Many newcomers choose to rent an apartment on a monthly basis. Rental costs vary across cities and across Canada. They usually cost less outside large cities. You will likely pay at least $350 a month to rent a room. You can pay at least $2,000 a month to rent a larger apartment or a large house. An immigrant-serving organization where you plan to settle can help you find a home that you can afford.
If you want to buy a house, you will probably need to get a mortgage. Banks and other lending institutions give mortgage loans. They decide whether you have enough income, enough assets (things you own) and a good credit rating. Most banks will ask you to pay at least 10% of the cost of the house from your own money. In addition to your mortgage payments, you will have to pay for property tax and household insurance. If you plan to purchase a condominium (condo), you will have to pay other fees.
Food will be a basic expense. Costs will depend on the size of your family. This cost can double if you often eat in restaurants or choose to buy specialty items. Clothing expenses may be less than 10% of your take-home pay. You may spend a lot more if you buy your clothing at designer stores. Second-hand shops sell used clothing and furniture at very low cost.
Many Canadian families have one or more cars. Canadians either buy their cars new or used or they lease them, which is a form of rental. Make sure you think of all the costs before you decide to buy or lease a car. For example, when you own a car you will have to pay to keep it working well, for gas, monthly loan payments, registration and insurance. When you lease a car you will sign a contract to have the car for a set period of time. You will pay the same costs as you do when you own a car. Many Canadians use public transportation, walk or bike.
It is the law that all cars must be insured and registered with your provincial or territorial government. Car insurance can be expensive, but it protects you and other drivers in case of an accident.
For most jobs in Canada, your employer will remove some money from your pay cheque. This is called a deduction. Pay cheque deductions can reduce your pay by as much as 25% to 35%. Your pay cheque will show how much money has been deducted for each item. The total amount of your pay cheque before deductions is your gross income. The amount you get to keep is your net income or take-home pay.
Like many countries, Canada adds sales taxes to many of the goods and services you buy.