Combine pension and immigration of first-generation

February 2, 2019

Conjuguer retraite et immigration de première génération

Photo: Unsplash

This text is part of a special booklet.

For anyone who lives in Quebec since always, the preparation for retirement is a challenge of size. In the achievement of a savings objective adequate, the amount of information about and tools to learn is therefore an important bet for an immigrant of the first generation. Interview with Pierre-Franck Honorin, section director, newcomers and cultural Communities at Desjardins.

That must first know the newcomers about public and private plans available in Quebec and in Canada ?

They should also be aware that there is a very big difference between our plans and those of other countries. It is necessary, for example, explain to them that the pensions of public and private depend on the number of years in Canada, the amounts paid year after year and they are capped. In some countries, public pensions are combined pensions, the employer, and the employee expects to achieve a comfortable retirement when will come the time to retire from active life. It is upon their arrival that we need to explain the impact of the retirement savings, government, corporate and personal, and guiding them properly. In the minds of many immigrants, it remains the idea that the business for which they will be working in Quebec will automatically contribute to the pension for them. There really is a bridge to be done in education to give them the right time and give them the tools.

For some immigrants, there is a possibility of double taxation at the time of the disbursement of the schemes assessed. What is it ?

Canada has signed some agreements to avoid double taxation with several countries in the world. For example, at the time of his retirement, a person who has worked and contributed a part of his life in Italy will receive the sum for which it will be imposed by the Italian government. This person will still have to report the income-there here, in addition to those affected in Quebec, but it will be able to deduct what has been paid in Italy. However, there are some countries where an individual might be required to pay twice on the same amounts, without a tax credit. It is important for the immigrants of the first generation learn to know the plan of provision of taxation that exists between the two countries. When the folder is a little more complex, you can invite people to call a specialist in international taxation to see how a legal solution can be found.

International transfers to the extended family are common for citizens of some countries. How to reconcile this reality with the challenge to accumulate savings sufficient for retirement ?

A person who comes to work here has actually sometimes the weight can continue to financially assist relatives who have remained in the country of origin. A portion of the salary that they receive is thus sent abroad. We are therefore facing a new reality : how to make fund transfers in a safe manner at an affordable cost, so that a sum be sent on a regular basis to the family. We accompany the people, which allows us to see if the person has a life project in Canada in the short, medium or long term, if she plans her family to come or to return to his country for his retirement.

To prepare for his retirement, any new entrant must be able to plan a budget taking into account the reality of here. What strategy should we put forward ?

The expenses of a new arrival are often a challenge upon arrival in Quebec, because it requires a lot of shopping, which, sometimes, have not been provided. The first step for their retirement project is to hold a budget that will allow him to fully realize all of their financial projects, including their retirement project. At the same time, it is necessary to put a particular emphasis on the different pension plans available in Canada that will meet the retirement plans as well as other life projects. There are a lot of things to explain about the reality of here, and the goal is to inform the newcomers so that they have all the tools in hand to maximize their integration.

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