Canadian New Immigrant Financial Investment Guide
2、 Suggestions for core investment direction
Popular practical cases:
Manitoba immigrants used real estate arbitrage: after purchasing a property in South Surrey, Vancouver, they cashed out CAD 850000 with a 1.24% low interest loan, and profited from the domestic and international interest rate differentials.
New immigrant preferred target: Dollarama (TSX: DOL) continues to grow with a low price strategy, with net sales increasing by 5.7% annually, making it suitable for long-term TFSA holdings.
1、 Basic account configuration strategy
Tax Free Savings Account (TFSA)
Both investment income and withdrawals are tax-free, suitable for reserving emergency funds, purchasing cars, or retirement plans
By 2025, the annual contribution limit will be increased to CAD 7500, and the accumulated unused limit can be used in combination
Registered Retirement Savings Plan (RRSP)
The contribution amount can be tax deductible, and investment income can be deferred to retirement for extraction, suitable for high-income groups to optimize taxation
The annual contribution limit is 18% of the annual income (up to a maximum of $32490 CAD)
Emergency fund pool
Need to reserve 3-6 months of household expenses (recommended to deposit into a high liquidity savings account)
Using a bank special account to waive management fees, while also obtaining free checks and interbank withdrawal services
3、 Key measures for risk avoidance
Debt Priority Management
Prioritize repaying high interest debts such as credit cards, and accelerate mortgage repayments (increasing monthly payments by $25 can save $5340 in interest)
Cost sensitivity control
Avoid high management fees for mutual funds (2.42% annual fee can consume 50% of the 50 year investment return)
Insurance hedging mechanism
Configure critical illness insurance/life insurance to transfer accidental risks and avoid family financial crises
4、 Common Misconceptions of New Immigrants
Overconsumption trap: Suppressing unnecessary shopping (delaying 24-hour consumption decisions can reduce impulsive spending by 30%)
Abuse of real estate leverage: The ratio of household debt to income has exceeded 161.8%, and it is necessary to purchase a house based on financial resources
Tax planning lag: Insufficient utilization of TFSA/RRSP tax exemption quota leads to overpayment of taxes