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Years ago, when I started working at my first job related to my degree, I opened an RRSP account with TD CanadaTrust. The bank representative talked me into doing automatic 25$ monthly contributions to my RRSP. I was wondering why the rep would be concerned about that. Do they get some incentives from signing people up for that or was she trying to instill good savings habits ?
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Sep 25, 2013 17:15
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Do you need to ask? The bank doesn't care about how comfortable your retirement is.
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Sep 25, 2013 17:24
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Gotta hit that monthly product quota.
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Sep 25, 2013 17:28
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rt_hat posted:Years ago, when I started working at my first job related to my degree, I opened an RRSP account with TD CanadaTrust. The bank representative talked me into doing automatic 25$ monthly contributions to my RRSP. I was wondering why the rep would be concerned about that. Do they get some incentives from signing people up for that or was she trying to instill good savings habits ? Also, you're almost certainly paying a high MER for whatever fund they signed you up to. I'd convert that poo poo to e-series (see OP).
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Sep 25, 2013 17:46
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Lexicon posted:Do you need to ask? The bank doesn't care about how comfortable your retirement is. Make sense though 25$/month doesn't amount so I guess they push it on every customer they can get. I'm going to cancel it because I do my own fixed RRSP contributions to a separate account and that TD one is a small annoyance when I file my tax returns.
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Sep 25, 2013 17:48
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Anybody have any advice/recommendations for changing banks? I signed up with TD when I was 14 because they were right by my house, but their savings interest rates/chequing account conditions are absolute poo poo (customer service/branch hours is excellent though) and I'm tired of leaving money on the table for no reason. Is it as easy as walking into another bank and telling them I want to transfer everything over, going to TD and telling them I'm leaving, and then it's done?
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Sep 25, 2013 18:01
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reflex posted:Anybody have any advice/recommendations for changing banks? I signed up with TD when I was 14 because they were right by my house, but their savings interest rates/chequing account conditions are absolute poo poo (customer service/branch hours is excellent though) and I'm tired of leaving money on the table for no reason. Is it as easy as walking into another bank and telling them I want to transfer everything over, going to TD and telling them I'm leaving, and then it's done?
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Sep 25, 2013 18:03
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Any recommendations of which e-series fund to get? There's quite a few: TD Canadian Bond Index - e TD Canadian Index - e TD Dow Jones Industrial AverageSM Index - e TD Dow Jones Industrial AverageSM Index ($US) - e TD European Index - e TD International Index TD International Index Currency Neutral TD Japanese Index - e TD Managed Index Aggressive Growth - e TD Managed Index Balanced Growth - e TD Managed Index Income - e TD Managed Index Income & Moderate Growth - e TD Managed Index Maximum Equity Growth - e TD Nasdaq® Index - e TD U.S. Index - e TD U.S. Index ($US) - e TD U.S. Index Currency Neutral - e As for changing banks, I would look at PCFinancial for day to day banking, also possibly ING Direct. I'm currently only with TD due to having special needs (I need a US based account, which only they and RBC offer out of everyone in Canada as far as I can tell).
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Sep 25, 2013 18:09
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reflex posted:Anybody have any advice/recommendations for changing banks? I signed up with TD when I was 14 because they were right by my house, but their savings interest rates/chequing account conditions are absolute poo poo (customer service/branch hours is excellent though) and I'm tired of leaving money on the table for no reason. Is it as easy as walking into another bank and telling them I want to transfer everything over, going to TD and telling them I'm leaving, and then it's done? If their account fees are crap, try finding a credit union. I think selecting a banking option for work direct deposit/emergency fund account/chequing account/internet bill payment is important too. For long term/retirement investing, if you switch your bank you could keep the TD account and convert it to a TD direct investing account to hold e-series, yes.
