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How to Prepare Financially for Settling in Canada

Hannah Arendt said, “Loving life is easy when you are abroad. Where no one knows you and you hold your life in your hands all alone, you are more master of yourself than at any other time.”

It is not easy for everyone to be so adaptable. Moving to another country is a huge step. Let alone preparing to settle in a new country. 

It is more challenging than you can expect.

There are so many things to think about. Aside from the lifestyle changes, you also must consider your financial situation.

In this article, we will focus specifically on moving to Canada. Canada is a very immigrant-friendly country, with a great support system available to new immigrants. In fact, Canada gets over 300,000 new immigrants per year.

How to Prepare Financially for Settling in Canada

You must make some preparations before you move to Canada too – especially in terms of your finances.

Let’s breakdown your basic living expenses to see how you can successfully prepare yourself financially for settling in Canada.

Your basic living expenses in Canada

When preparing your move, consider the following living expenses:

  • Housing (rents, mortgages, loans): Around 30-55% of your income will go to housing related costs. With the recent rise in real estate prices and rents in Canada, expect this to be on the higher end.
  • Utilities (heating, water, electricity): Expect this to be 5-10% of your monthly costs
  • Food and Clothing: Around 20-25% of your income will go into these expenses
  • Transportation:Expect to spend between 5-15% of your income. You can either buy a car or lease it. If you decide to buy a car, you will have to purchase car insurance. It is expensive but it is mandatory. So, bear in mind the finances you will need for this too. Otherwise, like most Canadians, you can choose public transportation until you achieve financial stability.
  • Healthcare: While healthcare is free in Canada, it doesn’t cover vision, dental, or incidental fees. Expect to spend 5-10% of your income on a personal health plan, or out-of-pocket costs. 

Things to Do Before Moving to Canada

1- Provide proof of funds:

You will need to provide “proof of funds” at the time of application for the Canadian visa.

Proof of funds shows that you have enough funds to bear the living costs of you and your family in Canada.

2- Research the area you are moving to:

If you are ready to move to Canada, you are likely going there as a student or as an employee.

You must do thorough research about the area you are moving to. There are different provinces and territories, and ministry rules and living expenses can be different everywhere. So, this is one of the most important things that you need to look into while you prepare to move.

3- Research accommodation expenses: 

In your initial days in Canada, you will most likely live at a hotel, with friends, or family, or in some shared accommodation. This is going to be temporary, and you need to make the necessary arrangements for that.

Next, you must look into the various property rental websites and social media. You will get a clear idea about the rents and various housing schemes in your area. The costs differ from place to place. So, the maximum research you can do before you move there will turn beneficial for you. It will also mentally prepare you for what you can expect once you go there.

4- Start the process of opening your bank account: 

It is slightly difficult to open a bank account in Canada. Unless you are a student or an employee. However, there is an option that you can start the process online from your home country ahead of time.

Once you accept the job and your documentation is clear, you can begin the process.

If your bank account is open before you move, then you can transfer a safe sum from your home country to this account.

You can visit the bank personally ff your process does not get completed before you arrive in Canada.

Once you open your bank account, you receive a bank card. This card will enable you to make transactions and withdraw cash from ABMs.

Things to do After Moving to Canada

1- Get your Social Insurance Number:

The Social Insurance Number (SIN) is a document that the Government of Canada issues. It is a type of identification card that provides different benefits that the government offers.

So, applying for this card should be on your top priority list.

Its application system is easy. Also, it is free of charge.

You can find all about it on the official website of Service Canada. You will also find out the easy ways to apply for it.

2- Get your Health Insurance: 

Canada offers public healthcare coverage to its citizens and permanent residents.

Since you will be an expatriate, it will take time for you to become eligible for public healthcare coverage.

However, you can still apply for healthcare insurance from your provincial or territorial health ministry.

The eligibility and waiting period for a permanent health card depends from one province to another. There are different criteria in most places, so you need to look into that.

If you are there as an employee, your employer may also offer you some health insurance benefits in your job package.

It is important to look into these packages before you accept the job. Because healthcare insurance is one of the most crucial things. You can get sick anywhere. But if you are medically insured, you will not have to bear the treatment costs or pay for your medical bills from your pocket.

An important thing to remember is that public healthcare may not offer coverage for dental or vision. You may want to also consider the benefits of getting life insurance protection in case something happens to you.

3- Start building your credit history: 

As mentioned before, you need to open a bank account promptly.

After that, you can open a credit card account through your bank.

It is important to know that Canada uses a different credit scoring system.

You will need a good credit score if you want approvals for loans to buy a house or a car.

Even for renting an apartment in most places in Canada, an established credit scoring is required.

Also, you need a good credit history if you want to avail benefits on utilities like the internet and phone.

Now, there is something that you need to know about “secured and unsecured credit cards.”

A secured credit card is a credit that is backed up by the consumer’s money in the form of collateral.

Most financial establishments in Canada want newcomers, who do not have a credit history, to start with this type of credit card.

However, some banks offer unsecured credit cards to newcomers too. These cards help the newbie to start building their credit history and score as quickly as possible.

Unsecured credit cards can be used as regular debit cards. The user will have to pay their regular debts, and within a few months, they will be able to build their credit score and have an established credit history.

So now, it will become easier for them to apply for loans. They can also shift to other secured credit cards that offer better advantages.

The Bottom Line

Moving to Canada is a huge life event. It can provide a lot of opportunity for you and your family. It’s best to prepare yourself financially ahead of time, so that you can have a smooth and successful transition to your new home.

Chris
Chris
Chris Evan was born in Quebec and raised in Montreal, except for the time when he moved back to Quebec and attended high school there. He studied History and Literature at the University of Toronto. He began writing after obsessing over books.

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