Canada and Nordic countries are few well known countries in the global north to have a universal and generous social welfare among other western developed countries. However, there has been immense debate on effectiveness of their service on the well-being of beneficiaries. This research focuses on perspective of youth aging out of foster care to examine the relationship between foster care system and youth’s homelessness later in adult life. Increased psychological and behavioural change among adults was noted more among those who identified themselves as having been placed or passed through foster care system. Psychological problems and poor mental health have been attributed to parents’ child separation, inadequate policy, and lack of actions to protect children who go through foster system. Existing studies have shown that participation in welfare programs such as the foster care system resulted in poor mental health well-being and a high rate of vulnerability that led to homelessness. This research aims to create awareness of the connection between foster care and homelessness as seen from the young people’s perspective and with particular attention to their mental health wellbeing. Discussion includes the effects of homelessness, the stigma associated with being homeless, and recommendation for policymakers, social workers, and non-for-profit agencies to alleviate homelessness of youth who pass through foster care system.