Canada Banking System: Tips for International Students and Other Immigrants
You’ve decided to study in Canada as an international student. What comes next? Taking care of your money, as it is for many overseas students, maybe at the top of your priority list.
Rent, food, and “just living” expenses can quickly deplete savings. This is especially true for international students, who must spend extra on tuition, exchange currency, and live in temporary housing because they are far from home.
To make the most of your time as a student and your academic career with the money you have, you must understand the fundamentals of Canadian money. It is quite beneficial to understand how to open an account, create a budget, and utilize debit and credit cards in Canada.
Learn about the fundamentals of money in Canada and obtain the tools and information you need to make sound financial decisions. Get the International Students Finance Guide right away and take control of your finances.
Different types of bank accounts in Canada
For many people who move to Canada, one of the first things they do is open a bank account. This will let you transfer money, and if you need to show proof of income when renting your first apartment, it will be very helpful. Most Canadians have a chequing account and a savings account. With a chequing account, you can access your money every day and make a lot of transactions. With a savings account, you can put money away for the long term and earn more interest on it.
A checking account is for everyday banking, making purchases, and paying bills. You can set up your account so that regular payments like rent and utilities are taken out automatically. With this type of high-activity account, you have a lot of freedom because you can put money in and take it out at any time. You can also use your debit card to pay for things and send money electronically. But keep in mind that most checking account balances don’t earn interest.
A savings account: The best place for money you don’t need every day is in a savings account. In this type of account, your balances earn interest, and knowing that your money is safe gives you peace of mind. You can easily get to your money if you need it for emergencies or other unplanned costs.
As an international student, you might want to have both so you can get more money from your savings account and make as many transactions as you want with your checking account.
From banking to budgeting, here are 5 tips to get you going.
1. Set up your bank accounts before you get to Canada.
There are things you can do at home that will help you be more ready for school in Canada. Talk to a financial advisor before you leave to start the process of opening a Canadian bank account so you can enjoy benefits like:
- Being able to send money from your home country to Canada easily
- You can get your money right away when you get to Canada.
- You can use your account anywhere in the country, no matter what province or city you move to.
2. Learn about the different kinds of accounts and choose the right one for you.
There are many different kinds of accounts. Check out different student accounts to see which one has the best features and benefits for you. Here are some key things to think about:
- Fees per month: There may or may not be monthly fees on a student account.
- Instead of a set number of free debit transactions, you can make as many as you want.
- Money transfers between countries
- E-Transfers with Interac within Canada
- Minimum or no minimum balance required
3. Make a budget: Figure out how much you spend each month.
Your monthly costs depend on where you live and study, what kind of housing you choose (on campus, off campus, or shared), how you get around, what you eat, and what kinds of fun things you do. Add up all of these costs and compare them to the amount of money you have each month.
4. Get and use your first Canadian credit card.
With a student credit card in Canada, you can start building your credit history and credit score. If you need a loan or mortgage in the future, having a Canadian credit history and a good credit score will help you get better terms, like a lower interest rate. Here are some facts about this important topic to help you learn more:
- How to figure out your credit score and your credit history
- How to build your credit history
- Making good use of credit
5. Know the best ways to pay
A recent article from the Bank of Canada says that only one in three purchases, or 15% of the total value of purchases, are made with cash. Debit and credit cards are the most common ways to pay for anything from a cup of coffee to a couch that turns into a bed. Nearly everyone in Canada has at least one debit card, and about 9 out of 10 people have a credit card.
Final Words
If you want to make the most of your time as a student and academic career in Canada, you should familiarize yourself with the fundamentals of banking in Canada. This will enable you to create a budget and carefully plan your purchases. Now, pay careful attention to what you’re learning.
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