The Average Canadian Household Net Worth Is Huge!

The average Canadian household net worth is surprisingly huge at roughly $680,000 in 2021, up from $400,151 in 2012 according to Statistics Canada. The average Canadian household net worth is roughly 2X the average U.S. household net worth.

Not only is the average Canadian net worth larger than the average American net worth, the Canadian housing market is also hotter than the American housing market! If the U.S. housing market ever gets as hot as the Canadian housing market, U.S. home prices could rise by another 30% – 75%.

When you think of Canada, what do you think? I think wonderful skiing in Whistler, hockey, maple leaves, free healthcare, cold weather, Hong Kongnese buying up Vancouver, French Quebec, McGill University and Blackberry devices. Seldom do images of extravagance and wealth come up.

You would be hard-pressed to name three well-paying international Canadian firms. Whereas you could easily name a dozen international American firms like Google, Facebook, Goldman Sachs, and more. As a result, the average Canadian household net worth might be overly-inflated given real estate prices have done so well.

Canadians Are Rich!

Despite the perception that America is the land of opportunity, we are falling behind with even The Associated Press saying that 4 out of 5 Americans are at risk of living in poverty or near-poverty at some point in our lives. That's pretty sobering news given how hard we work.

For example, Vancouverites boast the highest net worth of all Canadians at roughly $1,144,204. Torontonians on the east coast have a average net worth of roughly $966,0000.

I've argued why Socialism could be a means to a brighter future to much disdain by readers everywhere. However, with this latest data about Canadian household net worth coupled with the research I conducted abroad in Socialist Europe, it's become evident that Capitalism is not the only means to wealth.

For those of us who live in the United States, a Joe Biden Presidency, at the margin, means we may be moving closer to Canada's government style. Therefore, perhaps the average net worth of Americans will increase as well.

Why Is The Average Canadian Household Net Worth So Huge?

To understand why the average Canadian household net worth is so high, let's look at some key reasons.

Real estate is booming in Canada

As of 2021, the median home price of $531,000 in Canada is 56% higher than the average US home price of $340,000. The chart below either says that Canadian home prices are at risk of a correction, or US home prices are severely undervalued. There's probably some truth to both.

$531,000 equates to 94.5% of the current average household Canadian net worth, which means the average household net worth is at risk of sharp movements in either direction. Other studies show that 60-65% of assets are tied into real estate. Either way, anything over 50% is quite risky after a certain age.

US vs. Canada Home Prices Chart

It is clear that the hot Canadian housing market is one of the biggest drivers of wealth creation. Below is another chart that shows how Canada's strong housing market has boosted the average net worth of millions.

If the below chart doesn't prove there is a Canadian housing bubble, I'm not sure what does. Canadian home prices have clearly decoupled from disposable income. Whereas in the U.S., the housing market actually looks undervalued.

The Average Canadian Household Net Worth Is Huge, largely due to a strong Canadian housing market

 Greater social safety net

Another reason why the average Canadian household net worth is so high is due to strong government social programs. When you've got free health care, strong unions, subsidized college tuition, and deep support for the unemployed you are more likely to be less stressed and do a better job at work or on your business.

As a result, the average Canadian gets to save and invest more of their disposable income. A lot of that extra disposable income has gone to housing. But some of the disposable income goes into the stock market as well.

Debt in a bull market

Canadian household debt runs roughly 160% of disposable income, one of the highest in the world. The debt is largely mortgage debt which has been going up in a relatively steady fashion for well over a decade.

Even during the global pandemic, real estate prices and stock prices have continued to go up. With cheap debt everywhere, Canadians and Americans are wisely refinancing their mortgage debt.

Check out Credible if you want to refinance your mortgage. You'll give no-obligation quotes from competing lenders in minutes. Mortgage rates are close to all-time lows. Take advantage.

Mortgage Interest Rates by Race

Smaller population

With a population of only 34 million in Canada, it's much easier for the Central Government to govern and take care of its people. The Low Income Cutoff (LICO) is around 10% in Canada. This compares to around 16% of Americans living in poverty as of 2021 according to the US Census Bureau.

Look at small countries such as Singapore, Switzerland, and Monaco. All have very high GDP per capital because it's much easier for the government to take care of its people.

Lower military spend

When you've got America as your neighbor, you don't have to spend as much on F-35 fighter jets to protect your country. The US will scramble their jets and switch on ARC Net in no time.

When you're not the World's Police, butting in every other country's business, military spend isn't as big a priority either. Canada spends roughly $20 billion a year on the military compared to $860 billion a year in the US. Americans say they are Canadians when they travel to some countries for a reason. It pays to be more peaceful.

More open immigration policy 

According to the Canadian government, 21% of the total population was foreign born in 2011, the highest proportion among any G8 country. Canada is a hot spot for immigration because they have major worker shortages in hospitality and skilled industries.

With Vancouver as the closest North American international airport to Asia, Vancouver is able to garner wealthy Asian traffic that bring with them strong savings customs.

