Help! I Need a Mortgage!

Purchasing a home, especially your first, will be one of the most expensive and important purchases of your life. It’s important to understand how the process works and the impact that buying a home can make on your short and long term finances. Follow these three handy tips to see how much house you can afford! 


Did you ever drive around with your parents during the holidays looking for the best lights in town and thought “I wonder how much this actually costs?” Or maybe you’ve started looking at listings in neighborhoods you’d like to live in, only to realize you have no idea how much you can afford? Whatever the case may be, securing a mortgage is an intimidating process. We’re here to help with a three step process that gives you a great starting point for where to go and how to makes sure it fits your budget.

Step 1: Check, Check, Check It Out

Are you ready for this next chapter to begin? It starts with a word that still sends shivers down everyone’s spine after high school… “homework”.

First you’ll need to determine your credit score. I recommend sitting down with your financial advisor who will be able to best accurately determine how much debt you’ll be able to undertake.

Financial advisors use your credit score to determine whether you qualify for a mortgage and how much you will qualify for (alongside the Mortgage Stress Test). An easy way to take a realistic look at your spending patterns is by going through your banking and credit card history. Staying in touch with your current spending habits will prevent any unpleasant surprises when going in to discuss your options with your advisor.  

Step 2: Evaluation Time: What Can You Spend?

Figuring out “how much you can afford to spend” versus “what you should spend” can be hard. Imagine spending your entire budget on your lavish dream home, but you can’t invite anyone over because you don’t have furniture for them to sit on. Compare that with a home within your means that you can afford with furnishings that you, your friends and family will enjoy. Just because you qualify to buy a large house, doesn’t mean you should make yourself “house broke”. If you purchase a home and leave yourself some wiggle room, it’ll give you more flexibility to spend your disposable income on other things such as trips, family, and decor for your new digs! Ask your financial advisor about the lifestyle trade-offs that occur when you take that step to become a homeowner.

I also recommend talking to your financial advisor about creating a budget that provides a holistic picture of your current expenses, long-term expenses, future expenses, and miscellaneous expenses that will come with being a new homeowner. Compare this budget with your current spending habits you identified in step one and you should be able to identify if you can realistically afford the purchase of a home. Need some help? We have some tools to help you create a budget. 

Tip: Practice living on this self-made budget for a while before making the steps to purchase. This way, you know that you can actively save and handle the budget change while making sure it is accurate.

Step 3: What You Should Spend & Knowing the Fees

Time to look at all the fees that come with buying a home! *Gulp* Many of these fees exist on top of the cost of your home so make sure you leave room in your budget.

  • Down payment (at least 5%),
  • Mortgage Default Insurance Premiums
    • Your down payment amount affects the costs associated with your mortgage. The higher your down payment, the less Mortgage Default Insurance Premiums (more commonly known as CMHC). Mortgage Default Insurance Premiums are mandatory in Canada, and are calculated based on your down payment amount. These fees are an insurance on your mortgage. If you can realistically afford putting down a 20% down payment, you can avoid paying CMHC. If you have the means to save for a 20% down payment, it will save you a ton of money.
  • Appraisal fees,
  • Home inspection fees,
  • Land transfer fees, and
  • Lawyer fees (approximately 1.5% of the total cost of your home)

As well, remember that once you buy a place to call home, your total monthly house costs are much more than just your mortgage payment and things like property taxes, home insurance and condo fees should be added to your budget. One of our previous blogs explores the expenses of homeownership.

In Canada, there are guidelines on how much an individual can spend on a house, based on your monthly income. In most cases, it is recommended that your monthly housing costs do not exceed 30-40% of your total gross monthly income. There are many good reasons to stay well under that number, remember, all those pesky fees and your monthly house costs we discussed above? They stack up fast and can leave you “house broke” if you are not careful.


Only you can decide your lifestyle and how much you’re comfortable spending each month, and if having a mortgage payment is right for you. Your finances are one of the most crucial and personal pieces of your life so it is important that you feel confident making the decisions that are right for you!

Are you thinking of purchasing a home? What advice do you have for people looking to buy a home? Share your thoughts in the comments below, it’s on the house!

The Cost of Being Single

Single and ready to mingle? Well, if you didn’t need another reason to despise Valentine’s Day,  I’m about to give you one more – independence is expensive. Whether you are choosing to live the single life or you just haven’t met the right catch yet, you’ve probably experienced some of the nuisances that come with taking on the world on your own.


That’s right – next time one of your friends in a relationship gives you a “You are soooo lucky you don’t have a partner to buy an expensive Christmas present” feel free to fire back with “Oh yeah? Try paying up to double for monthly housing, rent, pets, cable, utilities, furniture and credit card fees.”  

