How far are you from being homeless?

7 min readFeb 29, 2024

Homeless people are frowned upon, often hated. For their mess, their smell, their alleged drug habits and criminal behaviour. But I think the main reason behind hatred is that they remind us of our own cruelty, and the cruelty of the system that we benefit from.

Homeless people are considered a separate class. It goes:

us, the middle class
the working class
the poor
and then the homeless.

But some of those lines are imaginary — like the notion of middle class, which I’ll examine in a future article. And other lines can very easily be traversed, at least from top down.

So what is standing between you, and a tent city?

Your health

Being healthy is under-appreciated. It’s taken for granted. We straight out taunt our body. Smoking, drinking, processed food, sodas, lack of sleep, a sedentary lifestyle, skimping on oral hygiene and dentist visits, not exercising or exercising too much: all risks we take, hoping everything will be fine. We might be doing it for fun, or out of necessity. Or in the hopes that by working longer hours, taking up a side project, going to a conference, we might just catch that lucky break that will allow us to take time off, and finally take care of ourselves.

But with every late night, every hamburger we grab on the go, every time we sleep in instead of going for a walk or to the gym, we’re taking out a loan. Like a credit card, first the minimum payments get bigger. Being overweight or obese — like 2/3 of Canadians — makes daily tasks more difficult, it requires updating our wardrobe, overly relying on a car to get around. Having hypertension, high cholesterol requires medication or medical services, joint disorders require regular physiotherapy. And if we miss the minimum payments, our body might just give up.

Your job

20M out of the 40M Canadians work. There’s a good chance that if you’re working age, you’re working a job. The average hourly rate of $43 will get a monthly after tax budget of $5,639. That allows to rent an apartment anywhere, maybe even a house, and still have enough left over to live a good life.

But 9% of workers earn minimum wage. One of the highest minimum wages in Canada is $16.75 for Ontario — the salary a McDonald’s cashier makes. Employed full time, that comes to $34,840 a year, $29,085 after taxes. $2423.75 a month is enough to rent and eat even in the most expensive cities. Well, in Toronto, it’ll only be a single room for $950, but in the suburbs it can be enough for a basement apartment.

As long as you have a full time job, you’re safe. Of course, unemployment figures do a lot of heavy lifting. Not every job is a full time job. And the gig economy has pushed many into unfavourable arrangements. Working poverty is a real thing.

Your education

Unemployment rate among those with a masters degree or higher is half that among those with only a high school diploma, not to mention higher salaries.

You might loose your job, but if you’re an expert of a sought after field, it’ll only be up to you when you continue your career with a new employer. Of course there are some risks. The labour market might shift, you might end up being over-qualified for the available positions. AI is making knowledge workers uneasy. But the right education and experience still helps a lot get a job before your severance package runs out.

Your savings

Having money stashed away for a rainy day can be a potential source of income. With as little as $750,000 in investments, chances are you can withdraw 4% or $30,000 every year, and never run out of money. You can also sell your assets. From downgrading your high end smartphone to giving up your car, stuff you amassed when things went well can buy you months or years.

Benefits

Loosing a job is usually considered a temporary setback. With an official unemployment rate of 5.7%, there’s a good possibility that you’ll find something, and get back on your feet.

Employment Insurance

It’s quite easy to qualify for Employment Insurance. You had to work for 18 weeks (700 hours) before getting laid off for no fault of your own. You’ll be receiving 55% of your salary for the following 45 weeks.

If you worked a minimum wage job, that 55% is still $1,596 a month, enough to rent a bed, and still eat and pay your phone bill to have a chance at finding a new job. If you were living at large, and your rent was higher than $1,200, you’re not so lucky though. If you also want to eat, you’ll loose that place in a couple of months. And without a job, it’ll be hard to compete for even the cheaper rentals.

And you better hope you can find a job before those 45 weeks expire.

Disability benefit

If you can’t work a job because of a medical condition, you can qualify for disability benefits. The maximum monthly payment of $1,606.78 won’t get you far. Especially if your condition has additional costs.

Pension

Pensions plans are not easy to navigate in Canada. With RRSP, CPP , OAS, employer pension plans, and GIS you might be just fine to stop working — at 60 or older.

The system is geared towards a monthly total minimum payment of ~$1,800. That might be enough for the bare minimum, but won’t allow you to pick up golf and water aerobics. Or to rent a one bedroom apartment, and still have enough for groceries and other expenses.

Income assistance

Every province has some sort of income assistance program. You have to be eligible, apply, and if granted, you’ll get a maximum of $886/month in New Brunswick. But this is a last measure. You have to prove that you don’t have more than $1,000 in your bank account, and have exhausted every other benefit. Income assistance won’t save you from homelessness.

Your home

It seems hard to become homeless if you own a home. Of course, if you have a mortgage, then after prolonged unemployment, a default will be imminent. But let’s look at the happy case, when your house is paid for. You only have to pay utilities, insurance and the always increasing property tax. If you turn down the thermostat, your yearly costs for a three bedroom house will be around 10k (2k for insurance, 4k property tax, 1.5k for water, and 2.5k for heat and lights). That’s $830 a month.

Any time something breaks, you just dip into your home equity line of credit, or take out a reverse mortgage, and you’ll be able to live happily. With a condo, you don’t even have to worry about a leaking roof or torn off siding, although you’ll be on the hook for the condo fee.

Most combinations of minimum income and home ownership will save you from homelessness for decades to come.

Your friends and family

A spouse who earns enough for the both of you might disqualify you from many assistance programs. But you won’t need them anyways. If that’s not the case, having good relationships with friends and family will not only brighten your days, but will also save you from having to sleep in a tent — or worst case scenario, they can lend you the tent. Going back to your childhood home’s basement might feel like a step back from having your own place, but it’s the smart choice in many cases when you’re left without income. Giving up a rental, or selling a house before it’s foreclosed on might be the right choice if your financial situation turns dire.

Pooling resources with a friend to save on rent and utilities is also a smart choice when going gets tough.

So, how far are you from homelessness?

At this point you might be relieved. You might work in an in-demand profession, having to turn down recruiters left and right. You might have a rental property that gives you enough income that you have been sailing the oceans. You might have parents, siblings or kids who can’t wait to spend more time with you, and would welcome you anytime. You might be looking forward to a pension that’ll pay all your bills.

But before gloating, and labeling homelessness as a weakness, think about the factors that helped you build your safety net. Not everyone had those opportunities, and that doesn’t make them weak or inferior. Or addicts and criminals.