Navigating Canada’s financial landscape can be daunting and stressful for newcomers, and moving to a new country can negatively impact financial confidence. According to A The latest survey conducted by Interac (Interac), while 61% of newcomers felt good about their finances when they first arrived, that number dropped to just 31% after coming to grips with the financial realities of settling in. Managing finances in a new country can lead to a feeling of security. Anxiety and fatigue.
Realizing these challenges, Interac cooperated with Conscious economics The Mindfulness and Money digital learning program for newcomers. This program, created by Conscious Economics and presented by Interac, helps newcomers build financial confidence and incorporate mindfulness techniques to reduce financial stress.
To complement this, Credit Canada is also committed to supporting and educating newcomers during their transition, and offers valuable financial education tools, including butterfly Budget app. Together, these resources help ease the transition and promote a sense of financial health and well-being.
Below, we’ve outlined some tips for newcomers to Canada to manage their finances while promoting mindfulness as they adjust to their new lives.
Understand Canada’s financial system
Credit scores and debt management practices can vary greatly between countries, making it important to understand the Canadian tax system to ensure compliance with local regulations. Building a strong credit history is crucial to achieving financial stability and opening up opportunities for future investments, such as buying a home or starting a business. Fortunately, there are comprehensive resources designed specifically for newcomers, offering valuable guidance and support as they settle into life in Canada.
Guide to the Canadian Financial System
For many newcomers to Canada, the concept of a credit score may be completely unfamiliar, as it is not a universal financial measure across the world.
In Canada, credit scores range from 300 to 900, and a score above 700 is usually considered good. A strong credit score is built by consistently paying bills on time, keeping credit card balances low compared to their limits, and maintaining a low frequency of new credit applications.
Many believe that debt is inherently negative and should be avoided at all costs. However, adopting responsible use of credit through the use of credit cards can be effective in building a positive credit history. This can be a challenge at first because it contradicts the deeply held belief many have about avoiding debt.
By carefully managing a credit card with timely payments and keeping balances low, newcomers can establish a strong credit score, which is crucial for accessing various financial opportunities, such as loans or rental properties.
Debt can be a sensitive topic for many, especially for newcomers who may have experienced financial instability in their home country. However, debt varies from country to country.
Your goals may require you to challenge your concept of debt. In Canada, there are different types of debt, including secured and unsecured debt. Secured debt is backed by an asset, such as a car or home, while unsecured debt does not require collateral. It is important to carefully consider the implications of each type of debt before borrowing money.
Are you worried about setting up a credit card? You can start by getting your feet wet instead of diving in at the deep end.
“There are other ways to build credit without needing a credit card, such as making sure you make your monthly payments, especially if these bills are in your name. Your phone bill is an example of this. Your rent. Maybe your car payments. Any bill that is in your name, as long as you make those payments in a timely manner, is sure to make a big difference in how it shows up on your credit score. -Asil Al Baba, financial therapist and co-founder of Mindfusion and Money
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Accommodation and transportation
Housing and transportation are two essential aspects of daily life that newcomers must consider when managing their finances in Canada. For many, the cost of living in Canada may be higher than what they are used to in their home country. It is necessary to research and understand the average costs of rent, utilities and transportation in different cities or regions for planning Realistic budget.
“In most cases, [a mortgage] It is the largest and largest amount of debt you will ever owe…For newcomers, it is very important to understand what your goals are regarding housing. Is home ownership important to you? There are many different belief systems around that. -Asil Al Baba, financial therapist and co-founder of Mindfusion and Money
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Understanding Canadian taxes
Taxes in Canada can be complex, and it is essential to understand the different types of taxes that apply to a newcomer. These include income tax, sales tax (GST/HST), payroll taxes, and property taxes.
Learning about the Canadian tax system will not only help newcomers stay compliant with regulations, but also ensure they take advantage of the deductions and credits available. Online resources Available to learn how to file taxes as a newcomer.
Adapting to the Canadian tax system requires a practical understanding and emotional acceptance of its complexities. For many newcomers, this involves recalibrating their approach to finances, as there may be more factors to consider compared to their home countries.