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Sep 25, 2013 18:11
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I'm just thinking from a day-to-day banking level. Right now I have a choice to either pay $10/month for my chequings account or never dip below a $2500 balance. When I look at throwing a downpayment out there, $2500/$10 a month is not substantial but it's still $2500/$120 a year. I organize my budget via savings accounts, so I have multiple accounts making 0.35% and when I look at something like ING, I could be getting 1.35%. I'm not in a place where I'm looking at long-term investing just yet, aside from my RSP match through work. As I get my mortgage situation handled and finalized, I'm just trying to streamline my day-to-day banking so I can get the best return. Then I can mess around with investment options. reflex fucked around with this message at 18:32 on Sep 25, 2013 |
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Sep 25, 2013 18:19
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PC Financial is awesome, you get grocery points for spending money! As for changing banks, here are the steps: 1. Open new account. 2. Change all automatic deposits and bill payments to the new account. 3. Wait for all of this stuff to happen at least once. This ensures that you don't NSF or incur any charges by trying to automatically pay a bill from an old, empty account. 4. Move your money over to the new account. Close the old account.
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Sep 25, 2013 18:22
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tuyop posted:PC Financial is awesome, you get grocery points for spending money! That's probably the best way to go about it. I tried using TD's "Easyswitch" thing and it was a huge pain. You have to give them all the account numbers/details for your old accounts and then it can take something like 30-60 days for your old bank to actually send the money over and of course they drag their feet as much as possible. Considering you could just go do it all in one day by visiting your old bank in person it's really not worth the supposed "easyness" of their service.
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Sep 25, 2013 18:31
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Squibbles posted:Any recommendations of which e-series fund to get? There's quite a few: Canadian couch potato recommends these ones, with an asset allocation suitable to your personal situation (i.e. bond vs equity percentage). These are the basic index funds that track large companies in proportion to their size - those other funds are basically managed fund shenanigans as far as I can tell. You want to avoid those if you buy into the wisdom of indexing. He has a post floating around where he specifically recommends the non-currency-hedged versions, for younger investors anyway. It's a nuanced and complicated argument though, so if anyone feels better suited to explain, I'm sure we'd all be all ears.
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Sep 25, 2013 18:59
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Squibbles posted:Any recommendations of which e-series fund to get? There's quite a few: Canadian Couch Potato lists this portfolio as their e-series portfolio. From the choices you've listed for options, I agree with him. Everything else on that list is crap, for various reasons (active management, ultra-large cap only, European index when there's no other way to diversify to emerging markets, etc) Canadian equity 20% TD Canadian Index – e (TDB900) US equity 20% TD US Index – e (TDB902) International equity 20% TD International Index – e (TDB911) Canadian bonds 40% TD Canadian Bond Index – e (TDB909) My personal flavor would be to have 15% Canadian equity, 25% US equity, 30% international, and 30% bonds though. Note that there is almost no reason to ever have foreign bonds, because all they do is add currency risk. That said, currency risk is not a big deal long term, and hedging reduces returns so I wouldn't suggest it unless you're very near retirement, and even then, you should be diversified to make it a non-issue and be pulling from your best performing assets (which would probably be CAN equities or Canadian bonds) if the Canadian dollar sucks. My reason for weighting Canada lower is that Canada is only 4% of the global stock market cap, whereas the US is 54%. I weigh international a bit higher, because it's my opinion that while the US is huge, it's still 54% of the world. You wouldn't want to over-invest in Apple or something else that can't really grow to a larger proportion of the market than it already is. I think 15% in domestic equities is clearly still a fair amount of home bias. reflex posted:I'm just thinking from a day-to-day banking level. Right now I have a choice to either pay $10/month for my chequings account or never dip below a $2500 balance. When I look at throwing a downpayment out there, $2500/$10 a month is not substantial but it's still $2500/$120 a year. I organize my budget via savings accounts, so I have multiple accounts making 0.35% and when I look at something like ING, I could be getting 1.35%. Agreed, definitely don't pay the banks more than you have to. This reminds me to close out the last remnants of my ING Direct TFSA, I have a miniscule amount of $ in there from when I used to use it as a emergency fund/short term savings. ING Direct Canada was bought out by Scotia Bank recently, if anyone is curious. I may just axe the regular high interest savings there too. Does anyone know what HISA's that Questrade offers (high interest savings account vehicles that are listed as if they're a mutual fund, but are CDIC guaranteed up to $100k), and what kind of fees are associated with buying/selling them through Questrade specifically? rhazes fucked around with this message at 22:11 on Sep 25, 2013 |
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Sep 25, 2013 18:59
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rhazes posted:My reason for weighting Canada lower is that Canada is only 4% of the global stock market cap Another reason to weight Canada low: we live here, and already have significant "Canadian risk" exposure. It's the same logic that follows from not investing* heavily in your own employer. (* outside of advantageous share purchase programs of course - because always take free money, but don't maintain significant holdings).
