Doing More With Less: Part 2

IKEA Canada's vision is to create a better everyday life for the many people, and naturally, great design, quality, and affordability are key. But what does “affordability” really mean? Last fall, Selwyn Crittendon, CEO and Chief Sustainability Officer at IKEA Canada, gathered some of Canada’s top finance experts to discuss what it means to do more with less.

Panel guests included moderator Bianca Freedman, Chief Executive Officer at Edelman Canada; Shannon Lee Simmons, founder of the New School of Finance and personal finance writer for the Globe and Mail; Nathan Kennedy, content creator and host of the podcast “New Money with Nathan Kennedy,” and Rachel Wong, co-founder of Monday Girl, Canada's leading network for professional women.

With costs continuing to rise in Canada and worldwide, the obvious question is how can we shift our focus to doing more with less as Canadians? In a post-pandemic world, what does affordability truly mean? “When times get tough, the first thing we tend to think about is what we can cut out,” says Selwyn Crittendon. But the IKEA CEO wants to change the narrative: “For me, it's not about living without, but what can we do together to ensure Canadians can live healthy, sustainable lives more affordably?” Of course, one way is by shopping some of the many beautifully designed, multi-functional products and smart storage solutions that are made to support people living in small spaces and on a budget. 

Nathan Kennedy’s approach is all about getting creative. “Canadians have to find scrappy ways to pay their bills without losing sight of tomorrow,” he says. One way is to treat yourself like a bill. By that, Kennedy means withdrawing a couple of hundred bucks a month and “paying” yourself to a separate account. “It comes out just like every other bill—only you get to take this little bit and stow it away. It’s a simple thing—you can do it on your phone in five minutes,” he says. ”And it really can add up over time.” 

When it comes to the thorny topic of home ownership, Kennedy has some thoughts. “A lot of times, real estate isn't the greatest investment in the world—unless you’re cash flowing,” he says, wondering aloud how many 25-year-olds have $150,000 to put down on a condo, let alone a house. Instead, he advises people to focus on reworking their budgets, “and maybe renting, and investing the rest, and finding different solutions,” he says. 

Shannon Lee Simmons agrees it’s time to get crafty. “I think we have to turn the dialogue on its head,” she says. “The hand many people were dealt ten years ago doesn't apply anymore.” Now, affordability for the average person is a series of different things—including finding innovative ways to secure housing that makes you feel safe but also lets you save for the future. Lee Simmons consistently reminds clients (and herself!) that it’s important to play the long game when it comes to money and affordability. “So much of it is a little bit for a long time, and that's a really hard reminder when you're scared and panicking.” 

This scenario is all too familiar to Rachel Wong, given that much of Monday Girl’s membership skews younger. “Of course, they’re concerned about housing,” she says, “They're concerned about—’ will I be able ever to afford anything— let alone afford my rent?’”  

For Wong, financial literacy is crucial—especially for young women— as is having a sounding board to give and receive feedback. She points to a successful campaign launched by Monday Girl —#PayDay series where thousands of members anonymously submitted what they earn, what they spend, and—(cue hard swallow) what they save. “I think opening up that sort of transparency is super key for women,” says Wong. “What we're hearing is ‘thank you so much for opening my eyes.” Having this space helps members—many of them junior level— realize they aren’t the only ones finding it tough to get by right now. 

At the other end of the spectrum are Canadians aging into retirement—many of them Lee Simmons’ clients. Where once people saw their house as equity— the “ace up their sleeve,” as she puts it, and could sell and downsize, these days it's “‘downsize into what?’ Where are you going to live?” Plus nowadays, people are increasingly renting into retirement. “They never got the house because they couldn't afford it because things changed so drastically,” she says. As a result, she’s seeing a trend of an extended semi-retirement phase. Lee Simmons often advises clients to push CPP and old age security to age 70 to boost inflation-protected guaranteed income for life, “which means working for longer,” she says. ”It's a bummer. It's a reality. It's a real thing.” 

At the same time, Lee Simmons wonders if the last 50 to 60 years were ever sustainable. “This idea that one day at 55 you’d kick up your feet and live for 40 years with no money. Like what? That’s wild!” she says. “So I also wonder if the boomers –they got lucky.”

In our next post, we’ll explore the circular and second-hand economy and how it can help Canadians navigate rising living costs.