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This ‘hangry’ millennial’s stress-eating problem is taking a bite out of her financial dreams

Introducing Spent, a fresh look at the financial lives of Canadian millennials from the Financial Post

By Victor Ferreira

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Spent is a new column in which the Financial Post’s Victor Ferreira takes an entertaining and insightful look at the financial lives of everyday Canadian millennials. Some toil in lower-paying jobs while others are earning six-figures — what unites them is their desire for more and their everlasting struggle to get it.

Some days, it just takes a few drops of rain. On others, it’s the back-to-back-to-back phone calls that push this 28-year-old administrative assistant we’ll call Diana over the edge.

Her clients and coworkers already know all the signs and, more importantly, they know the solution. It’s a vice that cost her close to $240 in a recent one-month span.

“I stress eat a lot,” said Diana. “Some days, it’s just so busy you literally can’t shove any food in your mouth, so those days where I go five to six hours without eating, I get ‘hangry.’”

Becoming so hungry that it angers her turns her into a different person — one she could only describe with a profanities-laced rant not fit for these pages.

The reaction is understandable: She often goes five hours without food because of a high volume of calls she handles, many of which include conversations with clients who ask her to do more than her job requirements and threaten to have her fired if she doesn’t.

It can be difficult to remain professional. “So to keep myself happy,” she said, “I buy myself some snacks.”

Pre-COVID-19, it was common for Diana to hit a grocery store six times per month, not for groceries but to pick up bags of Doritos and Cheetos, jars of pickles, blocks of cheese, croissants and scones. There were also the single or double orders of fries at A&W, multiple trips to Tim Hortons and pie shops. In one month, she racked up a $603 bill on food and drink.

Diana knows her spending on snacks is excessive, and more importantly, it’s burdening her dreams of owning her own property to escape another cesspool of stress.

Living in her parents’ home means she doesn’t pay for rent and real groceries — she has been able to remain debt-free and her main expenses have been a transit pass ($129) and a cellphone bill ($67). It has also allowed her to consistently put $766 of her monthly take-home income of $2,712 toward her nest egg, now $68,933 split between her chequing account, her TFSA and her RRSP.

Yes, this scenario has some advantages, but it’s far from ideal. She’d rather live a comfortable distance in the opposite direction, but, like many in her situation she felt renting would put too great a strain on her finances to be feasible and home ownership is all-but impossible in the city. Staying at home, for now, has been the more responsible choice.

The drawback is that she can’t stand to live with her mother, who insists on keeping tabs on where she is at all times, doesn’t understand the concept of personal space and forces our subject to adapt to her own strict and conservative schedule.

“If I wanted to bake a cake at midnight, all that rattling around, she would wake up and say what are you doing,” Diana said. “But if I lived on my own, I could bake a cake whenever I want.

(“It’s not about the cake, it’s about having your own space,” she clarifies, knowing her mind once again transitioned back to food.)

Her mother is also why Diana sneaks in most of her snacking at work. Being caught with a single chocolate bar is enough grounds to provoke an argument.

Since the COVID-19 outbreak, she’s only been going to the office once per week and has been reduced to ordering McDonald’s through UberEats at 1 a.m., carefully disposing of the evidence.

Diana would prefer to own her own property, either a condo or a house, and is open to moving outside of Toronto to find real estate she can afford. If there’s no other option but to rent, she’s willing to accept that option. To help Diana, we enlisted the help of Nicola Wealth financial advisor Kyle Westhaver.

According to Westhaver’s calculations based on the primary affordability rule that an individual should not spend more than 32 per cent of their gross on mortgage principal and interest, taxes and heating expenses, the most Diana would be able to afford on monthly payments is $950. This calculation can also be used for rent, he said. The average studio apartment in Toronto, was $1,527 pre-Covid-19, according to Bullpen Research & Consulting Inc., a real-estate researcher.

To pay for rent, Westhaver said that Diana would likely have to divert the entirety of her monthly savings to housing. He also identified her transit budget as an area of interest because even though Diana bought a monthly pass, she double-dipped on transit by regularly ordering Lyft and Uber rides ($84). When she starts commuting to the office five days per week again, she should try to eliminate the latter two.

“I would say the new avocado toast or latte is definitely the Uber or Lyft ride,” Westhaver said. “I find that’s one of the more sneaky expenses on an income statement.”

Cutting back on travel, which is not currently possible anyway, and her prior shopping patterns will also be necessary.

At this point, she’d have enough to pay for an average studio in Toronto, but would also have to pay monthly Internet and electric bills at the minimum. Diana would also have to make significant cuts to her food budget, most of which would be diverted into groceries, where the average Canadian spends about $120 per week.

If abandoning future travel, the ability to refresh her wardrobe and her beloved snacks is too much to ask, living on her own in Toronto might not a reasonable option.

A solution might be to move in with her boyfriend, a 27-year-old who also lives with his parents. Together, their annual income reaches about $80,000, which would mean that they could afford to pay a combined $2,130 in rent or on a mortgage, Westhaver said.

An average one-bedroom apartment in Toronto is $2,107, according to the Toronto Regional Real Estate Board, and so as a couple, it’s just within their realm of affordability.

Diana could also put the entirety of her $68,933 savings into a down payment and be approved for a mortgage of the same amount on a $400,000 home. To find average real estate prices on a house that cheap would require leaving Toronto for Quinte West, Ont.

For his part, Westhaver would advise Diana to stay at home for a while longer. Instead of giving Diana the peace she seeks, a move of any kind would add a sizeable monthly cost to her balance sheet and result in further stress.

“You could scratch and (claw) your way into buying a … 300 sq ft condo in Toronto for all of your money and all of your savings and not be able to save currently just for the chance to be a little more stressed out a job you don’t love,” Westhaver said.

The pandemic, however, may work to Diana’s advantage. Her expenses on transit are near-zero and her food bill has been slashed to a pittance of what it was once. While staying with her parents, she’s saving now at a better rate than she ever has and Westhaver suggests that she continue to do. Eventually, she might have enough for a larger down payment that could bring monthly mortgage costs down.

Hearing what she expected, Diana resigned herself to the idea.

“Listen, I don’t think my mother is going to let me leave until I get married,” she said.