Wealthy

An in-store bakery manager and Galen Weston walk into an empty bar together. (Don’t ask why.)

At that moment the average net worth of people in that room is $10.35 billion. The grocery czar (Canada’s third-richest dude) has $20.6 billion. The baker has a $120,000 RRSP and owns a house in Oshawa. And a 2008 Harley. Plus a doodle.

That’s how averages work. They don’t tell you much.

In recent days StatsCan announced that the average net worth of Canadian households just passed $1 million. That happened in the first few months of this year. And it means little. When a median net worth is calculated – that point at which half the people have more and half have less – the number drops fast, to $530,000.

So if your NW is half a mill you’re, ah, normal. But this, too, is misleading. Wealth is overwhelming concentrated in the hands of a relatively small group of people. Maybe you’re one of them.

The top 10% (by net worth) have half the wealth, possessing at least $2 million. The top 5% hold 43% of the wealth, and that includes any family with $2.3 million or more.

To be a 1%er by wealth takes a net worth of $7.5 million. These people have about a quarter of all the stuff. Finally, the top 0.01% (like Galen) have a minimum of $170 million and own 5% of the country’s assets – held by a mere 1,700 families.

The other end?

If you have $300,000 or less in net worth you belong to a huge group of Canadians – 40% of us – who together hold just 1% of national wealth. The middle class – the four in ten with between $300,000 and $1.3 million – have 25% of the wealth. In other words, 80% of Canadian households have less than $1,300.000 and own just over a quarter of all the wealth. The other 20% of the population owns the rest – three-quarters of everything.

By the way 45% of all household net worth is in real estate. That used to be 54% – just after the pandemic, but you know what’s happened since 2022. Plop. Fizzle. Plunk. That is a dramatic tumble in just four years, showcasing the boom-bust nature of Canadian housing upon which we have placed more than $2 trillion in debt. When real estate prices correct and fall by 20-30%, mortgages don’t shrink at the same time. You still owe what you owed when the place was worth more. So, ergo, net worth takes a hit.

In contrast, the TSX composite index has gained 215% since its low point in March of 2020 when Covid came to town. And since the beginning of 2022 the index has returned 66% – over the same period of time a detached home in Toronto shed about 27%.

This helps explain how wealthy people got wealthy. And stay that way. The bottom 80% of Canadians (by net worth) have a little over 50% of their wealth in a house. One asset. One address. One town. With debt. The top 1% keep only 15% of net worth in real estate, with about 70% in financial assets – like stocks, funds or bonds. Diversified. Liquid. This also sheds light on why average folk are so impacted by changes in the property market, since the combination of too much leverage and over-investment in one asset leaves them vulnerable in a way the wealthy are not.

Sure, everybody thinks they need a house more than they require an investment portfolio. So they do what they do.

Fine. Just don’t complain about Galen.

About the picture: “I spotted this fellow walking his pack of well-behaved pooches at Surrey’s Crescent Beach,” writes Heather, “marvelling at his ability to keep them all in line. Perhaps you could hire him to keep the steerage section in line. I’ve been reading your free financial blog for many years. Can’t thank you enough for all you do to make the world a better place.”

To be in touch or send a picture of your beast, email to ‘[email protected]’.

Source: https://www.greaterfool.ca/2026/07/26/wealthy/