Your 20s Are The Most Expensive Decade Of Your Life

The topic of this post occurred to me when I realized I was spending nearly six-figures to educate myself in my twenties. I did the math a few times just to be certain, but it’s true: by 29 I will have spent over $80,000 on tuition fees and textbooks. Some of this cost has been softened with scholarships, but the rest of it just didn’t seem like such a huge burden because it’s being  stretched over so many years. Nevertheless, my classmates and I still complain about the price tag of our degree. Since a number of my friends are also married or entering into home ownership, they’ve spent tons of money in other areas of their life as well.

I realized that your twenties might be one of the most expensive decades of your life.

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this about sums up all my feelings on spending on “necessities” in my 20s

Why is being in your twenties so expensive?

You’re going to spend over $25,000 financing your post-secondary education.

The average bachelors degree costs $23,000 in tuition & fees in Canada. If you follow up with 4 years of Medical School or Dental School, tack on an additional $50,000 or $70,000, respectively.

This is compounded by not being able to work full-time, but still having to pay room & board. In order to make ends meet, students are now borrowing an average of $26,000 in student loans to pay for it. This does not include credit card debt (which 1 in 20 people fear they will never pay off!)

Finding “The One” costs $43,842.

People are always gasping at the average cost of a wedding (around $26,000) but they forget about how much is spent leading up to that big day. As I’ve pointed out in a previous post, dating is NOT cheap, but even I didn’t expect the price tag of going from first date to Big Day to cost over $40,000. The average age of first marriage has been on the rise, to its highest ever at 31 for men and 29 for women in Canada, but since there’s a year or two or more of planning beforehand, the bulk of the cost still hits in your 20′s.

The average first-time home buyer expects to be able to drop a $48,000+ downpayment on a home.

There are a number of different ways to come up with a down-payment for your first home, and in Canada where the average house price is $389,000, you might need to exhaust every option you have. The average first time homebuyer is 29 years old and planning to put $48,000 to $300,000 down on their first home. I’m not really sure where they found this money after spending $26,000 on student loans and $43,000 getting married, but good for them.

 Mothers still have their first child in their 20s (barely), and children are expensive

The average first-time Canadian mother is 29 years old (in the USA it’s 26). I don’t know who these superwomen are that are getting married, buying houses, and having their first baby at 29, but it really makes me worry about my own 29th birthday next year. Baby’s first year will cost upwards of $8,000, just in case you thought you were going to catch up on that student loan debt or make a few extra mortgage payments. Too bad for you!

Additional costs such as traveling or buying furniture for your first home is compounded by earning your lowest salary ever and working only part of the decade, since you’re spending the first few years in school. Ouch!

What can you do to cut costs?

When it comes to school, apply for every scholarship you find and then work part-time as you study to help pay for the cost. If you graduate with student debt, pay it off as fast as humanly possible so you can get on with the rest of your adult life.

If you think you can save $40,000 by staying single, think again: it’s more expensive to be single than in a relationship. What you can do is find someone that shares the same financial values as you, and believes in living within your means so you can both save and invest for your future. Don’t buy into the wedding fever, and instead opt for something smaller and cheaper. The pricetag of your wedding does not determine the quality of your marriage, so there’s actually no justifiable reason to spend big on the big day.

If you can’t afford to put 20% down on your first home, postpone purchasing until you’re in your 30s. It’s not a race. There’s no award for the first person in your friend group to sign a mortgage. The word “mortgage” literally means “death-grip”. Let’s stop patting people on the back for rushing into that.

If you want to have children, there’s nothing wrong with putting it off until the rest of your financial house is in order. There’s also no rule that says you have to buy a house or get married first, so go ahead and have a baby out of wedlock and pocket the cash.

What can you do to get more money?

It’s not going to be easy, since wealth disparity and economic mobility are real challenges, but that doesn’t mean you have an excuse to do nothing. Some of the biggest mistakes 20-somethings make are: choosing to remain under-employed, dragging out debt repayment at the expense of things they’d really rather spend their money on, and failure to save early, earnestly, and seriously.

Getting what you want in life is a matter of prioritizing your goals and taking action. I’m of the mindset that you can have everything… just maybe not all in your 20′s.

How to Deal: Annoying Salespeople

I may be sounding more like a social pariah every day, but I do really enjoy shopping alone. It can be nice to occasionally have a friend along to bounce ideas off of or give a second opinion on an item I’m not sure I can pull off, but when it comes to shopping I like to get down to business alone. This way I can get into the stores, try on clothes, make quick decisions, and get out of the mall in reasonable time.

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Over the past year I’ve noticed sales associates starting conversations with me. A lot. Shopping alone has made me a bull’s eye for sales people looking to well, sell crap to. As a former sales associate I truly appreciate a warm smile and pleasant greeting. I always politely return it, but often find myself getting hounded by a sales person that can’t read my otherwise closed off body language that is saying I would prefer to be left alone. 99% of the time I tell them I am just browsing, and that seems to often translate into following me around the entire store, telling me about every item I pick up and the newest trends in stock. I’m not sure if that’s because I look so hip and fashionable that of course I would want to rock the latest trends, or because my frugality has started to make me look like a before picture on What Not to Wear.