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Sep 25, 2013 19:04
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Cool, thanks for the tips and info 
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Sep 25, 2013 19:05
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reflex posted:I'm just thinking from a day-to-day banking level. Right now I have a choice to either pay $10/month for my chequings account or never dip below a $2500 balance. When I look at throwing a downpayment out there, $2500/$10 a month is not substantial but it's still $2500/$120 a year. I organize my budget via savings accounts, so I have multiple accounts making 0.35% and when I look at something like ING, I could be getting 1.35%. http://www.redflagdeals.com/deal/financial-services/ing-direct-open-a-thrive-chequing-account-with-payroll-deposits-get-100-for-free-3996/
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Sep 25, 2013 19:06
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cowofwar posted:In that case definitely open a INGDirect.ca thrive chequing account. Switch your payroll over and they'll give you $100 free. Plus you can use the not-so-bad high interest savings accounts. ING Direct loving rules. Other than the Scotiabank-purchase sword-of-damocles, I don't understand why everyone doesn't use them. It's not like you need to keep your banking in one place - I use ING Direct for banking, MBNA & Chase Amazon credit cards, TD for e-series, Questrade for ETFs, and BMO for all my business banking. I'm a bit nuts though, admittedly.
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Sep 25, 2013 19:10
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Lexicon posted:ING Direct loving rules. Other than the Scotiabank-purchase sword-of-damocles, I don't understand why everyone doesn't use them. It's not like you need to keep your banking in one place - I use ING Direct for banking, MBNA & Chase Amazon credit cards, TD for e-series, Questrade for ETFs, and BMO for all my business banking. Also INGDirect just sent me a letter informing me that they now allow cheque deposits by taking a picture of the cheque with their smart phone app. First bank in Canada to allow this option and they're free.
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Sep 25, 2013 19:22
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How easy is it to transfer money cross-institution? The closest ING ABM is a 5min walk from work, but a 30min drive from home. If I need money on the weekend, the only real option I have is transferring cash to my TD account and using my TD debit card to withdraw that, right? That surely would take a couple business days? EDIT: How does ING make money? There surely is some bs cash grab somewhere in there, right? reflex fucked around with this message at 19:35 on Sep 25, 2013 |
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Sep 25, 2013 19:26
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reflex posted:How easy is it to transfer money cross-institution? The closest ING ABM is a 5min walk from work, but a 30min drive from home. If I need money on the weekend, the only real option I have is transferring cash to my TD account and using my TD debit card to withdraw that, right? That surely would take a couple business days? With ING, you can use all manner of credit unions, HSBC and National Bank ATMs for no cost. You can also set up multiple EFT linkages from $BANK to ING. You don't even need personalized cheques like their website says - you just go to $BANK and ask for a "direct deposit form with the bank's stamp on it". Mail that to ING, and they'll create an EFT link so you can transfer money in either direction (it does take 1-2 business days though). reflex posted:EDIT: How does ING make money? There surely is some bs cash grab somewhere in there, right? The same way every bank makes money - by borrowing at X% and lending out at (X + Y)%. They don't have a vast network of branches, replete with managers, and free coffee and plush green chairs - so that's why they can, at least in theory, offer such good rates/products. Sadly, the GFC, and the Scotiabank purchase makes the continuation of this less, rather than more, likely in future, but that was the original logic. Lexicon fucked around with this message at 19:43 on Sep 25, 2013 |
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Sep 25, 2013 19:40
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cowofwar posted:Not really, loyalty is over-rated. I use RBC and MBNA for credit; RBC and ING for chequing; ING, Ally (now RBC) and Hubert for savings; and MDFinancial for investments. I'll be closing down my RBC accounts once my free student accounts end when I finish grad school. Paying for a chequing account is dumb. Pretty sure some credit union beat them to the punch there early this year. But still a pretty cool feature.