In the US, we put up fences, pass discriminatory laws, enact trade embargoes and speak negatively about the Chinese. We also don't seem to get along well with the French.

Greater Canadian natural resources

When you've got oil, minerals, and gold, what more do you need? Canada is resource rich, providing a never ending source of wealth.

There's this enormous debate about the Keystone Pipeline project that would ship crude oil and bitumen all the way down to the refineries in Texas (cancelled by Joe Biden). Big bucks. Big dependency. Six figure jobs abound!

It's kind of like the Saudis ruling the world just because they've got so much oil. It's nice to inherit great wealth.

Slightly higher tax rates at lower income levels

The top Federal marginal tax rate in the US is currently 37% on single income of over $400,000 and couple income of over $450,000 a year. The top Canadian “Federal” tax rate is 29% of taxable income over just $135,054. The closest bracket we've got is a 28% tax rate on taxable income over $87,850 and up to $183,250.

Canadians also pay Provincial tax rates of 10%-16.7% on incomes as little as $67,000+. In comparison, California taxes income between $46,766 and $1 million at 9.3%, and California is one of the highest tax states.

By having a lower income threshold and slightly higher taxes, this means that more people contribute to ensure a healthier system. There is no constant droning on about how half of Americans don't pay any Federal taxes. Oh, and Canadians don't have estate tax either.

Canadian Household Debt Chart, Bloomberg

More Canadian Net Worth Statistics 2021

If you want to get down to the nitty gritty of the average Canadian net worth, here are some more facts.

Net Worth Canada Percentiles – Top 1%, 5%, 10%, and 50%  in Net Worth

  • The top 1% of net worth in Canada in 2021 = $9,737,000
  • The top 2% of net worth in Canada in 2021 = $2,500,000
  • The top 5% of net worth in Canada in 2021 = $980,000
  • The top 10% of net worth in Canada in 2021 = $840,000
  • The top 50% of net worth in Canada in 2021 = $482,000

Canada’s Net Worth Dollar Amounts Between Percentiles

  • The amount of net worth required to go from 90 to 95% = $140,000
  • The amount of net worth required to go from 95% to 99% = $8,757,000

High Net Worth Individuals Canada

  • Number of individuals with a net worth between $1 million and $5 million, High Net Worth, HNW = 764,033
  • Number of individuals with a net worth between $5 million and $30 million, Ultra High Net Worth, UHNW = 91,823
  • Number of individuals with a net worth greater than $30 million, Very High Net Worth, VHNW = 10,395

Average Net Worth In Canada By Province

  • Average net worth per household in British Columbia (BC) = $943,742
  • Average net worth per household in Ontario = $714,796
  • Average net worth per household in Alberta = $700,171
  • Average net worth per household in Quebec = $470,325

Average Net Worth Canada Statistics – Cities

  • Average net worth per household in Vancouver = $1,144,204
  • Average net worth per household in Toronto = $966,698
  • Average net worth per household in Calgary= $840,417
  • Average net worth per household in Montreal = $520,725

Average Household Income Canada Statistics – Provinces

  • Average income per household in British Columbia = $102,355
  • Average income per household in Alberta = $122,282
  • Average income per household in Ontario = $106,806
  • Average income per household in Quebec = $83,007

Related: Why Are Canadians And The French So Rich?

Canadians Are Living Large With A Big Average Net Worth

Despite long work hours and inventing so much of what we use every day (iPhone, Android Phone, iPad, Chromebook, Intel processor, Nike shoes, Google, Yahoo, YouTube, AirBnB, Pandora, etc) Americans are not the wealthiest ones in North America.

Canadians are King and Queen thanks to their extraordinarily strong housing market and Social system of governance. With stronger governance comes better managed financial institutions. A wider taxation net also helps ensure that a country is more united.

Although it might be hard to name a handful of Canadian billionaires, having a household net worth of $680,000 in your mid 30s to early 40s is not too bad at all. This is especially true if your health care is covered when you retire. If the average $680,000 household can keep working for the next 20 years, there's a good chance that many of them will become millionaires.

Americans can look forward to more Canadianized America given the redistribution of wealth and the ever growing size of the government.

Americans should think twice about working so hard and taking so much career and financial risk. Although there are risks with owning real estate, it's clear that over the long run real estate has helped more people get wealthy than not.

Related: The Best Life Hack For Americans: Taking Advantage Of Canada

Manage Your Net Worth Carefully

One of the best way to become financially independent is to get a handle on your finances by signing up with Personal Capital. They are a free online platform which aggregates all your financial accounts in one place. This way, you can see where you can optimize your money.

Before Personal Capital, I had to log into eight different systems to track 25+ difference accounts to manage my finances on an Excel spreadsheet. Now, I can just log into Personal Capital to see how all my accounts are doing, including my net worth. I can also see how much I’m spending and saving every month through their cash flow tool.

After you link all your accounts, use their Retirement Planning calculator. It pulls your real data to give you as pure an estimation of your financial future as possible. Definitely check to see how your finances are shaping up as it's free.

