As housing costs climb, young adults rely on the bank of mom and dad to cover the majority of living costs.
Surrey, B.C. - As young people head back to the classroom next month, a recent survey commissioned by Coast Capital Savings and conducted by Insights West sheds light on yet another consequence of high housing prices in the region.
“Moving out to live on campus or with roommates was once a rite of passage for university kids,” says Tracey Arnish, Chief Member and Employee Experience Officer. “Apparently, for post-secondary students in Metro Vancouver, that isn’t necessarily the case anymore. They simply can’t afford it and if they can, it is likely because it is heavily subsidized by mom and dad.”
The survey, focused on understanding the financial literacy and typical financial obligations of young people aged 18 – 25, found that although young people are planning for their financial future, most have poor financial knowledge and are dependent on their parents for the vast majority of major expenses. Two-thirds of youth in the province who are enrolled in school took on summer employment, either full- (36%) or part-time (31%), yet a significant number still turn to their parents for support to cover many of their day-to-day expenses. A majority share expenses with or are completely dependent on their parents for housing (56%), groceries (55%), and school tuition (54%) and fewer for their monthly cell phone bill (43%).
Notably, young people in Metro Vancouver are much more likely than those living elsewhere in British Columbia to lean on their parents to cover all of their housing expenses (44% vs. 28%).
“It is much more expensive to rent or buy in Metro Vancouver than it is anywhere else in the province, which puts yet another stress on students who are already combatting high tuition costs along with rising transportation costs and limited earning power,” explains Arnish. “There’s a domino effect as parents take on the additional expense to help their kids out. The effect trickles down and puts everyone behind financially.”
As people in Metro Vancouver continue to battle the combination of high housing prices, increasing rental costs with low vacancy rates, and the prediction of increasing interest rates, developing a plan to ensure financial well-being is more important than ever.
“Now more than ever, it is imperative that you are working with a financial planner to really take the reins of your financial future,” emphasizes Arnish. “Achieving what is important in your life – whether that’s home ownership, retirement, or travel – can be within reach. It really is, but you need a solid plan, a strategy to get you there. Financial planners aren’t just for your parents, either. University students can benefit from sitting down, building a strategy and laying the ground work for financial success. A new school year usually feels like a fresh start. Why not ride that tide and apply that fresh start to your finances as well.”
Coast Capital Savings
Coast Capital Savings is Canada’s largest credit union by membership. An Imagine Canada Caring Company, the credit union invested $5.6 million into local communities in 2017, focusing on empowering and engaging youth. Coast Capital is one of Canada's Most Admired Corporate Cultures™, and is a winner of the Canada's Best Managed Companies Platinum Club designation. It has 52 branches serving its 555,000 members in the Metro Vancouver, Fraser Valley, Vancouver Island and Okanagan regions of British Columbia. Product innovations include Canada's first free chequing account from a full-service financial institution. To learn more, visit coastcapitalsavings.com.
About this Release
Results are based on an online study conducted from May 31 to June 7, 2018, among a representative sample of 301 BC young people aged 18 to 25 who are members of the Angus Reid Forum. The data has been statistically weighted according to Canadian census figures for age, gender and region. The margin of error—which measures sample variability—is +/- 5.6 percentage points.
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