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Sep 25, 2013 19:45
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reflex posted:How easy is it to transfer money cross-institution? The closest ING ABM is a 5min walk from work, but a 30min drive from home. If I need money on the weekend, the only real option I have is transferring cash to my TD account and using my TD debit card to withdraw that, right? That surely would take a couple business days? Bank has $1,000,000 in deposits, holds $200,000 in reserves, loans out $800,000 at different risk levels depending on their calculations. Every year they might make $100,000 in revenues on that $800,000. From that they pay out $10,000 to depositors as 1% interest, $40,000 in expenses, $20,000 to stock holders and retain $30,000 as profit. The idea that banks need to charge depositors for services is wrong and has led to people paying for their accounts. If you have an account with a bank they should be paying you and your banking should be free as they are using your money to make money. Paying them money so that you can have them make money off your money is idiotic and is the bank just double dipping because they know most of the public thinks of them as a service provider that just holds deposits in a giant vault. Every quarter the big banks in Canada record multi-billion dollar profits. Do you really think they need to charge account fees? RBC has 18,000,000 clients and recorded $2.3 billion dollars in profit last quarter. Assuming every client paid $10 a month for 12 months that represents $2.16 billion in fees or one quarter's profit. So getting rid of all the account fees would drop profits from $10 billion a year to $7.5 billion a year. cowofwar fucked around with this message at 19:56 on Sep 25, 2013 |
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Sep 25, 2013 19:50
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cowofwar posted:The idea that banks need to charge depositors for services is wrong and has led to people paying for their accounts. I may have made this point already, but my parents honestly thought this Canadian "service fee" concept was some elaborate joke on the part of the bank manager when the moved from the UK and were setting up accounts here. Only Canada could produce consumers so docile as to accept this as the status quo. It's virtually unheard of elsewhere that I'm aware of. Edit: Also, cowofwar, it seems that me and you are banking-philosophy soulmates 
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Sep 25, 2013 19:53
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cowofwar posted:So getting rid of all the account fees would drop profits from $10 billion a year to $7.5 billion a year. Most companies aren't too keen on a 25% drop in profits though. I think the US has similarly retarded banking fees, especially when it comes to overdraft.
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Sep 25, 2013 20:11
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FrozenVent posted:I think the US has similarly retarded banking fees, especially when it comes to overdraft. Yeah, overdraft on some US accounts can be criminally punitive. But it's pretty unusual to have monthly "service fees" like we do up here, or at least it was pre-GFC. It was never the norm anywhere except Canada prior to that.
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Sep 25, 2013 20:17
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Speaking of ING Direct, if people sign up for chequing accounts and deposit $100 using a current member's Orange Key, both members get $25. My Orange Key is 13965765S1 - feel free to use it, and others should post theirs too.
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Sep 25, 2013 20:23
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FrozenVent posted:Most companies aren't too keen on a 25% drop in profits though.
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Sep 25, 2013 20:48
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Do you goons transfer money between your ING and other banks? How long does it take for that transfer to be recognized?
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Sep 25, 2013 20:53
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cowofwar posted:This is where governmental regulations would be expected to be in place. The current fee structures penalize the poor for being poor but they are at a disadvantage without paying for a bank account. Meanwhile rich people have their account fees waived. Sadly the poors have a terrible lobbying budget. Banks, on the other hand...