As a single guy myself, I can personally vouch for the frustration that comes with these costs so please consider this blog as not only a tool to help you save some dollars – but some much needed therapy for me.   

Grocery Shopping 

One of the most surprising increased costs that come with being single is the increased amount spent on groceries. You may think “Wait a minute… shouldn’t more people equal more food costs?” It does – but couples are able to take advantage of volume discounts and decrease the amount of waste that drives up a single household’s grocery bill. There’s nothing more disappointing than walking the crowded aisles at Costco and not being able to buy the bulk pack of muffins and the 4L Chocolate Milk jug. If you are like me and end up splurging on them anyway, you’ve now paid double the amount it would cost someone in a relationship who can spread the cost over two budgets (and half of the milk won’t end up going spoiled).  

On average, a single man and woman will spend $319.87 and $247.33 a month respectively on groceries. To put it in perspective how much extra they are spending, the average household of four will spend $494.50 a month on groceries. That’s well over half and that doesn’t include the amount of money spent on eating out, which single people tend to do a lot more.

TIP: Something I’ve found extremely helpful to manage grocery costs and limit the amount you eat out is to pair up with a “meal prepping partner”. Spend a couple hours at the beginning of the week cooking a couple of dishes to store in your fridge for the week. Not only is cooking more enjoyable when you have a friend, but you are splitting your grocery cost and preparation time in half while giving your meals variety throughout the week so you aren’t eating the same pasta for lunch for five days straight. 

Home Ownership & House Expenses 

A 2017 Vice Money article reported that 64% of millennials identify as being singlewhich is up 12% from 2004 (seems like more people are joining the dark side!). That seems like a pretty high number since rent costs for one-bedroom apartment (averaging as high as $1,800 a month in Toronto and Vancouver) are skyrocketing so it makes sense why some couples are ready to “take the next step” and move in with each other so quickly.  

I’ve been a homeowner for three years and am in my first few months of living alone. The monthly costs are quite daunting to not have a tenant to offset mortgage, utilities, and condo fees and I’m constantly looking for ways to trim any unnecessary variable costs like cable costs.  

TIP: If you are single and looking to purchase a home – there typically isn’t much of a difference between the cost of a one bedroom and two bedroom place and it is much harder to turn a value on a one-bedroom if you are ever looking to sell. If you can bare it, spend a little more to buy the extra bedroom that gives you the opportunity to house a roommate if your purse strings get a little tight. When you have the flexibility to live alone, you can always turn the room into a spare bedroom/office/pottery studio or whatever you fancy.  

Maintaining a Social Life  

Here’s a shocker – single people spend more money on their social lives. Now that I live alone, I find myself spending a lot more money with friends just to get my social fix. From patio drinks to movie popcorn, these purchases can add up real fast.  

Dating is also quite expensive, especially if you are footing the bill. A 26-year-old male from New York writing for Refinery29 just did a study where he went on 14 dates and tracked all of his purchases. In two weeks, he spent $771 and that’s with $0 dates included! Chivalry may not be dead but your chequing account may be if you are not careful.  

TIP: Cut the booze. Or at least opt out of the casual 1-2 drinks after work or when you meet friend for dinner. Last year when I was training for a Spartan Race, I cut out alcohol entirely for two months and ended up saving about $50-$100 a week! Depending how much you cut out, that’s enough to cover your utility bills for the month (and that 4L jug of chocolate milk from Costco).  

Retirement Planning &  Benefits 

Depending on your age, retirement may be the furthest thing from your mind and the last thing you can imagine allocating any of your paycheck towards. Especially when you are single, it seems unfathomable to think long-term when you are constantly weighed down by short term monthly fees like car payments, cell phone bills, utilities, and mortgage costs 

Since couples can split the majority of these costs – they have the luxury of being able to contribute more to their retirement. According to this MarketWatch study, of those in the 90th percentile of wealth between the ages of 65-69, two-person households had $878,000 in assets versus $380,000 for those in the same demographic who are single. That’s a big difference.  

TIP: I know it’s hard to imagine actively contributing to your retirement when CPP is likely being deducted from your paycheck but if you can afford it – it will pay off in the long run. I prefer to set up automatic pension contributions so I don’t even see the money coming off my paycheck.  Many workplaces will match pension contributions up to a certain percentage so if you can, max them out! It’s free money!  

Single friends, navigating these costs solo can be scary so let’s take care of each other. Comment below with some tips and tricks you use to give yourself some breathing room in the monthly budget.