Financial planning is very much necessary especially when you arrive in a new country to live and work. However, you can split your plan into short term and long term

Here are some of the essential steps (leaving opening bank account) which are equally applicable and important to your short and long term financial plan.

Open your Bank Account
The first step is to open a bank account as soon as you arrive and start settling. If you are married and have children then you may like to have a joint bank account with your spouse as your Canada Child Tax Benefit (CCTB) money may be deposited directly to your bank account. Here are websites links of some banks and financial institutions:

Bank of Montreal –www.bmo.com
Canada Trust –www.tdcanadatrust.com
CIBC –www.cibc.com
Royal Bank RBC – www.rbc.com

Some banks are offering many incentives to newcomers. It is better for you to have that information, compare and then decide which bank is suitable to your needs.

There are many factors to consider when you choose a bank to open your bank account. You may ask these questions before you make up your mind to open a bank account:

• What services do they offer?
• What do they charge for each of the services they would be offering?
• If you requires, would they be issuing you a credit card or not. In either case you should know the bank requirements
• If you need, would they be giving you line of credit or not?

Prepare your budget

Budgeting is an important step towards financial planning. Many newcomers and immigrants think that they will prepare their budget when they would start earning. This is not a good planning approach. You should have your budget in place whether you earn or not. Even if you don’t have any source of earning in the beginning, you have to spend the money on bills, grocery and other items anyway. Sobe careful in your spending and try to draw a very clear line between the ‘need’ and ‘want’.

When you start earning, revise your plan based on your net pay or take-home pay. Take home pay is the amount that you receive after usual deductions income taxes, employment insurance (EI) and retirement pension contributions etc. This deduction may range from 15% to 30% of your earnings. If your income is under taxable limits, you may get some of your deducted income tax amount back when your file your annual income tax.

List down all your expenses

–          Rent /Mortgage
–          Public Transport /Car expenses
–          Insurance /Bills
–          Internet/Telephone
–          Grocery / House keeping
–          Clothing
–          Health /Medication
–          Entertainment / Socializing
–          Others

Also calculate your earning including income from employment, CCTB and GST/HST credit .

It is a good practice to look and analyze your budget at the end of each month and adjust your next moth budget accordingly. This exercise would let you know where you actually stand. Keep a close eye on your bank statements. It will give an exact idea about your earning and spending and the bank charges as well.

Long term goals

When you feel that you are gradually settling start saving for children education through Registered Education Saving Plan (RESP) and also for your retirement through Registered Retirement Saving Plan (RRSP)

If your situation permits, you may start saving money to buy a house and therefore, arranging the down payment for it. However, don’t make a hasty and emotional decision to buy a house. Give your time till you have some steady and guaranteed income and you know where you want to live.