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How Much Do You Need To Make To Live In Toronto?

Toronto, the capital city of Ontario, Canada, is a vibrant, bustling metropolis known for its diversity, art scene, gastronomical delights, and robust real estate market. However, living in this city also comes with a steep cost. This article will help you decipher how much you need to make to comfortably live in Toronto.

Understanding the Cost of Living in Toronto

The cost of living forms a crucial part of assessing how much you need to make for a comfortable life in Toronto. Different lifestyle choices merit different costs, but essential living expenses typically cover housing costs, food and groceries, transportation, healthcare, and miscellaneous expenses such as entertainment and personal care. Consider that, as of 2021, the average cost for a monthly pass on the Toronto Transit Commission (TTC) is approximately CAD 156. Food and groceries average around CAD 400 per month per person. A night out at the theatre, dinner at a mid-range restaurant, or gym memberships may add another few hundred dollars to your monthly budget.

The Defining Factor: Housing

Housing is typically the most substantial monthly outlay for individuals living in Toronto. The type of housing—whether it is rent or a mortgage—plays a significant role in determining the income you need. As of 2021, the average cost to rent a one-bedroom apartment in downtown Toronto is around CAD 2,000 per month. For a mortgage, the average price for a detached house in Toronto is about CAD 1.7 Million. Considering the minimum 5% down payment and an average mortgage rate of 2%, monthly payments would be around CAD 6,500.

Necessary Annual Income for Different Lifestyle Choices

If you plan to lead a modest lifestyle, covering your necessary expenses and saving a little, you should aim for a yearly income of around CAD 50,000 to CAD 60,000 after tax. This figure allows for basic housing, food, transportation, and healthcare. Remember, this estimate restricts your lifestyle to essentials and may not provide financial comfort for unplanned expenses or entertainment. For a more comfortable and freer lifestyle that includes more entertainment, eating out, traveling, or living in a more high-end location, expect to earn somewhere around CAD 80,000 to 120,000 annually after tax. For a luxurious lifestyle with higher-end housing, frequent continental vacations, dining out, high-end shopping with a good savings rate, the yearly income required spikes up significantly. A minimum annual income of CAD 200,000 after tax would be required.

What’s Next?

Remember that these figures are rough averages and could vary depending upon your individual circumstances or sudden fluctuations within the market. However, this guideline can help provide a realistic expectation of what it costs to live in Toronto. With the continually rising cost of living and housing, the question of how much one needs to make to live in Toronto is increasingly important for both potential residents and employers. It helps individuals plan their finances effectively and aids employers in providing competitive salaries to attract and retain talent in the city.