superwench

Ok, first I'll start with a rant! Had an appointment with RBC today to set up some bank accounts. (Chequing and savings) not impressed by having to pay for fees on every damn thing! I miss UK banking already.

Can anyone give advice on the best bank accounts to go for? RBC were giving us a terrible rate of interest at something like 0.03%!

Heard presidents choice is worthwhile?

MarkG

PC Financial is free for most normal transactions that you do online or with checks. Out of the ordinary transactions like bank drafts, I believe you have to do through CIBC, and pay fees for.

Interest is only about 1% on savings accounts, so you won't see much improvement there.

SchnookoLoly

For chequeing accounts, you're going to pay fees with any of the big banks. Some banks will waive the fee if you keep $x in the account, usually $1k or $2k or something, but then you don't earn interest.

PC Financial is excellent, they are one of the four banks I am using. No fees, great for most everyday stuff, but as MarkG said, you then have to use CIBC if you need drafts or currency exchanges or whatever, and then you'll pay for that, though you often would pay for it at a normal bank anyway.

For savings, you can be a bit more flexible. We have savings accounts with Tangerine, PC Financial, and Canadian Tire Money. All three tend to do bonus interest in almost a rotating schedule, so you can take advantage of interest rates. It's often 2.5% on new deposits for 3 or 6 months, so you just plunk your money into that account when the promo starts, then transfer it to another bank when they start their own promo afterwards. Pretty easy, and keeps interest reasonably high. Most banks otherwise will have regular savings rates of 1% or maybe 1.25% if you are lucky.

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Our main chequeing account is wtih one of the "Big5" banks, as Mr Schnooks works there, so we get the employee rates - no fees, discounted fees for other stuff, but still pay for some things, like banker's drafts or certified cheques and whatnot. We also no longer get one free transfer a month OUT of the savings account we have with that bank, even if we do the transfer online... we used to get one free one a month, but now it's a $5 fee every time, which is stupid, but we do keep a bit of reserve in there since transferring between that bank and Tangerine/CT/PCF takes 1-2 business days. But I digress.

Hope that helps!

withabix

If you can keep a minimum balance of $3500 in Scotiabank, you pay no monthly fees whatsoever (other than extras such as the $1 for emailing money by Interac, using other banks' cash machines and international transfer fees, which every bank charge).

That fee avoidance is equivalent to getting a 4.5% net annual interest rate on that $3500, so worth doing if you can!

If you don't need a 'high street presence', try Tangerine. Also now part of Scotiabank (you use their cash machines for no charge), so the fees are starting to creep in on flipping TFSA accounts to other banks and such. Tangerine also has free photo cheque depositing (although Scotiabank doesn't ) using your smartphone.

I do my daily banking with Scotiabank and my savings are with Tangerine (until I buy a house and with then have no savings!).

colchar

Isn't ING Direct free as well? Or have they changed their name to something else?

withabix

Tangerine (and now owned by Scotiabank).

ChrisBan

There are also some banks that offer free banking programs for newcommers, Scotia was the last one I know that did this. TD were for a time also offering a free tablet for new accounts

Aviator

Used RBC for 20+ years without issue for personal account. The account costs $35 a month all in. Somebody has to pay banks, in the UK it is mostly business accounts that pay (then add the costs into pricing), although I had heard UK banks will be charging soon.

We use a credit union for business banking and some personal investments.

I don't believe there is one financial institution that gives the best of all worlds.

Tried PC Financial - did not work at all well for me. Used ING for a while, that did not work well either.

In BC, banks are insured by CDIC for up to $100k per account, credit unions are unlimited and underwritten by the provincial govt.

ChrisBan

Indeed, think BBC did an article on it a few months ago. They're already doing it more and more now, Nationwide last year introduced an X £ a month account with benefits you probably would have got free a few years ago

withabix

They use your money in the markets and by lending it to make their money.

They charge you when you use their money (eg loans, mortgages, overdrafts).

There shouldn't be any reason why you should pay them to look after your money, which they then borrow and make their money by using your money.

MarkG

Particularly when it's just bits in a computer, not gold coins they have to stash in a vault somewhere.

danfolkestone

Most of the banks have ways in which to get free or discounted banking, if you can meet the qualifying criteria. Those criteria vary wildly, so it's worth shopping around.

We're with HSBC, as they were the only bank who would give us a mortgage when we first moved here (in 2008, when banks were overly cautious in the wake of the banking crisis), based on my credit history with HSBC UK. As far as I know, they still offer free bank accounts for newcomers for 12 months. After that, you can continue to qualify for a free "Advance" account if you have a big enough mortgage or savings and investments with them. Other upsides include a sterling-denominated account that we use to deposit cheques from England, a rewards credit card with no annual fee and ability to view your Canadian and UK HSBC accounts in one place through online banking.

On the downside, they don't have many branches, their branches don't tend to open at the weekend and they tend to be slow to adopt new technologies. Their savings interest rates are also poor, in line with most of the bricks and mortar banks.

Aviator

One way or another we all pay. Whether it be 'free' accounts and lower interest rates on deposits, higher interest rates on loans etc or pay for accounts. Most of the time with 'free' accounts, we don't see how banks make profits or how much we are really paying. Virtual banks make savings on reduced costs of infrastructure or sharing with another bank (ING & Scotia), credit unions are member owned and not under the same profit commitment of the major financial institutions, banks make profits for shareholders, greedy fat cats some may say, however some of these shareholders are union funds, pension funds, mutual funds many of us own, insurance companies, municipalities etc.

There is no way around paying fees, it is just how we do it and how much we see. It seems more acceptable when we don't know.