Our Cost of Living

The cost of living is so distorted depending on where you live so I thought I would give you a financial snapshot of what it is like where we live, in the Comox Valley on Vancouver Island.

Many hear of real estate costs in BC and think Vancouver which actually has some of the most expensive real estate in the world, completely out of control based on local wages. Average house costs there are over a million dollars depending on which study you look at.   We are across the water from Vancouver and actually have a pretty reasonable standard of living on a middle income.  The average house cost here is $362,000 as of end of January 2016.  Our home was purchased for $384,000 (1700 sq ft 3 bedroom on crawlspace on keyhole street) but is less than 10 years old in a great neighborhood.  If you were willing to go with an older home or different neighborhood you could easily purchase a home here for $220,000 + and condos start at $100,000 for something older/not great neighborhood to $200,000 for very nice in great neighborhood.  Unemployment is high but if you have assets which would allow you to pay off all your debts and live on a lower income this is definitely a great place to live with beauty all around you - which is exactly what we did.  We brought our own jobs with us with self-employment.  The employment year prior to us moving here we made 3x as much as the current salaries we pull from the company - and we have a much nicer standard of living  now with a lot more freedom.

Other costs:

Groceries - based on my frugal budget ours is $550 for two adults included all non-food items like OTCs/makeup etc.

2015 figures taken straight from my budget costs:

Electricity $1663 - 1700 sq foot house  with heat pump/AC ran by electricity and a hot tub (*home has windows in every room so we rarely have lights on except late at night in summer and after 4pm in Winter)

Natural Gas $663 - hot water tank, fireplace (only used occasionally but more this winter since natural gas is cheaper than electricity), and BBQ

House Insurance- $906 includes earthquake insurance for structure and contents(that is optional but so important here)

House tax - $3071/year-we pay in full each June.  Includes water and sewer.

Current cost of gasoline - 90 cents per litre.  We are one of the cheapest places on Vancouver Island to buy gas - always which makes no sense as they have to truck the gasoline further than Victoria or Nanaimo but the larger the town/city the bigger the price.

Other costs are about the same anywhere for things like cable and entertainment - except people tend to do more free things outdoors here as we live in such a natural playground.  You end up with weird expenses like buying kayaks which we did last year (Costco - $400 each plus $75 each in safety equipment) but that expense is one time and should last us many years to come.  We also bought snorkels and flippers - $60 each, again, an expense which we shouldn't see for many more years to come.  Our entertainment mostly consists of observing nature for free - gotta love free!

There is less entertainment here - and what we do have is cheaper like local theatre productions and smaller concerts.   If we want the big city we only have to go 1.5 hrs to Nanaimo or 2.5 hours to Victoria.  There are tons of festivals and things to do if one seeks it out.

It costs a little more to fly off the island than it does the mainland, although in the last several years the airlines have built in the connector costs - our flights to Spain included the connector which saved us $250 compared to when we went to Portugal 2 years ago.

Everyone says the ferry costs are ridiculous here - and they are quite high - but in almost 4 years of living here we rarely take the ferry.  We usually fly off the island.  For those unfortunate enough to have to use the ferry to go to specialists etc I agree, paying over $100 per direction for a vehicle and one person to travel from Nanaimo to Vancouver is outrageous.  The last time I took the ferry was in 2014 when we went to Quadra Island for the weekend.  Hubby takes it occasionally for business but that is usually reimbursed by our clients in Vancouver.  It really is not necessary to travel off island for much - it is a very large island and you would be hard-pressed to not be able to find something you were looking for here.  When that happens you order it - free shipping with amazon :)  We order our office supplies for the Company from Eastern Canada as they are so much cheaper than being at the mercy of the big box office supply store here - and those get delivered for free usually within a day or two.

Our vehicles cost relatively the same as when we lived in Alberta - except hubby's sports car which we find extremely reasonably priced here for a specialty mechanic and in Alberta we  paid 2x as much.
Yes, we pay 12  % tax here but since our Province rejected the harmonized sales tax we have 5% GST and 7 %  PST.  The benefit to separate taxes is that lots of items are excluded from PST.  When we got our floors installed we only paid GST on product and installation as if you get a tradesperson to do the work you do not pay PST.  If you buy the floor and install it yourself you pay 12% GST and PST on product.  That rule is to benefit employment which I think it has.  There is no PST on things like books, education, or consulting.  A pretty fair system if you ask me.  Alberta only had 5% GST and no Provincial sales tax, which is likely to change now that oil has tanked and they cannot meet their budgets.  In Alberta healthcare was free - also likely to change very soon.  Here we pay $150 for a family of 3 per month for basic healthcare (no dental or prescriptions included but all hospital/doctor visits).  I am just in the process of deleting my Stepdaughter as she has set up her own healthcare but believe the rate for two adults is approximately $120 per month.  The $150 is the maximum any family in BC pays, regardless of number of children or income.  British Columbia has had a balanced budget for the last several years - something I was very surprised at.  Unemployment has always been an issue in this Province, which is one of the reasons why I left right after highschool for Alberta but things seem to have gotten better on the employment front since we moved here 4 years ago.

