How To Prepare Financially Before You Arrive in Canada

The starting point is to estimate how much it will cost you to live in Canada. The IRCC website has an estimate of how much you need to bring depending on your family size. Beyond this, find out how much it costs to live in your destination city in Canada. The cost of living will vary depending on where you decide to settle. Some costs will be similar for items and services across Canada.

Also, before you leave your home country, visit the Canada Border Services Agency website to find out more about:

• bringing money with you to Canada
• items you can bring into Canada duty-free and tax-free

READ ALSO: THINGS TO DO BEFORE YOU ARRIVE IN CANADA AS A NEW IMMIGRANT

2. Things To Consider

Depending on your home country, your life in Canada may be more expensive that what you are used to. Also, you may have to take a job with lower pay while you upgrade your skills or get experience working in Canada. In order words, your financial status could change.

Household expenses can take up to half your take-home pay in Canada. Your expenses will include the cost of the following:

• home
• food
• heating and other utilities
• clothing (especially if you are arriving during Winter)
• health insurance
• transportation

Accommodation Cost

As you will find out, most Canadians spend 35% to 50% of their income on housing and utilities. This includes the following:

• the cost of renting your home or paying your mortgage (a mortgage is a long-term loan.)
• heating cost
• cost of paying for electricity, telephone service and water.

While it is possible to pay your rent on a monthly basis, some landlords may require that you pay for some months in advance. Please note that rental costs vary across cities and across Canada. So, you need to put this into consideration when deciding on your destination city. If you don’t know where to start, an immigrant-serving organization can help you find a home that you can afford.

If you are planning to buy a house, you will probably need to get a mortgage. And this means your monthly cost may be higher compared to when you rent. In addition to your mortgage payments, you will have to pay for property tax and household insurance.

Health Insurance Cost

As a newcomer, some provincial and territorial health programs may not cover you for the first three months they are in Canada. You can start by reading about the healthcare service in Canada. In case your province’s healthcare service will not cover you, you will need to get private healthcare insurance.

Basic expenses

Food will be a basic expense and the cost will depend on the size of your family. Expect this cost to double if you often eat in restaurants or choose to buy specialty items. Also, you need to consider the clothing expenses. This may be less than 10% of your take-home pay. You may spend a lot more if you buy your clothing at designer stores.

Depending on which city you stay, you decide to buy or lease a car.  Before you decide whether to buy or lease a car, think about all the costs. For example, when you own a car you will have to pay to keep it working and that means paying for gas, monthly loan payments, registration and insurance.

Car insurance

It is the law that all cars must be insured and registered with your provincial or territorial government. So, if you decide to own a car, you have to factor in this cost. Car insurance can be expensive, but it protects you and other drivers in case of an accident.

One of the admissibility criteria into Canada is having enough fund to take care of your first few months in Canada. The immigration officer may ask you to prove you have enough money to support yourself and your family. It doesn’t matter that you already showed this to the visa officer during your application. Aside showing to the immigration that you have enough fund, having enough fund can make your transition smooth.

The amount of money you need to support your family depends on the size of your family. To calculate the size of your family you must include

• yourself
• your spouse or partner
• all your dependent children and
• your spouse’s dependent children (if applicable)

Also, you must include your spouse or dependent children even if they are

• permanent residents or Canadian citizens
• not coming to Canada with you

READ ALSO: WHAT TO DO IN YOUR FIRST WEEK IN CANADA

4. Have Proof of Funds

For proof, you must get official letters from any banks or financial institutions where you’re keeping money. This should be kept where you can easily access it when coming into Canada.

The letter(s) must

• be printed on the financial institution’s letterhead
• include their contact information (address, telephone number and email address)
• include your name
• list outstanding debts such as credit card debts and loans
• include, for each current bank and investment account, the
  • account numbers
  • date each account was opened
  • current balance of each account
  • average balance for the past 6 months

You will find that every now and then you have to make payments for occasional expenses. For examples,

• buying prescription medicine (not covered by health insurance)
• school supplies
• long-distance calls to friends and family in your home country etc.

So, account for this when preparing for how much you will bring. You can easily take care of these you get a job.

6. Other Things To Prepare For: Pay Cheque Deductions

As with most jobs in other countries, your employer will remove some money from your pay cheque. Pay cheque deductions can reduce your pay by as much as 25% to 35%. The money from these deductions usually pays for:

• Income taxes
• Canada Pension Plan or Quebec Pension Plan
• Employment Insurance
• Union dues (if you belong to a union)
• Payments to a retirement or pension plan (if you belong to a plan or choose to make contributions through your employer)
• Any other deductions you and your employer agree to in writing

Your pay cheque will show how much money has been deducted for each item.

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