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Sep 25, 2013 20:59
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Australia always had service fees as well, a couple of their banks have gotten rid of them in the last couple years, but they're definitely still there. They're only like $5 a month though for unlimited transactions, usually. The NSF fees will kill you over there, too though. I'm wondering what I should be doing for investing. I have a TD bank account that I use for chequing, and two ING savings accounts, one which has my savings in it, the other which has the money I use to pay my taxes with. Obviously the taxes one I'm not going to change, but I'm open to options on the other one. I moved back to Canada in late 2011 after leaving in early 2009. I have never had a TFSA. Does this mean I have the same $25,500 available as everyone else, or is my limit lower because of the time I spent outside of the country? Should I even use my TFSA? I'm in a high marginal tax bracket, but I'm self employed so my income is far from steady, it's not like I'm a senator or something with a guaranteed high wage forever. I definitely wouldn't be using the whole $25500 or however much it is straight away, obviously, but it'd be good to know what the limit is to avoid accidentally going over it. How much should one keep in their regular savings before investments? Six months of emergency money? Then after that I guess the suggestion is to put the rest in e-series? HookShot fucked around with this message at 21:05 on Sep 25, 2013 |
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Sep 25, 2013 21:01
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reflex posted:Do you goons transfer money between your ING and other banks? How long does it take for that transfer to be recognized? HookShot posted:Australia always had service fees as well, a couple of their banks have gotten rid of them in the last couple years, but they're definitely still there. cowofwar fucked around with this message at 22:26 on Sep 25, 2013 |
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Sep 25, 2013 22:22
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reflex posted:Do you goons transfer money between your ING and other banks? How long does it take for that transfer to be recognized? Let's see... I make an automatic $50 transfer to an ING savings account (I think they gave me money for doing this at some point?). Mint has the latest one being credited TO ING on 17 September and leaving my chequing on 18 September. The one before that was TO ING 2 September, FROM Chequing 4 September. If you move money into your account, it reads as a deposit at ING before it leaves your Chequing. It's obviously not cleared until it arrives and is processed, which can take some time, but yeah. To go the other way, I moved money FROM ING on 19 September and it arrived in my Chequing on 20 September. So, about one day for the last few transactions. I swear it's taken several days in the past before though.
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Sep 25, 2013 22:30
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cowofwar posted:You should avoid using your RRSP for the first-time home buyer's withdrawal and just contribute in to your TFSA for a down-payment instead. What's the rationale behind that? The RRSP contribution still gets you the tax-deferment and the corresponding nice tax return that you can place in savings or use for your down payment or whatever. Since you're losing out on investment gains either way, wouldn't it be advantageous to just repay your RRSP AND get the tax refund instead of just saving to a TFSA, paying for a down payment, and then contributing to an RRSP later?
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Sep 25, 2013 22:33
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tuyop posted:What's the rationale behind that? The RRSP contribution still gets you the tax-deferment and the corresponding nice tax return that you can place in savings or use for your down payment or whatever. Since you're losing out on investment gains either way, wouldn't it be advantageous to just repay your RRSP AND get the tax refund instead of just saving to a TFSA, paying for a down payment, and then contributing to an RRSP later? You shouldn't be tapping your retirement funds to afford a down-payment on a house. If you can't manage the down-payment without tapping your RRSP that generally means you've tapped all your liquid funds which is not a place you should be when purchasing a house. If I was to buy a $300,000 house I should have $15,000 in an emergency house maintenance fund, never mind my 6 month emergency savings. What happens when you get a $10,000 bill for a major sewer repair within the first year of owning your house (this happened to us) and you have no savings and are committed to both mortgage payments, RRSP contributions and RRSP withdrawal recontributions? You're boned. But if you have tons of money then it makes sense to do it rather than using after-tax money. But I would guess that the vast majority of people using the Home Buyer's Plan are not in this situation and my advice was for them. Most users will use their $25,000 from their RRSP to afford their down-payment or use it to let them buy a more expensive house that they can't afford rather than using it for a long term tax strategy. cowofwar fucked around with this message at 23:03 on Sep 25, 2013 |
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Sep 25, 2013 22:58
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cowofwar posted:As a Canadian citizen who was age of majority when the program started you should have the full contribution limit. That said, TFSA contributions are after-tax and RRSP contributions are tax deferred. So if you are in a high income bracket now and expect to be in a lower bracket when retired then your RRSP should be a priority. Otherwise TFSA should be a priority. You should avoid using your RRSP for the first-time home buyer's withdrawal and just contribute in to your TFSA for a down-payment instead. Ok cool... I don't have an RRSP because I'm stupid (and also because I didn't expect to come back to Canada when I left) so I should probably get onto that. I honestly don't have a clue what tax bracket I'm going to be in when I'm of retirement age though.
