I Write a Lot of Cheques. Is ING’s THRiVE or PCF’s No Fee Account Better for Me?
I find it a bit amusing to read posts on sites like RedFlagDeals where people brag that they never write cheques and they put all of their purchases on plastic to get points. I’m sure it works for them: I just doubt they have children. So far this new school year, I’ve written 17 cheques for my kids. That’s just in 3 months. And that doesn’t include all the cash sent in for various charitable “Toonie Tuesday” days and to buy milk tickets.
The cost of cheques from our “Big 5” Canadian bank was what led us to opening our President’s Choice Financial No Fee Chequing account. Believe it or not, you can order free cheques for your PCF No Fee account. As many as you need!
ING Direct, unfortunately, does not offer unlimited free cheques. You can get your first book free for a THRiVE chequing account. After that, though, you have to buy the cheques. They are reasonably priced compared to a “Big 5” bank, though.
Clear winner: PC Financial.
I Keep a Large Balance in My Chequing Account. Which Pays Higher Interest: THRiVE or No Fee?
I Keep a Very Low Balance in My Chequing Account: Which Pays Higher Interest: THRiVE or No Fee?
This one unfortunately can vary as both ING Direct and PC Financial like to offer short-term higher interest rates to lure in new customers. The following analysis is based on their regular posted rates.
Today, in December 2013,
the regular posted rate for an ING Direct THRiVE chequing account is
- 0.25% for a balance between $0 – 49 999.99
- 1% for a balance of $50 000 – 99 999.99
- 1.1% for a balance of $100 000 or more
the regular posted rate for a President’s Choice Financial No Fee chequing account is
- 0.05% for a balance between $0 – 1 000
- 0.1% for a balance of $1 000.01 – 5 000
- 0.15% for a balance of $5 000.01 – 10 000
- 0.25% for a balance of $10 000.01 – 25 000
- 0.5% for a balance of $25 000.01 and up
In both cases you only get the higher rate on the amount of money you have in the account above the previous tier.
For example, if you have $55 000 in your chequing account, you get about
- at ING Direct
50 000 x .0025 + 5000 x .01 or about $175 per year
- at PCF
1000 x .0005 + 4000 x .001 + 5000 x .0015 + 15000 x .0025 + 30 000 x .005 or about $200 per year
Interest is actually calculated daily and paid monthly which means it will compound so these numbers are just approximations.
If you keep a low balance, say below $10 000, ING Direct will pay you more interest per year as it has a higher interest rate for low balances.
If you keep a high balance of over $60 000, again, ING Direct will usually pay you more interest per year.
Between $30 000 and $60 000, though, PC Financial pays you the most interest!
Winner? It depends on what balance you usually keep in your account.
I Bounce Cheques but Never by Much or For Long: Which is Better a THRiVE account or a No Fee Account?
OK I have no personal experience with this one. I’ve never bounced a cheque and it’s unlikely I ever will. I’m also one of those obsessive people who arrives 7 minutes early for every meeting or gathering. (But don’t worry, I never ring the doorbell early because I know most hosts are running late.)
So this part is based on the information listed on the respective websites for ING Direct and PC Financial.
First, why are you bouncing a cheque? If it’s because of a miscalculation of a few dollars, then the following info may be useful. If it’s because you don’t have enough money to pay your bills and you’re bouncing a cheque for hundreds of dollars, you probably aren’t going to find a solution here.
The ING Direct THRiVE Chequing Account Whoops Protection Plan
If you pass a credit check when opening your THRiVE account, you can qualify for free Whoops protection.
The Whoops plan covers an overdraft of up to $250. In other words, they will let the cheque clear your account so you won’t get in trouble with the person you paid or the other bank.
Next, they will email you a notice right away stating you are overdrawn.
You have 30 days from when the account balance dropped below 0 to pay the overdraft.
After that 30 days, you will be charged a $2.50 fee for every 30 days that the account balance is under $0.
Once the account balance is under $0 no new cheques or payments will be allowed to clear.
Whoops covers “future dated bill payments and email money transfers, pre-authorized debits, and cheques.”
PC Financial’s No Fee Chequing Account Offers Optional Overdraft ProtectioN
PC Financial’s No Fee account does not offer free overdraft protection.
When you open your account, you can apply for Overdraft Protection. The maximum protection available is for $5 000. Not all applicants will qualify for the maximum. We were told by the agent when we opened our account that a credit check would be necessary to apply for overdraft protection.
For clients with overdraft, the account balance must be brought above $0 at least once a month.
If you use the overdraft service, you will incur a charge and a fixed interest rate on the overdraft balance. In December 2013, the charge is $4.97 each month that you have an overdraft. The interest rate charged on the overdraft is 19% per annum. Ouch!
