NEW AI helping to identify undiagnosed genetic disorders in children
Researchers have developed the world's first algorithm powered by artificial intelligence to identify children with undiagnosed rare genetic disorders.
The journey to home ownership can be very exciting, especially with your realtor selling you dreams of the perfect home.
However, it’s important to avoid the trap of becoming house poor -- a situation where an overwhelming portion of your income is devoured by housing costs, leaving little for other aspects of life.
Below, I’ll explain some practical strategies to maintain better financial health while owning a home. With careful planning and smart decisions, your home will enhance your quality of life, not constrain it.
The next time that you drive through a nice neighbourhood to admire the homes, take a minute to consider how much the home owners are paying to live there:
Buying a home is often presented as a more affordable alternative to renting. If you were to compare monthly rent versus mortgage payments on the same property, the mortgage payments would almost certainly be smaller.
However, as the property owner, you’ll also have more financial obligations. You’ll bear full responsibility for maintenance, taxes, and repairs -- all of which you should account extra for in your monthly housing budget.
If you fail to do so, it’s easy to find yourself house poor, with a large portion of your monthly income going toward living expenses, and little left over for saving, investing, or doing other things you enjoy.
It’s also important to consider how mortgage interest rates change over time. For example, many Canadians are facing drastic mortgage payment increases this year, as renewal rates reflect today’s high interest rates.
The good news is that being a homeowner doesn’t have to make you house poor. The key lies in proper planning and budgeting so you don’t find yourself in over your head.
Before you even begin looking for a home or working with a realtor, you should have a good idea of what you can afford in terms of a monthly mortgage payment.
Remember that real estate agents are, at their core, sales professionals. As much as it’s their job to help you find something within your budget, it’s also their job to help you find a house that you really love and upsell you on all of the benefits of it.
Similar to buying a car, the home buying process can often lead you on an emotional rollercoaster, and you may find yourself willing to go outside of your budget for the perfect home.
As much as I’d encourage you to find your dream home, make sure that you’re also evaluating your options logically, with your budget in mind.
Remember, your mortgage payment will not be your only expense.
You’ll have to include utilities like electricity, water, and internet. The bigger your house is, the more your space will cost to heat in the winter and cool in the summer. Bigger homes may also require Wi-Fi extenders to ensure the whole home has coverage.
Then, you have to account for maintenance and upkeep costs. Unless you’re a hardcore DIY pro, you’ll have to account for monthly maintenance costs like landscaping, weed control, snow shovelling, and pest control, as well as semi-annual repairs to plumbing, electrical, appliances, or your roof.
The size of your property relative to the dwelling unit itself can also play a factor here. A larger, more rural property may come with higher landscaping costs or require you to buy a four-wheel drive vehicle so you can drive up and down your dirt driveway.
The age of the dwelling unit could also play a part in your maintenance costs, as older homes are likely going to have more impending repairs compared to newer builds.
For example, a new roof could cost you $8,000 or more, and will usually be required every 15 years. This means you’ll need to budget $544 per year or $44 per month extra to account for inevitable roofing expenses.
Last, but not least, you’ll want to account for annual property taxes on the home as well as home insurance costs.
To get the best picture of how much home you can realistically afford, it’s best to factor in all estimated costs, including:
Your real estate agent or financial planner should be able to help you out here, as long as you’re asking the right questions.
Many financial advisors recommend using the “30 per cent rule” when it comes to housing. This rule advises keeping your combined living expenses below 30 per cent of your income. Only around 20 to 25 per cent of Canadian home owners exceed this, according to the latest studies by the CMHC and Statistics Canada.
If you’re married or buying a home with a friend who will also contribute to your household income, you may be able to use your joint income to purchase a larger home while still staying within your budget.
While it may not be feasible for everybody, making a larger down payment on your home will reduce your monthly mortgage payments, making home ownership more affordable in the long run.
If you never got a chance to plan ahead and you’re already feeling the financial pressure, you have a couple of different options. These could include refinancing your home at a lower interest rate, renting out an extra room or space on your property, or it may come down to downsizing by selling your home and moving into something more affordable.
Christopher Liew is a CFA Charterholder and former financial advisor. He writes personal finance tips for thousands of daily Canadian readers on his Wealth Awesome website.
Do you have a question, tip or story idea about personal finance? Please email us at dotcom@bellmedia.ca.
Researchers have developed the world's first algorithm powered by artificial intelligence to identify children with undiagnosed rare genetic disorders.
Eating more ultraprocessed foods is linked to a higher risk of cognitive decline and stroke, even if a person is trying to adhere to a Mediterranean diet, the DASH diet or the MIND diet, a new study found.
Charlie Colin, bassist and founding member of the American pop-rock band Train, best known for their early-aughts hits like 'Drops of Jupiter' and 'Meet Virginia,' has died. He was 58.
Toronto has been awarded the WNBA's first franchise outside the United States, with the expansion team set to begin play in 2026.
Diminished but not deterred, Hamas is still putting up a fight after seven brutal months of war with Israel, regrouping in some of the hardest-hit areas in northern Gaza and resuming rocket attacks into nearby Israeli communities.
Police say they have wrapped up their on-scene investigation into a deadly boat crash in eastern Ontario as details of the incident begin to emerge.
WestJet Airlines plans to launch a new cheaper fare category that would be available to travellers willing to fly without a carry-on bag.
Canada's dental care plan is 'getting there' Health Minister Mark Holland said Wednesday defending the program's rollout that's now seen two million seniors sign up, but just 10,000 oral health providers enrolled to treat them.
A new survey found a majority of Canadian respondents plan to stay within the country on their next trip amidst high costs of living.
When Jujhar Mann said he wanted to be a pastry chef on a grade school career project, he didn't imagine that pursuing his dream would land him on a popular Netflix baking competition.
A city known for its history, ties to outer space and southern barbecue, is also home to a Winnipeg chef dishing out dozens of perogies.
A Montreal photographer captured the moment a Canada goose defended itself from a fox at the Botanical Garden.
Public libraries in Atlantic Canada are now lending a broader range of items.
Flashes of purple darting across the sky mixed with the serenading sound of songs will be noticed more with spring in full force in Manitoba.
Catching 'em all with impressive speed, a 7-year-old boy from Windsor, Ont. who only started his competitive Pokémon journey seven months ago has already levelled up to compete at a world championship level.
A sanctuary dedicated to animals with disabilities is celebrating the third birthday of one of its most popular residents.
2b Theatre recently moved into the old Video Difference building, seeking to transform it into an artistic hub, meeting space, and temporary housing unit for visiting performers in Halifax.
A B.C. woman says her service dog pulled her from a lake moments before she had a seizure, saving her life.