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Sep 25, 2013 23:06
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tuyop posted:Let's see... I make an automatic $50 transfer to an ING savings account (I think they gave me money for doing this at some point?). Mint has the latest one being credited TO ING on 17 September and leaving my chequing on 18 September. The one before that was TO ING 2 September, FROM Chequing 4 September. If you move money into your account, it reads as a deposit at ING before it leaves your Chequing. It's obviously not cleared until it arrives and is processed, which can take some time, but yeah. Yeah I did one that took three days about a week ago too. So it can vary. edit: urrgghh sorry for double posting.
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Sep 25, 2013 23:06
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HookShot posted:Ok cool... I don't have an RRSP because I'm stupid (and also because I didn't expect to come back to Canada when I left) so I should probably get onto that. I honestly don't have a clue what tax bracket I'm going to be in when I'm of retirement age though. There are a lot of resources in the financial independence world for working this out. I think that basically you can figure out your retirement "income" level by filling in the variables here: Required income at retirement = Your current income - employment costs (costuming, commuting, business services, recreating/destressing, work-related food and drink) - savings (since you won't be saving anymore) - some housing costs (assuming you will own your home, if you plan to rent forever, omit) - miscellaneous "life stage" costs (daycare, child raising stuff, other things) - difference in taxes between the total and your current income. I swear I'm missing something, but yeah. Most people discover that they can afford to live on much, much less than they make while maintaining the standard of living that they value because most of their income is consumed by the consequences of their vocation.
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Sep 25, 2013 23:16
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I have a general question for you Canadian money wizards: how cautious is too cautious when dealing with real estate? In my mind, I want to have a $55,000 for downpayment/realtor costs/associated costs/minimal furniture + $25,000 in liquid funds for emergencies. But there is no way in hell everyone who buys an apartment/condo is just rolling in to the bank with 75-80 large in liquid funds, right? How do people afford to own?
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Sep 25, 2013 23:20
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HookShot posted:Ok cool... I don't have an RRSP because I'm stupid (and also because I didn't expect to come back to Canada when I left) so I should probably get onto that. I honestly don't have a clue what tax bracket I'm going to be in when I'm of retirement age though. reflex posted:I have a general question for you Canadian money wizards: how cautious is too cautious when dealing with real estate? In my mind, I want to have a $55,000 for downpayment/realtor costs/associated costs/minimal furniture + $25,000 in liquid funds for emergencies. But there is no way in hell everyone who buys an apartment/condo is just rolling in to the bank with 75-80 large in liquid funds, right? How do people afford to own? http://www.theglobeandmail.com/report-on-business/economy/debt-by-numbers-troubling-trends-in-consumer-spending/article14017219/ Most people just look at their rent payment to estimate whether they can buy a house. If they're paying $1200 a month in rent then they think they can afford a $1200 a month mortgage. However, when you factor in all the additional costs of home-ownership over a couple years it will tend to actually be about $2400 a month. So they rely on credit cards to pick up the slack and the bank doesn't properly discourage people from buying since there is no risk to them thanks to the Canada Mortgage and Housing Corporation. See this thread http://forums.somethingawful.com/showthread.php?threadid=3533827 cowofwar fucked around with this message at 23:27 on Sep 25, 2013 |
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Sep 25, 2013 23:20
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