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Map of Canada and U.S. (Photos.com)

Map of Canada and U.S.

(Photos.com)

Household Finances

Does it cost more to live in Canada or the U.S.? Depends if you have kids Add to ...

This question is part of the age-old debate between two nations. The societies of both Canada and the United States hold the view that their own country is the better place to live. Generally, neither country learns all the facts about what the other country has to offer. So, which is better: Canada or the United States?

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Benefits
Becoming a mother is one of the greatest gifts in the world. Spending time with your child as he or she grows up is a need of every mother. How does your country support new moms?

Canada
Canada has paid leave, and many employers offer benefits to new mothers, or parents, ranging from 17 weeks up to as much as 52 weeks. During this time, one of the spouses can claim Employment Insurance (EI) for approximately 15 weeks. Generally, EI payments are 55 per cent of weekly earnings but have a maximum payment of $485 per week. Parents can also split the allocated time if they choose.

U.S.
While their northerly neighbors have a solid set of maternity and parental benefits, the United States currently does not mandate any sort of maternity leave. However, the Family and Medical Leave Act (FMLA) allows up to 12 weeks of unpaid leave for extreme sickness and birth of a child. While this 12 weeks of unpaid leave is not specifically categorized as maternity leave, it can be used under the FMLA as such. Small companies of under 50 employees are exempt from the FMLA. Some states such as California and New Jersey include paid maternity benefits into their disability insurance, but this choice is solely at the discretion of each state.

Services
Some of the more well-known services available to Canadians and Americans are healthcare and university funding. The United States is ranked No. 1 for most expensive healthcare per capita at $8,233. Conversely, Canada ranks No. 6 worldwide and is over $3,700 cheaper than the United States at $4,445 per capita, according to a 2012 OECD Health Data study using 2010 statistics. Americans pay over 17 per cent of their Gross Domestic Product (GDP) towards healthcare while Canadians sit at about 11 per cent.

University can be another extremely large cost in a person’s life. It puts many students tens of thousands of dollars in debt. Individual states have the choice on whether or not they want to grant funding to large state-run universities. Despite these grants, schooling is still very expensive for the average American. A bachelor’s degree in the U.S. can run from about $37,600 for an average public college to over $160,000 at prestigious schools such as Harvard. In Canada, the average cost of an undergraduate degree starts at $8,000 (Quebec) and increases to about $26,000. The most expensive undergraduate programs in Canada will cost around $50,000, which is approximately one-third the cost of a degree from Harvard University.

Average Salaries
According to the website numbeo.com, the average income of an American and a Canadian are approximately the same amount. Canada’s after-tax monthly income is about $3,000 which totals around $36,000per year. The U.S. sits just below Canada at approximately $2,942 per month, or roughly $35,300 per year.

The real difference is seen in the cost of living. While Americans and Canadians roughly make the same amount per annum, there are large gaps in specific spending areas of both countries.

The monthly rent for a one-bedroom condominium in the downtown area of your average city in Canada is near $907, but only about $878 in the United States. This difference of roughly $29 per month adds up to nearly $350 in the course of a year. If you multiply that over a five-year span, you are looking at over $1,700 in additional expenses for housing alone.

Food is much more costly in Canada. One kilogram of chicken breasts costs around $6.50 in the United States, while it averages almost $11 in Canada. A mid-range, three-course meal for two in Canada ends up costing $60. In the U.S. you are only paying about $44. Finally, clothing is more expensive in Canada than in the United States. A $40 pair of Levi’s jeans in the States will run you about $55 in Canada.

If all the little things are added that cost more in Canada, the total is far more than the $750 salary difference that was originally stated. By this measure, the U.S. is cheaper to live in.

The Bottom Line
Canadians receive better social benefits such as healthcare, paid maternity leave and greater subsidization of their post-secondary schools. Both countries generally have around the same annual income. However, the cost of living in the United States is remarkably less. While Canadians may pay less for larger-life events, Americans pay less for day-to-day expenses such as eating and housing costs. Maybe it all evens out in the end, or perhaps one place really is better to live than the other.

If you live a healthy and active lifestyle and don’t plan on having children, the U.S. is potentially the place for you. If you plan on having many children and need the help putting them all through school, Canada may be the more suitable choice for your family. Whichever the case, the choice should be made on the basis of what you value most.

 

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