Edmonton Real Estate Market

[erudyk_29]

Just a quick note, 24% is likely the marginal tax rate for a minimum wage earner. I’d guess the average tax rate for them is somewhere between 10-15%. Then you also qualify for pretty well every benefit out there (gst cheques, child tax benefits, etc). Someone in this position, should be able to live decently with a room mate in a 2 bedroom apartment

I checked the tax brackets that this person would fall into at both the provincial and federal level and it was 24%, I'm not sure if there are any caveats to that, though as you mention there probably are. You're also right that this person probably has access to a lot of tax benefits.

This doesn't change the fact that they're still living paycheck to paycheck, with very little if any hope of upward social mobility. Any increase in rent could still put this person on the brink of become homeless or even over the edge or having to make choices between eating and paying rent.

It is admittedly an extreme case as I said, but there's a reason there's been such a big increase in the amount of homeless folks in recent years. A massive part of that is that a lot of people simply can't afford any type of housing, even in a relatively affordable city like Edmonton.

 

[edm13]

I checked the tax brackets that this person would fall into at both the provincial and federal level and it was 24%, I'm not sure if there are any caveats to that, though as you mention there probably are. You're also right that this person probably has access to a lot of tax benefits.

This doesn't change the fact that they're still living paycheck to paycheck, with very little if any hope of upward social mobility. Any increase in rent could still put this person on the brink of become homeless or even over the edge or having to make choices between eating and paying rent.

It is admittedly an extreme case as I said, but there's a reason there's been such a big increase in the amount of homeless folks in recent years. A massive part of that is that a lot of people simply can't afford any type of housing, even in a relatively affordable city like Edmonton.

Yes, so those brackets would apply to any marginal income. For the 2024 tax year, the federal basic personal amount is $15,7051 and the Alberta basic personal amount is $21,885. So you pay no tax on these initial amounts you earn. So a minimum wage earner would pay very little in tax.

I can see your point but people are also just not making good financial choices, probably cause they were never really taught. Honestly, if I was in that situation, I’d be working my day job and any side jobs I could find. Someone always needs their snow shovelled or grass cut, etc. you have to be willing to hustle. I also wouldn’t be spending money on liquor, smokes, drugs and the rest of it. So there is some personal accountability required.

That being said, I honestly don’t know how people on minimum wage survive in the more expensive cities. All I can think is 4 of them move in together as roommates

 

[kcantor]

Yes, so those brackets would apply to any marginal income. For the 2024 tax year, the federal basic personal amount is $15,7051 and the Alberta basic personal amount is $21,885. So you pay no tax on these initial amounts you earn. So a minimum wage earner would pay very little in tax.

I can see your point but people are also just not making good financial choices, probably cause they were never really taught. Honestly, if I was in that situation, I’d be working my day job and any side jobs I could find. Someone always needs their snow shovelled or grass cut, etc. you have to be willing to hustle. I also wouldn’t be spending money on liquor, smokes, drugs and the rest of it. So there is some personal accountability required.

That being said, I honestly don’t know how people on minimum wage survive in the more expensive cities. All I can think is 4 of them move in together as roommates

Not that I'm advocating it but a friend of ours transferred from Vancouver to London, England. She ended up three tube stops from work and shared a one bedroom apartment with two twin beds with 5 others. They all worked shift work and each had access to one of the beds for 8 hours a day.

 

[David A]

Yes, so those brackets would apply to any marginal income. For the 2024 tax year, the federal basic personal amount is $15,7051 and the Alberta basic personal amount is $21,885. So you pay no tax on these initial amounts you earn. So a minimum wage earner would pay very little in tax.

I can see your point but people are also just not making good financial choices, probably cause they were never really taught. Honestly, if I was in that situation, I’d be working my day job and any side jobs I could find. Someone always needs their snow shovelled or grass cut, etc. you have to be willing to hustle. I also wouldn’t be spending money on liquor, smokes, drugs and the rest of it. So there is some personal accountability required.

That being said, I honestly don’t know how people on minimum wage survive in the more expensive cities. All I can think is 4 of them move in together as roommates

Yes, if you make $15,000 you pay no Federal or Alberta tax. However, after deductions for CPP or EI (probably around 7%) but that leave around $1,160 per month to live on which may barely cover rent for a 1 bedroom apt these days even here. So yes, you would probably need a room mate if you want to eat also.

The Federal tax rate is 15% and Alberta is 10% I believe, so not sure how that makes 24%, but it is close. Add 7% or so on for CPP and EI and that is 32% marginal deductions even for someone is a lower bracket.