowners in Vancouver

We will never be homeowners in Vancouver. Combined, RD and I will gross about $165,000-175,000 this year. Our housing costs are relatively low ($1,650/month rent), and we are both good savers with enough in the bank for a decent down payment. The problem is, we live in Vancouver. And according to a recent Globe and Mail article, the average price of detached houses sold in November 2015 reached $2.53-million – which is up 27.7% from November 2014.

More than 91% of 66,752 detached homes surveyed within Vancouver had assessed values of at least $1-million on July 1, 2015, and prices have jumped at least 10% since then.

I just quickly plugged our numbers into a mortgage affordability calculator. Even if we spent a year or two saving a bit more money, we will still be forever priced out of the detached housing market here in Vancouver.

scotiabank_mortgageaffordability1

Based on the above numbers, the bank says we could afford a maximum purchase price of $982,000 (LOL), but we’d also be responsible for almost $20,000 in CMHC mortgage insurance (LOL x2). And our monthly mortgage payments would be $3,800? Hahaha just, no. But I went to Realtor.ca anyway and plugged in a search for detached houses in the Vancouver area that were less than $950,000 – and this is what I found:

housesinvancouver

A boat. In all of Vancouver, we could afford to live on a 480 sq.ft. boat. Sure that boat only costs $300,000 – but you also have to pay $9,700 in moorage fees each year, as well as an annual $1,870 licensing fee. And even still, you’re living on a boat.

As depressing as these numbers are, I’ve never pictured myself living in Vancouver forever. Neither has RD. Even though we both love our neighbourhood, our tiny house, and our jobs right now, I’ve never considered putting down permanent roots in this city. Vancouver is amazing, and I can absolutely see why it is so appealing. But it was always my plan to spend 10 years here gaining experience, and then move back to Victoria where I could use that experience to get a well-paying job. I don’t know if I’ll make it back in that 10 year time frame, but I think long-term living somewhere outside of this city is going to happen. At some point.

In conclusion, it’s obvious we will never EVER be homeowners in Vancouver. And I’m okay with that. Really. Because even if we could afford something, it doesn’t make sense to forfeit everything else in life that we love – like travel and early retirement and living a comfortable life with plenty of disposable income – just to own the roof over our heads. It’s also a very unsettling thought to have so much money tied up in a house that will drop in value when a housing correction hits Vancouver. So we’ll happily continue to pay 10% of our gross income towards rent, and maybe one day we’ll be ready to buy a home in another city … where we can afford more than a boat. :)

5 ways to diversify your income this year

We all know that it’s important to diversify your investments, but diversification isn’t just for your retirement portfolio – I’ve always been a fan of diversifying your income as well. And I’ve been thinking about it a lot lately, since a friend of mine is desperately trying to figure out a way she can bring in extra income each month.

April will mark 10 years since I graduated from college, and I can’t believe I’ve been in the work force for a decade already. In that time, I’ve held 8 full-time jobs over a variety of different industries. EIGHT JOBS. Some of those jobs only lasted a few months, while others I was at for a couple of years. None of them really relate to each other, but what remained constant over those eight full-time jobs was the fact that I always had multiple ways I was making money on the side.

Related: Are you a job hopper?

Benefits of diversifying your income

Not only do you increase your disposable income, but it can make you feel more secure against a job loss or emergency situation. Working above and beyond the 9-to-5 has always part of my routine because it provides me with additional cash to throw at my financial goals (whether it was getting out of debt, saving for a down payment, funding my future retirement, or going on an awesome vacation).

Related: How I saved for my down payment

Here are 5 ways I’ve been able to diversify my income over the years:

1. Offer a service

photo 1(1)Think about what kind of service you can provide to people. This can be anything from walking dogs, tutoring, babysitting, painting, consulting, mowing lawns, or maybe shoveling snow. :)

Love to cook? Did you know people will pay you to make them a home cooked meal? Try Mealsharing.com or EatWith.com to earn extra money doing what you love – and share your love of food with interesting guests.

When I first started getting serious about my debt, I started to do a bit of freelance graphic and web design. I didn’t make a lot of money in the beginning, but within a couple of years I was able to charge between $40-60/hour.

This may seem like a weird service to offer, but I’m going to throw it out there because it’s unique: an ex-boyfriend would carry the backpacks of people who wanted to camp overnight in the wilderness, but didn’t have the capacity to carry their own gear. He loved this because he basically got paid to go hiking, and he was able to share remote areas of BC with people who otherwise wouldn’t have been able to experience it on their own.

2. Sell a product

Now I’ve never actually sold a product before, but I’ve often thought about putting my graphic design skills to work and selling cards or prints on websites like Etsy. I’ve also had co-workers who sell their knitting, cross-stitching, and other crafts online. It doesn’t make them a lot of money, but it’s a way for them to turn their hobby into a little bit of cash.

