Sunday, 13 January 2013

Boomers' Retirement Plan - its Us Yuppies

The landlady came by the other day to pick up rent. Had a nice long chat with her...asked me if everything is alright and if I plan on buying a place of my own anytime soon. ``Advised`` me that is too early to buy at my age, and I'd better stick to renting from her (not that I would expect any other advice, or have any other course of action). Also told me about her deadbeat 40-something son with a failing business in Saratosa, Florida...I politely inquired about how is he able to live in such an expensive city on the gulf if he's not bringing in any money. Turns out he's living at one of their properties there, so it must be smooth sailing failing business or not. Apart from that, they got 2 more rental condos in Toronto. Living the dream, if they wouldn`t be so close to kicking the bucket.

My writing might have a bitter taste to it, and I do notice it seeping through. Back in 1989 my family bought a townhouse in Edmonton...for a meagre (relatively speaking) price of ~$55k. Thats with my dad bringing in ~$40k/yr at the time. The difference between the landlady and my family is that we didn't have an aim to become landlords or perhaps have not recognized the opportunity at the time. Now I'm wondering how is it possible for any young professional to buy their own 1-2 ($350k-$450k in a good area) bedroom condo in Toronto (not even considering a townhouse/house atm) without being a slave to the bank for the next 10-20 years. If you're interested to see some calculations on the topic, I got some in a previous post. In short, buying my own condo would leave me with savings of $121 left per month, for the next 10 years, which isn't exactly pretty. So of course, I, as countless others, rent from the boomers who were able to capitalize on the opportunities in the 80s and before that. They don`t need to rely on their retirement savings, invest in stocks or bonds, create businesses or do anything at all. They already got their best investment in front of them - its us yuppies.

I consider myself quite well off for my age, I have a nearly new econobox car, can afford to get out, dress well, treat the girls, engage in personal projects, went on a vacation last year. But I can`t help but be disillusioned when I can`t even come ``home`` at night and that I`m not a person but a high yield bond. In feudal system the term would be a serf. Maybe I`m overly ambitious...but is having a place of your own a grand ambition?

If any other yuppies would like to pitch in their thoughts, you`re more than welcome too.