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How to manage your finances in Canada as a newcomer

How to manage your finances as a newcomer New to Canada? Learn how you can fast track your financial success and settle in your new home.

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How to manage your finances in Canada as a newcomer

If you’ve recently moved to Canada or plan to move here, you’ll need to get your Canadian finances in order.

This will help you get settled into your new life and do things like pay rent, get a debit card and a credit card, transfer money, deposit cheques, buy groceries, and other necessities.

Depending on what country you’re coming from, the Canadian banking system might be more or less familiar, says Parmpreet Jathol, a financial advisor and mutual funds representative at Scotiabank, “It can be a challenge when people get to Canada and they don’t know how to navigate Canadian banks. By connecting with your financial advisor, we can help walk you through how to save, how to invest and do the important daily work of managing their finances or setting up accounts.”

We’re here to walk you through everything that you need to know about the financial system and banking in Canada so that you can fast track your financial success, avoid fraud, and settle into your new home.

Canada’s banking system

Setting up a bank account is pretty simple! All you have to do is provide identification like a passport, immigration papers, your Social Insurance Number (SIN) if you have one, and proof of address. Some newcomers may not have proof of address as soon as they land in Canada. At Scotiabank, instead of providing proof of address, you can use a referral from an existing Scotiabank customer in good standing. For proof of immigration, you can use your temporary residency permit, your Confirmation of Permanent Residence (COPR), or your work or study permit.

Some banks like Scotiabank allow you to open an investment account online before you arrive in Canada from your home country if you are eligible to simplify your banking. You can open an everyday chequing account at a bank branch after arriving in Canada.

But those are just the basics around opening an account. You will also need to know how the Canadian banking system might be different from what you’re used to – so that you can make the right financial decisions.


Canada has five major banks and a bunch of smaller community banks, online banks, and credit unions.

When you are choosing a bank as a newcomer, you need to consider what your specific financial needs are. For example, many banks won’t let you deposit international cheques via their mobile apps or ATMs. If you will be receiving frequent cheques from your home country, you will most likely want to choose a bank that has branches near you.

But you’ll also want to look at the details and fees of the bank accounts that you choose to open so that you don’t end up paying more than you need to in monthly fees and transactional fees, says Jathol.

“In some countries, you just have a savings account and do all your banking through that one account,” she says. “However, in Canada most people have two accounts – a savings account and a chequing account to manage their personal finances. A chequing account is designed to pay bills and usually has lower transaction fees or a certain number of free transactions per month.”

While many bank accounts charge monthly fees, they are often waived if you keep a certain minimum daily balance in your account.

Another thing to understand, Jathol says, is that the interest rate on a savings account is lower in Canada than in many other countries. For that reason, it isn’t always the best idea to keep all your savings in your savings account.

“A great option is to look into a tax-free savings account. It allows you to save a fixed amount of money every year and invest it in ways that will earn you more interest without paying tax on that interest. That kind of savings vehicle doesn’t exist in some other countries, so it can be easy for newcomers to overlook it,” she says. She adds that in Canada, most of your banking can be done without going into a branch and using mobile and/or online banking.

Household money management

Once you’ve chosen a financial institution and figured out how to open a bank account, you need to move on to the important step of figuring out how to manage your money: budgeting, investing and paying for the things you need.

Jathol explains, “For anyone who comes to this country, an important thing to learn about is how to manage and budget their money in ways that leverage the investment vehicles available to them in Canada. Beyond TFSAs, there are options like registered retirement savings accounts (or RRSPs) and the registered education savings plan (or RESPs).”

These accounts can help you build towards your financial goals secure your financial future over time – even with small initial investments. “One of the most important steps in money management is to get started on investing early and creating a financial plan as soon as you’re able to when you’re settled in Canada,” she says.

When you are new to Canada, you will likely be getting a lot of financial ads targeted to you on social media, which might not always be accurate. Jathol encourages newcomers to be careful and verify information they have read online with trusted sources such as family, friends, and their financial advisor. If you meet with a financial advisor at your bank branch, the meeting will be free and you won’t be obligated to take any of the recommendations that the advisor gives you, but it can help you better understand your finances.

As part of Scotiabank’s efforts to prioritizes your health and safety during the COVID-19 pandemic, we encourage anyone looking to meet with an advisor to book an appointment in advance of visiting the branch.

