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Careers, finances big hurdles for immigrants

Careers, finances big hurdles for immigrants – Immigrants face a myriad of challenges adjusting to life in a new country, but perhaps two of the biggest are establishing a career and finances.

According to Statistics Canada, some 1.16 million foreign-born people immigrated to Canada between 2006 and 2001, accounting for 3.5 per cent of the total population of Canada in 2011.

As of 2011, 20.6 per cent of Canadian residents – more than 6.7 million people – were born outside of Canada. Compared to other G8 countries, Canada has the highest proportion of foreign-born residents.

A recent report by BMO Wealth Institute concludes that newcomers face a myriad of challenges when arriving in Canada, including many financial hurdles.

The report found the top five challenges immigrants face when arriving in Canada are finding adequate employment, learning a new language, adapting to the weather, missing support from their homeland, and financial constraints.

“Starting a new life in Canada can be an exciting experience but there are many unknowns and challenges to adapting to a new country, and these include key financial considerations,” says Chris Buttigieg, senior manager of wealth planning strategy with BMO Financial Group. “With all of the obstacles that new Canadians face it is all the more important to ensure they have their financial house in order.”

Immigrants can receive help finding employment and overcoming some of the financial hurdles they can encounter when coming to live in a new country like Canada.

The Toronto Region Immigrant Employment Council, for example, has a mentoring program to help skilled immigrants look for career opportunities.

Newcomers are matched with a leader in their profession and are given exposure to the job market, effective job search strategies and greater understanding of the Canadian workplace, resulting in more than 75 per cent finding employment in their field within 12 months.

BMO offers a number of tips to help new Canadians navigate the financial landscape in Canada.

It’s important to start building a good credit history as soon as possible. They can start building a credit score by opening a small line of credit or credit card and paying off the balances as required.

Build a budget by tracking all expenses over a three month period and then estimate how much you can spend per year in each category.

Also develop a financial plan. This strategically allocates financial resources to achieve financial goals.

One way newcomers can move toward achieving their financial goals is to minimize the amount of tax they pay on what they earn each year.

Tax free plans like the Tax Free Savings Plan and tax deferred plans such as the Registered Retirement Savings Plan are crucial tools of any financial plan to reach savings goals for the purchase of a home or for retirement.

Another tax-advantaged plan is the Registered Education Savings Plan (RESP) which can be used to save for a child’s post-secondary education.

Up to $50,000 can be contributed into an RESP for each child who is enrolled in qualified educational programs such as a trade school, CEGEP, college or university. There is no annual contribution limit and the government will add a grant of up to a maximum of $7,200.

Income and capital gains can be generated within an RESP through investments and grow tax free until the children named in the plan are ready to pay for their post-secondary education. They only pay income tax on the gains earned by the plan and the grants as they are withdrawn, which usually is low because the income of most post-secondary students is very limited.

And speak with a financial professional. They can help immigrants develop a personalized financial plan that will incorporate their financial goals for today and into the future.

Talbot Boggs is a Toronto-based business communications professional who has worked with national news organizations, magazines and corporations in the finance, retail, manufacturing and other industrial sectors.

By: Talbot Boggs, The Canadian Press

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