The cheapest provinces to live in Canada were revealed and they're not where you'd expect

If you've ever wondered whether your money could stretch further by moving to a different province, you're not alone. The cost of living in Canada can vary a lot depending on where you are — and a new study from Statistics Canada provides a detailed look at how much bang you really get for your buck across the country.

This fresh report released on Thursday dives deep into a cost of living comparison between all provinces and territories — not just based on prices, but also taking into account how much money people actually have to spend.

By factoring in both income and local price levels, looking at both how much people earn and how much they can actually buy with that income, it paints a much more complete picture of affordability.

So whether you're planning a move or just want to know how your home province stacks up, here's what the numbers say.

How the study worked

To get a true sense of economic differences, the study used regional purchasing power parities — or PPPs — for 2021. These numbers adjust income levels based on the local cost of goods and services.

Ontario prices and incomes were used as the baseline, so for example, if a region's PPP is 0.90, that means what you can get for $100 in Ontario costs just $90 there.

Traditionally, cost of living is measured by how expensive it is to buy things like housing, food and services — but that only tells half the story. This study goes a step further by combining that info with household disposable income, so we can see how far a typical paycheque actually goes in different parts of the country.

Cheapest cost of living in Canada

If you're looking for a cheaper place to live, the Atlantic provinces come out looking pretty good.

Based on prices alone, New Brunswick, P.E.I. and Newfoundland and Labrador had the lowest overall cost levels in the country, with PPP rates all under 0.90. That means $100 stretches over 10% further in the Maritimes than it does in Ontario.

New Brunswick — the cheapest province overall — scored a PPP of 0.87, which means everyday expenses like housing, food and services cost about 13% less than they do in Ontario.

Shelter in particular is significantly cheaper in this part of the country — which can make a big difference, given how much rent and mortgage payments can eat into your income. According to the study, New Brunswickers shell out about 53 cents for every dollar Ontarians spend on housing costs.

Where things get pricey

At the other end of the scale, B.C., Alberta and Ontario had the highest prices for living costs of all the provinces in Canada.

Given that Ontario is used as the baseline, it had a PPP of 1.00 — which also happened to be the second-highest provincial rate in the country. Alberta's PPP is also right on the mark at 1.00.

Meanwhile, B.C. had the highest PPP of any province at 1.07, with shelter costs especially high at 1.23 — the most expensive of anywhere in the country.

The territories tell a different story

If you're thinking of heading way north, be prepared — life in the territories is a whole other level of expensive.

Nunavut had the highest price levels of any region, and unfortunately, it also had the lowest PPP-adjusted household disposable income. That means people in this territory have the least money available after taxes, relative to how much things cost where they live.

However, in contrast, the Northwest Territories and Yukon fared much better, ranking the highest in the country for disposable income despite their steep costs.

Where income actually goes the furthest

So, what's actually the cheapest province to live in Canada, once you factor in how much money you can make there?

Outside of the territories, when it comes to stretching your paycheque, Newfoundland and Labrador takes the cake. Once the average income is adjusted for local prices, this province comes out on top — meaning residents there tend to have more purchasing power than anywhere else in the country.

Alberta comes in second, thanks to high household incomes that more than offset its steeper cost of living. Saskatchewan and P.E.I. also rank well, offering strong value for what people tend to earn in those provinces.

At the other end of the scale, Manitoba ranks last among the provinces, with Quebec and Nova Scotia not far ahead. Despite their reputations for generally lower costs of living, lower incomes in these regions mean households don't come out with as much spending power.

Meanwhile, Ontario and B.C. come out around the middle once cost of living and income are both factored in — despite higher nominal wages, those earnings don't stretch as far in provinces where housing and services come with a hefty price tag.

Here's how much annual spending power the average person has in each province, after taxes and local prices are factored in:

1. Newfoundland and Labrador: $43,373
2. Alberta: $42,462
3. Saskatchewan: $40,995
4. Prince Edward Island: $40,310
5. New Brunswick: $39,104
6. Ontario: $37,653
7. British Columbia: $36,479
8. Nova Scotia: $36,448
9. Quebec: $36,247
10. Manitoba: $35,949

Bottom line: if you want your paycheque to go farther, heading east — or west to Alberta — could be your best bet.

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