I've been using Personal Capital since 2012. As a result, I have seen my net worth skyrocket during this time thanks to better money management.

Retirement Planning Calculator

Grow Your Net worth With Real Estate

Besides finding out the average Canadian household net worth is ~$680,000, it's also interesting to see how much more expensive the average Canadian home price is. Real estate in America is DIRT CHEAP in comparison!

Therefore, I think it's wise to invest in U.S. real estate. With mortgage rates staying low, corporate earnings strong, and demographic trends towards even lower cost areas of the country, the best way to invest in real estate surgically is through real estate crowdfunding.

Here are my two favorite real estate platforms:

Fundrise: A way for accredited and non-accredited investors to diversify into real estate through private eFunds. Fundrise has been around since 2012 and has consistently generated steady returns, no matter what the stock market is doing.

CrowdStreet: A way for accredited investors to invest in individual real estate opportunities mostly in 18-hour cities. 18-hour cities are secondary cities with lower valuations, higher rental yields. They also have potentially higher growth due to job growth and demographic trends.

Both are free to sign up and explore.

I've personally invested $810,000 in real estate crowdfunding since 2016 to diversify my investments. It's nice to earn income 100% passively as I spend more time taking care of my children. 

Related posts about Canadian net worth and income:

The Average Net Worth For The Above Average Person

The Average Net Worth For The Above Average Married Couple

How Much Should People Have Saved In Their 401(k) At Different Ages?

More more nuanced personal finance content, join 50,000+ others and sign up for the free Financial Samurai newsletter. I've been writing about personal finance online since 2009.

101 thoughts on “The Average Canadian Household Net Worth Is Huge!”

  1. I am told that a median net worth figure is actually a more reliable indicator of net worth in a community than average net worth. This is because the net worth of a few billionaires in Canada will skew the figure upwards by quite a bit. Is it true that, generally, in Canada, “average ” net worth is 2 times that of “median” net worth?

  2. Good write,
    Well as someone having in depth view on Canada, so what do you say
    What do the Atlantic immigration Pilot and the Rural and Northern immigration Pilot Programs attempting to do?

  3. Canadians are generally the happiest and nicest people I have met while traveling the planet. They generally seem happy with their country.

    Many know their wealth comes from their proximity to the states.

    The smartest people I knew in college and high school ended up moving to the states and did very well. Most did not want to return mainly bc of the weather, lack of proper medical care and opportunities for their children.

  4. Canada doesn’t have a tax called Estate Tax, but it taxes all estates by a different standard mechanism.

    On death, all your assets are deemed to be disposed of and the estate must pay capital gains tax and other relevant taxes on all (theoretical) proceeds. For deferred tax retirement accounts the full value is 100% taxable as ordinary income in year of death for example. Canada has no notion of free “tax basis step-up” for inherited assets as exists in the US.

    So this actually makes for a more aggressive estate taxation regime than in the US for smaller estates, though potentially less aggressive for very large estates.

  5. The social safety Canada offers is great. It lifts a lot of people out of poverty and gives them hope. As a Canadian, I’m glad I dont have to worry about health care on a high level for my entire life. Its also nice to see kids from struggling families having a fair chance to succeed.

    That said, there are definite drawbacks to Canada’s system.

    If you are amongst the professional 9-5 working class, there is little financial incentive to try harder as you get taxed heavily for any effort that goes over and above (it can be different for small business though).

    The Health Care system overall is mediocre. Lack of specialists, huge wait times for diagnostic exams (MRIs and such) and a general overall complacency for a very average system.

    The article above raves about Canada’s real estate wealth but its built on money printing and euphoric speculation. With every year that passes, more and more of Canada’s economy becomes real estate centric….this is definately not healthy long term despite what the net worth numbers may say.

    Brain Drain – talented, skilled professionals generally have better opportunities in the US. Most of my more motivated counter parts moved to the US a long time ago and have done very well. Me and my wife have seriously contemplated doing the same….in general salaries are higher and living costs are the same or lower (Toronto has actually become a very expensive city to live in… Los Angeles without the palm trees and beaches).

    Canada is not all rainbows and sunshine.

  6. Robert in Vaudreuil

    If you don’t mind cold weather and somewhat long winters, Canada is a great place to live especially if you enjoy winter sports. It is a land of opportunity, good social programs, well funded government pension plans and is relatively safe except for a few tougher neighbourhoods in major urban areas. I’m thankful for living in this great country and feel very lucky to have entered the housing market in the late 90’s.

    Lately though, there are concerns by many about growing debt under Justin Trudeau’s watch.

  7. Sheldon Philp

    you are forgetting to calculate the value of the currencies. US is 30% higher. pretty much evens it up!

  8. I would never use the words “free healthcare” because as we all know someone is paying for it!!!

    1. B.McFarlane

      Nothing is free but in Canada nobody worries about the last five years of life where everyone needs the biggest chunk of health care. In the United States people work their whole life which the doctors end up with in the last five years of life. I had an inheritance in Canada which would have been eaten up by medical bills in the last five years of life.
      Also in Canada my home is never taxed even when you die. Death and taxes are very important reasons why Canadians are wealthier than their American neighbours.