3. Get a part-time job

I’ve had part-time jobs for years. None of them paid particularly well, but they offered me a steady income when I desperately needed as much money coming in as possible. The great thing about part-time jobs is they’re often flexible and can work around your current schedule. While in college, I worked two part-time jobs, and while I was getting out of debt, I worked two part-time jobs and a full-time job. It’s not often glamorous work, but it could help you get out of a tough financial situation.

4. Rent out your property

carIf you’re a homeowner, consider renting out your spare bedroom or your basement suite to bring in extra income. I’m also a fan of AirBnB as an option as long as you’re careful about who you rent to. An ex-boyfriend used to rent out his downtown Vancouver apartment every time we left town on vacation. It brought in over $100 per day and he was very happy for the extra income.

There are also people who rent out space in their vegetable garden, an area in their garage, and even their parking spaces. When I was a homeowner, I had an extra parking stall that I wasn’t using, and would rent it out for $50/month. It wasn’t a lot, but $50 extra each month is better than nothing – especially for a space I never used.

5. Blogging

This might be the hardest way to make money for someone who isn’t already a blogger – because you actually have to start a website from scratch. :) Having a website can be quite lucrative – I know some bloggers who make over $10,000/month just through advertisements. That’s quit-your-day-job type of money, but for the rest of us, you can make anywhere from a couple hundred to a few thousand dollars a month once you figure out what your niche is, and once you get the right connections.

Related: How I became a freelancer

Diversifying your income stream can be hard work at first. But it’s my experience that the benefits outweigh the extra hours you have to put in each week. And now? It is completely worth it and just seems normal to work an extra 8-10 hours a week above and beyond my normal full-time job.

What are some ways you’ve diversified your income?

Splitting Expenses With Your Significant Other

Before RD and I moved in together, we had a talk about how we wanted to take care of our household expenses. It was an interesting conversation as we chatted about what did and didn’t work in past relationships when it came to money.

In relationships, there are generally three ways that couples split costs:

  1. Split evenly – expenses are split down the middle, or you take turns paying.
  2. Split according to income – expenses are split proportionately, based on income.
  3. One person pays for the majority – well, self-explanatory.

Prepping veggies for dinnerWhile I’ve lived with boyfriends before, there was always a pretty significant difference in income. In college, I lived with someone who was already established in a career. He paid for most things because he knew I couldn’t really afford to. But once I started working, our incomes aligned a lot better, and we started splitting things evenly (to the point where we had a very detailed spreadsheet of expenses).

Then there was an ex-boyfriend who I financially supported during the last year of our relationship when he quit his job to go back to school. And Nic, who was a student – I paid for most of our dates, and while we lived in Germany, he paid for a bigger portion of our rent. We probably ended up pretty even in terms of splitting expenses over the course of the relationship – it just fluctuated based on each other’s income level at the time.

My relationship with RD is unique to me because I’ve never lived with someone where we’ve been in the same place financially (he makes more at his full-time job, but I make up the difference with my freelance income). Not only that, but we have the same sorts of spending habits. So it seemed logical that we split our expenses evenly, right?

Kind of.

What I didn’t want was to have a spreadsheet going and track expenses down to the penny. I’ve done it before and it really seemed to take the romance out of “treating” your partner to something. But I still wanted our expenses to be fair since we have no plans to combine our finances anytime soon (I like the idea of combining certain aspects of your finances together, but always want to keep some things separate – even after marriage).

Here’s what we’ve come up with:

  • We split rent 50/50 ($1,650/month)
  • I pay for the internet bill ($65/month)
  • RD pays for the hydro bill ($50/month)
  • We take turns paying for groceries, and reconcile our receipts once a month
  • We take turns treating each other to meals out

We don’t track every dollar we spend and I like it that way. Our day-to-day spending is quite relaxed. If we need something for the house, I’ll pick it up on my lunch break – or he’ll grab it on his flex day. We don’t keep track of the little things. It also means I don’t feel bad if I put a $10 bottle of kombucha in the shopping cart, he doesn’t mind picking up our bar tab when we’re out with his co-workers, and I can feel good treating him to a dinner out with my friends.

Being able to contribute equally makes me feel empowered. In 2006, I had to borrow bus fare from my then-boyfriend because I didn’t have enough in cash or credit to pay for it on my own. That was nearly 10 years ago, and seeing how far I’ve come makes me feel really good. I like that I don’t need someone to support me financially, and I like knowing that I’m financially equal to the person I want to be with.

That being said, I know that what works for us might not work for another couple – and it might not work for us forever. But for now, I’m happy with how things have been working out so far. :)

How do you split shared expenses with your significant other?

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