Well first things first. Spend some, it’s good for your soul and good for the economy!
Living on the current minimum wage is tough. The good news is minimum wage is increasing to $14 per hour on January 1, 2018. That is an increase of $2.60 per hour, or about 20% in just over one and a half years.
So by all means spend some of your well-deserved wage increase. Maybe buy a few clothes, enjoy a steak, pay down some credit card debt, and buy your mom the present you always wanted to get her and never could.
But don’t forget about your Future Self! Managed correctly, this wage increase could be a life-changing event for YOU!
If you are 25 years old, you likely have another 40 years of work ahead of you, and you will likely live much longer than that.
If you were to save JUST $1 per hour of your $2.60 per hour wage increase until you turned 65, and invested it all in an equity portfolio that earned an average of 8% per year in your TFSA, you would have a staggering $539,000 when you turned 65!