If you find yourself in a situation in which a sales associate is trying to upsell you, there are some things you can do without resorting to rudeness.

 

  1. Use closed off body language. Do not make more eye contact than necessary and keep your body turned away from the sales associate whenever possible.
  1. Politely tell the employee you are just browsing. If the employee continues to ask questions or provide “helpful” information, let them know that you don’t need any help, but will find them when you do. Now you have not only given them a hint, but spelled it out clearly that you would like to be left alone. And by adding that you will find them again specifically, any commission vultures will be assured that they will still get the credit for the sale.
  1. If the above methods do not work: start asking them personal questions, doing the Harlem shake, making awkward jokes or something else a little out there to make them feel too awkward to stick around.
  1. The fail-proof method to avoid the annoying sales associate is online shopping. Lately I’ve been shopping online more because the prices are usually lower, shipping costs seem to be going down for me, and there are often awesome bonuses that you don’t get in store. (Sephora, I’m looking at you and your 3-free samples with purchase.)

At the end of the day it is good to remember that sales associates are trained to be too helpful to customers, so patience and politeness is key, even when you find yourself growing frustrated with all of the unwanted attention. First world problems, am I right?

Do you find yourself feeling hounded by sales associates? Are we just becoming more accustomed to virtual shopping experiences, making traditional shopping methods seem more intrusive to us?

My Car Expenses are Driving Me Insane

I hate driving. Hate it. I am paranoid about dying in a car accident so I can’t drive in the snow or rain or at night without freaking out. That said, I do love my car. Because when it’s daytime and I don’t have to drive in adverse weather conditions, it’s really, really convenient to have a vehicle. Lucy, my Ford Focus, makes life easier when I want to go somewhere far. But at what cost?

A really freaking large cost. I recently added up what this convenience is costing me:

Car payment: No money down, super-sized warranty (I have terrible luck with cars, we’ve already had to use this once), 5 years. $339.32/month

Gas: We used to have to fill up once a week to get to both of our jobs. However, I am now working from home and my husband only works about 9 miles away. I’m guessing we fill up about every other week. $70/month

Car insurance: I pay this automatically and 6 months at a time to keep the cost as low as possible. $439.77 every 6 months or $73.30/month

AAA Plus Membership: I don’t care what anyone says, this is a NECESSITY. In 2012, we maxed our uses out. Didn’t know there was a limit? Well, there is. Only we could ever hit it.  $108 a year or $9/month

Parking: We park with a permit from the city. $60 a year or $5/month

Oil changes: Assuming 1 every 3 months. $80 a year or $6.67/month

All of this, not including maintenance or tire replacement, comes to a whopping $503.29/month! Once again, this is assuming we NEVER have to change tires or have maintenance done. Ever. Which is false.

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Now obviously, a lot of people drive quite a bit cheaper than this because they don’t have car payments. But we aren’t even at the average! The average used car payment in 2012 was $351/month. The average new car payment in 2012 was $452/month. People are spending a lot to drive.

What’s the alternative?

If we both got bus passes and ditched the car, we would only be paying $200/month for transportation plus whatever a rental car costs when we leave town. However, a co-worker of my husband lives very near us and takes the bus an hour and a half each way! Driving takes only 20 minutes. If my other half works 20 days a month and saves around an hour and ten minutes each way, he is saving 46.67 hours of commute time. That’s like 2 days folks!

So for now, we pay for time. We pay because we are upside down on our vehicle. We pay because we don’t know if we will be in a public transportation friendly area a year from now. And let’s face it, we pay because it makes our lives so much easier.

For now, we will be keeping our beloved Lucy. Maybe someday we will save money by going carless, but not today. Hey, at least we only have one, right?

Do you own a car? How much do you pay per month for transportation? Anyone else name their cars like a teenage girl?

Frugal Fashion: bundle up on a budget considering cost-per-use

I think technically the first day of winter is December 21st, but if you live as far north as me, you know that the cold has already been here for awhile. I make a concerted effort not to break out my winter jacket until November 1st — it’s a mental game I play so the season feels shorter than it really is — and I kind of love that moment when I finally put it on and get to be so toasty and warm again. This happiness last through the holidays until about the second week for January, at which point I kind of feel done with winter and want the cold to stop (4-5 months later, I get my wish).

This year I’m happy to report my Burton snowboard jacket I purchased 6 years ago is still going strong. I did, however, buy some winter boots this year. I thought I could get away with some really thick socks in my Hunter wellies. However, now that there’s snow on the ground again and temperatures are dipping below -20C (-4F), my feet were freezing in rubber boots. I lasted all of two really cold days before purchasing a pair of Sorel Joan of Arctic boots. My quality of life has literally improved ten-fold as I am no longer risking frostbite for each of my toes on a daily basis.

As far as winter gear goes, my advice would be to splurge on a quality jacket and snow boots, and then save on everything else.

