She earns $110,000 and helps her family. can you get out?

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For most of Leanne’s life, she was a third parent to her two younger brothers, as well as a support system for her parents who had “suffered for money” for a long time.

Since last year, the 31-year-old has been making $110,000 a year between her marketing career and freelance projects. Prior to that, her price tag was $90,000—more than what her parents made in most of their lives.

For this reason, for nearly a decade, she contributed to her parents’ mortgage on their home in Milton, along with splitting grocery bills and providing essentials for her siblings. “I’ve been working since the age of 15 to help do what I can,” she said.

But now, with her dad getting a raise, her parents can live more comfortably and Leanne can think more about herself, which means continuing to buy an apartment or a country house with her longtime boyfriend.

“It’s been a plan we’ve had for a while,” Lian said. “We both can afford the rent and maybe even a starter apartment in GTA.”

So what is stopping her? First, she feels bad about leaving her parents.

Second, she wants to see if buying a place is feasible even though her and her boyfriend have a combined income of around $200,000.

“Can we even afford anything in GTA. Is the purchase smart?” she asked. “The market is crazy.”

When it comes to daily spending, Leanne is pretty consistent, despite her driving to the office daily “from Milton to my office (in the west end of Toronto),” she said.

While she buys groceries for the family, she can bring leftovers most days. Occasionally, she’ll have lunch with her co-workers, or stay downtown for dinner with friends.

On the weekends, Leanne spends time with her boyfriend, taking free excursions to the outdoors or going to the mall to ‘window store’ or seeing a movie…maybe once a month there will be a birthday and we’ll splurge a little more that night. ”

We asked her to share a week of spending to get an idea of ​​her finances.

expert: Jason Heath, Managing Director, Objective Financial Partners, Inc. on Lian’s status

Leanne recently paid off her student loan and got a good salary. I can appreciate Leanne’s desire to help her family, but it seems like she’s done a lot over the years. She’s 31, so going out alone doesn’t seem unreasonable.

Leanne is in the 43 percent tax bracket with an income of $110,000, so RRSP deductions will help her accelerate her savings. A contribution of $10,000 will turn $10,000 in savings into more than $14,300 including tax refunds.

Although a homebuyer plan’s RRSP drawdown of up to $35,000 for a first-time home remains an option for aspiring homeowners, the 2022 federal budget included a new budget — a tax-free first home savings account. It might not be available until 2023, but it’s a strategy Leanne should consider.

In the meantime, I may focus on saving in a tax-free savings account, which will provide flexibility. It could be an emergency fund for her, or she could withdraw RRSP or FHSA contributions.

She and her boyfriend should do some budgeting based on their current lifestyle to see what they can afford. Unless they can commit to living somewhere for five years, I’ll be hesitant to buy due to the high transaction costs associated with moving to Toronto — provincial and municipal land transfer tax, estate commissions, and other costs. Renting for your first foray into living on their own might be best.

They also need to agree now on how to manage their joint financial obligations. Will they contribute equally? Will they contribute based on their income? Will they put their salaries in a joint bank account? These are important discussions to have before moving in with someone to set the stage beforehand.

consequences: She spent more. Spend in Week 1: $547.50, Spend in Week 2: $1342.50

How do you think she did: Leanne says her spending this week was about the same as her average, except for helping her younger sister buy a laptop.

“I always think about what I have right now and what they are going through,” she said. “I will do everything in my power to make sure they don’t rely on me too much.”

Takeaway“It’s a great relief to know I don’t need to feel guilty,” Lian said.

She had a chat with her mother and father to explain her situation. “It got really emotional because they realized how heavy this financial burden is on me,” she said. “They actually thanked me and encouraged me to move on with this and chase my dreams.”

Her parents assured her that they would talk to her siblings to relieve her of this burden and told her they had some money for other emergencies.

“That’s why I can now think about how to go about buying a home,” she said. “I’m considering the FHSA because we won’t rush into that anytime soon.”

Following the advice, Leanne will continue to contribute to her TFSA for “Resilience”.

next step? Find out about finances with boyfriend.

“We will have a conversation about how we can fairly organize our salaries to open a joint bank account.”

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Digital design by McKenna Deighton.

Evelyn Kwong is a Toronto-based journalist and former editor for the Toronto Star. Follow her on Twitter: Tweet embed

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