Credit and debt

A lot of new Canadians think that debt is always a bad thing, but using credit and debt strategically in Canada can actually help you build wealth over time, says Jathol.

Since credit scores and credit history aren’t generally transferable from one country to the next, many newcomers are surprised that they have to start over from scratch building a credit score in Canada. That will make accessing credit difficult until you can build up a record – which could make it harder to do things like setting up utilities, getting a cell phone, buying a car, or purchasing a home. That’s why it’s important to start building your credit as soon as possible. You can do this by getting a credit card and a mobile phone. Some banks like Scotia allow you to get access to credit with no Canadian credit history to help ease your transition.

Depending on your financial situation, you might need to get a secured credit card – which is a credit card where you have to put down a deposit in order to start using it. By using it and paying it back over time, you can potentially increase your credit rating and credit limit which may qualify you for more secured and unsecured credit from lenders.

“When taking on debt, you just have to make sure that whatever you’re taking on is manageable,” says Jathol. “How you manage debt when you arrive will follow you and could help or harm you in the future.”

Ways to avoid financial fraud

One thing that you need to look out for as a newcomer is financial fraud. Many scammers target new immigrants who don’t yet know how the Canadian banking system works.

“One tip to remember is that no bank or financial institution will call you and ask you for your personal information or card numbers,” says Jathol. “If someone does this, call the institution back before giving it to them.”

Jathol has seen a lot of online scams exploiting newcomers. “Sometimes it’s a company that offers you a job, but the job is just a way to get your financial information or get you to pay a fee or transfer money for them,” she says.

Make sure you do your research whether you’re looking to rent an apartment, or apply for a job to ensure that the person you’re dealing with is who they say they are.

The best rule of thumb is to approach every financial transaction with caution until you know enough about the Canadian banking system to know that it’s legitimate.

Learn more about common scams and how you can fight fraud by visiting our Security Centre.

Banking and COVID-19

Worried about limiting your contacts to protect yourself from COVID? Most banking can be done in Canada without going into the bank – whether through online, mobile, or phone banking. Reach out to your bank to find out ways you can get the banking you need to do accomplished from the safety of your home.

If you’re facing financial hardship from moving during a pandemic, things like using your emergency fund, looking for programs that can support you, and finding ways to budget well can help. Making sure you have all your documents together and know how to access health care, are other things that could be important if you’ve just arrived.

It’s simpler than it seems

Money management for immigrants can seem complicated — but it’s just about learning how to navigate the system. When you first arrive, reputable financial advisors can help you figure out how to best manage your money in Canada so that you’ll meet your short and long term financial goals. Ask for help if you’re confused — it will set you up for later financial success.

About Scotiabank

Scotiabank is one of the top Canadian banks and a leading bank in the Americas. Guided by our purpose “for every future”, we help our customers, their families and their communities achieve success through a broad range of advice, products and services.

Launched in 2008, the Scotiabank StartRight Program is designed to simplify banking for Canadian Permanent residents, International Students and Foreign Workers who have recently landed in Canada. We can help ease your transition to Canada by getting you started with a Scotiabank International Account that allows you to transfer up to $50,000 before you arrive to help you feel more prepared knowing you have proof of funds ready. We can even help fast track your study permit with the Scotiabank Student GIC Program.

Our Scotiabank StartRight program can also help you start banking in Canada with 12 months of free banking, access to credit with no credit history, unlimited no-fee international money transfers, and expert help from Financial Advisors.

We also launched ScotiaRISE – our new, 10-year, $500 million community investment program designed to help promote economic resilience among disadvantaged people and communities. In particular, the program is centred on using funding and partnerships to increase graduation rates and postsecondary enrolment, help newcomers feel at home faster and secure meaningful employment and senior opportunities for underrepresented groups. It’s all part of why Scotiabank is the bank for newcomers.

Legal Disclaimer: This article is provided for information purposes only. It is not to be relied upon as financial, tax or investment advice or guarantees about the future, nor should it be considered a recommendation to buy or sell. Information contained in this article, including information relating to interest rates, market conditions, tax rules, and other investment factors are subject to change without notice and The Bank of Nova Scotia is not responsible to update this information. All third party sources are believed to be accurate and reliable as of the date of publication and The Bank of Nova Scotia does not guarantee its accuracy or reliability. Readers should consult their own professional advisor for specific financial, investment and/or tax advice tailored to their needs to ensure that individual circumstances are considered properly and action is taken based on the latest available information.