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July 4, 2018 | What’s Precious

A best-selling Canadian author of 14 books on economic trends, real estate, the financial crisis, personal finance strategies, taxation and politics. Nationally-known speaker and lecturer on macroeconomics, the housing market and investment techniques. He is a licensed Investment Advisor with a fee-based, no-commission Toronto-based practice serving clients across Canada.

Someone mentioned recently this is an excellent blog to suicide by. That caught my attention. Have things been a little too dark here lately?

Perhaps. But don’t blame me. I didn’t invent FOMO, Trump, Dippers or moister house lust. This site is just a slice of rolling history reflecting society and tempered (of course) with canines. If people are weird, vacuous or hormonal, well, it’s recorded. It would be hard to make up the stuff that’s happened lately. So deal with it, or leave and watch Global News.

Having said that, there is hope for humanity. Not everyone has stepped off the debt ledge into the abyss of stuff. Some young people understand it’s all a trap. First they make you crave things. Then they make them unattainable. The only way to bridge is by borrowing more money than your parents could ever fathom at your age – setting up a dismal path for the rest of your working years. But wait. This is getting depressing again.

Time to bring in Wilf, a blog dog who has learned well. Good boy, Wilf.

In a recent blog post you wrote that “nobody corresponds with me because they’re okay.” That seems like a pretty sad state of affairs, so I thought I’d change that.

I haven’t been reading your blog for as long as some, but it’s still been a couple of years. It was my wife who got me hooked, so right off the bat you can tell that we aren’t your classic “Mars and Venus” case. We’re in our late 30s, two kids, and rent a nice place in downtown Toronto. For years we watched as home ownership got more and more expensive, but managed to resist (barely) the siren song. Instead, I worked while she went to med school, and we used my earnings to keep loans minimal. While her classmates bought new cars and took vacations, we drove our clunker, stayed home, and paid off debt. When the clunker died, we bought our next car with cash (that was before we read your blog and learned why leasing was better, but nobody’s perfect).

As a result we’re 100% debt free. We save a big chunk every month (which goes into registered accounts invested in diversified ETFs with a 60/40 split), plus my wife has a nice defined-benefit HOOPP pension. Yes, we sometimes feel house lust, but we long ago realized that the stresses of home ownership would make us less happy, not more. And why would you pay a huge chunk of our net worth to be less happy?! It would be madness.

Perhaps one day we’ll buy, but right now, with our finances in order, we’re on the precipice of splurging on something that actually will make us more happy: a part-time housekeeper. Less time doing chores means more time for everything else, and time is what’s really precious.

Thanks for all the advice! Sincerely, Wilf.

So here is the question: what defines success?

The correct answer: that which brings you happiness, pleasure, joy or (especially) contentment.

These days society has been telling its young what they should be happy about (owning real estate) even when that is inextricably, firmly linked to so much that’s unpleasant. Mortgage debt. Property taxes. Insurance, maintenance, fees, repairs, utilities. Plus the stress of rising interest rates or a falling housing market. If kids arrive or a marriage fails, being tethered to big fixed costs and a massive borrowing becomes more complex, costly. A job loss can be devastating in a special way only the mortgaged can understand. And almost all young homeowners have zero net worth outside those walls. No diversification. No balance. No liquidity. No safety net.

How, exactly, can this make you content? Or enjoy time? Or savour every fleeting month of your youth?

Nah, the goal of life isn’t a house. It’s liberty, health and the cash to make the most of them. Never surrender your freedom, nor trade it cheaply for some dirt and some debt. Years later you’ll understand what a Faustian foul-up that was.

Wilf and his young doc wife are buying help, not a house. In essence, it’s a purchase of time.

Envy them.

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July 4th, 2018

Posted In: The Greater Fool

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