An income of $196,000 places you in the country’s top one per cent of earners. But does it make you wealthy?
The Western world has become chastened and frugal. The reasons are many: corporations crouched in fear of another, much worse recession; penniless governments a-toppling; and Europe, for the foreseeable future, mired in a debt debacle. But you wouldn’t know it from life in Toronto, where a luxury condo opens its doors every week and we queue for hunks of exotic chocolate at the new Maple Leaf Gardens Loblaws. We’re bouncing along in a prosperity bubble.
The exact meaning of prosperous, of course, depends entirely on one’s perspective. Last fall’s Occupy protesters were keen to demonize the so-called One Per Cent—the monocled, yacht-owning multi-millionaires who are now greed personified. However, the threshold for the top one per cent of income earners is much lower than you’d expect: $196,000, in the latest Statistics Canada numbers. That’s no small amount of money, but hardly the means for a life of leisure. In an increasingly pricy city like Toronto, where we pay a premium for everything from milk to car insurance, $196,000 can seem positively middle-class.
Break it down, and it translates to roughly $10,400 a month, after taxes. For many Torontonians, that $10,400 disappears fast. Thousands go to the mortgage. For those with young kids, daycare can cost upwards of $1,500 a month. There are the car and RSP payments, wardrobe refreshes, utility bills and something to set aside for when the furnace inevitably conks out. Plus the cost of the sushi, pad Thai and butter chicken that we order in three nights a week—because we’re all too tired to cook by the time we get home from work.
Then there’s the stuff that fills our houses—the calibre of which is the subject of intense, unspoken competition among my peers and neighbours. During my entire childhood, spent in a comfortable lower-upper-middle-class neighbourhood of Montreal, I am quite sure that my mother did not waste a single moment worrying about replacing her laminate kitchen counters with granite or marble. There was no such thing as a $1,000 Bugaboo stroller, or anything like it. You could host a casual weekend party without spending a fortune on artisanal cheeses. Living the good life simply wasn’t the full-time, across-the-retail-spectrum pursuit it has now become.
HOW THEY SPEND IT