Key takeaways
- Start with a small first goal, such as $1,000
- Build toward three to six months of essential expenses
- Keep it in a separate high-interest savings account or a TFSA
- Automate a transfer every payday
- Avoid payday loans; they’re among the most expensive ways to borrow
Why it matters more for newcomers
Newcomers often have no credit history to fall back on, may be between jobs, and may be supporting family at home. A cushion of savings means you can handle surprises without high-interest borrowing.
How much to save
Aim first for a small, reachable goal, like $1,000. Then build toward three to six months of essential expenses: rent, food, transit, phone and any regular money home. Our budget calculator shows your monthly essentials.
Where to keep it
- High-interest savings account: separate from your everyday account, so you’re not tempted to spend it
- TFSA: interest grows tax-free once you’re a resident with a SIN and 18 or older; choose a savings option you can withdraw quickly
Tip: Online banks often pay higher interest on savings than big banks.
Building it while sending money home
- Automate a small transfer to savings every payday, even $25
- Decide your monthly amount home in advance and stick to it
- Save part of any tax refund, benefit payment or bonus
- Compare transfer providers; saving on fees and exchange rates frees up money to save
What to avoid
Payday loans and high-interest instalment loans can trap you in debt. If you’re short, talk to your bank about options, or to a non-profit credit counselling service.
General information, not financial advice.
