How Do You Plan for Your Family’s Future in Canada’s Most Expensive City?

No one in Vancouver needs to be told how expensive it is. We’re already living it. But yes, our fair city is still the reigning champ in unaffordability across all of Canada—and those of us raising tiny Vancouverites are especially feeling the squeeze.

If a family needs to rent a place with two bedrooms, the average monthly cost is up to a whopping $3,049. Not only are there added costs of living when caring for children, your long-term financial goals might all of the sudden include paying for an extra $40K university degree, or two, down the road.

In a place where people may feel that they’re barely getting by in the now, planning for a whole family’s long-term financial future can seem like an overwhelming task.

Bonnie McRae is a single mom and a renter raising two kids in East Van, one elementary school-age and one in high school. She’s experiencing the challenges facing Vancouver parents firsthand: “Being in one of the most expensive cities, every area of our lives is pricey.”

She cites the high cost of living, combined with the family demands on her time and energy as barriers to working towards her financial goals. “Offering the bare minimum standard of living for a family is a stretch on any regular income,” she said, “as a single parent, with the age of my kids, anything beyond paying for the basics feels quite impossible.”

Vancouver parents will be happy to hear that, when times are tough and the accounts are looking lean, you can still find ways to move the dial on your financial future. “Having a good handle on your cash flow is crucial. Tracking every dollar that comes in and goes out and categorizing expenses into essential and non-essential categories can help identify areas where you can adjust your spending,” said Marcus Van Reeuwyk, Investment Advisor at Prospera Credit Union.

He noted, “Although it may seem slow and painful, consistently managing your expenses, investing in growing your career and income and starting a regular contribution to your savings will really pay off.”

McRae’s goals, like many parents’, include putting money aside to protect her family against the unexpected, saving for her kids’ postsecondary education and hopefully, securing some financial security for herself in old age.

When it comes to building up an education fund for your kids, Van Reeuwyk recommends RESPs. “You will receive a 20% (or more if your income falls below a certain threshold) matching grant from the government for contributions up to $2,500 per year. Your child may also qualify for the $1,200 BC Training and Education Savings Grant between the ages of 6 and 8.” Speaking with an advisor such as Van Reeuwyk can help you make use of any grants and bonds that apply. 

Another complication to McRae’s wealth management is that, as an entrepreneur, she is and has been self-employed for many years, meaning that she hasn’t had the luxury of relying on benefits from an employer. People who work for themselves need to coordinate things like CPP contributions and employment insurance on their own. Another area where they’re lacking support is estate planning and life insurance.

No one likes to consider a scenario in which they won’t be around for their kids, but making a will is one of the many not-so-fun (but very necessary) parts of parenthood.

“Your will can address not only how your financial affairs are to be settled, but also who will look after your minor children in the future. Not completing a will leaves those decisions in the hands of the courts,” added Van Reeuwyk.

He suggests that parents discuss their life insurance needs with an advisor to ensure that adequate funds are left behind to support their children, noting that “people often overestimate the cost of life insurance and your advisor will work with you to obtain coverage within your budget.”

As a divorced single parent, McRae is no stranger to shifting life circumstances—or the effect those changes can have on your finances. She stressed, “Being able to shift your financial planning with current needs would be of huge value. Not having the support, or not seeking the support, to have that just gets you further and further behind.”

The good news is that it’s never too late to make a financial plan, and your local credit union can help you do it. “Working with an advisor can significantly enhance the feeling of financial security,” said Van Reeuwyk, “In fact, 81% of those with comprehensive financial plans feel on track with their financial affairs, compared to only 44% with no planning.”

You can book an appointment online  or call 1-888-440-4480 to meet face-to-face with one of Prospera Credit Union’s advisors. They’re all Certified Financial Planners who can offer advice that’s tailored to you and your family’s needs and goals.