      1. Incorrect population density alone disproves this. When you have millions of people not working thinking the government will pay for them to do Drugs(California) and clean up there shit in the streets well this is the reason there is a wealth gap between us and you. Im worth more then the average Canadian but I work and work hard. Canadians work they dont make an excuse saying the government should pay for them in everything. They get free health care but most of my canadian friends come back to florida for real health care. Not a see you in 5 months shit.America is better then Canada plain and simple. Maybe if Canada would actually pay for some of there own defense instead of depending on America to protect them well you know makes us better by default. If other countries didnt cry like bitches begging America to protect them well you know all Americans would have way more money but unfortunately we are told we have to care about you all. Personally we should invade canada and make it US territory. Then youll be paying for the defense you get.

        1. You work so hard, but you can’t even put together a coherent sentence. That’s the wonderful American system.

        2. USA has never spent a dime to protect Canada. The USA spends money on their military for themselves. How many Americans have died in Canadian conflicts? Many Canadians have died in American ones. We subsidize your security and often enter conflict zones to stabilize so you can go on your next conquest to kill people in the name of democracy.

          1. George Brown

            Whoa! I’m Cdn , ex military. Actually U.S. has spent lots on protecting Canada and NATO. We should be spending more for our defence. Actually Americans have died in cdn Conflicts. Canada was in WWI and II before the U.S. . Americans joined Cdn Forces before the U.S. became involved. Also, Canada did not join the illegal Gulf War (2003).
            Canada was not participant in Vietnam War. Andrew, please do not cherry pick or make up facts. Do research before commenting. U.S. is not perfect but neither is Canada. Thank God for the U.S.

        3. Hmmmph, trolls like this one deserve punch in the face. Name a place and time, I am available both in Boston and Toronto.

          US is “stronger” than CAN, but not better. I know it because I have lived in both. Got families, friends down there but never have I morons like this guy as friend. I guess his so-called Canadian “friends” are purely imaginary unless they love taking insult from Americans

          I am a Millionaire in relatively young age and always can go back to Boston any freaking time I want but I won’t

          Toronto feels like home. Boston? Hmmmph that place is infested with Irish rednecks

  9. Canadian here, and here’s my thoughts on building wealth in Canada:

    Programs from cradle to grave:
    1. Mat leave of up to 1 year: the government pays a part of your salary (up to $400/week) and your employer tops it up for half of the year. Fathers can take paternity as well (though for a much shorter period of time).

    2. Baby bonus of $100/month

    3. Good public schools so private school is not a necessity. Daycare is expensive, though, up to $1000/month except in Quebec where it is heavily subsidized.

    4. RESP – subsidized child education savings for college (ie. you put in $2000/yr, the govt will give you $400 per year, to a max of $50 000/plan)

    5. university/college costs: low compared to US eg. undergrad $5000-6000/yr, med school $15 000/yr. Student loans are not large so can be paid back in a reasonable amount of time. MBA still expensive though – $50 000 – $90 000/year depending on school (employer may pick up the tab)

    6. high middle class salaries: in Ontario, we have the “Sunshine” list – public workers salary disclosure of those making >$100 000. It is populated with police, teachers, TTC (Toronto public transit) workers, nurses, paramedics, social workers etc. Minimum wage is $10.25.

    7. savings programs: retirement (RRSP) and TFSA (tax-free savings programs). RRSP is retirement saving we can deduct from income (so we pay less tax), TFSA allows our savings to grow tax-free (max contribution currently $5500/year but limits may rise). The Globe and Mail had a contest and the winner had a TFSA of $100 000 (this program is only 5 yrs old so he only contributed about $25 grand. The rest was tax-free growth).

    8. stable housing market – new mortgage rules means 20% down, max 25 yr mortgage (so rare for underwater homes). Banks require documentation for loans (no liars loans).

    9. stable pensions (for public workers at least) – my pension is 104% funded. 401K-style pensions (defined contribution) not as common as US. Pension 1 can be taken at 55 yrs + a bridge supplement, Pension 2 (CPP – Canada pension plan) can be taken at 60-65 yrs, then Old Age Security (OAS) can be taken at 67yrs.

    10. healthcare (throughout life) + drugs are covered (at age 65yrs but you can apply for drug coverage earlier if you are in financial hardship). Govt sets drug prices to keep prices down.

    11. many programs for those down on their luck – welfare, unemployment, disability, subsidized housing for mentally ill. We don’t have food stamps but a food allowance can be applied for if you are on welfare.

    12. immigration – Canada cherry picks its immigrants. But if you get here, you can sponsor your parents and they are also eligible for a pension after residing here for 10 years (even if they never contributed).

    13. job security through unions, strong labour laws etc.

    We don’t have the extremes of wealth or poverty. We are comfortable.

