The average Canadian overspends every month with a monthly average household deficit running into CAD940. You can save this amount by reverse-engineering the Consumer Spending Statistics (Canada).
On what things does the average Canadian household spend their monthly income? By having an idea of the cost of living in Canada, you can make your austerity programs to slash debt and pay what you owe on time.
Cost of living in Canada per month (spending behavior)
For context, you first need to understand the average annual household expenditure in Canada. The most recent statistics from Statistics Canada indicate that Canadian households spend CAN$86,070 for a year’s household expenses or CAN$7,172 a month.
What’s worrying is that Canada’s average household income (not yet excluding taxes) is only CAN$6,232 a month, which means the average Canadian tends to overspend beyond their means. The average monthly household deficit then runs into CAN$940, amounting to CAN$11,280 a year!
The only way households can spend so much despite their income being limited is if they have savings or if they are borrowing someone else’s money.
Average household expenses in Canada – top expenses
From extrapolations derived from Statistics Canada’s data, the largest proportion of Canadian household expenses come from house purchase, mortgage, or rent. These accommodation expenses amount to CAN$1,404 or 19.6% of an average Canadian household’s expenditures.
Housing-related expenses also account for as much as 28.2% of the Canadian average monthly income, which is precariously close to the 30% sustainability threshold that real estate experts suggest.
Savings tips based on Consumer Spending Statistics (Canada)
Your income tax and mortgage or rent payments are unavoidable, which are considered as fixed expenses. Instead, adjustments in your budget must revolve around the things where you can do something.
Your target is to slash the deficit, which in average Canadian households, amounts to CAN$940 per month.
If your household’s spending profile follows the average trend, then here are the things you can slash: