johnh009

Don't forget, also, back in the 1960s/1970s, many people tended to get married much younger so they had a head start. I had my first house paid off by the time I was 28, then I bought a bigger one, and a bigger one and by the time I was finished I realised I needed to stash something away for retirement. I never bothered with the toys as I find that when the novelty wears off with many of these materialistic possessions, I do not use them.

dgagitw

Coming a bit late to this one but my general observation is that the cost of living, as a proportion of after-tax income, works out more or less the same in the two countries. The one thing that seems to be fairly consistent though is that, when I compare people doing similar jobs, the ones in Canada have better housing on the whole.

ann m

If not already factored into your equations (and sorry, I can't remember 'cos the thread has been rambling on for too long ) - but will your wife be working? Either intitally, or in due course. Looking for a "lifestyle change" that is comfortable will require this. I think so, anyway.

We muddled by OK on $75k for the first two years (and with no mortgage). No fancy toys but we did factor in the odd holiday and get back to the UK a couple of times.

Four years on, I have an OK job, not earning mega bucks but we now have that cushion we were seeking.

TheKellys5

I'm struggling with how to work this kind of comparison out?!
Do I just multiply my current UK salary by the relevant number (x2 or whatever), and that is the figure in $CAD as a guide-stick - or do I need to convert my UK salary to $CAD before multiplying?
The latter works out very badly for me :/

el_richo

I don't agree with all this as a guide to set expectations. Mainly because different areas of Canada have very different costs of living (including property prices, fuel costs, accessibility to activities, etc). For example, Moncton and Vancouver. Not to mention the difference in wages throughout areas in the UK. Plus only you know what lifestyle you want and the amount of money you'll be bringing with you.

I stand by this:

You need to figure out where you want to live, where the work is, and what it pays. Then you need to check out the area/s for property that you'd want and the cost.

The grocery costs via the store website.

The cost of vehicles you want or need.

The price of fuel in the area you'd live.

The distances to places you think you'll travel to figure out approximate running costs of vehicles.

Activities you believe you'd partake in the area's, and the costs.

Flight prices to destinations you'd consider travelling.

Cost of furnishing a home via websites.

Cost of TV's etc via websites.

And so on........

Then see how much money you'd have left and/or what you can afford. Would your life improve in the way they want it?'

iaink

Straight multiplication, although you can argue till the cows come home what the correct number to use is... If you get £x2 then you (probably) wont feel worse off.


My boss was reflecting the other day that the actual exchange rate when he came over in the early 80s was 4.something, so thats what they multiplied his salary expectations by... that was a great deal back then.

jimf

As a very crude starting point for any comparison I would be looking at taking UK salary in GBP multiplying by X2 and looking for that number as a salary required in $CAD. However, it all depends on the locations in the UK and Canada. For London to Moncton I would expect X2 to be a good move but from Doncaster to Vancouver perhaps not. Anything significantly under X2 I would be inclined to look closely at the actual salary deductions and living expenses in more detail.

TheKellys5

Cool, thanks for the clarity. El Richo et al, yes we understand the nuances of it all, and largely agree. That said, the same pretty much applies to even moving within the UK too. But when all is done it is helpful to realise that 1 or 2 of the jobs I have applied to are spot on with this methodology more or less with regards to salary expectations to likely cost of living requirements - my worry was the latter (convert to $CAD 1st would mean the salary would not meet the likely requirement and was a worry to add to all the others while trying to finalise our move

Tangram

I'm on a 2x multiplier of my old salary in the UK. I live in one of the cheaper parts of Canada. I still don't have boats, skidoos, ATVs, pools etc.

huddm

Tangram

Last year in the UK a family of 4 needed an income of £29 200 to cover living costs and in Canada it was quoted as $65 000. The ratio is 2.22, so on x2 you will be no better off unless you move from an v high cost area in the UK to low cost in Canada . When I moved from Suffolk to Alberta in 1997 my living cost we about 2.5 in Canada( rural to a city) and return to UK(Ontario to Oxfordshire our living ratio was 2.25). This was close to the $2.15/£1 ratio in 2005.

I have only lived in Alberta & Ontario not experienced living costs in other provinces. In reply to a previous posts I agree Canada is so variable in costs. One of my Canadian friends used to say Canada is ten countries in one, with differences in taxes, costs, laws etc.

From my own experience you need to ensure you can maintain the equivalent UK salary in Canada, otherwise you will not enjoy living in Canada. We found our saving got used up pretty quickly supplementing a low income I had for the first 2 years there.

Hudd

Siouxie

Even within the same general area the cost of living varies greatly.

For example, where I live in Hamilton - on "the mountain" - prices of housing, food, utilities, city taxes etc are reasonable and I can manage comfortably on my salary (which is approx 2x UK) . If you move to the city centre (downtown) then it is even cheaper as housing is considerably lower (though I wouldn't recommend it!) If you move to the West end of the city which is far nicer you would need 3x salary minimum, if you moved to Ancaster/Dundas/Waterdown you would need at least 3.5-4x salary as house prices and taxes are much higher.