My Essential Winter Gear:

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 1. TNA Dalles hat, Aritzia $40 / 2. Canada Goose parka, Amazon, $650 / 3. Knit scarf, H&M $13 / 4. Talula Fulton mittens, Aritzia $12 / 5. Sorel Joan of Arctic boots, Amazon, $112(I paid $200 retail from a local store because a) CAN/US exchange rate, b) shipping c) needed them IMMEDIATELY)

The Talula mittens pictured above may be the best thing that’s ever happened to my hands in winter. At $12 a pair, they’re super affordable, but their quality is also outstanding. Knit on the outside, they’re fleece-lined inside so they are SUPER warm. Furthermore, they’re really easy to take care of: I spill coffee on mine probably every day, so at the end of the week I throw them in with the laundry and they come out good as new. Love! As for the other items pictured, I’ve amassed an excellent collection of scarves from H&M in my time (I’m also partial to circle scarves from American Apparel) and my TNA knit cap (different than the one pictured) is a staple in my hipster wardrobe. I’m not warm unless my head is covered! Long live the toque!

 I realize I’m going to get some trouble for calling this a “frugal fashion” post, then listing expensive items, but I don’t think spending $850 on a good jacket + winter boots is unreasonable.

(maybe I just really don’t like to be cold!)

When purchasing good winter gear, you should be doing so with the expectation that you will get a few years use out of it. Like I said, my Burton winter jacket (valued at $600 new) is on its sixth winter. If you divide the purchase price over the number of years of use, the price becomes a lot more manageable. For example, I don’t see any reason why my new Sorel boots won’t last at least 4 years. At $200 over 4 years, that’s a cost of only $50 per year. Since I will wear them daily for approximately 5 months per year, that’s a total of 600 days of wear which makes their cost-per-use only $0.66.

Am I willing to pay $0.66 per walk to the train station at -20C? You betcha.

On the other hand, opting for cheap winter gear — say $80 boots or a $150 jacket — that you need to replace annually will ultimately cost you more over the long run. Not to mention cheap stuff can generally be relied upon to wear out faster, defeating the purpose of owning it in the first place.

How To Save Money on Winter Clothes:

- buy accessories like mittens and toques during big sales like Boxing Day. Because these items are small and usually add-ons to big purchases, they end up super-discounted to entice buyers.

- coupon! The main reason I was able to score a high-quality expensive winter jacket is because I found a 25%-off coupon for the store. I went on a sale day and my discount was doubled. My Burton jacket had a $600 price tag but I actually paid half of that!

- buy online. As you can see, the Amazon US offers some better deals than Amazon Canada, like my Sorel boots. If you can find something at a great price on the internet and can wait out the shipping, it’s a great buy.

Stay warm out there, guys!

Is Pinterest a Consumerist Trap?

Pinterest is one of those super popular social media platforms that can be a complete time suck if you allow it to be. You were supposed to be at your friend’s house five minutes ago but you logged in to check out the latest pins and black-out browsed for the last hour and a half. Truthfully, I enjoy a good Pinterest spree every once in awhile. My mother has developed a full-fledged Pinterest obsession which I feel partially to blame for since introducing it to her last year.

Beautiful travel photography, delicious cake recipes, cosmetics, interior design, and trendy fashion photography can be easy to get caught up in and stare at for much longer than is probably healthy.

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I’ve been wondering for ages if Pinterest is really a healthy place to go for someone trying to stick to a budget.

There seem to be two camps of thought about Pinterest. On one side, there are people that believe that Pinterest pushes consumerism in a society already chock-full of people going into debt to buy themselves a lot of stuff. You seen an awesome mullet dress (Short front, long back. I just love the term.) that you didn’t know about until two minutes ago but CANNOT live one day longer without. I don’t purchase magazines anymore and I find myself so out of the fashion loop that Pinterest is now how I learn about what’s hip with the young folks these days. Pinterest teaches you what you should want to buy. Only the strongest of wills can stand steadfast in the resolve to stick with a reasonable clothing and decor budget for the month.

Conversely, others think that Pinterest is an anti-consumerist tool that can stop people from making unnecessary purchases. This is done through choosing images, brands, items, products, etc. online, instead of in-store. You can create a Pinboard of designer sunglasses you love, for example, and through pinning them feel you have acquired them in some way. You still get the feeling of excitement of choosing an item without the act of purchasing it.

Both arguments could have some validity, but an anti-consumerist tool Pinterest is not –

although Pinterest potentially stops you from purchasing some items, it doesn’t exactly stop the consumerism, just reroutes it to a digital form instead of physical.

You may splurge and break your budget, or feel very deprived. I live in the middle of nowhere, so shopping isn’t much of an option for me. Pinterest is something I use mostly as a virtual recipe book while I browse the internet. I try not to go onto Pinterest itself too much, because that is where the temptations seem to be. If you are a current or former shopping addict that finds it hard to resist purchases, maybe Pinterest isn’t the best platform to use. If you love Pinterest too much to say goodbye, here is a brilliant solution: surf anti-consumerism Pinterest boards exclusively.

Do you think that Pinterest makes people spend more money, or less?