The Financial Challenges Facing Generation Y
Home Trust is a proud sponsor of the RateSupermarket.ca’s Get Out of My House giveaway, providing a $1,000 GIC to the lucky finalists.
By: Benjy Katchen
Vice President, Deposits
Home Trust Company
Today’s young adults face quite the checklist in order to achieve financial independence; graduating from post-secondary school, finding a well-paying job and saving a nest egg are just some of these milestones. However, overcoming these hurdles is proving to be more difficult for today’s generation than in decades past – and a few factors are responsible, including an increasingly competitive job market, and a steeper-than-ever cost of living.
Challenge 1: Lack of Employment Opportunities
Did you know that unemployment for youth in Canada sits at 14 per cent? That’s double the national average! It’s not that today’s kids aren’t skilled or unwilling to work – in fact, they’re among the most qualified and highly educated young workers in decades. However, this flux of skilled workers are competing for a narrower selection of very specialized jobs, making it tough for everyone to find a place on the employment ladder – especially in their desired field!
As a result, it is taking some young adults longer to enter the job market, delaying their potential for earning and saving the funds needed to really launch into adulthood. Some kids are resorting to lower paying gigs that don’t require an education, just to make ends meet.
Challenge 2: Student Loans Take a Bite Out of Savings Potential
The average post-secondary graduate is facing $27,000 in debt repayment – and a previous RateSupermarket.ca study found that it’s taking an average of 14 years to pay off! Saving for a home down payment, or managing monthly bills become a lot more challenging when juggled with steep debt repayment.
This lingering debt also makes it more challenging for young adults to enter the housing market. The fact is that housing and rent costs are steeper than they were in the past. According to the Canadian Housing and Mortgage Corporation, the average resale price for a home in Canada is $367,500, and is forecasted to rise further to $377,300 in 2014.
Compared to what homes went for in the mid-80’s – around the $100,000 mark – it’s no wonder so many kids are putting off homeownership and are living in the family home for longer..
Our Finalist Pick
Our chosen candidate for RateSupermarket.ca’s Get Out Of My House giveaway is Katie Kish of Hamilton, Ontario. We feel she exemplifies the true spirit of the giveaway through her work ethic – the fact that she works part time in her field while balancing two other part-time jobs is impressive. We also applaud her ambition to move out and relieve her mother of some of the financial pressures associated with being a single mom.
About Home Trust
Home Trust is not like other trust companies. Not only do we have a proven track record of helping Canadians fulfill their dreams of home ownership, building their small business and saving for their future, but we have been a leader in delivering these dreams to Canadians for over 25 years.
To help you meet your saving and investing goals, we offer a wide range of Guaranteed Investment Certificates (GICs), Registered Retirement Savings Plans (RSPs), Retirement Income Funds (RIFs) and Tax-Free Savings Accounts (TFSAs). All our deposit products are eligible for Canada Deposit Insurance Corporation (CDIC) insurance.
Home Trust Company operates across Canada, offering Canadians the financial solutions they need. Our head office is located in Toronto with branch offices in Vancouver, Calgary, Montreal, Halifax and Winnipeg. We are a wholly owned subsidiary of Home Capital Group Inc., a federally regulated, publicly held trust company that trades on the TSX under the symbol HCG. Home Trust is fully secured by Canada Mortgage and Housing Corporation (CMHC) and is also a member of the Canada Deposit Insurance Corporation (CDIC).