Student Investor – Millennial Revolution

FIRECracker is a world-travelling early retiree. She used to live in one of the most expensive cities in Canada, but instead of drowning in debt, she rejected home ownership. What resulted was a 7-figure portfolio, which has allowed her and her husband to retire at 31 and travel the world. Their story has been featured on CBC, the Huffington Post, CNBC, BNN, Business Insider, and Yahoo Finance. To date, it is the most shared story in CBC history and their viral video on CBC’s On the Money has garnered 4.5 Million views.

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It’s time for another reader case!

But before I continue, I just want to let you know about an amazing offer from Porchlight on our upcoming book, Parent Like a Millionaire (Without Being One), out on March 3. From now until Feb 17, you can pre-order for only $13 USD (a 35% discount)! And if you bundle it with our first book “Quit Like a Millionaire”, you get 2 books for only $25 USD (35% off)! We have written about multiple tax optimization and savings strategies in it to save you thousands of dollars, so the book easily pays for itself. As always, thank you for reading and for your support!

And now on to our reader case.

Hi Kristy and Bryce, 

I hope this email reaches you both well! 

I entered the adult world yesterday (keep in mind I’m 22 years old). I decided that was it!!! I had had enough!!!! I couldn’t let my savings continue to sit in a stale savings account so I followed your workshop and have set up my Questrade and Passiv accounts. I’m now at the point of picking my ETFs, and thought I’d write to see what you would recommend. 

My situation is a bit different than perhaps the regular investor because I don’t really have a monthly income. I’m currently completing my Master’s degree and am supported through an NSERC scholarship that pays out in three stipends across the year (ie. 9000$ in the fall term, 9000$ in winter, 9000$ in spring). I TA on top of this, but this only made about 2700$ last term (I am only given a “half TA” load due to my scholarship). I also earned an admission scholarship (7500$ paid out across three terms), so my tuition was reduced for the entire first year (the extra came out of my stipend payments). 

However, my scholarship is non-renewable meaning I will be fully relying on TAing/supervisor next year (my university guarantees a 25 000$ stipend amount for this). I will also have to pay tuition next year, which factors in another cost. 

The fun part now: I got an inheritance of 30 000$! Don’t worry – my grandfather is alive and well. He simply wanted to give me my inheritance early so that it could either help with school or so that I can invest it (rather than sitting in his stale savings account). My other grandfather had also set up a savings account for my education, which totaled to about 14 000$ (but about 4000$ was used for rent last year). My idea is to use the remaining 10 000$ from this second savings account to pay tuition next year, invest the entire 30 000$ inheritance (future down payment), and then live off of the scholarship/TA pay. Since I won’t necessarily need the 30 000$ for about 10 years (assuming my partner and can afford a house in our early thirties), I thought either 50:50 or 60:40 equity to bonds. 

So to summarize my finances: 

Winter 2026 term (Jan-Apr):

+9000$ (scholarship stipend)

+30 000$ (inheritance)

+10 000$ (thank you grandpa!) 

+ 2500$ (admission scholarship)

+ 2700 (TAing)

-2456$ (tuition)

= 51 744$

Spring 2026 term (May-Aug)

+9000$ (scholarship stipend)

+ 2500$ (admission scholarship)

-2456$ (tuition)

= $9044

Fall 2026 term (Sep-Dec)

+8333ish (TAing and supervisor top off)

-2456$ (tuition, but will probably increase a few dollars by next year). 

= 5877$

And then the Fall 2026 situation repeats itself for the next two terms (hopefully I will be graduating in August 2027). 

As you can see, my income will drop throughout the year. This is part of the reason investing worries me – I need to have some savings easily accessible to help supplement the reduced income during my last year of grad studies. To also note, I have about 20 000$ in savings from working throughout my undergrad; this can also supplement living costs or be invested. 

To directly answer your specific questions: 

Your gross/net annual family income: 

+9000$ (scholarship stipend)

+ 2500$ (admission scholarship)

+ 2700 ((TAing, likely a bit less because I am TAing a different course this term at a different pay rate). 

-2456$ (tuition)

+9000$ (scholarship stipend)

+ 2500$ (admission scholarship)

-2456$ (tuition)

+8333ish (TAing and supervisor top off)

-2456$ (tuition, but will probably increase a few dollars by next year). -> but ignoring this since I want to use the 10 000$ from my grandfather to cover tuition

-15 000$ (rent)

+ 3000 (freelance photography, this is a super rough estimate since work isn’t guaranteed)

= 17 121$ -> what I have to live off for the year

Your monthly family spending:

-300$ groceries 

-30$ coffee (I like to study in coffee shops okay )

-20$ coffee beans (

-50$ household things (this amount varies, sometimes suddenly I run out of bathroom cleaner, dishsoap, detergent all at once or sometimes I spend nothing on this category)

-74.39/4=18.60$ (cat food, but I only have to buy it every four months or so. Treats and litter factor into my grocery costs). 

