Immigrants Who Landed 10+ Years Ago Are 23% Richer Than Canadian-born Families

The study tracked wealth gaps between newcomer families and Canadian-born families between 2016 and 2023. The findings tell two very differentstories depending on how recently you arrived.  

One of the reasons newcomers move to Canada is for a better quality of life. The study brings good news for them: immigrant families, both recently arrived and those who’ve been in Canada, for a long time, are wealthier than they were in 2016. Moreover, immigrant families tend to build wealth over time. After 10+ years of landing, the median net worth of immigrant families actually surpasses that of Canadian-born families.  

The study also reveals how immigrants and Canadian-born families build wealth differently, and the impact of education on net worth. 

Key Takeaways 

• Recent newcomer families (those in Canada for nine years or less) had a median net worth of $132,300 in 2023, up from $77,500 in 2016. But they were still behind Canadian-born families. 

• Established immigrant families (those in Canada for 10+ years) had a median net worth of $751,500 in 2023, outpacing similar Canadian-born families by 23.5%. 

• Home equity is the single largest source of wealth for all families, newcomer and Canadian-born alike.  

• For newcomers, lower homeownership rates in the early years are a major driver of the wealth gap. 

The Recent Newcomers: Gaining Ground, But Still Behind 

Recent newcomer families (landed in Canada 0 to 9 years ago) increased their median net worth by over 70% between 2016 and 2023. Recently arrived immigrant families, where the major income earner was 25 to 44 years old, grew their median wealth from $77,500 to $132,300 in this time. 

But Canadian-born families at a similar stage of life also grew their wealth over that period, and by more. In 2023, the median net worth of Canadian-born families was $293,900, more than twice that of recent newcomer families. The relative gap was even wider in 2019, when Canadian-born families were nearly three times wealthier than recent newcomer families. 

A large part of this comes down to housing. In 2023, 40% of recent newcomer families owned their principal residence, compared to 59% of Canadian-born families. That gap has held roughly steady since 2016.  

Recent newcomers are also more likely to live in Toronto and Vancouver, where prices are significantly higher. This makes breaking into the housing market harder. Among homeowners, recent newcomer families held an average of $145,700 in home equity, versus $194,600 for Canadian-born families. That’s a difference of roughly $49,000 or 33%. 

Established Immigrants Are Wealthier Than Their Canadian Counterparts 

For newcomer families who have been in Canada for a decade or more, and where the primary income earner is between 35 and 64, the wealth picture reverses. 

Established newcomer families had a median net worth of $751,500 in 2023. They outpaced Canadian-born families at a similar life stage by $143,100 or 23.5%. 

In comparison, in 2016, established newcomer families held $52,100 (or 10%) more than their Canadian-born counterparts. 

Housing is central to this growth in wealth. About 70% of established newcomer families owned their principal residence in 2023. This was roughly the same rate as Canadian-born families. But established newcomers held significantly more equity in those homes. In 2023, established newcomer families had an average of $432,100 in home equity (46.6% of their wealth) compared to $283,400 for Canadian-born families (34.9% of their wealth).  

The retirement savings gap also narrows over time but doesn’t close. Established newcomer families had $65,400 less in Registered Pension Plans (RPP) than Canadian-born families in 2023. But this was an improvement from a $109,700 gap in 2016. 

The gap in RRSP assets also shrank, from $30,400 less in 2016 to $21,600 less in 2023. This likely comes down to an increase in earnings over time, which results in more contribution room. 

Canadians With University Degrees Outpace Educated Immigrants 

The wealth gap was wider between recent newcomer families where the primary income earner held a university degree and similarly educated Canadian-born families. In 2023, recent newcomer families with a university degree had a median net worth of $246,800. This was 2.7 times lessthan Canadian-born families with a university-educated primary earner. 

Although Canadians with a university education continued to have a higher net worth from 2016 to 2023, their wealth only grew by 23% over this time. On the other hand, university-educated recent newcomer families grew their median wealth by about 54% in seven years. 

