money tips

10 Money Tips for New Immigrants to Canada

The ability to control your finances is a skill you’ll have to hone once you arrive in Canada. You can fritter your savings in many ways, so be on guard from the get-go.

Ensure you have a good idea the cost of rent, utilities, as well as taxes. If you arrive without a job, you must do all you can to stretch your savings until you start earning a living. The tips below will help you find your feet.

  1. Accept all Benefits

The Canadian government has a vast array of benefits targeted at newcomers to Canada. These benefits can help you settle fast in your new country.

There are tax breaks and other benefits you can qualify for such as the Goods and Services Tax/ Harmonized Sales Tax, Child Benefits Program, and other health programs.

You can also avail yourself of the Rent Assist program, which helps you to make ends meet as a low-income renter. If you’d like to know more about these benefits, you can check the Canada Benefits Finder.

  1. Get Your Social Insurance Number

A few days after your arrival in Canada, you should apply for your Social Insurance Number (SIN). This number is essential and should not be taken lightly.

It is your passport to applying as well as receiving government benefits. Another critical document to remember is your health card. A free medical check-up by the government can save you or your loved ones from a lot of medical bills.

  1. Stick to Your Budget

Like so many other newcomers before you, you’d most likely be arriving with limited funds. Keeping your expenses on the low is critical to your survival, and you can only do that by sticking to a budget.

You could get a budgeting app to help you prioritize your expenses. Another advantage to budgeting is it enables you to focus on your financial objectives. You can find a step by step guide to budgeting put together by the Financial Consumer Agency of Canada (FCAC) here.

You could also try a budget calculator – which is a useful tool if you already know what to do with your money. Here’s the link to the FCAC Budget Calculator here.

  1. Open the Perfect Bank Account

No matter where you may choose to reside in Canada, there’s a likelihood you’ll be paying for your groceries and utilities with a credit or debit card. Cash is also an option; however, carrying out your transactions online is still the safest route to take.

Be that as it may, do not use your credit card if you can’t offset the debt before it’s due. Before you choose a credit union or bank, ascertain how much you can keep as your monthly balance so you can avoid excessive service fees.

Most banks have different rates for products and services, and you can compare prices by asking around or checking online. You can also use the FCAC Account Selector tool here.

  1. Cut Cost on Utility and Grocery Bills

If you believe Statistics Canada, then you’d know that the typical Canadian household spent around C$500 on groceries in 2017, so expect the bills to be higher today.

When you consider other expenses like rent, clothing, home equipment, and clothing, you’d realize how these payments take a considerable slice of your savings. Some of the ways you can save money on your household bills include:

  •  Scouring for grocery coupons on newspapers or checking online for discount sales.
  • Buy products from thrift stores and garage sales. You can find a garage sale during summer, and thrift stores often offer discounts on the products you buy.
  • Skip out on the cable TV, Netflix and Hulu payments for now until you have a steady job. Only subscribe for services that can increase your revenue or help you find a job if you don’t have one.
  • Use energy-saving equipment to cut cost on your energy and hydro bills.
  1. Have an Emergency Fund

If and when you do get a job, you should save up money on the side that can last you and your family for a few months in case the unexpected happens. You should also invest in a Registered Education Savings Plan (RESP) and a Tax-Free Savings Account (TFSA) for your child.

Instruments like the above are government-backed, enabling you to enjoy tax-free dollars. The government also matches your  RESPs which means free funds for your child’s education!

  1. Build Your Credit

Having a credit history is an essential aspect of living in Canada. Once you arrive, take your time to apply for a credit card and use it cautiously. Many banks will assist new immigrants by giving them a free credit card once they open a bank account.

As stated earlier, do not purchase items with your credit card that cannot be paid off when it’s due. Building a credit history will come good for you in the future when you want to purchase a house or buy a vehicle.

  1. Brush up Your Education

If you arrive in Canada without a degree, you might want to brush up on your education to widen your job opportunities. You can apply for the Lifelong Learning Plan (LLP) which allows you to receive up to C$20,000 in funding for your education.

You can use the funds to pay for expenses which include your tuition and boarding costs. It’s essential to understand the money isn’t free. You’re mandated to repay the loan within a decade after your graduation.

  1. Invest Spare Cash

Idle money is money that’s not making money for you. You can put your spare cash to work by investing in bonds, stocks, REITs, mutual funds, and other investment products. Before you jump into the gravy train, remember to follow these guidelines below:

  • Invest in what you know.
  • Shop for investment products with minimal fees.
  • Diversify your investment portfolio.
  • Look towards a long-term yield.
  1. Pay Your Taxes on Time

Canada takes her taxes seriously. Canadian residents and citizens pay their taxes yearly. Even when you have no income, filing your returns will make you eligible for the government benefits listed above.

If you don’t understand how to file your taxes, go to the free tax clinic closest to you. You can also use free tax software. The paid version is available to use if you don’t qualify to use the free software.

Conclusion

Relocating to Canada isn’t a walk in the park. The tips above will help you manage your finances wisely.

 

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