While the complexity of taxes may seem overwhelming at first, it is important to realize the long-term societal benefits that arise from these contributions. Your emotional journey may vary, as perceptions of taxes can vary greatly depending on your past experiences.
“And it’s difficult for a lot of people who come from areas where there’s a lot of corruption or mistrust of governments and systems to actually give that money away and trust that it’s going to show up in the service roads and other ways that it’s going to show up. Back to you.” -Asil Al Baba, financial therapist and co-founder of Mindfusion and Money
It may take time to build trust in the system, but understanding that taxes support progress in education, health care and infrastructure can help newcomers appreciate their role within Canadian society.
Fraud prevention for newcomers
Another big stressor can be the fear of being taken advantage of when you are new to a country. Below are the steps that Interac advises you to adopt and which are mentioned in the Money Vigilance program to reduce the risk of fraud:
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Stop: Take time before responding to unwanted messages
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Proofing: Ask yourself if the sender is trying to exploit emotional vulnerability for a sense of urgency
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Speak up: Report fraud attempts
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Practice good digital hygiene: Protect your personal data
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Block Sender: Close untrusted contacts.
Are you new to Canada? Learn how Interac It can help make your life here much smoother.
Building financial confidence
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Set small, measurable goals
Achieving financial confidence starts with setting small, measurable goals. Start by determining what you want to achieve in the short term, and think about goals such as saving for a specific purchase or paying off part of current debt within time frames of 3 months, 6 months, or 1 year.
“Take a moment as a newcomer to think about your goals and that process and make sure you immediately build the right financial frameworks to support those long-term goals.” -Asil Al Baba, financial therapist and co-founder of Mindfusion and Money
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Utilize Interac products for secure transactions
Interac It provides Canadians with secure and efficient payment solutions, supporting peace of mind in financial transactions. Using Interac e-Transfer® to send and receive money is convenient and fast, with strong security features that protect against fraud.
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Stay on track with expenses and create a realistic budget
Maintaining a realistic budget is essential for effective expense management and financial confidence. Use budgeting tools or apps Like a butterfly it can provide insight into spending patterns and ensure accountability. Regularly reflecting on your budget will help adjust it in response to life changes or financial goals, supporting sustainable financial health.
Incorporating mindfulness into money management
Developing awareness of the present moment is the cornerstone of effective money management. It involves taking care of your financial situation without it being overshadowed by past mistakes or future fears. You can try:
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Breathing exercises and grounding techniques
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Non-judgmental observation
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Create a daily mindfulness routine
“It’s probably especially hard for you if you’re, for example, in a manager position in your country, and you have to start at the entry level of the job. There’s a lot of guilt, shame, anger, frustration and a lot of emotions that can come up as a result of that experience.”
So this non-judgmental observation is an invitation to continually return to being curious about what you notice without judging it and attaching too much meaning to it. -Asil Al Baba, financial therapist and co-founder of Mindfusion and Money
Stay connected and supported
“Building community. This aspect is very important. At our Mind and Money membership, we believe that healing happens in communities. It is very important as a newcomer to create this new support system around you and build your social capital. -Asil Al Baba, financial therapist and co-founder of Mindfusion and Money
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Join community groups and events
Participating in community groups and events can be a valuable resource for those looking to boost their financial knowledge and confidence. These groups provide a supportive environment where individuals can share their experiences, challenges, and successes in money management.
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Accessing mindfulness and financial resources in the conscious economy
Conscious economics Interac offers a wealth of resources designed to integrate mindfulness with financial health. Their Mindfulness and Money resources provide tools and strategies for cultivating a thoughtful and balanced approach to finances.
These resources often include guides on mindfulness practices that promote calm and clarity, and help make more intentional, stress-free financial decisions. By accessing these tools, individuals can learn how to reduce financial anxiety and build healthy relationships with money, transforming the way they approach their financial goals.
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Build a support network to share experiences and learn from others
Creating a strong support network is essential in navigating the often complex personal finance landscape. Engaging with family, friends, online forums, or colleagues with financial experience can provide valuable insights and advice.
Financial assistance for newcomers
At Credit Canada, we can be part of this support network. If you need help building your credit or managing debt, Credit Canada advisors are here to help. Contact us today to get started.
