Friday, April 21, 2017

What I have learned finacially from moving around!





What I didn't mention in the About Us was that right after I graduated from University in 2011, I immediately left Toronto and moved to Eastern Canada. After spending a year in Eastern Canada, I moved to Alberta for a few years before moving back to Eastern Canada. After moving around a few times across Canada, I had come to realize a few things.

  1. Cost of Living Across Canada Having lived in different cities across Canada, I have realized that the cost of living in Canada is actually quite manageable for a millennial like myself. People complain how they can't afford to move out to Toronto or Vancouver but if they look across the country, there are a lot of places to work and live a very comfortable life. This site shows the average house price in all major cities across Canada. As you can see, the difference between some cities are $100,000 plus. That's quite of bit of money for young people trying to make it in this country. If you are curious about what kind of house you can get in different cities across Canada, just go to www.realtor.ca.
  2. Premium for living in a certain geographical location Everywhere you go, there are areas that cost more and areas that cost less. This has nothing to do with the size of the house, but merely the location of the house. People pay a large premium to live closer to amenities or pay for a more expensive house just to save 10 minutes every morning. You can see it in Toronto right now where people are willing to pay lots of money just to live closer to the city. These overpriced geographical premiums prevent a lot of people from being financially free. Sometimes, a simple change in location might be the key to being wealthy.
  3. Geography and Wealth Building Expanding on my previous point, where you choose to live can greatly affect your ability to build wealth. Premiums on Geographical location work twice as hard against you. You pay more for the actual house and you also pay more for costs associated with living (i.e taxes, utilities and transportation). Here is a simple example. By living in Eastern Canada, I paid less for my house, property tax, insurance and utilities compared to what my parents paid living in Toronto. You might argue that you can earn more money in a larger city, but not according to Stats Canada. I remember when I was living in Alberta, my wife was able to find a higher paying job and our house cost significantly less when compared to Toronto. Where you live can significantly affect the rate your wealth can grow.
  4. Your Surroundings and Spending Habits  Your surroundings can greatly affect your spending habits. I remember when I moved away from Toronto, I felt less pressured to buy the most expensive car I could afford or the latest technological gadgets. A lot of people are easily influenced by their surroundings or the people they interact with. I have learned that by changing my surroundings, I became less susceptible to such influences. I am not saying that you have to move around like me, but changing your surroundings either by getting a new job, making some new friends or volunteering in an area you are not familiar with can be helpful. Go experience different surroundings and I guarantee it'll make you smarter financially as well.
I am very passionate about not living in an overpriced city like Toronto or Vancouver because it puts you in a huge disadvantage for building wealth. It's like running a marathon and choosing to do it while carrying a 30lb weight. I recently read an article where the author explains in detail about how living in a low cost city can benefit you greatly. I grew up in Toronto and I love the city, but having lived and seen different cities across Canada, I can tell you there are options out there. I hope that people realize a simple decision can set you ahead 5 to 10 years financially. This can mean that instead of retiring at 65, you can now retire at 55. Or instead of spending your time working, you can spend more time doing the things you want (i.e spending time with friends or pursuing your hobbies). When I committed to this journey, I made a conscious decision to always live in an area with affordable housing. Take my advice and start being wealthy today.

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