Financial disparities for new Canadians

Among new Canadians, 63% have delayed or cancelled major life decisions, such as home purchases, new vehicles, children or postgraduate education, due to financial constraints, compared to 46% of longer-term residents. Furthermore, 40% of new Canadians have postponed or foregone personal health services in the past year due to financial concerns, versus 32% of other Canadians.

A striking 95% of new Canadians frequently worry about their finances, "all the time," "sometimes" or "occasionally,” according to the survey. Only 1% of new Canadians and 3% of older residents responded “rarely.” This figure is significantly higher than the 84% of Canadians who have been here longer than five years.

"The findings from our latest poll underscore the importance of understanding and addressing the distinct needs of new Canadians. Credit unions, with their deep commitment to community and personalised service, are exceptionally positioned to meet these challenges," Guthrie said.

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Importance of a financial advisor

The majority (83%) of new Canadians lack a dedicated financial advisor, compared to 64% of longer-term residents, the survey showed. Among those with advisors, new Canadians are less likely to feel understood or satisfied with the advice provided.

Only 35% of new Canadians feeling confident their advisor will help them reach their goals, compared to 48% for long-term residents. This attitude is also reflected in only 32% expressing satisfaction with their advisor, while 53% of older Canadians do so.

Finally, a mere 28% would even recommend their financial advisor, compared to 53% of long-term residents.

Best financial products for new Canadians

A good place to start is to confirm that your financial literacy is solid. Financial literacy is the knowledge and understanding of how to make money decisions that are best for you and your family. Start with a good financial literacy primer before moving on to learning more about specific products, strategies or accounts.

Learn how to budget

Another critical skill is to learn how to budget. Budgeting is a skill that allows you to plan goals, set out steps towards that goal and track your progress. If you'd prefer to use an app or online tool, consider using

Build your credit score

A credit score is a three-digit number that helps lenders and other finanical institutions to assess how reliable you are as a customer. Building your credit score is done over time, although there are some tips for quickly improving your credit score. Given the importance of a credit score in almost all financial decisions — such as buying a home, getting a credit card or applying for a loan — it's critical to spend a bit of time learning how best to start, build and maintain your credit score.

Get a bank account

While learning how to negotiate the financial landscape in Canada, you'll need to open a bank account. There are plenty of options in Canada, but to find an account that maximizes benefits and minimizes fees, check out bank accounts that tailer products and perks towards new immigrants.

Best high-interest savings accounts

Investing your savings could pay dividends, but it’s not always easy to turn your investments into liquid assets if you need cash fast. Parking your money in a regular savings account isn’t a bad idea, but the interest rate on a traditional savings account could be as low as 0.01% a year — practically nothing.

Luckily, there’s a middle ground. High-interest savings accounts (HISAs) pay substantially more than traditional savings accounts, giving the funds you deposit the chance to grow.

EQ Personal Account: EQ Bank's Personal Account currently has an interest rate of 2.50%, and a 4% interest rate when you set up direct deposits.

This is one of the best non-promotional interest rates in Canada right now. Not only do you get a good rate, the EQ Personal Account also comes with many more advantages, and very few conditions.

Beyond making you money, you will pay no monthly fees and there’s no minimum balance to maintain. Account holders also have unlimited transactions and free electronic fund transfers, mobile cheque deposits and bill payments. Unlimited free Interac transfers are also included.

Scotiabank MomentumPLUS Savings Account: With Scotiabank’s MomentumPLUS Savings Account, the longer you leave your money untouched, the more it will earn. The regular interest rate is 1.40%, on top of which you can earn a premium period interest rate of 0.85% for the first 90 days and increases up to 1.25% for leaving deposits untouched for 360 days. This makes it ideal for those medium-term goals like saving a down payment for a house, a vacation or a renovation.

Neo Money: The Neo High-Interest Savings Account offers the 4% interest rate, as well as unlimited free transactions, and no minimum deposit requirements.

Build up your credit and earn cash back as well

Most new immigrants will want to focus on getting a credit card that provides perks for those relatively new to Canada. To find a credit card, check out the Money guide on credit cards best suited for new immgrants.

If you'd prefer to focus on getting cash back, instead, check out the best cash back credit cards can help maximize your earnings on everyday spending. Cash back is one of the most attractive credit rewards options because you can spend it however you choose. There are no rules or restrictions on how you use your cash.

Tangerine Money-Back Credit Card: The Tangerine Money-Back Credit Card lets you earn 2% cash back in two spending categories, or three spending categories if you deposit your cash back into a Tangerine Savings Account — it also comes with no annual fee.

These spending categories are flexible enough to reflect your spending habits which, if they happen to change from time to time, you can choose new categories every 90 days. You’ll earn 0.5% cash back on all other purchases, without any tiers, caps, or limits. Your cash back is dispersed monthly, which means you never have to wait to reap the rewards of your spending. You'll also receive an extended warranty doubles the manufacturers’ original warranty by up to one additional year.

Scotiabank Momentum® Visa Infinite: With the Scotia Momentum Visa Infinite card, you’ll earn 4% for every $1 you spend on groceries, recurring bills and subscription services, 2% on gas purchases and daily transit, and 1% on everything else with no cash back limit.

Survey methodology

The Canadian Credit Union Association (CCUA) survey of 1,639 Canadians was conducted by the Angus Reid Group through an online survey in November 2023. The CCUA represents 187 credit unions and caisses populaires outside of Quebec, with $308 billion in assets.

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Nicholas completed his master's in journalism and communications at Western University. Since then, he's worked as a reporter at the Financial Post, Healthing.ca, Sustainable Biz Canada and more. Aside from reporting, he also has experience in web production, social media management, photography and video production. His work can also be found in the Toronto Star, Yahoo Finance Canada, Electric Autonomy Canada and Exclaim among others.

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