Great News for Canadians: We’re Wealthier Than Ever!

Last week, Statistics Canada released the results of the Survey of Financial Security – conducted between September and November 2012 – and the news is good: the 2012 median net worth among family units has increased 44.5 per cent since 2005 to $243,800, and almost 80 per cent from 1999 – just 13 years ago. 

Family units are defined as two or more persons living in the same dwelling related by blood, marriage, common law or adoption.

The measure of net worth is a simple calculation: what is left if you sell all assets and satisfy all debts. So why are we wealthier?

The largest asset reported nationally remains the principal residence. Prices were skyrocketing in the early 2000s. British Columbia reported the highest median net worth of family units at $344,000, more than double the figure reported in 1999 when it was the fourth wealthiest province in this regard.

Conversely however, the largest source of debt in Canadian families remains mortgage debt, which represents about 77% of all family debt in the nation. This percentage remains very similar to what it was in 1999, but the amount of mortgage debt rose drastically from $453.6 billion in 1999 to $1.0 trillion in 2012.

Worrisome is the divide between rich and poor, which increased in the period. A slight decrease in their median net worth shows up for families in the lowest quintile. However, those in the top three quintiles saw large increases, about 80% since 1999. Statistics Canada attributes these changes to differences in home ownership and private pension assets between the quintiles.

Single parent families have the highest amount of debt, with this figure seeing a slight increase in the last decade. Senior-aged families have more assets than do younger families.

The bottom line – to get ahead financially, it appears that getting a job that features access to a private pension, buying a home, and making sure your relationships are stable is the proven path.