FINANCIAL LITERACY FOR NEWCOMERS:
WHAT EVERY NEW CANADIAN MUST KNOW
By Joseph J. White— President, REMIC
Canada attracts hundreds of thousands of newcomers each year, many arriving with strong financial skills, yet even highly capable immigrants often struggle with the country’ s unique financial systems. The challenge isn’ t ability. It’ s that the rules are different here and misunderstanding them can lead to costly mistakes.
One of the biggest differences is the importance of credit. A newcomer may have an extensive credit history abroad, but Canada treats them as if they have none. Without a Canadian credit score, newcomers can face higher borrowing costs, difficulty renting housing, or trouble obtaining a mobile phone plan. Building credit early is also the prerequisite for eventually qualifying for a mortgage. Using a secured card or newcomer banking product helps establish a score within the first year.
Debt products in Canada require caution. Credit card interest commonly ranges from 19.99 % to 29.99 %, and payday loans carry extremely high effective rates. Using credit as one might in another country, carrying balances or making minimum payments, can lead to rapid debt accumulation.
Taxes can also be confusing. Canada’ s system includes several valuable benefits, including the Canada Child Benefit and GST / HST credit, that many newcomers miss. Filing taxes accurately and on time ensures access to these programs.
Newcomers also face an increased risk of scams, particularly fraudulent CRA calls and fake job offers. A simple rule helps: no legitimate Canadian government agency will demand immediate payment through gift cards or crypto, nor will they threaten deportation over unpaid bills.
Basic banking also works differently. Many newcomers are surprised to encounter monthly account fees, transaction limits, and charges for e-transfers. Promotional“ newcomer packages” offered by major banks often expire after 12 – 24 months, leading to unexpected fees. Lower-cost options, such as credit unions and digital-first banks, are often overlooked but offer permanent, low-fee alternatives.
Canada offers tremendous financial opportunity, but success requires understanding the local system. Building credit early, managing debt, and learning consumer protections creates a strong foundation. The best investment a newcomer can make in their first month isn’ t in the stock market, it’ s in financial education.
Real Estate Mortgage Institute of Canada, www. remic. ca