As I described in Part One Moving Money, Transfers and Holds, it takes a full business day to get money from your PC Financial savings account to your PC Financial chequing account. That makes it much easier to bounce a cheque accidentally. ING Direct, however, lets you transfer money instantly from your ING investment savings account to your THRiVE account. That can help reduce the risk of a bounce.
Can I View My Used Cheques Online for Free?
With both the THRiVE and the No Fee account you can look at a scan of your cashed cheques online for free. This is great for joint accounts where you can’t remember who wrote a specific cheque and what it paid for.
Can I Pay My Bills Online for Free?
With both THRiVE and the No Fee account you can pay bills online for free.
Can I Pay by Debit for Free?
With both THRiVE and the No Fee account you can pay by debit at stores for free.
Paying by debit with the No Fee account at a Loblaws or affiliate store will also earn you PC Points which can be redeemed for groceries.
What ABMs Can I Use for Free?
For PC Financial No Fee accounts, you can use the banking machines at PC Financial kiosks, and the banking machines owned by CIBC, for free.
For ING Direct THRiVE accounts, you can currently use only the banking machines on the Exchange network. These include many credit unions and National Bank branches.
Rumour has it that sometime in 2014 it may be possible to use ScotiaBank machines but that has not been confirmed yet.
Email Money Transfers and Interac e-Transfer EMTs
I don’t understand the email money transfer system well enough yet to comment much on it. ING Direct says it offers no-fee free email money transfers for THRiVe accounts. I’ll have to test what that means for another article.
It costs $1.00 to send an Interac e-Transfer EMT from your ING Direct THRiVE account. It is free to receive transfers in to your account. Again, I don’t understand these enough yet to comment.
PC Financial has Interac e-Transfer EMTs. It costs $1.50 to send an Interac e-Transfer EMT. (It’s not clear whether there is any charge to receive a transfer.)
Can I Get a Bank Draft?
At ING Direct you can order a bank draft but there is a fee. It will be couriered to you, not to the person you want to pay, nor can you pick it up except at one of their very few locations/Cafes. The Cafes cannot issue drafts: you can have a draft couriered to the Café for pickup though. In December 2013 they quote a price of $10 for a draft and a requirement of 2-3 business days to courier it to most locations.
At PC Financial you can get a Bank Draft for $7.50 plus any required courier charges.
What Kind of Statements Can I Get for my Chequing Account
You can view and print your bank statements online for both ING Direct THRiVE and PC Financial No Fee accounts.
For a fee you can also have a paper statement mailed to you for a No Fee account.
A Surprising Fee
OK this may just be surprising to me, but PC Financial charges a fee to negotiate a cheque written in US dollars or any other foreign currency. This is in addition to the fee built into the exchange rate for the foreign funds. The fee is $7.50 for a cheque for under $1000 and $15 for a cheque for over $1000.
I believe this means if you write on a cheque you issue that it is payable in, say, US dollars, they will charge this fee. I don’t think this fees applies to when you try to cash a cheque in US dollars payable to you. I’ve sent an email to ask for clarification.
So Which is Better: ING Direct’s THRiVE or PC Financial’s No Fee Chequing Account
Obviously, this one will depend on how you use your chequing account.
For us, I would say the ING Direct account is best except for one problem: they don’t offer free cheques. Until my kids outgrow the school system, this is a deal breaker.
ING Direct otherwise suits us best because
- we keep a fairly low balance in our chequing account and it pays the highest interest on a low balance
- it offers free small overdraft protection, even if we don’t need it
- it allows us to instantaneously transfer money from our investment savings account to our chequing account (and back!)
- a credit union with an ABM is closer to us than a CIBC or PCF ABM
- we can deposit cheques online using their photo submission app
PC Financial might suit others best who
- keep a balance between $30 000 to $60 000
- can reach a CIBC or PCF ABM easier than an Exchange ABM
- need overdraft protection up to $5 000 and are prepared to pay for it
- want lots of free paper cheques
- would like to collect PC Points for paying by debit at Loblaws and affiliated stores
Of course since these are both no fee accounts with no minimum balances, you can even be like us and try one of each!
Do you cheque with PC Financial’s No Fee account or do you THRiVE at ING Direct? Please share your experiences with other readers by leaving a comment.
Yes, I bank with ING Direct, among other places. If you open your first account at ING Direct using the number below, you and I will both get a cash bonus. (There’s no bonus right now for opening a second account. Rats.)
From now till December 31, 2013, the bonus is $50 for you and $50 for me. Wahoo!
I’d have the same ad for PC Financial but they don’t offer any bonuses to you or to me.