Cost of Living Increases in Ontario: What to Expect in 2025

As Ontario residents prepare for the new year, understanding the anticipated changes in living costs will support financial planning and avoid surprises. The Canadian province faces economic adjustments, as it does every year, impacting everything from daily expenses to housing, utilities, transportation, and more.

Here are the changes you should expect and prepare for in 2025.

Ontario Cost of Living Increase Overview

• The projected cost of living increase for 2025 in Ontario is around 2.5-2.7%.
• These increased costs comprehensively reflect inflation, wage growth, and the rising prices of essential expenses.
• While wage increases are expected to reach around 3.45%, these adjustments vary widely by sector and industry. Some sectors will experience more favourable conditions than others.

What Is the Current Cost of Living in Ontario?

The current cost of living in Ontario in 2024 includes everything from housing and utilities to transportation, food, and connectivity. 

Housing

Ontario is consistently one of Canada’s most expensive provinces in terms of living costs, with marked variations between urban centers like Toronto and smaller rural areas. 

Housing remains the most significant monthly expense for Ontario residents, with the average home price reaching $878,620 and average monthly rent landing around $2350. Toronto leads the province in housing costs with the highest numbers across the board, with smaller towns offering more affordable living arrangements for those willing to relocate.

Utilities

Utilities are another substantial and essential expense. You’re likely currently paying around $339.49 monthly, including electricity, water, gas, internet, and cable. Dissecting this further, we see monthly averages around $102 for electricity, $90 for water, and up to $328 for gas. 

These totals also vary widely based on individual energy consumption and specific locations within the province. Some areas may have lower fixed energy costs or higher electricity demand charges than others, and particular residents may have drastically different usage patterns.

Transportation

Transportation costs depend on whether or not you have your own car. If you’re a vehicle owner, you’re paying around $9,000 per year, or $750 monthly, for things like fuel, insurance, upkeep, and parking. On the other hand, if you do not own a car and rely on public transit, those costs are much more affordable, around $91-156 for monthly transit passes.

Food

Food is another essential that costs hundreds of dollars each month. In 2024, the average person spent around $445 on food. Those who choose to eat their meals out can pay even more, as costs can range anywhere from $15-100 for an individual meal, depending on the type of restaurant.

Internet/Cable

Internet and cable may be included in utility costs, but some view them as spending categories. Internet has become a non-negotiable for many residents, costing an average of $64 monthly. Cable TV can cost another $49 monthly, with streaming as an alternative that costs roughly the same amount.

Phone bills can also be expensive, with cellular and data plans ranging from $55-65 monthly.

What Are the Impacts of the Cost of Living Increase?

The rising cost of living in Ontario has far-reaching effects on residents.

• Rising Household Expenses: The costs of goods, groceries, and basic household expenses require residents to spend more money just to maintain the standard of living they’re used to.
• Wages and Income: The 3.5% wage increase expected for many workers will provide some relief but not enough to offset the total cost of living increase, especially for those who work in sectors that experience lower wage growth. For these folks, additional income may be necessary.
• Housing and Rent: The housing crisis continues in the Canadian province, driving up competition and home/rent prices and making it increasingly more difficult to find adequate housing at affordable prices. Rent and mortgage payments require a significant portion of monthly income and expenses, making it rather difficult to save or invest with the bit of money left after paying for housing and other essentials.
• Financial Pressure on the Middle Class: The middle-class faces squeezed finances due to rising expenses and modest wage increases. 

How To Manage the Cost of Living Increase

Proactive efforts to manage the increased cost of living in Canada can go a long way toward protecting your finances and maintaining your current standard of living.

Budget

Create and maintain a comprehensive, personalized budget to track essential expenses and pinpoint areas where you can save money. Use budgeting apps and other financial planning tools or professionals to get better control over your spending patterns.

Consider Additional Income Streams

Consider adding new income streams to offset the higher costs. Some ideas to help you supplement your primary income sources include:

• Freelance work
• Starting a side business
• Exploring passive income opportunities (investments, rental property)
• Gig economy work for flexible, part-time earning

Access Government Support

Explore government programs that can offer assistance, from tax credits and housing benefits to additional cost-of-living adjustments.

Cut Costs

Reducing your monthly recurring costs may be the most effective way to manage increased expenses. While it may be difficult to lower your housing costs, you can realize significant savings by exploring ways to reduce other costs, like utilities or transportation.

For example, you can invest in alternative power sources to save on electricity and gas costs, like portable power stations or solar generators. The EcoFlow DELTA Pro 3 Portable Power Station can power almost all of your essential home appliances, but it becomes a secret weapon when you pair it with solar panels to create the EcoFlow DELTA Pro 3 Solar Generator (PV400W). 

If you have a lower kilowatt-hour requirement and want something smaller, you can explore another option in the EcoFlow DELTA 3 Series Solar Generator, with an expandable capacity between 1-5kWh. 

Want something even smaller to charge your personal devices and essential appliances? Check out the EcoFlow RIVER 2 Series Solar Generators. They are compact and portable, a great entry-level option for those who don’t require whole-home power.

You could also adjust your energy use timing, avoiding times of peak demand.

Other ideas to cut monthly costs include consolidating debt, cancelling unnecessary subscriptions, or meal planning.

Frequently Asked Questions

Final Thoughts

In 2025, Ontario residents face challenges and opportunities to manage their increased living costs. While concerns are valid as wage increases struggle to keep up with the rising costs of essentials, there are strategies residents can use to navigate these changes, mitigate rising costs, and maintain current living standards. 
One of the best ways to prepare for a higher cost of living is to reduce monthly expenses, and investing in alternative energy sources can help you save significantly on utilities. Explore EcoFlow’s DELTA Series Solar Generators, which can help you supplement electricity and gas power, helping you save each month and manage fluctuating costs.