    1. Canada is a very cold country dec to April is very cold lots of snow summers are great up to 80 degrees or more food prices are not bad rents are very high 2 bedroom apt $2500 a month houses are $1000000 plus good luck toronto
      Is the place to live

  10. Very interesting stats!

    10% having a net worth of $1.5 million sounds like a lot. Chalk one up to another socialist leaning country with high taxes and free healthcare?

    1. Do not know where you get your number. The opposite is true. Canada has far more non-white in % than in the USA. 72.9% are white in Canada and that includes Hispanics :) The projection is that before 2040 there will be more non-white than white in Canada, far sooner than USA.

      You have not met those Chinese or Philippinals couples that works 60 hours each in Canada I suppose :)

  11. I think the fact you guys have disaster insurance is huge!

    If we had that in the US, I think there would be less inequality and more fulfilled people not afraid to go after their dreams.

  12. mysticaltyger

    *Social safety net.

    The problem with the social safety net in America is it’s used by so many not as a “net” but a hammock. The liberal politicians use it as a way to buy votes and to control people. They don’t really care if the money is well spent and they are not held accountable. Same deal with health care. Medicare/Medicaid costs have skyrocketed along with private health insurance….so the government is not doing a better job…just a better job at hiding the costs from citizens. That is the problem with America. It’s more corrupt. Not just business…but the government, too.

    * Debt in a bull market.

    Actually, this doesn’t sound like a good thing. If that debt bubble deflates, watch out. America’s per capita net worth was better before our debt bubble popped, too. recently did an article on Canadian banks and they basically came to the conclusion that their balance sheets look almost as bad as the ones of bit American banks before the real estate bubble popped.

    * Smaller population. With a population of only 34 million in Canada, it’s much easier for the Central Government to govern and take care of its people.

    –On this, we agree. America is soooo big…it’s just a lot harder to manage all those social programs and actually do it well. Bigness also opens the door to more corruption (as already mentioned).

    * Lower military spend. When you’ve got America as your neighbor, you don’t have to spend as much on F-35 fighter jets to protect your country. ….It pays to be more peaceful.

    You’re contradicting yourself here. Canada can spend less on their military precisely BECAUSE NATO and other agreements allow them to free ride off our military spending. It’s easy to say “let’s just spend less on the military”…Yes, I get it…there is plenty of bloat in our military spending….but the reality is there are evil people and governments out there just looking for opportunities to strike. I guess that makes me sound like a paranoid nut job, but seriously the western countries have gotten so complacent…I don’t think it’s a healthy thing.

    * More open immigration policy.

    We probably agree here. America’s immigration policy is a disaster for citizens. We accept huge numbers of low skilled illegal immigrants who end up being a net drain on the tax base. And we probably don’t accept enough skilled immigrants. That’s the problem. It all goes back to our government’s corruption and ineptitude.

    *Natural resources.

    Natural resources are great but they don’t guarantee that they’ll be managed well. I think of petro states like Venezuela. Apparently, Canada is doing a better job.

    * Slightly higher tax rates at lower income levels.

    I wouldn’t necessarily object to higher taxes if we had less corruption and ineptitude, but that’s not the reality.

    Sometimes I just think the cold weather countries just do a better job of managing stuff in general. With the exception of Russia, it just seems like the cold weather countries have less corruption and get things done….government & citizens alike. The warmer the weather, the greater the corruption and ineptitude (with Australia as the exception here).

  13. Looks like they are in trouble with that much debt, assets locked up in their houses, and housing in a serious bubble. I would likely be willing to pay slightly higher taxes at lower income levels to guarentee medical care though. The idea of most people contributing instead of not contributing is definitly appealing as well :-)

  14. I plan to take a business trip to Vancouver to understand more about their $662,600 in average household net worth. Anybody have any tips on where to go and specific thoughts about the area?
    Hey Sam….when in Vancouver, make sure you spend time near the two big Universities there: UBC and Simon Fraser U. Salaries at Canadian Universities have risen quickly in the last decade…so there is lots of money in those areas. Also, regarding net worth…many Canadians also own a cottage on a lake or on the ocean. This asset does not always show up in financial stats, but it does add to the net worth of the household, as many of these cottage properties are now worth 350 -400K, or more.

    1. Will do mate. I plan on interviewing folks on their thoughts about the economy, where they go on vacation, the government, the future, how they see the US, and whether we are all so crazy for working so hard and trying to create new things when we are falling behind.

      1. Hey Sam – Just curious – who and how do you interview people? just you just strike up conversations with random people? Thanks

        1. Yes. From the hotel concierge to the taxi driver to the concession stand vendor. I try and get a good swath of people in society to get various points of views.
          Students and veteran workers in finance and real estate are also on the list. It’s pretty easy to talk to people if you’re friendly.

  15. Can you name a handful of Canadian billionaires? I can’t, but I can name 20 US billionaires in a heartbeat.

    The median household wealth is around $240,000 give or take. Not bad either way you slice it. Canadians are rich and I’m letting them pay the bill next!

