How Long Will It Take To Transfer My RRSP or TFSA? Are There Rules?

I was reading through some posts on the Canadian Money Forum one of which was about how to transfer a RRSP, in cash, from one financial institution to another. One of the replies said that financial institutions can work very slowly and may even phone you to try to talk you out of the move. That got me thinking about all of the RRSP and TFSA transfers I’ve done in the past 2 years and how long they took–and whether there are any rules banks have to follow.

What Is the Process for Transferring a RRSP or TFSA to Another Bank, Brokerage or Institution?

The actual process is very similar no matter which two financial institutions you are talking about. In almost all cases, you open the account that will receive the money or assets, then you fill in a T2033 form provided by that receiving institution which either they or you mail to the bank, brokerage, credit union, or other institution that currently has your holdings.

The T2033 is pretty straightforward. On it you list

  • the name and address of the place that will be receiving your assets
  • the name and address of the place that will be sending your assets
  • the account numbers, client numbers, transit numbers or other identifying numbers for the RRSP or TFSA at both institutions
  • your name, address, phone, and sometimes SIN
  • how to move non-cash assets.
    For example:
    transfer stocks and mutual funds as is, or sell them and then move the cash;
    convert any cashable GICs to cash and then move the funds, or move them as GICs, or move them as they mature to cash

There’s nothing very complex about a T2033 although some brokerages seem to make them look pretty ugly.

Are There Any Rules for Transferring Assets from one RRSP or TFSA to Another?

The disgruntled comment on the forum made me wonder if there were any actual rules about how quickly financial institutions have to handle these routine transfers.

Reading a line in In Your Best Interest piqued more of my interest. It said “The former firm must reply [to the requested transfer] within 2 days and deliver all the securities and cash, within ten days.”

So I went out and looked for more information.

While I couldn’t find the exact document I was looking for on the IIROC website, I did find another document on the Government of Canada Financial Consumer Agency of Canada website.

It answers the specific question of how long can an institution take to complete a RRSP transfer request.

It says:
The length of time depends in part on what is held in the RRSP. It could hold cash, stocks, mutual funds, etc. Each of these may require different handling times. So the longest time allowed is the time required to handle the most complicated asset in the request.

For “deposit-type” products, the target time is that within 7-12 business days after receiving a properly completed request , the chartered bank will send the cheque to the receiving institution.

If the “deposit” has to mature first, that extends the time permitted.

Note that the time is for chartered banks. It doesn’t say how long for other institutions.

For “mutual fund-type” products, it says to check Guideline 81-102 of the Investment Funds Institute of Canada.

For” securities-type” products, which presumably includes ETFs and stocks, it says Transfers by chartered banks of registered plans containing securities will be processed according to Regulation 2300 of the Investment Dealers Association.

Clear as mud, right?

I tried to go to the next level and look up Guideline 81-102 but it’s slow going so far. So in the meantime, here are some personal experiences for what they’re worth.

Time for Cash to Move from one RRSP or TFSA to Another at a Different Financial Institution

We had assets scattered all over the place from disorganized contributions made during the early years. Gradually we’ve been rounding them up and corralling them in a few brokerage accounts. It’s led to many transfers and I’ve timed a lot of them. Here are some examples.

These moves all happened in 2012-early 2014. As described in another article, the TFSA transfers from ING Direct to BMO InvestorLine this year show the randomness of some of these events. Both transfers were initiated at the same time in the same way, but there is a 7 business day difference between the results!

Each of these transfers was of cash only. Each was initiated by mailing the T2033 from a public mail box, so some of the required time includes the time for Canada Post to pick up and deliver the T2033 to the first financial institution.

And just in case you’re interested, no one has ever contacted us to try to talk us out of transferring our funds. (I suspect they’re glad to see me go!)

Where the Money Started Where the Money Stopped How Many Business Days It Took
The Canada RSP ING Direct 15
CIBC BMO InvestorLine 16
CIBC CIBC Investor’s Edge 3
ING Direct BMO InvestorLine 18
ING Direct BMO InvestorLine 11
ING Direct CIBC Investor’s Edge 12
ING Direct RBC Direct Investing 14 to leave ING
7 to then reach RBC DI!

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Have you had to transfer funds in a registered account from one place to another? How long did it take? Please share your experiences with a comment.

If I Transfer a Stock to my US $ InvestorLine RRSP After the Record Date Where Does the Dividend Go?

Earlier this month I set up a US $ side within my InvestorLine RRSP. Then I funded it by moving some stocks I owned from the Canadian $ side to the US $ side. Unfortunately, I outwitted myself and moved them after the Date of Record for the next dividend payment. So where did the dividend appear?

TD Pays a Dividend on July 31 to Owners of Record

When I transferred some TD stock, I left most of the shares on the Canadian dollar side of my RRSP. I only transferred a portion to the new US dollar side.

The entire July 31 TD dividend payment appeared on the Canadian side of my RRSP account.

I had not been sure whether InvestorLine would push part of the dividend through to the US dollar side of the account to follow the shares or not. And I had wondered what exchange rate and fee they would apply if they did. They didn’t so they didn’t apply anything.

The Moral of the Story: Watch those Dates of Record Before Shifting Stock

As I mentioned in my earlier post, pay more attention to the date of record than I did and you can avoid this confusion!

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Has anyone else ever made a mistake about the Date of Record that cost them? Please share your experience with a comment.