Welcome to Life at the Poverty Line Month and Happy 2012!
I’ve somehow made it to 2012 and my second to last month of my year-long journey. I can’t believe it’s already January and this project is in the home stretch. As a reminder, make sure to “suggest my last month” in the next few days, as on Friday I’ll be posting my top five ideas for you to vote on.
Life at the poverty line
This month I will be living at the poverty line level. Although the Government of Canada has yet to set an official definition or measure of poverty, there are several ways that this number can be determined for the purpose of this blog. In all the research I’ve done so far, poverty is generally looked at and measured in one of two terms: absolute or relative.
Absolute terms “compare household income with the cost of a basket of specific goods and services. The Fraser Institute’s Christopher Sarlo has written extensively on poverty in Canada in recent years. His publications on the subject of poverty measurement are considered by many as the bibles of the absolute poverty measure in Canada.” (canadiansocialresearch.net/poverty.htm) This is usually referred to as the “basic needs approach”, where it is determined what minimum resources are required to sustain a healthy life and how much money you are needing to make in order to fulfill those needs. According to the 2010 “FEDERAL POVERTY REDUCTION PLAN: WORKING IN PARTNERSHIP TOWARDS REDUCING POVERTY IN CANADA, Report of the Standing Committee on Human Resources, Skills and Social Development and the Status of Persons with Disabilities Basic Needs Poverty Lines by Household Size, 2007 (from The Fraser Institute)”, the basic needs poverty line for a household size of 1 person is $10,520 per year.
Relative poverty measures household income of individuals and groups compared to the income and spending patterns of the general population. It changes as the income of the population in that area does. Many people refer to Statistics Canada’s Low income cut-offs when referring to relative poverty measures, although the Government of Canada makes it clear that they are not defining poverty, but low-income. According to Statistics Canada’s 2101 Low income cut-offs , the low income cut-off after tax for a household size of 1 person living in a metropolitan area of over 500,000 inhabitants (ie. Toronto) is $18,759.
There is much debate over which is the best method to use to determine poverty – the more right wing and the more left wing views. What’s most interesting to me is that I could not possibly live off of the basic needs poverty line of $10,520 determined by the Fraser Institute. After my rent of $750 (an amount which is fairly average for an apartment in Toronto), I would have just over $4 a day to survive off. That $4 would have to cover my food, transportation, emergencies, health care if needed, entertainment, phone, and any other bills. That is not possible, unless you are getting all free food, walking everywhere, and nothing went wrong.
So I’ve decided to use the Stats Can Low Income Cut-off as my working poverty line for this month. Dividing the $18,759 by twelve months, leaves me with $1,563.25 for the month of January. Minus my rent of $750 and bills of $150 (some of these can be reduced and I will talk about that more in other posts later this month) and divided by the 31 days of January allows me $21.40 per day to pay for my food, transportation, emergencies, entertainment and any other expenses I have.
I will still be working and making money, so in order for this to work I’ll be setting aside any extra money that I make this month over the $1,563.25 and at the end of the month donate a percentage of this excess (still to be determined) to food banks and other such organizations that aid poverty-stricken Canadians.
I realize that is a lot of numbers, so below is a very quick summary. Tomorrow I’ll talk about my plan for the month and how I’m feeling about this journey.
- Low income cut-off for a one person household in Toronto per year: $18,759
- Amount of money per month after tax: $1,563.25
- My amount of money left per day after rent ($750) and bills ($150): $21.40