  16. I am a dual citizen, now living in the USA. Something that has not been mentioned is the solidarity of Canadian pensions. Most Canadians are retiring around 55-56 with a rock solid pension, and can look forward to two more pensions in their 60’s: the CPP and the OAS.

    Also, education is much more uniform in Canada. You can move from province to province and get a similar solid education for your kids. University education does cost money, but nothing close to the sums here in the U. S. And finally, teachers in Canada make much more money than in the U. S. Right now in Toronto, a teacher with 10 years experience makes 98K. And when you retire around age 56, you get a nice pension of about 70 K per year.

    1. Retiring at 50-55 with a 70k/year pension for life is a beautiful thing. Everybody should migrate to Canada, suck it up with the weather, teach for 30 years and live the dream if they are struggling for cash! We need more teachers.

      1. mysticaltyger

        A lot of public sector jobs have similar deals to the Toronto example (at least in California). Problem is, they’re not financially sustainable here, and I bet the same is true in Canada. I pay 14% of my gross salary toward my pension now…and my public sector employer now pays 59%. Yes, that’s right….my salary plus an additional 59% for the pension. That percentage over 100% for police and firefighters. When life expectancy is ~ 80, retiring at 56 is not sustainable.

  17. How much do goods and services cost in Canada compared to the US? Even if we do adjust to equivalent dollars for our comparison, if a BAG of milk in Canada costs far more than what a gallon would here in the US are we really that much worse off?

    1. The Financial Blogger

      Everything is way more expensive in Canada, that’s for sure!… ok, except for school, daycare and health care ;-)

  18. This is not surprising to me, in the very least! I live outside of Buffalo, NY. Right on the US-Canadian border. Every weekend, Canadians come to our high end malls in DROVES. They’ve got money to spend!! I wish I could find the exact number, but Canadian spending accounts for a ridiculous amount of our sales tax revenues in this county.

  19. It’s been awhile since I saw the actual number, but something like 42% of Canadian tax payers don’t pay any income tax (fed or prov). Whatever that number Romney got in trouble for was, it’s really close to that. Top rates are high, yes, but if you’re in those brackets, you’re getting deductions for things like retirement savings. We don’t have the mortgage interest deduction, but there’s lots of others. Presumably we also require higer levels of retirement savings, iven our higher cost of living.
    At 27, our household net worth hasn’t hit the average, darn. Hopefully by the end of next year.
    The debt levels are troublesome, especially with the low interest rates we’ve got. It’s been mentioned, but the longest fixed term mortgage rates we can get are 5 yrs, though I think I may have once seen a 10 year.

    1. Is the percent of non taxpayers that high as well? At least it’s 5% lower than us, but maybe it’s always going to be at these levels since it’s just demographics.

      At 27, you haven’t reached the average age of 35-40 yet so not to worry!

  20. As a reasonably well informed American, I was flat out shocked by the wealth disparity with our neighbors to the north. Nicely researched post!

  21. You forgot an economy mostly run by oil, minerals and conservative banking. These are more stable industries than the ones in the USA. Canada suffers a bit of a dutch disease, being driven mostly by natural resource extraction.

  22. I have no idea. The Canadian housing market hasn’t crashed. It’s easier to find a high paying government job.

    My condo has gone up in value like crazy over the past few years.

  23. Interesting data. Australian-by-way-of-England comedian Jim Jefferies has a great joke, “The U.S. is #27 in education. But #1 in confidence! You know what that means? You are breeding a bunch of stupid confident people! They make the worst employees!

    Hahahahaa!! Only the truth is funny! btw, FS, this caught my eye from your post…Americans say they are Canadians when they travel to some countries for a reason. On your recent journies, do you travel with a U.S. passport? Do you travel as an ‘American’? Or something other than American?

      1. Nice~! There is a book “The Great Reckoning” that describes possibilities for those inclined. It may cost a little money, but the one time you need an option you will pay any amount for a choice. Glad to see you have made plans to have choices! Maybe sometime you will explore that subject (or something similar) in a post. Continued success to you!

  24. I think many of the savy Canadians are safe even if there is a housing bubble in Canada because many of them came to Arizona where I live and bought hundreds and in some cases thousands of single family homes for deep discounts in ’10-’11. Others bought commercial properties or land deals that they’ve already flipped at impressive multiples. So the Hong Kongese are buying up Canada and the Canadians are buying up Arizona.

    1. Just need the Canadians and Hong Kongnese and the rest of the world to buy up San Francisco and makes the citizens of the best city in the world wealthier. Once you come out here, you’ll see why people don’t leave. Trust me!

      1. I would need probably a ~$5m networth to live like I can in AZ with a ~$1m networth. To put things in perspective, I bought a home in a very nice gated neighborhood at the bottum of the market for $320k (put another $30k in to make it my ‘dream home’) and financed it at 2.5% (5 ARM but I can pay it off at the end of the 5 years if rates go up too much). My home is 15 minutes from everything fun and work. With all the left over money I save on housing I can afford to fly to Utah every other weekend to ski with my season pass. And in the summer there’s mountains and a beach within 2-4 hours and also plenty of lakes for waterskiing. And our tax rates are way lower, especially for enterpreneurs. That is why IMO Arizona is better than California!

