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The Economics of Pet Ownership

Furry friends don’t come cheap.

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Caring for a pet can be a great way for kids to learn responsibility, but they don’t come cheap. Americans spent $123.6 billion on their pets in 2021, up nearly 20% from 2020 (aka the Year of the Pandemic Puppy).

Here’s a closer look at some common costs of common household pets.

Dogs

Man’s best friend? More like man’s priciest friend: dogs cost their owners $1,391 a year on average between food, vet visits, grooming, treats and toys. And remember: the bigger the breed, the bigger the food bill.

Adopt > shop: Especially if you’re buying designer. Tibetan mastiff puppies can run from $3,000-$5,000, all the way to $1.95M!

Cats

With many of the same carrying costs as dogs, a pet cat will run you $1,149 annually. And while you won’t have to pay for a dog walker, you’ll want to set aside $150/year for litter—unless you plan on monetizing your kitty as a “petfluencer.”

Pro tip: It’s cheaper to invest in scratching posts and cat towers than new couches and carpets.

Birds

The chattier the bird, the more expensive: cockatoos and macaws can have a $5,000+ price tag, while parakeets are the “cheepest” (sorry). Parakeets are also quite budget-friendly, with annual costs of only $185.

Customers also bought: You’ll want to invest in an air filter if you plan on getting a cockatiel, cockatoo or African grey, which produce a lot of “dusty powder down“.

Fish

Fish can be one of the least expensive pets to own, or one of the priciest. Try $300K for a single Asian arowana… Saltwater tanks also cost significantly more than freshwater. Plan to budget $15-200 per month.

Budget for home decor: Found Nemo? Next, you’ll want to kit out their tank with lights, gravel, plants and driftwood. Treasure chest optional.

Gerbils/hamsters

A popular “starter pet” for kids, they’re relatively inexpensive and low maintenance. (Even the Cadillac of hamster wheels is only $35.) Again, litter is your biggest cost, followed by bedding—which you can DIY using toilet paper. Although that might actually increase your expenses now that TP prices are on the rise.

Guinea pigs come with a 2x multiplier: Guinea pigs are social creatures. This from the guinea pig lobby: experts recommend picking up a pair so they don’t get lonely.

Rabbits

A pet rabbit’s diet consists of hay, high-fiber pellets and plenty of fresh veggies, costing owners about $190/year. Green thumb? Grow your own “rabbit food”.

What’s up, doc?: Rabbits have been known to gnaw on cables and drywall, making for potentially pricey snack sessions. Stay vigilant!

Reptiles

Like birds and fish, reptile costs vary: expect to pay $30-50 for a leopard gecko or baby iguana, and $100K+ for a rare white monitor lizard. Also like fish, there’s a high start-up cost involved, with terrariums typically ranging between $100-$180.

Cold-blooded ≠ energy efficient: Between the under-tank heater, heat lamp and lighting, reptiles will run up your electric bill almost as quickly as a teenager.

#investing #kids #money #spending

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Age 5

The one about allowance.

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A wise accountant once told us people spend 40% less when they buy with cash and not credit. Is this true? Maybe. What does it tell us? Your little person needs to see and understand money before they start spending it. The majority of us transact with plastic or phones, so kids don’t see money anywhere. It’s tough to value what you can’t see. Good news, your five-year-old will happily save for their goals or simply for saving’s sake, if you normalize and encourage it.

Start here.

One great way to make money visible… allowance. We get a lot of questions about allowance.

Take this Advice.

It’s allowance, not bribery. Think of allowance as a fixed weekly or bi-weekly “salary” for being a kid. Chores? They’re part of being a good citizen. Don’t pay for them. Set an allowance, and keep it consistent.

I haven’t carried money since the 90s. No problem. A mom we admire uses cotton balls as her in-home currency. Her kids’ allowance is paid in dollar balls. Cotton fills a jar fast, which may have your five-year-old feeling and acting like a plutocrat (all pretty harmless until they start asking about tax havens…)

Save Spend Share Shares. Sure, your kid can direct their allowance into separate “accounts”. 50% into saving, 25% into spending, 25% into sharing? Maybe. But while giving is important, don’t overlook the importance of giving time. Experiential giving makes kinesthetic memories. And putting that extra 25% into a “shares” jar to invest could mean your child has a meaningful nest egg to dip into for philanthropy once they’re older.

BONUS.

Don’t Create a Wage Gap. These are your child’s formative years. Champion equality. Remember that women still earn 82 cents or less on the dollar, and it might be a good time (and a great conversation) to make that up to the young girls, girl-identifying, and nonbinary kids in your home.

#age 5 #Financial Literacy by Age #investing #kids #money

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SpongeBob’s Road to Real Estate

A Pants-Wearing Sponge Cleans Up in the Housing Market. Here’s the Takeaway.

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Against all odds, everyone’s favourite sea sponge is doing quite well for himself: he owns his own home! Say what you will about SpongeBob’s fashion, food, and career choices, this kid’s captured a milestone that’s a dream for many. And he’s not just captured that milestone, he’s slayed it.

SpongeBob’s hollowed-out pineapple home is allegedly worth $18 000 000 — almost 3X what Drake paid for his Toronto manse. Consider the view: “This post-modern tropical gem features 360-degree ocean views and three stories of nautical luxury,” boasts a video on SpongeBob’s official YouTube account.

Okay, so how did he do it, and what lessons can we soak up from this real estate rockstar?

Millennial Bob: A fiscally savvy thirtysomething

Thanks to a glimpse fans once got of his driver’s license, we know SpongeBob was born on July 14, 1986 — so, he’s a millennial at age 35. Those who grew up watching SpongeBob SquarePants may find it hard to believe that he’s been more disciplined with his finances than the majority of us, but hey, crazy things happen under the sea. Let’s consider that Bob may be a financial wizard, and deconstruct his money moves.

He’s a famously devoted fry cook — some say the world’s greatest — at the Krusty Krab, Bikini Bottom’s favourite fast-food joint. Work ethic? Check! Income? … inconsistent. In one episode, according to Spongepedia, Bob claims to make under ten cents a year. In another ep, we learn that he pays his boss, Mr. Krabs, $100 an hour for the privilege of working. We’ve seen him pocket an envelope of cash on payday, so he does get the occasional haul, but really Bob’s the original gig worker.

The Takeaway

He’s been side hustling since he was 12— jouster, chef, lifeguard, lawyer, the list goes on. Bob started early, put time to work in his favour, and probably learned a thing or two about compound interest along the way.

Is he investing? Probably. He’s sure invested a lot of time over at Mrs. Puff’s Boating School, where he’s failed to get his boating license 1 258 058 times. Silver lining? He’s saving money on gas and boat payments, and likely making that money work for him in the markets.

And finally, Bob knows a deal when he sees one. Submerged “land” is considerably cheaper to buy than its above sea equivalent. In Canada, a man recently listed two lots, “presently underwater,” for the bargain price of $99,000.

Is this the investment property to sink your savings into? We prefer drier. But hey, location, location… floatation!