Every year, Canada welcomes hundreds of thousands of newcomers, many arriving with their families, embarking on a journey to build a new life in a different country.
Newcomer families, much like any other, often allocate a significant portion of their income to expenses related to raising children. Therefore, understanding the anticipated costs in Canada becomes a crucial consideration.
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Moreover, a recent study conducted by Statistics Canada sheds light on this matter. The study categorizes families based on income levels and family size.
Income categories are as follows:
- Low income: Below CAD 83,013 annually.
- Middle income: CAD 83,013—137,790 annually.
- Higher income: Over CAD 137,790 annually.
The number of children (single, two, and three-child households) and the structure (single-parent and two-parent families) distinguish family sizes.
Which Child-related Expenses Requires the Highest Costs?
The study reports the distribution of total expenditure per child in a two-child household as follows:
- Healthcare: 4%
- Clothing: 7%
- Miscellaneous: 10%
- Childcare and education: 14%
- Food: 17%
- Transportation: 20%
- Housing: 29%
Does this pattern change based on the number of children?!
As anticipated, these findings exhibit variations depending on family size. For instance, the total expenses for children (ages 0-17) in single-child households were as follows:
- Low-income: CAD 290,580
- Middle-income: CAD 373,500
- Higher income: CAD 545,580
These figures are notably higher compared to equivalent numbers from two-child households. This aligns with expectations, as parents in single-child families, having fewer children to provide for, can allocate more of their income to a single child. Similarly, expenditure per child in three-child households was lower across every income bracket than in two-child homes (notably lower than expenditure in single-child families).
The study reveals that expenditure per child is 20-38% higher in one-child families compared to two-child households. Additionally, three-child families spent 8-15% less per child than their two-child counterparts.
What is the Expenditure by Families on their Children?
For families with two parents, the amounts spent on each child aged 0-17 were as follows:
- Low-income: CAD 238,190
- Middle-income: CAD 293,000
- Higher income: CAD 403,910
In addition, when comparing data from the same family groups, which accounted for children living at home from ages 0-22, the expenditures were as follows:
- Low-income: CAD 308,710
- Middle-income: CAD 378,900
- Higher income: CAD 521,270
This comparison highlights the significant increase in expenses as children age an additional 5 years in Canada. Notably, a general finding from the study, spanning all income groups and family sizes, is that if children aged 18-22 still reside at home, total expenditures per child increased by $68,000-CAD 117,000—primarily attributed to post-secondary tuition fees. This information becomes more pertinent considering that, as per a 2017 survey, 90% of adults aged 18-19 and 68% of individuals aged 20-24 live at home.
Do these Findings Vary Based on the Number of Parents in a Household?
In conclusion, the study identified disparities in child expenses between single and two-parent households.
Furthermore, at the low-income level (for families with one, two, and three children), expenses were largely comparable between one and two-parent households. However, this similarity diminished as the number of children increased in a family: one-child families spent approximately the same amount per child, regardless of the number of parents, but in three-child households, two-parent families notably outspent their single-parent counterparts per child.
Interestingly, as families moved into the middle-income bracket, single-parent households consistently surpassed two-parent households in per-child expenditures by a significant margin, regardless of the number of children.