        1. Arizona is certainly great for those who don’t have as much money despite the long distance to water, indirect flights to the world, less food and arts diversity, no top 25 universities and so forth. But if you have the money, $5 million net worth based on your number, you move to California to live it up and figure out ways to shield your money from the IRS.

          There’s a reason why there’s a robust tourist industry along the California coast and not so much in Arizona. Nobody dreams of visiting Arizona, but it’s California Dreaming for many people all over.

  25. There has been quite a bit of talk about the “housing bubble” bursting for a while now and I have to agree Canadian homes in large metropolitan cities are quite high. I live in Toronto and the cost of housing has gone from affordable to unaffordable for those in their early 20’s over the last 15 years or so. It’s great for the boomers who purchased back in the 1980’s and 90’s which is where a lot of that wealth comes from (they have probably paid off their mortgages by now as well). Especially in Vancouver and other parts of BC there are a lot of wealthy Asian immigrants buying up housing and then take out mortgages with low interest rates, which if I had the money to cover the cost of the house I would take the lower rate and invest instead. Also not having to worry about medical expenses for the most part definitely takes a lot of stress off retirement savings and lifestyle in general, or so I would image, I’m not quite there yet lol

      1. Yes that is true, I love Canada though. And it’s not all cold here! In Toronto we get 86 degrees F and above (I totally had to do a Celcius to Ferenheit conversion on that) in the summer and less snow than New York state for the most part. But then again if you live in California then yes it’s nicer weather year round lol

  26. Canadian here: Take these numbers with several large grains of salt. Make no mistake that the average Canadian household is in real trouble. I just recently discovered the blog “” and it pulls the curtain back, exposing the upcoming crisis there.

      1. According to his blog, he’s an economist, has been in the government, has written several books and is a RE investor. I’m not sure of his current rent/own situation, but if he’s an investor, he must own property somewhere.

        Personally, I don’t have the background to contradict or confirm his exact findings. But from what I know about my friends and family, many of them are finding it hard to deal with the current prices given their salaries.

  27. You cannot say that Capitalism is not the only means to wealth. Socialism is far deeper than just high taxes and social services. Socialism is the means of production and distribution are controlled by society (aka the gov’t). You would be hard pressed to find a wealthy nation that is actually socialist. Cuba anyone?

      1. The Financial Blogger

        We are not socialist ;-)

        The Gov’t sure controls more things than the US but we are still capitalist. In fact, the most comon way to get rich in Canada is to start your own business. This would not work if we were socialist.

        I think Canada is a great place to stay for the middle class as several things are free or cheap. On the other side, we still pay our cars at a higher price than in the US even if our dollar went up by 40%…. We love being fooled!

  28. Well, let’s say you make $200,000 living in Nova Scotia, that’s 29% + 21% = 50% marginal tax on all income over $120-$150,000! If you make $500,000 in California, you’re only paying 39.6% + 13% on income over $400,000. Still terrible, but at least you get to make much more than $150,000 and not get taxed as much.

  29. Very well said. I do think about the Hong Kongese buying up much of Vancouver because I know several Hong Kong investors who’ve done just that in the past 10 years. North American real estate is CHEAP compared to major cities around the world.

    Great thoughts about immigration, savings culture, and occupational shortages.

    We Americans love to spend baby! With higher per capita income and lower housing, there shouldn’t be a problem to live a great life if we wanted to save.

    My only fear about moving to Canada is the weather…….

  30. This doesn’t surprise me at all! We recently vacationed in the D.R. where we met a large group of Canadians that we hung out with all week. They were all either retired or about to retire rich before the age of 50. We talked about it at length and they said that they think that their societal safety nets are a big reason that they were able to succeed. Can you imagine being able to retire early without having to worry about the cost of healthcare? That has got to be very freeing, mentally and financially.

    1. Totally and one of the main reasons I highlight in the article. To not have to worry about health care and going down the abyss of poverty is liberating. Allows then to take more chances.

      1. One of the younger women in that group said that she was trying to have her first child and was extremely excited to take something like 9 months of maternity leave. I don’t remember exactly, but I believe she said she got paid at 80 percent pay for 9 months.
        I cannot imagine how things would be different if young families had security like that in the U.S. I got six weeks of maternity at 50 percent pay and my employer wasn’t obligated to pay me anything at all!

        1. I’ve heard about the great same benefits as well. 9 months maternity leave rocks. I think in France and other Euro countries mothers can do 1 year maternity leave with majority pay and no ability to get laid off.

          If we implement this system, it could really jump start the population of America!

        2. I don’t know if we really need to jumpstart the population or not…but it would be nice for young couples to be able to have their first child without having a huge financial hardship. I also believes that it puts single mothers at a disadvantage and keeps too many of them trapped in poverty.

