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What Is the Average Cost of Living in Canada?

What Is the Average Cost of Living in Canada?

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So, you’re thinking about moving to Canada?

That’s not surprising, considering the country has a progressive administration, a reputation for compassion, and a landscape ideal for hikers, skiers, sailors, photographers, and city dwellers. So many individuals from all around the globe have shown interest in relocating to Canada.

But, this is the time to figure out the cost of living in Canada. In addition, you’ll want to find out how much it’ll cost you to relocate and how much it would cost you to live somewhere else is an essential first step if you’re thinking about making a move.

Whether you’re planning to retire in Canada, spend a few months there, or make Canada your permanent home, knowing how your finances will alter or appear the same in the north is crucial.

Cost of Living in Canada: Comparison With the U.S. And Europe

There’s a prevalent perception that social safety net expenditure in the United States is lower than in Western Europe and that Canada falls somewhere in the center.

Maternity and paternal leave are examples of this. Despite its enormous economic might, only the United States does not provide new parents with any paid leave. On the other hand, paid maternity leave might stretch for many years in various European nations.

Most businesses in Canada provide between 17 and 12 months of paid time off, depending on the company’s size.

Employees’ compensation insurance, which pays 55% of salaries up to $543 per week, may be shared by parents for up to 35 weeks. Some states in the United States have comparable systems, but the federal government does not compel this benefit to be provided.

As a result, establishing a family in Canada is likely to be less expensive, but what about the other costs that Canadians face?

Food and Other Consumer Products

In Canada, consumer goods and food tend to be much more costly than in the United States, with price hikes of 25 to 50 percent. Even though certain things are cheaper, you may expect to spend more on essentials.

In Canada, gas is also more expensive. The price of gasoline in the United States fell by 90 cents per gallon in 2015, while it fell by 41 cents per gallon in Canada. This is owing to the Canadian currency’s depreciation against the U.S. dollar.

A person in the U.S. who spends $80 per month on petrol and $150 per week on food should anticipate paying closer to $100-$120 and $200 per week on these goods, a difference of around $680 vs. $900 per month.

To put this in context. For a family of four, the gap grows to $1,050 vs. $1,350 over four weeks. After taxes, this is a significant difference for someone making an average entry-level wage of $3,000 or $4,000.

Yet, when it comes to things to do in Canada for the sake of entertainment, you can expect the prices to be on par with the U.S. In addition, inflation rates are higher in the U.S. than they are in Canada. 

Less Expensive Medical Care

It’s difficult for the average Canadian to see the actual cost of Canada’s universal healthcare system. Even though Canada spends a significant amount of money on healthcare—approximately $4,500 per capita in 2015—the U.S. ranks top globally with a healthcare system that spends roughly $8,200 per capita.

To put it another way, when you take into account the 20 percent strength differential between the U.S. and Canadian currencies, the disparity in costs becomes much more apparent.”

After taxes, Americans pay for this out of their wallets, with insurance premiums that vary widely in cost on the private market and via employer-sponsored programs.

Family insurance for two adults and one kid may easily cost more than $1,000 per month in the United States, which is around $500 more than Canadians are taxed for universal health coverage.

Higher Education Tuitions and Costs

Because Canadian institutions are half the price of U.S. counterparts, the financial strain on students and their families to pay for their education is lessened.

Even yet, international students in Canada do not get the benefits of this policy. 

Utilities and Gas

Despite higher electricity and natural gas prices, Canada’s utilities are less costly than those in the United States due to the country’s general nationalization. However, the cost differential between the two nations is insignificant on a broad scale.

You can’t avoid certain expenditures no matter where you live or what you do every day.

For example, you might already look at condos and how much they cost. You can look here for more information and price breakdowns. 

The Tax System

The average tax rate in Canada is greater than the average in the United States. A large part of it has to do with tax brackets comparable to those in the United States, not just the general income tax.

The harmonized sales tax in Canada is far higher than any sales tax one would expect to find in the United States.

The federal goods and services tax and the provincial sales tax are combined in the harmonized sales tax, a consumption tax. The harmonized sales tax in Ontario, Canada’s most populous province and one of the best places in Canada, is 13%.

Urban Regions Versus Rural Places

Housing expenses are the most significant factor in the cost of living in cities, suburbs, and rural locations.

Canada’s big cities like Toronto and Vancouver are pricey. Still, places like New York and San Francisco (with typical rentals of $3,000 to USD 4,000 for one-bedroom flats in their downtown regions) are much more expensive than Canada’s smaller cities.

For example, the average rental in Manhatten can cost upwards of USD 4,000.

Planning a Move: Simplified

The moving process is notorious for its anxiety-inducing “qualities.” However, the more information you have on hand, the more calm and collected your moving process. 

We hope that our guide has shed some light on the cost of living in Canada and its categories that you need to keep in mind. But, if you’re still feeling a bit off on the details, you can learn more by checking out our travel and lifestyle section for all of our extra tips and strategies. 

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