Established immigrant families with a university-educated earner lag behind Canadian-born families with similar education. But the gap is closing. In 2023, Canadian-born families had 17% more median wealth than established newcomers with a university degree, down from 45% in 2016. In dollar terms, this is a reduction of nearly half, from a $322,500 gap to $165,400. 

Surprisingly, established newcomer families without a university degree come out ahead of their Canadian-born counterparts. Their median net worth was $566,000 in 2023, about 31% higher than Canadian-born families with a similar profile. 

In absolute numbers, higher education still correlates to more wealth. Established immigrant families where the main income earner had a university degree had a median net worth of $955,600. This was 68.8% more than established immigrants without a university education.

The Wealth Picture: Home Equity Holds the Biggest Share  

Wealth in this study means net worth: the total value of everything a family owns, minus what they owe. The main components are home equity, other real estate, Registered Pension Plan (RPP) assets, Registered Retirement Savings Plans (RRSPs), and business equity. It also includes other assets like savings, investments, and vehicles. 

Across all families, home equity in a principal residence was the single largest source of wealth. In 2023, recent newcomers and Canadian-born families, where the primary earner was aged 25 to 44, had a similar percentage (37% to 38%) of their wealth in home equity. Primary home equity comprised almost 46.4% of established immigrants’ wealth. This shows a positive trend for immigrant homeownership over time. However, Canadian-born families with older earners (35-64 years) had only 34.9% of their wealth in the form of home equity. 

Recent newcomer families held more of their wealth in other real estate (besides their primary residence) and business equity than Canadian-born families. In 2023, other real estate made up about 10.5% of recent newcomer families’ total wealth, compared to 5.4% for Canadian-born families. Business equity accounted for about 16% of recent newcomer families’ wealth, versus 10.3% for Canadian-born families. 

Other real estate made up about 8% of established newcomer families’ wealth in 2023, compared to 5% for Canadian-born families. The dollar gap between the two groups nearly doubled from 2016 to 2023. Business equity followed a similar trajectory. Established newcomer families held $63,900 in business equity in 2023, compared to $49,300 for Canadian-born families. 

Canadian-born families have more in retirement savings, compared to recent newcomer families in the same age groups. RPP assets made up 7% of recent newcomer families’ wealth in 2023, compared to 15% for Canadian-born families. RRSPs accounted for 4% versus 8%. This can be attributed to several factors. Newcomers tend to enter the Canadian labour market later than Canadian-born people, which means fewer years of pension and RRSP contributions. Plus, it takes time for immigrant earnings to catch up, which correlates with lower savings. 

The pattern stays the same for established newcomer families. Despite having more total wealth than Canadian-born families at a similar life stage, established newcomers held 22% of their wealth in RPPs and RRSPs combined, compared to 36% for Canadian-born families. That gap narrowed from 2016 to 2023, but it remains significant. 

Note: The study excludes families in the top 5%, to limit the influence of extremely high-wealth families on the averages. 

What This Means 

The data points to one consistent pattern: time in Canada is the strongest predictor of wealth among immigrant families. The gap is significant in the early years, and it doesn’t close quickly. But for most groups, it does close eventually. 

Housing drives more of this than anything else. Getting into the market is harder in the early years, particularly for newcomers in Toronto and Vancouver. But once established, newcomer families tend to hold more home equity than their Canadian-born counterparts. Immigrant families also have more of their wealth in other real estate, besides the home they live in.  

University-educated established newcomers are still behind Canadian-born families with similar education, even after a decade or more in Canada. But the wealth gap has nearly halved since 2016. This shows that the importance of a higher education is only increasing with time. 

That said, established newcomers without a degree have already surpassed their Canadian-born counterparts. Although the study doesn’t explain the reason behind this, contributing factors likely include an overrepresentation of immigrants in high-paying trades and a higher rate of self-employment. The fact that immigrant families, both recently arrived and established, had more of their wealth in business equity also aligns with this. 

Retirement savings are the one area where the gap persists across both recent and established newcomer families. This isn’t surprising, given that immigrants join the workforce later and take longer to find their financial footing in Canada.