This post analyses Canadian income, spending, cash flow, and net worth — putting a spotlight on the financial gap between Canadians at the high

The Uneven Distribution of Canadian Income, Cash Flow, and Net Worth

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2024-10-10 02:30:03

This post analyses Canadian income, spending, cash flow, and net worth — putting a spotlight on the financial gap between Canadians at the high and low ends of the spectrum. To explore the data beyond a simple broad average, we’ll split the data into a quintile distribution, and also a breakdown by age group.

Note: throughout this analysis the data is broken down into income “quintiles”. This means that Canadian households have been ranked from low-to-high based on their income, and then divided into 5 groups.

“Quintile 1” refers to the bottom 20% of households, while “Quintile 5” refers to the top 20% of households. Quintiles 2/3/4 represent the middle 60% of the distribution.

As of 2023, the average Canadian household earns $96,406 per year (in after-tax income) and spends $93,707 per year, yielding cash flow of $2,699 per year which can be saved / invested.

However, as we’ll see below, the simple average doesn’t show the nuances of the story. We can get better insights by breaking down the data into age groups and quintiles (lower income vs. higher income buckets).