How High is the Cost of Living in Toronto for Millennials?
Millennials in Toronto continue to face increasing costs to live – at a far steeper rate than anywhere else in Canada.
A Huffington Post report stated that young people living in Toronto will need to earn $5000 more in the coming year – over $400 more per month – to keep up with the rising living costs, all things equal, compared to this year.
The report, citing statistics by LowestRates.ca, found that Toronto residents will need to make $40,583 before tax to make ends meet to live in their city. That is up from their estimate of needing to make $35,000 before tax for this year.
What factors are at play?
The above numbers are derived from basic living costs that include:
- Rent of a one-bedroom apartment (if you own your place of residence, the above numbers are significantly higher)
- Phone & internet
- Transportation (public transit, not the cost to own/lease a vehicle and insure it)
- Health & fitness
- Insurance (personal & tenant)
- Entertainment (you still need to have a life)
The Royal Bank of Canada released quarterly numbers showing that housing affordability has decreased for the eighth straight quarter – two straight years and counting – across Canada, meaning Torontonians and Canadians, in general, find themselves in the most precarious situation, living cost wise, in nearly 30 years.
Can someone live in Toronto earning the minimum wage?
In January of 2018, the minimum wage in Ontario jumped to $14/hour, up from $11.60/hour previously. This increase represents a jump of 20%. There were plans to further increase that number to $15/hour for January 2019 but that has been halted, as many small & medium sized businesses are still struggling to be sustainable and remain open with the previous increase.
If someone were to work a full-time (40-hour) work week at $14/hour, they would earn $29,120 annually before tax. This means they would need to add a part-time job to their income to be sustainable in Toronto or find a way to increase their qualifications, so they can earn more than the provincial minimum wage. Another option would be to live in shared accommodations with roommates where you’re able to lower your rent and split the costs of utilities.
Toronto compared to other major Canadian cities
Canada’s four largest metropolises of Millennials are Vancouver, Toronto, Montreal and Calgary. When you break down LowestRates.ca’s estimate that Torontonians need to earn $40,583 pre-tax to live in Toronto, that represents $3,382/month.
Going back to the Huffington Post report, that places Toronto as the 2nd-most expensive city for Millennials to live in Canada. Vancouver is the most expensive, followed by Toronto, Montreal, and Calgary.
For reference, the overall cost of living for a Millennial in Calgary is about 50% lower compared to living in Toronto