You are talking of an area 20 minutes in each direction by car yet the price differentials are enormous!

helcat12

I think house prices are a great guide to this, as they tend to follow salary fairly closely.
If you look on MLS Canada and see the variation in house prices, even in a relatively small geographical area, then you can see which areas are pricier right away.
If you want to live in those areas, then you will have to earn a much higher salary and you may decide that the standard of living which you could expect in Canada for the wages you would be offered is not up to what you are hoping for.
On the other hand, if you see houses are modestly priced where you would like to live, then you can be reassured that the X2 multiplier £ to $CAD might be fine for you. You could also modify your location choice, of course, to get the lifestyle you are looking for on your expected salary.

Our experience is that there is unlikely to be a big salary difference between companies in a similar area for the same job (which is what you would expect, really), so increasing your salary expectations isn't really a viable option.
Something else (house size or location, probably) is going to be the other option.

marcwales

Thanks all, very very good info. HUDDM really got my jist in their reply.

So, I have amended my original figures, and come up with the following. Please take a look through and if it is more realistic. I completely understand everybody has different outgoings, but remember I am just looking for a resonable comparison so I do not end up in afinancial mess there because I got the bills wrong!!

OK, lets try again with figures amended from your replies :-

On current UK salary, after taxes and pension etc I keep 68% of earnings.
Regarding bills, these take up 83% of my take home pay.


EARNINGS of $71,000.
On earnings of $71,000, Canadian Tax website gives approx $55,300 after taxes (divide by 12 gives $4608 month take home). This is before other deductions like pension etc.

One post said he is left with 66% of his total earnings after taxes, etc (see his list earlier in post). Therefore, 66% of $71,000 is $46860. This is comparable with my figure of 68%. Obviously depends on various factors like his pension deductions etc, but seems like a reasonable ball park figure.

Therefore, using these figures gives $46860 / 12 = $3905 / month take home after taxes etc.

Assumed Monthly House Hold Bills in Ontario.

Mortgage $0
Council Tax $250 (based on $3000 year).
Car 1 Loan $200 (based on value of $7500 over 5-6 years)
Car 2 Loan $200 (as above)
Car 1 Insurance $300 (based on consensus of examples given of approx $3000+).
Car 2 Insurance $300 (as above)
Petrol Car 1 $240 (based on approx $60/week)
Petrol Car 2 $240 (as above)
Food $900 (based on consensus of examples given)
Phone/internet/TV $150 (based on consensus of examples given)
House Insurance $100 (based on consensus of examples given)
Water/Gas/Electric $250 (based on consensus of examples given, approx $3000 year)

TOTAL $3130


With a take home pay of $3905, this works out as 80% of take home pay goes on bills.

Same as current situation, where I am paying for a mortgage but with 1 older car.



Post from Reader explaining the 66% remaining.. How many of these would I pay? Maybe it wouldn’t get charged some of these so would have more than the $3905 from above???

“Aside from tax, you may well have other employee deductibles, depending on benefits you receive. Income tax is the tip of the iceberg. For example, I have the following deductions:

Admin Association Dues
Basic Accidental Death & Dismb
Basic Life Insurance
Pension Plan
Dental Coverage - Admin
Employee Assistance Program
Ext Hlth Admin (+Vsn,Pool,ETA)
Federal Tax
Long Term Disability-Admin
Medical Services Plan of BC
Parking
Provincial Tax
Weekly Indemnity Admin
Work Safe BC

After that little lot's deducted I'm left with 66% of my gross pay to live off.”



A different post wrote :-

A married man, wife not earning, two kids under 16 would get $54,456 after tax and NI type equivalents. An average of $4,538 per month though the way the NI type deductions work you get less in the first 2/3 of the year and more in the last 1/3.


So, ranges from $3905 to $4538 (but sure more to come out of this – life insurance, Union Dues, etc).

Also depends on how accurate my figures for monthly outgoings are.

Also, most importantly, I'll need accurate salary information.

JonboyE

The list of deductions that R I C H gave is exceptional and not typical of most employments. You would not have a deduction for MSP-BC for example. He also should have a word with his employer as they are not allowed to deduct WorksafeBC premiums from employees' wages.

More usual is to have a contribution to the group benefit plan in addition to Tax, EI and CPP. This amount will vary by company and policy so it is difficult to give any hard and fast rules.

If you have only the statutory deductions a single man will get to keep 74% of $71,000 in ON. With a non-working wife and a couple of kids this goes up to 77% plus child tax benefit.

marcwales

More usual is to have a contribution to the group benefit plan in addition to Tax, EI and CPP. This amount will vary by company and policy so it is difficult to give any hard and fast rules.

If you have only the statutory deductions a single man will get to keep 74% of $71,000 in ON. With a non-working wife and a couple of kids this goes up to 77% plus child tax benefit.[/QUOTE]

Brilliant, thanks for this. When you say "group benefit plan", is this the pension, dental, etc all rolled into one? Apologies for ignorance but I only pay pension and Union dues in UK. Probably a really stupid question, but have you any idea how much this is likely to be? Struggling to get an idea of true take home pay. Understand though that this figure is very variable between companies. Also, what kind of figure would the child tax benefit be for 2 kids, aged 8 and 5.
really appreciate your assistance. Look forward to your reply.