The
biggest financial decision for Gen Y-ers these days is to choose
between establishing a retirement savings fund and buying a property.
Many people in their 20s or 30s can’t afford to have both, so it’s
either one or the other. If you’re one of the majority, you need to
start thinking about what really matters to you as a financial goal.
If
you’re in your early 20s now, retirement could well be 40 to 50
years down the road. Still, it’s something that shouldn’t be left
in the backburner. Many Gen Y-ers won’t be able to receive a single
cent of pension because employers hire them only on a contractual,
not on a full-time, basis.
Buying
a property is something that’s best done in your 30s, which means
you have to start saving for a down payment in your 20s. For an
average-priced resale property in Canada, the usual down payment
amount is $25,000 to $30,000. Houses and condos in Vancouver,
Calgary, or Toronto require $5,000 to $15,000 more than that.
Most
people will choose to buy a property and put off saving for
retirement for another time. This is only natural. After all, the
benefits of buying a home are immediate, and real estate properties
generally increase in value over time—a value which can eventually
be used for retirement.
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