  31. The First Million is the Hardest

    It seems like I’ve been hearing about a Canadian housing bubble for at least 5 or 6 years now, who knows if or when one will actually burst.

    Canadians also get hit with much higher sales and consumption taxes which is why when I go to the mall on a weekend 60% of the parking lot is comprised of Canadian licence plates!

  32. Look what a stable economy can create! The U.S. economy took an extreme hit with the housing bubble which the Canadians seemed to dodge. People do not spend when they worried about their job, investments and housing values.

    1. It’s like the turtle pulling away from the volatile gate in the race to accumulate wealth.

      Stability does indeed breed wealth, which is part of the reason why Switzerland is so rich.

    2. mysticaltyger

      But, actually that’s not true. The savings rate in America is in the 3% range….Americans seem to spend all of their income in good times and bad.

  33. Do they on their way to a housing bubble? It seems like housing is ridiculously expensive in Vancouver.
    I really like Canada’s social safety net. I wouldn’t mind living there for a few years. It’s not easy to immigrate there though and it’s probably too cold for me up there.

    1. Hard to say as the US economy is improving and that should help them out as well. Their housing did take a brief dive in 2009, so they are not impervious. Canadians can’t even deduct the interest on their mortgage!

      Vancouver sounds expensive, but it’s still much cheaper than SF!

      1. Not only that, but there’s no such thing as a Canadian version of our fixed-rate X-year mortgage. No matter what mortgage you get, the interest rate always readjusts every 5 years.

  34. I didn’t get much sleep last night and my brain is somewhat in a fog, some hoping someone can help out here: If “Canadian household debt runs roughly 160% of disposable income” and it’s “largely mortgage debt” then how can their net worth be so high? In other words, if they are highly leveraged in their real estate, then their isn’t much equity in general. Equity is the only thing that contributes to net worth (assets – liabilities). So, how can average net worth be $400k with so little equity? Do Canadians have massive amount of other assets with little to no accompanying debt?

    1. Here’s an example of debt-to-gross income:

      $1,000,000 mortgage
      $500,000 income

      Debt / Gross Income = 200%.

      If the home is worth $1.4 million, then one has at least $400,000 in net worth given the $400,000 in equity with a D/I ratio of 200%.

      1. Thanks, makes sense. If I’d paid a bit more attention to the graph you shared then I’d have noticed the drastic appreciation that has occurred. I agree, it certainly does make you wonder about a correction (the slight dip in 2008 wasn’t much).

  35. Don’t worry, about 6 months from now Canada’s good fortune will be coming to a colossal end. Why? Because Sidney Crosby and team Canada hockey is going to massively choke at the Winter Olympics! When that happens, the entire country will fall into a deep mental depression that will ultimately lead to an economic depression lasting at least 4 years (until the next Olympics).


    1. The Financial Blogger

      Don’t count on that, the last time I’ve check, Team USA choked during the last Olympics ;-) hahaha!

      Sam, to get back on the topic, you forgot a huge part that explain this high average net worth; it’s called oil ;-) Alberta has been growing like there is no tomorrow due to oil sand. A few years ago, anybody that has 2 arms and 2 legs could easily make 100K working on oil platform up there.

      The second improtant point is Real Estate as you mentioned. The problem is that most Canadian in Western Canada are millionaire by accident. They bought a house at 50k 25 years ago and it now worth 1.5M$. It seems ridiculous but my house that is situated 1h drive from Montreal worth 350K in Quebec. The same house 1h from Vancouver worth over a million.

      Real Estate in Canada will collapse and we will fall behind the US again.

      1. True, true. Natural resources has been included, with the most obvious example in the Keystone Pipeline from Alberta to Texass.

        The thing is… don’t Canadians want to live in more temperate climates all year around with more activities and diversity? It’s part of the reason why Vancouver is so expensive no?

      2. Funny looking at old comments with the benefit of hindsight.

        Real estate in Canada has done anything but collapse. Toronto and Vancouver prices are through the roof.

  36. You don’t say if you’re converting the CAD to USD, but since it’s now only $1.00 USD to $1.03 CAD (or $.97 USD to $1.00 CAD), the numbers wouldn’t be far off even if you weren’t.

  37. Don’t worry Canada, one day we may need some of your massive fresh water supply down here in the states. So you can thank us for the F-35 Fighter Jet then.

    That household debt trend does not look to savory though…

    I also wonder how they will fare when they experience a decline in their own Baby Boomer consumption, something we will face too. We have immigration to help prop things up somewhat, but I don’t think that’s the case in Canada?

    1. Immigration is one of the factors I highlight that helps them with their labor shortages and wealth creation.

      I hope they really do share their precision water and minerals with us if needed.

      1. That is an advantage how? Studies in Canada show that while immigrants are more likely to create jobs, they have lower earnings and lower tax contributions than Canadian citizens. They also have the ability to import grandparents who can soak up 500k each in end of life health care costs. They are likely an economic negative once those programs are factored in.

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