I haven't updated this thread for a while. There have been some changes to my life.
The most important one is that my partner is pregnant and I am expected to become a parent in October. We first tried IUI and then IVF. On 30 January at 6:45, I learned that the egg retrieval was scheduled on 2 February and I immediately booked a ticket for the Netherlands and left Toronto at 17:55. On 17 February we did the pregnancy test together and the result was positive. I flew back to Toronto on 18 February and announced the news to my colleagues in the following week.
This has changed my plan quite a bit. In Ontario, an employee is entitled to parental leave of up to 61 weeks. Although it is not obligatory for the employer to keep paying the employee any salary, the employee will enjoy employment insurance payments. In my case, it can be either 537 CAD per week for 35 weeks, or 322 CAD per week for 61 weeks. Once I announced the pregnancy, it has become practically impossible for my employer, both before and during the parental leave, to fire me.
If everything goes well, my partner will move to Canada in April or May. In the first few months, we could just stay in our 2-bedroom apartment. But once the baby is here, it does not seem to make much sense any more.
Currently I am paying about 1,800 CAD a month for rent, utilities, and Internet. I sublet the other bedroom and the living room for 1,400 CAD per month and therefore my own housing costs only 400 CAD a month. With a crying baby, my partner, and our three cats, it won't be practical to keep having two roommates. But then there is really no reason for us to live in Toronto any more and spend 1,800 CAD a month on housing.
My plan is to find a detached house with at least three sound-proof bedrooms. More space, especially a backyard, will be good for my partner and the cats. Also, we can Airbnb the other two
sound-proof bedrooms both before and after the arrival of the baby. I first considered moving to Nova Scotia, where there are many beautiful houses with plenty of land for less than 80,000 CAD (like
this one), or in Newfoundland, where I found
this property with great Airbnb potential. I actually contacted real estate agents and collected various numbers (property tax, average utility costs, maintenance costs, potential rental income, etc.) The more research I did, the more excited I became.
If I purchase such a property, it seems a very realistic and even comfortable option for me to take 61 weeks off. Below are my estimates on the financial front.
- Incomes
- Employment insurance: $1,400 a month.
- Child benefits: $800 a month. (We will have very low income, at least on paper, to be able to receive child benefits.)
- Rental cash income: $800 a month. (We bought a rental property in January in Windsor ON for 190,000 CAD and rent it for 1,800 CAD + utilities a month.)
- Costs
- Housing and food: should be negative after deducting Airbnb income.
- Taxes: 0. (We will make sure that we are poor on paper. Also, various costs, e.g. structural depreciation, can be deducted from rental income.)
- Car insurance and fuel: 500 CAD a month. (I don't have a car but plan to buy one for the baby.)
This calculation seems to allow us to have a comfortable life without having to work! Financially it really does not make much sense for me to go back to work. I would make only 4,800 CAD per month extra post tax compared with staying at home. (Employment Insurance and Child benefits will become zero if I work.) The vesting of my stock options, which are probably worth much more than my salary, would continue in both cases. My cost will go up if I have to have a place to sleep in Toronto.
There are however a few problems.
- Practically, the timing to move to our new house is tricky.
- Before the delivery of the baby, it does not seem very practical for my partner to move to and live alone in NS or NL while I still work in Toronto. What if there is any medical emergency?
- Immediately after the birth of the baby, we probably will be too busy and exhausted to move.
- Financially, the plan depends on a lot of estimates.
- What if the Airbnb income turns out to be less than expected?
- Will we have enough energy to do Airbnb?
- Have I underestimated the costs of having a baby? We have never had any children before and it is the unknown unknowns that are scary.
I may have to go back to work if my estimates are really wrong. (I do not want to sell any of my investments and see my wealth diminish!) But it will be much trickier if we have already bought a house in Nova Scotia or Newfoundland and moved there.
To mitigate such risks, we have decided to first rent a house in Barrie for up to 1,800 CAD a month, with at least three bedrooms and two bathrooms, and try to do Airbnb there. We should be able to make a better decision once the unknown unknowns are gone.
So our current plan is as follows.
- My partner moves to Toronto in April or May.
- Together we buy a car and look for a house in Barrie.
- We move in the new house in May or June and immediately start with Airbnb, while keeping the apartment in Toronto for only 400 a month.
- I sleep in Toronto Monday - Thursday. I will still be able to get to Barrie if there is any medical emergency before the birth. (I could potentially Airbnb my own bedroom for Friday - Sunday.)
- I take parental leave when the baby is born and stop the lease in Toronto.
