Canada Year Book


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    Income, pensions, spending and wealth

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    Median after-tax income for Canadian families of two or more people was $63,900, virtually unchanged from 2007. This followed four years of growth.

    After the proportion of Canadians living below the low-income cutoff (after tax) fell in 2007 to its lowest level in 30 years, it remained unchanged in 2008 at 9.4%, or just over three million people.

    Earning patterns changing

    In 2008, both spouses were working in 7 out of 10 couples, up from 4 out of 10 couples in the mid-1970s.

    More wives are working today, and they are contributing more to family earnings. Both hours worked and earning power have increased for wives. Their overall contribution to family weekly earnings increased in 2008 to $740, about 41% of the total. In 1997, they contributed just under 40% of their family's weekly earnings.

    From 1997 to 2008, wives' average weekly earnings increased more than 15%, while husbands' average weekly earnings rose nearly 7%. The proportion of wives who were equal or primary earners increased from 37% to 42% from 1997 to 2008. Spouses are considered equal earners if each partner contributes from 45% to 55% of the total family earnings. (A spouse is considered the primary breadwinner if he or she earns greater than 55% of the total.)

    The gradual convergence of husbands' and wives' hourly earnings in dual-earner couples suggests that the economic roles within families are continuing to change.

    Chart 18.1 Pension assets of Canadians
    View data source for chart 18.1


    The value of all pension assets in Canada declined from $2.1 trillion in 2007 to $1.8 trillion at the end of 2008, partly as a result of declines in the stock market. Pension asset values had been rising since 2002, but peaked in 2007.

    Employer-sponsored pension plans account for the largest share of pension assets (58%), or almost $1.1 trillion in 2008. Individual registered savings plans (RSPs) were worth $631 billion in 2008, or just more than 34% of all pension assets, while social security assets were worth $140 billion, or about 8% of the pension total.

    However, the number of people contributing to the various types of pension plans was disproportionate to their share of total pension assets. At the end of 2006, 12.3 million people made contributions to social security (the Canada Pension Plan or the Quebec Pension Plan), 6.2 million contributed to registered retirement savings plans and 5.8 million had a registered pension plan from their employer.

    Chart 18.2 Pension assets of Canadians
    View data source for chart 18.2

    Greater wealth

    The recent surge in housing markets across the country has translated into greater wealth for many Canadians. At the end of 2008, households had $6.9 trillion in financial and non-financial assets. Of these assets, 39% was in housing and another 25% was in pension assets, excluding social security.

    The tax status of real estate and pension assets may partly account for the shift toward the bulk of household wealth being in these two areas. The primary residence of households is tax exempt when sold, implying that most homes are sheltered from taxes, while most pension plans do not require members to pay tax until they withdraw money.

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