Is 100k a good salary in Canada?

Canada has a global reputation as an amazing country, which drives thousands of people to move there every year. But the high standard of living also means the cost of living is high, making people wonder how much they need to earn to live a comfortable life. So, is 100k a good salary in Canada?

100k is a nice salary as it’s far above the national average. Only a few jobs, such as the medical and legal profession, management roles, data scientists, and engineers, earn that much. A family of 4 can live well on a 100k salary. But some other factors also affect whether it’s a good salary.

Even though it’s above the national average salary, 100k might still not be a good salary in some areas, especially if it’s pretax. Here, we discuss whether 100k is good enough as an annual salary and look at factors that play a role in determining a good salary.

What is the average salary in Canada?

In determining whether 100k is a good salary in Canada, it’s important to know the average salary in the country. The current average salary before tax in the country for full-time workers is $68,250. It influences the average household income too, which is $62,900.

However, the average salary largely depends on several other factors, most especially location and profession. For example, the average annual salary in each province varies. In 2020, Nunavut had the highest average salary among the thirteen provinces and territories at $87,355, and Prince Edward Island had the lowest at $45,912. Of the ten provinces, Alberta has the highest average salary at $61,865.

Can a Family Live on 100k in Canada?

Given that the median household income is below $70,000, a family with an annual salary of $100,000 earns above the national average income. Even where the $100,000 is a pretax salary, the household income will still be around $72,000 after tax which is higher than the median household income.

As a post-tax salary, 100k is a good salary in Canada and will meet more than the basic living costs of a Canadian family of four. Currently, the estimated cost of living for a family of 4 is $4,033 without rent, which equals $48,396 annually, less than half of the salary. Even if rent is included, there will still be enough to save and cater to a few other expenses.

However, where the $100,000 is the household pretax salary, the salary after tax is around $70,000. This salary is barely sufficient for a household of 4, especially in Toronto and Vancouver.

Highest Paying Jobs in Canada

100k annual salary isn’t common in Canada, especially at entry-level. Only a few professions pay that much or are close to it. Here are the jobs where the average income is above 100k annually

1.      Surgeons and medical doctors

Those working in the medical profession are one of the highest-paid in Canada. This includes physicians, surgeons, dentists, anesthesiologists, and even nurses. The high salary isn’t surprising given the high demand and the rigorous training they have to undergo before being certified and licensed to practice.

2.      Lawyers and Judges

Like the medical field, the legal profession also has a complex and long qualification process. While the demand level isn’t the same, lawyers also earn premium fees for their services and judges. In addition, to become a judge in Canada, one must have at least 10 years post-bar experience.

3.      Management Roles in Companies

Roles such as Chief marketing officer, Chief executive officer, chief financial officer, etc., also attract very high salaries in Canada. However, reaching this position usually requires years of experience, education, and expertise. In addition, the salary usually depends on the size of the company.

4.      Data Scientists and Software Engineers

These jobs are in high demand all over Canada. Depending on the province, you can find entry-level jobs in these fields that pay around $100,000. Even where the pay is less, it’s still significantly higher than the average salary.

What is a Good Salary in Canada?

What qualifies as a good salary in Canada is subjective and varies depending on the job, location, and personal preference. Thus, while an annual salary of $50,000 may be above average in one city, it’s below the poverty line in another. The same goes for what is an average salary in terms of a job. However, a good salary can guarantee a decent lifestyle and ensure the individual’s happiness and satisfaction. Factors that determine what will be a good salary include

1.      Housing

The cost of housing will greatly influence what amounts to a good salary, in anyone’s opinion. Whether you’re renting or paying the mortgage, accommodation takes a chunk of every household income. Generally, household income is sufficient when accommodation doesn’t exceed 30% of the overall household budget. Of course, this will differ from one location to another. For instance, the cost of rent in Toronto is far above that of Montreal. So, a good salary in Montreal will most likely be less than decent in Toronto.

2.      Lifestyle

Your lifestyle also affects what amounts to a good salary. Living a lavish lifestyle means additional costs outside of what is necessary to live a comfortable life in Canada. In most provinces, a single person can live comfortably on around $50,000 salary annually, and a family of 4 will live okay with a household income of around $80,000. But that’s only possible if there are no luxury expenses attached.

3.      Taxes

The tax rate is different across Canadian provinces, which also affects what amounts to a good salary. Nova Scotia has one of the highest tax rates among provinces in the country, with taxable income starting from $29,500, far below the above $40,000 that’s most common in other provinces. In Alberta, income tax only applies from the first $131,220 of taxable income. This disparity in tax rates also means that what amount to taxable income will be different across provinces. The higher the tax rate, the higher the amount of salary one has to earn.

In Conclusion

100K is generally a good salary in Canada, especially if it’s post-tax. Where it’s pretax, it’s still great for an individual, and a family of four can still live comfortably on that income. However, only a few jobs pay that much, especially at entry-level.

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