21 YO - Seeking Financial Advice

[james4000]

Hey everyone,
Please be gentle, i’m looking for advice.

I'm a 21-year-old from, Canada, looking for some guidance on my financial situation and investments.

Quick Snapshot:

• Income:

After everything Between my current job and other small business, I am bringing home $3,500 a month all expenses paid after all taxes everything paid off.

I have basically $3,500 a month to play around with now.

• Expenses: I've got a car loan with $36,000 outstanding at 6.99% interest.
• Savings: Currently, I've got $7,000 in a TFSA. I also have RRSP and FHSA accounts open.

I'm hoping to:
1. Quickly pay off my car loan.
2. Build a solid emergency fund.
3. Strategically invest for long-term growth.

Given this, I have a few questions:

1. How should I break down my investments between low, medium, and high-risk?

Any percentages you could advise on? (20-50-30?)

1. Any specific ETF or fund recommendations, especially from Vanguard?

I’m focused on long term, but I’d like to retire by 33-35, Might be unrealistic but i’m working hard and I might be able to achieve it.

I think about 4-5 million in the bank should do that for canada.

1. Should I prioritize my car loan over investments or balance both?

Would love to hear your thoughts and suggestions. Thanks in advance!

 

[grams]

@james4000 I have no clue on how you're gonna retire in basically 10yrs with 4 million, but pay your car off in full. Almost 7% interest being paid off is the same as making a 7% return on your investments. After that save for 3 months of living expenses. If you have a job and a business you probably don't need more than that as you have income coming in from multiple sources. In my opinion the best vanguard investment is VFV etf as it's the S&P 500 in the US, but in Canadian dollars. Just put money in and wait. Chances are in 30yrs it'll be worth much more than now. Only extra advice I'd give you is if you have a real business that's making money use your extra money to grow it. You can make around 10% a year on average in the S&P 500, but you can make unlimited returns with your own business. That's the first place to invest money into before worrying about other companies to give money to.

 

[resjudicata]

@james4000 I’ve used a few retirement calculators and I can’t see how you’re going to have enough for retirement at 35 saving $3500 per month.

To retire at 35 you’d need to be bringing in close to $22k per month.

There could be something I’m missing though

 

[barrettf50cal]

@james4000 Pay off your car. That's a 6.99% safe return after tax.

Maybe dump a bit more in the emergency fund, to have about 3-6 months of runway.

Let us know when you're done.

 

[resjudicata]

@james4000 Definitely pay off that car first. Personally I like the TFSA, maxing that out and not touching it would be a good idea. I’m still trying haha.

So many mixed reviews from RRSP, I’ve heard from several elderly that it just wasn’t worth the investment. I’ve decided to go the universal life insurance way. You pay more then a term life insurance, but there’s money built by retirement that you can withdraw.

Personally I went the union pension route. Got a good job that was part of a union and been putting in my time. Not too many places offer and direct benefit style pension anymore. Nowadays it’s all direct contribution, which is good if you switch jobs a lot, but the money will run out at some point. At least with direct benefit, you get a monthly cheque for life.

 

[james4000]

@resjudicata I agree, i got a job with the cupe union as well, they have added benefits with a years contract but there are strong chances they will either extend it or make it permanent full time.
I got something called municipal pension plan, but unfortunately it did not mention
What amount or what % they would be paying to that.

 

[resjudicata]

@james4000 My employer pays that, it’s on top of my hourly. So it’s something like $3+/hr right now. If it goes up $0.20-40 every year, retirement looks like $4-6k/month. Just gotta make sure I have enough working credits and hit minimum age 55.

 

[meeks83]

@james4000 Toughest thing about financial planning is, 1. when you need the money and, 2. how it is taxed at that time. With tax law changing here and there makes it a bit of a moving target.

Trying to figure out final take home rate after tax is never easy.

Really digging into earnings after taxes is the trick to really compare the opportunities and costs over time.

 

[deeann]

@james4000 Listen to The Money Guy Show podcast, especially episodes on things like how much to spend on a car related to your income etc

 

[da_man]

@james4000 This is such an obvious troll post I don’t even know where to start.

 

[james4000]

@da_man why is it?
You wake up in the morning to shit on someone rather lend 2 cents worth of advice?
Thanks!

 

[da_man]

@james4000 Yeah okay buddy. If you’re really making like $400k a year you’d be better off going to an accountant rather than fucking Reddit.

 

[james4000]

@da_man Dfq? When did I say I make $400K a year, what are you on!?

Jeez, columbian sugar has fallen into the wrong hands

 

[da_man]

@james4000 What. You supposedly take home 3.5k a month after all expenses paid. You make at least 400k in this fictional character you’ve created /s

 

[james4000]

@da_man Do a little bit of Math.

$3.5K a month in profits, is $42K a year not $420K , your common sense lacking brain cells need.

Profits of $42K a year after everything, I’m at $92K pre tax and expenses between my job and business.

Jeez dude, Please get yourself checked, We don’t have the best healthcare but it’s free?

Make some use of it?

 

[da_man]

@james4000 What do you think the /s is for my guy

 

[floridagatorguy06]

@da_man Lol I make $6000 take home a month and definitely don't make 400k a year. Your math is bad.

 

[james4000]

@floridagatorguy06 math ain’t mathing

 

[da_man]

@floridagatorguy06 lol. What do you think the /s is for?

 

[floridagatorguy06]

@da_man Adding the /s after everyone bugging you about your math skills does not erase the mistake. But mistakes are fine. I make them all the time.