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5 Things That Get You In Financial Trouble

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, Mon­tréal, 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.

22 comments

  1. @Seraphine — I agree. There are so many temp­ta­tions out there… I think common-sense goes a lot way. We do live in a con­sumer society!

    @Bluefish — How much is that in Cana­dian dol­lars, roughly?

    @angela — A lot of peo­ple do fell in the credit card trap. What mat­ters is get­ting out of it! And yes, immi­grat­ing is expen­sive for so many reasons…

    @dobbes — You are right! Even right out­side Ottawa, the net­work is very patchy. I still rely on phone booths quite a lot. Cell phone cov­er­age and fees should really be improved. Thanks for your input!

    @Sidney — I must admit when you put it this way, I just wanna move there!

    @Max Coutinho — It’s not that bad. The things are men­tioned are the things that sur­prised me when I first came because they are cheaper in Europe. Now food, clothes, real estate (rent or buy) etc. are much cheaper on this side of the Atlantic Ocean. At least for me. I do believe Por­tu­gal is cheaper than France still.

    @Juan Terosso — I know, this is a huge pain! Inter­net was cheaper and fast in France. I believe Canada doesn’t rank well glob­ally in terms of speed and price of the Internet.

    @Agnes — Eh, why not? :-)

  2. Trans­porta­tion can really add up. And when you own a car, it always needs fix­ing, not to men­tion the gas…

    I try and ride my bike as often as pos­si­ble. Nonethe­less, it is nice hav­ing a car to help me out ;) espe­cially when I am deliv­er­ing boxes and such things.
    .-= Seb´s last blog ..World Really Does Revolve Around Me. =-.

  3. You’re so right Zhu , espe­cially with heat­ing, trnas­porta­tion and cell phones.

    It’s funny to see how you adapt your­self to the Cana­dian conditions

    off to bed in Paris for me
    .-= Crikette´s last blog ..La journée de la tulipe … franco-canadienne =-.

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