This Montreal millennial couple makes $316,000 combined. Monthly child care costs? $203. With an excess in savings, they want to have their second child. What advice can they get?

Millennial Money is a weekly submission-based series that provides financial advice to millennials in the GTA. Read the full series here.

Montreal residents Tommy, 33, and Victoria, 34, bring in more than $ 300,000 including commission working in the sales industry.

This past year, and now, they’re experiencing a change and a shift in their mindset that has really allowed them to save, but also reflect on how fortunate they are.

“We are lucky to have kept our jobs and are still working from home. Before we might have been spending without thinking,” Tommy said.

With one baby, and plans to have another child, they have concrete goals on what they’d like to save for.

First, it’s to save enough for each child to have a “$ 100,000” nest egg before they turn two years old “to facilitate a down payment on their future home, car and wedding.”

Secondly, it’s also to have enough to retire by the age of 55, and pay off a mortgage to allow investments to grow over $ 3 million.

Finally, they want to buy a bigger “forever” home in the $ 1.4 million price range, using $ 350,000 of the equity from their current home to fund the 20 per cent down payment.

What does their day-to-day look like?

“We were never really good at bringing food to work and might have brought it one or two days per week. During COVID-19, we definitely tend to order UberEats or Skip the Dishes more frequently as it’s more convenient to have lunch already prepared,” Tommy said. Also, being at home, they’re able to prepare breakfast from home and dinner when possible.

On the weekends, during COVID-19 times, they’ve tried to do “activities that are low-key without many people, such as taking walks, going snowshoeing or skating.”

Other than their existing mortgage of $ 257,000 and credit cards they pay in full every month, they have no debt.

They’re wondering if there are more strategies they can employ to reach their saving goals quicker.

We asked them to share their daily spending to get an idea of their finances.

The expert: Jason Heath, managing director at Objective Financial Partners Inc., on Tommy and Victoria’s saving plans.

Tommy and Victoria have a combined gross income of over $ 300,000. Their mortgage payment is less than 12 per cent of their net monthly income. That said, they are planning for a second child as well as a move to a much more expensive home.

This is not a commentary on them specifically, but it is important to be mindful of lifestyle creep.

Often, as income rises, people’s spending rises with it. It is not uncommon for workers with high incomes to save very little of their earnings. And the more you spend, the more you need to save to some day become financially independent.

Parents in southern Ontario may think Tommy and Victoria’s $ 203 monthly daycare budget is a typo.



A 2020 Canadian Centre for Policy Alternatives study found infant child-care costs in Toronto to be the most expensive in the country, topping the list at $ 1,774 per month or $ 21,288 per year. This is more than Tommy and Victoria’s mortgage payment.

Child-care costs in Quebec are heavily subsidized by the provincial government.

Tommy and Victoria’s monthly expenses suggest they are saving nearly $ 8,000 per month. If they are, that is great, but it may be that their expenses are understated.

They may want to do some long-term financial planning to try to factor in a new home purchase, costs for a second child and some of their longer term goals, like post-secondary costs, gifts to their children, and eventually, for their retirement. Developing a long-term financial plan can help them set spending and saving targets today, as well as a budget for their new home that does not impede the other goals.

They do not have any life or disability insurance premiums as part of their budget, but it may be because they have group coverage at work. Tommy, in particular, may find if he has a group plan that it falls short of replacing his income, or it may not include his commission income.

They should consider an insurance needs analysis as part of a comprehensive financial plan especially given their plans to expand their family and take on a bigger mortgage.

If saving for their children’s future is a priority, Registered Education Savings Plan (RESP) contributions are the best option to plan for post-secondary education costs. RESPs can be used to fund trade school, college or university, whether in Canada or abroad.

Registered Retirement Savings Plan (RRSP) contributions for Tommy will be more lucrative than for Victoria given his income is higher. Tommy saves 54 per cent tax on his RRSP contributions, while Victoria saves only 37 per cent.

It sounds like Tommy and Victoria are on a good trajectory given their investment balances, modest mortgage and high incomes. Developing a financial plan on their own or with a professional could help them balance today and tomorrow.

The results: They spent more. Spending in week 1: $ 460.66 Spending in week 2: $ 1,357

How they think they did: This week, the couple spent more on their daily expenses, but it’s nothing out of the ordinary, considering they had a mini at-home celebration. “We had a pretty standard week, other than (Victoria’s) birthday expenses,” Tommy said.

The only big ticket item they had was paying off the Bi-Weekly mortgage and property taxes, which is an ongoing expense for the couple.

Take-aways: “The advice is fair,” Tommy and Victoria agree, adding that it’s great to see that the financial adviser’s advice matched a lot of what they have already been doing.

What they also recognize is that their $ 203 monthly expenses (in Quebec) for child care is rare compared to many other parts of the country. “We can’t even imagine paying for Toronto prices along with the city’s unaffordable real estate market.”

Finally, thanks to the advice, the couple will be looking into separate life insurance, and other insurance plans to reduce costs and risks if one were ever to lose their job.

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