Dan Kent, a writer and co-founder of Stocktrades.ca, has been a DIY investor for eight years. His portfolio includes a mix of dividend stocks, growth investments, and real estate, and he is continuously working to grow his net worth.
Let’s get one thing straight: I’ve never been a fan of pinching pennies. I don’t believe driving across town to save a few bucks is the best way to achieve financial independence, and I don’t recommend this mindset for you either. Sure, you can save more by penny-pinching, but merely saving isn’t enough to secure your financial future. You can’t save your way to retirement.
I learned this early in life. Instead of stashing money in a savings account, I invested it. By the time I was in my twenties, I had money in a brokerage account, earning dividends from companies that I’m still holding nearly ten years later.
Millennials, on the other hand, are facing real challenges with investments and savings. Over 80% of millennials don’t have money in the stock market, and more than 60% have nothing saved for retirement. While there are many reasons for this—poor economic conditions, skyrocketing housing prices, misconceptions about the stock market’s risks—one thing is clear: we have to push through these challenges.
I wasn’t born into a wealthy family. I bought my first home when the market was near its peak, earning a low wage. My story is about how I’ve managed to succeed so far and my plans for the future. Unlike the usual advice on saving money, my focus is on how to make your money work for you.
Between the ages of 18-21, I started saving for a home in Canada using my RRSPs (similar to the 401k in the United States). These accounts allow tax-free withdrawals for a mortgage. My company matched my RRSP contributions up to 4%, and I allocated 14% of my income to my RRSPs, letting my company fund the remaining 4%.
At $16.50 an hour, I wasn’t making much. By the end of the year, I would save around $6,000. Renting with roommates, minimizing expenses, and avoiding consumer debt helped me maximize my savings.
When I turned 21, I had enough saved to make a down payment on my first home. I didn’t go for my dream home; instead, I focused on affordability and rental potential. I put $20,000 down on a three-bedroom condo and rented out two rooms to cover my mortgage.
Until I was 25, I paid nothing for my mortgage, allowing me to stash money in my TFSA (Tax-Free Savings Account, similar to a Roth IRA in the U.S.). I maximized my TFSA contributions every year while continuing to fund my RRSPs.
From 25 to 28, I expanded my investments by purchasing a second home and renting out my first property, which covered 30% of my new mortgage. This period allowed me to invest more while paying down equity in two properties.
Today, my focus is on a blend of dividend-paying stocks and high-growth potential stocks. I invest in established companies that offer solid returns. The future holds continuous learning and growth for me.
Achieving financial independence doesn’t have to be extreme. While some investors choose to save every dime to retire by 40, that’s not my path. Financial independence can come from living a balanced lifestyle, making informed decisions, and buying only what you can afford.
Debt is a hindrance you should avoid. Spending only what you can afford and not stretching your income to its limit will pay off in the long run. I hope this article helps you increase your net worth and guides you toward better financial habits. You don’t need to take massive risks or buy property to succeed financially. The key is to spend wisely, avoid debt, and learn how to invest.