Your monthly budget and expenses will vary depending on your lifestyle and the province you choose to live in. Keep in mind that rent and food costs vary widely across Canada. Even within one city, rent varies greatly from one neighborhood to another. The following is a suggested budget for a family of four: Expenses Accommodation rental (two bedroom) $900 Heating (if extra) $75 Electricity $65 Laundry $35 Basic telephone $40 Medical insurance (in some provinces) $100 Television $40 Transportation (bus passes) $100 Entertainment $200 Food $600 Miscellaneous $200 Total: $2,355

If you eat out regularly, then expect to pay more than if you eat at home.  Here are some typical prices you can expect to pay:

Fast foods: $5- $8 per person (per dish or for a combo meal of burger, fries and drink, for example)

Restaurant: $10 – $20 per person (depending on food and restaurant)

Groceries: $200 -$300 per month for a single person (depending on the individual needs)

The most obvious thing in building credit is paying all your bills on time –— this includes not just credit card bills, but phone and cable bills. But even if you pay your bills on time, this doesn’t guarantee that you are building good credit.

For instance, if you have department store credit cards and are making large purchases regularly, this can affect the way potential lenders view you.

Also, make sure your bank reports any credit transactions you have with them to the credit agency because some companies don’t — and that is one of the ways to boost your credit rating.

Another thing to be aware of is getting credit cards through your spouse. When I first came to Canada I made that mistake. Despite having leased a car in my name and having made all my payments on time, it did nothing to build my own credit history, because our credit card was under my wife’s name. The moral of this story is for you and your spouse to get separate credit cards.

Finally, check your credit report on a regular basis and contact the credit bureaus immediately if you see any errors. There can be a number of reasons for errors showing up on your credit report, such as bill payments not being recorded. Another more serious problem, however, could be fraudulent use of your credit cards or personal identification to access your assets and income, which unfortunately is a growing problem everywhere these days.

Building your credit history in Canada as a newcomer is vital. First, and most obviously, you need to open a savings and chequing account at your local bank or credit union. This shows that you have money and are starting to establish roots.

If you have a larger sum of money to work with, the bank can hold a certain amount as security (a fixed deposit) and give you a credit card against that amount. For example, I negotiated with my bank and they eventually agreed to a $2,000 deposit (at first they wanted $3,000) and gave me a $1,000 credit card limit.

Another step you can take is to apply for a secured credit card. You can make a deposit upfront, possibly the same amount as your credit limit. You can start with a small amount and you can use it like a regular credit card to make purchases. When you make payments on time, you begin to build a good rating. If you default on your payments, the lender will use your security deposit to pay off your balance.

Additionally, many large Canadian banks and credit card companies offer newcomers cards with low limits to establish credit history. Some require an annual fee and some might have special offers that waive the annual fee for the first year.

It is important to find out whether your bank or other financial institution reports to the two nationwide credit bureaus, Equifax, and TransUnion. If they do not, then you will not be able to establish a credit history.

Building good credit takes time. If you use the card wisely and pay the balance in full each month, for example by paying your bills (mobile, internet, hydro) on time, you will begin to establish your history.

According to Transunion, applying for numerous cards all at once might damage your credit scores right from the start. Many hard credit inquiries indicate that you may be taking on too much debt and will have a lot of repayment responsibility and risk. Instead, apply for just one manageable card.

Examples of hard inquiries include a:

• Credit card company checking your credit after you applied for a card or a bank loan
• Company checking your credit before leasing you a car or before applying for a car loan
• Company checking your credit before purchasing a mobile phone plan

The key thing to remember here is that you should know when hard inquiries are about to happen. Your credit can’t be accessed for this purpose without you agreeing to it in writing.

Establishing a good credit history from the start can be beneficial for you later when you want to qualify for an auto loan or a mortgage.

Related Posts:

Building Credit History in Canada

Can I rent a home without a credit history?

Obtaining a credit card

If you’re still in your home country and planning to immigrate to Canada, it’s worth looking at developing a relationship with a global bank. Scotiabank, for example, has banking packages aimed at those looking to move to Canada.

Once you arrive in Canada, try to get a credit card quickly. If you’re meeting with a bank manager, bring any documents that show you have a good track record for paying your bills. Some banks have multilingual staff who can assess foreign documents.

If you’re turned down, ask about getting a secured card, where you give the issuer a deposit. It’s also a bit easier to qualify for cards from department stores such as The Bay and Canadian Tire, but be sure to pay off the balance each month, as these cards have very high interest rates.