Want to boost your net worth? Live in a mid-sized city

Posted on 15. Jul, 2010 by in General

Andrew Binet, Globe and Mail, Thursday, Jul. 15, 2010 7:39AM EDT

Which Canadian cities posted the biggest jump in household net worth last year? Toronto? Vancouver? Montreal?

Try Quebec City, Winnipeg, Halifax and Saskatoon. Each of these cities saw household net worth jump by nearly 10 per cent in 2009, according to WealthScapes 2010, a national survey of household financial statistics. Residents in these cities are doing the best job at managing their debt loads while continuing to invest, said Catherine Pearson, vice-president of Environics Analytics, the company behind WealthScapes.

Canada’s commercial hubs, on the other hand, posted net worth growth that hovered around or below the national average of 6.7 per cent. Vancouver, with its pricey real estate, managed to hold on to the title of the city with the highest net worth, but this doesn’t seem likely to last long. Its net worth growth rate was among the lowest of the large cities, at 3.1 per cent.

Calgary’s average household income, at $119,681, was $23,000 higher than any other city, but don’t be misled: The average household in Calgary had $184,850 dollars of debt. That’s nearly $25,000 more than Vancouver, and more than double Montreal. 

“Last year we saw that [people in Calgary] were continuing to behave as if there was a boom,” Ms. Pearson said. 

Yet it seems Calgary is an exception. “They were behaving differently than the rest of the country,” and “continued to carry heavy debt,” with risk-free household savings amounting to a little less than one-third of the amount of assets held in riskier vehicles like stocks and bonds, she said. 

In 2009, Canadians for the most part were “definitely more diversified” when it came to managing their financial assets. Coming out of the recession, there was a widespread “change in investment style,” according to Ms. Pearson, as Canadians transferred their riskier assets into “more cautious vehicles.” 

Cities where household net worth grew the most maintained the lowest levels of household savings. The level in Saskatoon grew 9.6 per cent in 2009, while each household has managed to save about $35,696 total. Torontonians have saved the most over all, with an average of $118,388 per household. 

Tags: , , , ,

Comments are closed.