Dan­ger!

Amid the reces­sion, money is tight for every­body. New­com­ers to Canada, and more gen­er­ally immi­grants, no mat­ter where they are from, may find mak­ing ends meet even more dif­fi­cult. Indeed, a large major­ity of them set­tle in Canada’s largest cities (Van­cou­ver, Toronto, Mon­treal, Ottawa) hop­ing for bet­ter job oppor­tu­ni­ties. It makes sense How­ever, life is usu­ally more expen­sive in urban areas than in rural ones.

Let’s face it, immi­gra­tion can bring a fair share of finan­cial trou­ble. First, apply­ing for per­ma­nent res­i­dence and relo­cat­ing in Canada isn’t cheap. Then, find­ing a good job may take time. And above all, man­ag­ing your money in a new coun­try isn’t easy, as you may not be as “street smart” yet as residents.

Here are five things that may end up strain­ing your finances more than you would have thought.

Trans­porta­tion: if you live in a very urban area you may use pub­lic trans­porta­tion but beware as it hardly seems to be a pri­or­ity for a lot of munic­i­pal gov­ern­ments. Plus, even pub­lic trans­porta­tion is quite expen­sive: in Ottawa, a one trip bus ticket is now $2.50 ($3.25 if bought in the bus) and a monthly pass is $91.50. And let’s face it, not mat­ter how you feel about dri­ving, North Amer­ica is very much a car cul­ture and you may need a car sooner than you would have thought. Sur, gas is much cheaper than in Europe yet dis­tances are longer in aver­age. Dri­ving dur­ing the win­ter also involves unex­pected costs such as win­ter tires, booster cables etc.

Cell phones: I think this is the biggest rip-off in Canada. The three main play­ers, Bell, Telus and Rogers, are quick to lock you into absurd three-year plans (3 years!) with high can­cel­la­tion fees. You are billed for both out­go­ing and incom­ing calls (isn’t that pay­ing twice for the same ser­vice?), as well as for check­ing your voice­mail. You are also charged com­pul­sory (and sneaky) monthly fees for call dis­play, 911 access, ser­vice main­te­nance etc. All in all, expect a very basic cell-phone plan to cost you at least $35 a month, and remem­ber that Canada’s cell­phone rates among high­est. On the bright side, for res­i­den­tial land line ser­vices, Cana­dian cus­tomers pay the low­est rates among OECD countries.

Heat­ing bills: yes, Canada has long and harsh win­ters and chances are, you will want to get rid of your jacket, your gloves and your hat indoors – it’s only nat­ural. Appar­ently, the aver­age heat­ing bill for a Cana­dian home is $1,800. For us, the high­est bill is the Feb­ru­ary one. But don’t panic, they are steps you can take to make sure you don’t go bank­rupt over your heat­ing bill. First, make full use of the sug­ges­tions and tips of the Min­istry of Nat­ural Resources’ Office of Energy Effi­ciency. Sec­ond, be smart. I’m not say­ing you should freeze in your place but don’t over­heat it. For instance, we use a small portable heater to warm up the bed­room before going to bed. In the sum­mer, air con­di­tion­ing can be very expen­sive to run too (not to men­tion it’s not exactly environment-friendly): be warned!

Pro­mo­tions: North Amer­ica is a con­sumer soci­ety and there are always sales, pro­mo­tions and spe­cial offers going on. In a way, it’s good because you can make the most of the com­pe­ti­tion. How­ever, it can be quite over­whelm­ing. I think it’s good to step back and pause before you buy: do you really need XXX or do you buy it because it’s on sale? The pres­sure to buy always more is pretty annoy­ing at times. So by all means, do shop around and make full use of spe­cial offers, but make sure you don’t actu­ally end up spend­ing money on some­thing you didn’t want nor need in the first place.

Credit cards: I was a credit card vir­gin when I first came to Canada.  Six years later, I have two credit cards: one that should have been can­celled long ago since I don’t use it, and one with a credit limit much higher than four months of my salary.  The key word, in the­ory, is self-discipline: do not charge some­thing on your credit card unless you know you can afford it. But more impor­tant, make sure you under­stand the rules of the game credit card com­pa­nies play. A lot of them use sneaky tricks to make sure you pay more: fluc­tu­at­ing inter­est rate, late fees, chang­ing pay­ment due date, low­er­ing your credit limit… If there is one agree­ment to read from A to Z it is this one: your credit card “card­holder agree­ment”. It’s bor­ing, it’s full of fine print and you’ll squint by the time you are done but it may save you money in the long run.

Related arti­cles:

1. 5 Things to Do When You Land in Canada (That No One Told You About)
2. A Nation Under Debt
3. How to Avoid… Bank­ing Scams
4. 8 Things More Expen­sive in Canada than in France
5. 10 Ways to Not Become Poor in Canada