-22.60$ (phone)

-56.50$ (internet)

-50$ (Uber)

-50$ (arts and crafts, hobbies) 

-100$ (date nights, going out) 

=697.70$ -> Give or take a bit extra certain months (train tickets to go home, dance lessons, camera equipment)

For any debts you have, please include:

Yay! I graduated from undergrad debt free! I currently have a whopping 4.04$ on my credit card. 

Any fixed assets you have (house, car, etc.)

NA

And investments or savings you have (cash, bonds, stocks, etc.)

That’s why I’m writing to you!

So back to my investment journey. I want to invest ethically, but I recognize that there will likely have to be some compromise no matter what (even the SPXT “no tech” ETF has holdings in Tesla and Meta). For as much as I can, I would like to avoid AI (not because of the bubble, but because of environmental harm), military/defense, and fossil fuels. I’ve been looking around, and the majority of “ethical” index ETFs have low distribution yields. At the same time, I wonder how much it’s really making a difference since even something like the ZGRN Paris Aligned Climate Equity Index ETF has holdings in Meta, Amazon, and Apple. In this sense, is it worth going with an “ethical” index ETF with a lower distribution yield since it’s never entirely ethical? Do you have any recommendations for how I can maximize my investment while limiting unethical investments as much as possible? 

Thank you both for reading through my email. I appreciate any advice or suggestions you may have and I look forward to hearing from you!

Best regards, 

StudentInvestor

This is very unique reader case because this person is only 22 years old and still in school! Considering how I barely knew my ass from a hole in the ground at that age, and she’s already thinking about investing, blows my mind! The other thing that really jumped at me is how much time StudentInvestor will have for her money to grow in the market and use the power of compounding to her advantage decades before everyone else! That said, I also remember living in moldy basements, surviving on instant noodles, and desperately looking for internships jobs to pay tuition, so I probably would’ve rather cut off my own arm than part with that hard-earned and vital-for-living money and putting it into investments. But StudentInvestor is in the envious position of having graduated debt-free from undergrad and having a small inheritance from her grandparents, so maybe leveraging the power of compounding makes sense in this case?

Let’s find out. As we always say on this blog, let’s Math That Shit Up!

Student Investor only spends a measly $8372.40 per year (which, incidentally, is how much we’re spending to raise our 2-year-old, so maybe we are being way too boogie with our kid?) because her rent of $15,000/year is being covered by her scholarship stipends. What’s confusing about how she’s breaking down her numbers is that she’s subtracting rent (and other costs) from her income and then ignoring one semester of expenses and saying her inheritance will cover it.

This muddles her math, so I’m going to simplify it by breaking out her tuition as a separate cost, putting her rent as part of her spending, and grouping her savings and inheritance as investible assets:

When you break it out like this, you can see that her scholarship and TA earnings is just enough to cover her tuition, rent, and living expenses with small surplus of $3259.60! That’s amazing, considering how most people graduate with buttloads of debt and explains why she went into grad school debt free! 

Nicely done, student investor!

So even though she got an inheritance, she really doesn’t need it to live on, so it’s a bonus that can help give her a leg up by growing exponentially when she starts working. 

Since the goal here isn’t early retirement (yet), it’s more about what she can do with this extra money and how fast it can grow and what it can become decades later. 

At age 22, if she were to invest the $50K made up of her savings and inheritance in a balanced 60% equity/40% fixed income portfolio of index funds like the one in our Investment Workshop, in 10 years, at the age of 32 that number would become: 

Nearly double to $90K, assuming conservative average long-term return of 6%/year! 

That said, it’s probably a good idea to have some money set aside to pay for tuition, just in case the TA-ing and photography side income dries up. She wants to set $10,000 a side to pay tuition next year, which leaves her with $40K to invest, which in 10 years, would grow into:

$70K! Nearly double by sitting on it and doing nothing. 

If she doesn’t need the money for 10 years, she could afford to go with a more aggressive allocation of 75/25 (equities/fix income), which tend to have higher returns over 10 year periods but will be more volatile in each individual year. That being said, it depends on her comfort level. You don’t know how you’re going to be as an investor until you’ve experienced a bear market. So, I would leave this decision up to her, since she is the one who has to keep herself from panic selling during bear markets. 

In terms of her question about ethical investing, our advice is to avoid stock picking and diversify by investing in the index. Then take the proceeds and donate it towards a cause you care about. The problem with ESG funds is that it’s highly subjective. What is ethical one year, can quickly become unethical the next, and is also dependent on who you ask. Tesla was considered very ethical a few years ago, and now it’s the opposite. And like she said, even the “ZGRN Paris Aligned Climate Equity Index ETF has holdings in Meta, Amazon, and Apple”, so trying to avoid AI is futile. 

At 22, StudentInvestor is doing very well for herself. She has no student debt, continues to save because her tuition and TA income can cover her tuition and living expenses and her inheritance is just the dessert, not the whole meal. If I were her, I would put aside the tuition money for next year, and then invest the rest in a balanced, diversified portfolio comprised of globally diversified index funds. She can donate a part of her earnings to a cause she cares about, like green energy, to offset the harm done by AI. 

What do you think? What should StudentInvestor do with her inheritance?

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