Budgeting is a vital financial skill that everyone should develop, especially newcomers to Canada.
Creating a budget allows you to track your income and expenses, identify areas where you can save money, and work toward your financial goals. As a newcomer, it is particularly important to start budgeting early on in order to manage your finances effectively in a new country. With a well-planned budget, you can make the most of your income, control your spending, and work toward a secure financial future.
Why make a budget?
Achieving financial success in Canada is probably one of your top priorities. Taking steps to manage your finances is important to achieving that goal. Creating a budget can also help you gain better control of your finances, manage debt, and work toward your short- and long-term financial goals as you build your life in Canada with confidence.
Budgeting can also improve your credit score by helping you manage your spending, avoid penalties and late payments on credit cards and bills. This can have a positive impact on your interest rates when applying for a loan or mortgage.[1]
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What to consider when building a budget?
When creating a budget, it’s important to assess your needs and wants, prioritize them, and set your financial goals.
Necessities are things essential to living your daily life, like paying for a place to live, utility bills, food, and getting around.
Wants are the non-essential things you enjoy but are not necessary to survive, such as good food, shopping, and entertainment.[2]
It’s important to identify your short-term and long-term financial goals because having clear financial goals can help you prioritize your day-to-day spending. Short-term goals might include setting a monthly target amount you’d like to save, while a longer-term goal might include buying a home. Your goals can also help you make informed financial decisions and stay motivated as you go. Whatever your goals, they are worth thinking about and are an important part of planning your finances.
Know where your money is going
Tracking your spending is also important for managing your finances. Every dollar spent affects your overall budget, and small changes in spending habits can have a big impact on your ability to save. You can easily track your expenses using TD MySpend, which automatically classifies your transactions into categories like needs, wants, and other transactions. You can even move a transaction to a different category at any time simply by tapping the category icon next to it in the Spend by Month, Spend by Category, or Transaction History views.
Try an exercise for a month or two using TD MySpend to record all your purchases and invoices, divide them into categories, and identify areas where you can make changes.
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How to put together a budget?
Just start with a monthly review of your income, expenses and investments. This will help you understand your financial situation and identify areas that need change. You can use a budget worksheet to organize your income and expenses and calculate your savings.
Understanding your spending and saving habits is also essential. Tools like the TD Cash Flow Calculator it can help you keep track of your income and expenses; and identify areas where you can save money.[3] Setting spending limits can also help you stay within your budget. This can include setting up automatic bill and expense payments and avoiding impulse purchases.[4] You may want to use TD MySpend to keep track of purchases made through your TD savings, checking or credit card accounts and stay on top of your spending.
Finally, it’s important to track, monitor, and adjust your budget as needed. Your budget should be a living document that changes as your financial situation changes. By regularly reviewing your budget, you can make adjustments and stay on track to achieve your financial goals.
Click here for more help on creating a budget in Canada.
Why choose DT?
150 Years Helping Canadians:
TD is proud to provide financial solutions to Canadians for over 150 years. TD also brings a century of experience helping newcomers navigate the unique challenges of the Canadian banking system.
With more than 1,000 branches, a reputation for excellence in financial services, and the ability to serve you in more than 50 different languages, TD has grown to be one of the largest and most trusted banks in Canada, now serving 16 million Canadians. .
TD offers online support and resources of interest to newcomers to topics like banking. basics, moving to Canada, credit score essentials and more. TD is open longer hours for your convenience. TD has thousands of ATMs across Canada to help you take care of your daily life.
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[1] https://www.canada.ca/en/financial-consumer-agency/services/make-budget.html
[2] https://www.td.com/ca/en/personal-banking/how-to/budgeting/budgeting-between-needs-desires
[3] https://tools.td.com/Cash-Flow-Calculator/
[4] https://www.td.com/ca/en/personal-banking/how-to/budgeting/make-a-budget
reference: www.cicnews.com