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Updated: July 14th, 2021

When immigrating to Canada, one of the first challenges you might face is learning how the financial system in Canada works. It’s important to research and understand the sector in Canada before actually getting there.

This could help with adjusting to your new life and possibly be one of the main factors when it comes down to being successful and thriving in Canada.

Below we’ll have a look at all things finance in terms of international money transfers, banking options and investment opportunities for you in Canada.

Choosing a Bank in Canada

bank cards laying on a table  |finances

One of the first things you’ll probably want to do after arriving in Canada is opening a Canadian bank account. It’s always a good idea to try and research banks before reaching Canada, that way you save time on running around. It would also be great to research a bank that is within proximity to where you’ll be staying or a bank that perhaps offers their services in your first language.

There are five major banks in Canada. They are:

  1. Royal Bank of Canada (RBC)
  2. Toronto-Dominion Bank (TD)
  3. Bank of Nova Scotia (Scotiabank)
  4. Bank of Montreal (BMO)
  5. Canadian Imperial Bank of Commerce (CIBC)

These five banks do provide similar services including savings accounts, safety deposit boxes, credit cards being among the few. Choosing a bank in Canada will ultimately be determined by what’s important to you or which banks suit your needs.

Some great factors to consider could be:

  • Fees and interest rates - These will vary from bank to bank. Consider choosing the bank with the most favourable rates according to your banking habits.
  • Branch and ATM access - Accessibility to your money are important, especially when first arriving in Canada, especially if you’re using public transport to get there. The ATM fees are quite important too.
  • Minimum deposit and balance requirements - if you have a certain balance, some banks may remove account fees. Try choosing a bank according to your budget and estimated monthly expenses to avoid any extra charges.
  • Online banking - All five banks do offer online banking, however, you could choose according to the features that are linked to each bank. The app or online bank website should suit your everyday needs.
  • Perks - Also check if any of the banks are offering any sort of promotion at the time or special discounts for signups or immigrants.
  • Customer service - When facing any issues you want the bank to be able to assist you efficiently. Being new to Canadian banks you may have many questions that need to be answered by someone patient and helpful.

How Do I Send Money Home From Canada?

4 ways to send money from Canada |finances

Sending money internationally has become easier over the years. The only thing you would need to keep an eye out for is the fees that come along with sending the money. Ideally, the best options would be the one that allows you to send money home with the least amount of fees and the quickest arrival time of the money received at the other end.

Below are a few affordable ways you can send money from Canada to your home country.

1. Western Union

Western Union is a third-party money transfer option providing competitive rates and low transfer fees. You can send money to over 200 countries and territories. You’re able to send money online, by phone call or via their mobile app.

Each country has its own list of restrictions on the amount being sent or received. The transferring fees are relatively low, however, it does depend on the amount being transferred.

2. XE Money Transfer

XE Money Transfer is another great way of transferring money to around 170 countries, of which most of them have same-day transfers. The online company is quite well-known for having some of the best exchange rates on the market.

Advantages include:

  • have your own private account on the website;
  • they don’t charge any additional fees to send your money
  • can monitor your account 24/7; and
  • have 24-hour tracking on your money transfers.

3. OFX

people sending and receiving money through an app |finances

OFX is another company that doesn’t have any transfer fees when transferring money to another country. Transfers can be done via debit card or wire transfer. The receiver of the money however is limited in choice. Money can only be deposited directly into the receiver’s account.

Depending on the country transfers can take anywhere from one to five days long. This is still a great option as they support 55 different currencies including currencies in Mexico, China, Pakistan, and Indonesia.

4. CurrencyFair

CurrencyFair is known and trusted globally. Setting up an account with them is easy, quick, and free. You’ll be able to send and receive money from over 150 different countries. Two great features on CurrencyFair are:

  1. ChatBot - online tool available 24/7 for when you may have questions or need to work through issues in real-time.
  2. Automatic transfers - you’ll be able to set up automatic transfers up to two weeks in advance.

Do I Need a Canadian Bank Account to Work in Canada?

Legally, you don’t need to have a Canadian bank account. It can, however, be very beneficial to you in terms of processing payments, paying taxes or building a credit history. Everyone employed is required to pay taxes, so if you don’t have a Canadian bank account you’ll have to pay it by wire transfer to the Canada Revenue Agency.

Do I Need To Be a Resident To Open a Canadian Bank Account?

No, you don’t need to be a Canadian resident in order to open a bank account in Canada. Canadian banks allow people to open a bank account even if:

  • you don’t have a job;
  • don’t have money to put in the account right away
  • have been bankrupt

You just need to make sure that you go in person to the bank and carry an acceptable form of identification.

Invest Opportunities in Canada

people discussing investment opportunities |finances

Tax-Free Savings Account

The Tax-Free Savings Account (TFSA) has been running since 2009. It’s a way for individuals in Canada, who are 18 years and older, to save money that is tax-free throughout their lifetime. Contributions to a TFSA are not deductible for income tax purposes. Any amount contributed to the account or earned through investment income or capital gains is generally tax-free, even when withdrawn.

Investments Permitted in a TFSA

  • cash;
  • mutual funds
  • securities listed on a designated stock exchange
  • guaranteed investment certificates
  • bonds
  • certain shares of small business corporations

Who Can Open a TFSA?

Anyone who is 18 years of age or older, and has a valid Social Insurance Number (SIN) can open a TFSA account in Canada. There are, however, certain provinces and territories in which the legal age to open a TFSA is 19 years old.

Good to know:

If you make a contribution while you’re a non-resident, you’ll be subject to one percent tax for each month the contribution stays in the account. You may also be liable for other taxes.

Types of TFSAs

The three types of TFSAs that can be offered are as follows:

  1. a deposit
  2. an annuity contract
  3. an arrangement in trust

Banks, insurance companies, credit unions and trust companies can all issue TFSAs.

You’re also able to set up a self-directed TFSA if you prefer managing your own investment portfolio.

A Successful Life in Canada

Being in a new country will certainly have its challenges, but it will also be the start of a great new adventure. Doing your research on your finance options and working smarter with your money, can help you build a strong foundation for a successful life for you and your family in Canada.

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