I usually don't talk about our retirement savings/plan and that is for a good reason.  Our financial picture is much different than most.  We had a paid off house when we left Alberta - worth twice as much as the home we bought here and were fortunate enough to sell it just before the Alberta real estate bust technically selling for what we bought it for (lost some on realtor expenses).  We stuck the rest of the money into our retirement fund.  We had extremely good jobs in Alberta which had pensions that we commuted and took on our own to self-direct which hubby enjoys and is good at.  We do all of our own investing, staying mostly ahead of the market and saving a bunch of money of investment fees.  Even with drops in the stock market we are doing fine.  We have zero debt.   We have always lived below our means even when we had a really high income and paid down debt.  We are self employed.  My husband is 53 and I am 46.  We intend on him taking out Canada Pension Plan at the earliest possible moment.   That also means we get senior discounts on things like house taxes much sooner than I would have normally.  We live frugally.

All of our college costs for the kids are already saved for, likely overfunded at this point based on the amount of money hubby put away since they were born.  Yes, we are extremely fortunate but none of that came without a ton of hard work, blood, sweat, tears, and delayed gratification.  At this time we no longer contribute to our retirement as feel based on our current lifestyle and the fact that we can work as long as we wish to there is no need based on what is already in there.  We do contribute to assets outside our retirement fund like the condo my Mom lives in but we own.  She pays us rent (lower than normal market value)- which adds to our monthly income.  

We canceled our life insurance last year with zero debt and no longer required by the court for child support reasons- another $100 a month in our pockets.  Our cost of living is going down, not up as effective September (when Stepdaughter is on her own financially) we no longer have to financially support any kids and child support ended when my Stepdaughter moved from her Mom's house.  We intend to help the kids out when they buy their first homes a small amount - that has been planned for many years.  We run a tight ship and did so even before we met one another, therefore our two households combined and financially things worked out.  I realize that doesn't happen for everyone.  Things like divorce, illness, and death of spouse/loved ones interfere in a lot of situations.  I lived in poverty as a child of a single working mom with a deadbeat dad and never intend to live that way again, therefore I am like a squirrel as hubby says.  I squirrel away money and groceries.  Both of us are not too proud to work for someone else/pump gas if necessary to live.  

We spend a lot of money on traveling right now, based on the fact that everyone says they are going to travel later in life and they rarely do or are unable to due to illness/caring for family.  I want to travel while I can and we make it fit into the budget.  If that changes down the road, so be it. We rarely eat out and when we do it is usually pretty inexpensively.  We are homebodies.  We don't keep up with the Joneses and have never felt the need to.  We own more vehicles than necessary, as both work from home but if the financial picture changed a vehicle would be the first thing to go.   We don't have expensive hobbies - unless you counting kayaking and that was a one-time investment.  We buy used when possible, including clothing.  We cook meals from scratch.  When we don't feel like cooking we sometimes add toppings to frozen pizza (bought on sale for $4 or less) to prevent much higher/less good for you expensive meals out.  We use credit cards and happily pay the annual fees - which save us at least $1000 each year on travel costs while at the same time paying zero interest as always pay them off in full.

I married someone almost 11 years ago that was like-minded financially - we were very lucky to find each other and have worked very hard to have the life we currently lead.  This will be the only post where I discuss our retirement/assets as never want to rub it in anyone's face if you aren't in the same position.  I just want to say we were in debt just like everyone else - and it took a long time to get out.  We had financial issues - hubby paid a ton of money (nearly twice the current value of our home) in child support to his exwife as she did not work nor contribute financially one single cent (unfair court system) to the 4 kids upbringing, even when they lived with us she was not required to pay child support.  He also funded their education 100%.  Life is not fair- you just have to deal with it.

This blog was started when we still had debt, still had education expenses, still were contributing to our retirement, still had child support.  Now our snapshot is different and we still try and live rich cheaply because we hope to preserve the life we have worked so hard and long to get. Thanks for coming along for the ride.