Category Archives: Money Tips

Goodbye BMO US Dollar MasterCard, You’re No Longer a Good Buy for Us

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A couple of years ago we took our first family trip to the US. We saved the money we’d need for hotels, shopping and activities for a few years ahead of departure day. When the Canadian dollar was above parity, we bought US dollars and stored them in an ING Direct US dollar savings account. Before the trip, I applied for a BMO US Dollar MasterCard. Now, though, it’s time to say goodbye to it.

Why a US Dollar Credit Card May be Beneficial

We could have used our regular Canadian dollar credit card for our US expenses. We didn’t because it would charge us a hidden fee on every dollar we spent.

Like many other credit cards, our Canadian dollar card charges a fee on top of the actual Canadian/US Dollar exchange rate. At the time we travelled, this fee was 2.5% of the cost of the transaction. For example, if we paid $100 USD for lunch, we would have to pay a fee of $2.50 in addition to the actual amount it would cost to buy $100 US dollars with Canadian dollars.

There are some Canadian credit cards, like the No Fee Sears Financial MasterCard that do not charge a foreign exchange transaction fee. Instead of one of those, though, we got a USD card.

Why We Preferred a US Dollar Credit Card

The second reason we got the USD card was to control what we paid as our foreign exchange rate. As I mentioned, we actually bought US dollars ahead of time when the Canadian dollar was stronger than the American. That meant we wanted a card where we could make our purchases in US dollars, then pay the credit card bill directly in US dollars.
For us, the BMO USD MasterCard worked perfectly. We paid no hidden fee and we knew what our exchange rate was because we pre-bought our US dollars.

So Why Cancel the BMO US Dollar Card?

Why, then, did I cancel the card today?
Because the card has an annual fee.

When we signed up for the card, the fee was $25 per year. If you spent $1000 in US funds during the year, they reimbursed the fee. For the first two years we had the card, we did have spending of over $1000 a year. This year, though, we won’t. We don’t plan any travel to the US for several years at least. And the fee is now $35 a year.

I did phone and make a half-hearted effort to have the fee waived. I received at least 6 apologies but no price reduction. So I terminated the card.

Be Careful Cancelling Credit Cards

In our case, our credit rating is fairly good. We also haven’t borrowed any money in many years. Cancelling a credit card can have a negative impact on your credit score. In our case, we didn’t care. If your credit rating is weak, however, be careful. Try to find out what impact, if any, the cancellation will have on your rating before deciding whether to cut up the card.

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Do you use a US dollar credit card? Do you travel or just shop online? Please share your experiences with a comment.

How to Make a RRSP Contribution Quickly and Easily Using ING Direct

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If you already bank with ING Direct now Tangerine.ca like we do, you can make a RRSP contribution in under two minutes, including getting your RRSP contribution slip for your income taxes. We used to make contributions at our “Big 5” bank when we were younger. Even though they were fairly quick about it, we still usually had to spend an entire lunch break getting it done. The first time we made a RRSP contribution online with Tangerine ING, I couldn’t believe how quickly and easily we got the job done.

UPDATE: Please be aware that as of January 2015, Tangerine has started charging a fee if you transfer your RRSP or TFSA from Tangerine to another bank, credit union, brokerage or financial institution.

As of the time this was written, in October 2013, ING Direct Tangerine does not charge any fee to transfer all or part of a RRSP to another institution. (Please see: Does It Cost Anything to Transfer Part of my Tangerine RRSP to Another Institution? (You can’t transfer a GIC, though, until it matures.) So we often make our initial contribution to our RSP Investment Savings Account at Tangerine, and then transfer it elsewhere at our leisure.

(Sometimes we just keep it at Tangerine and buy a RSP GIC if they are offering a great rate. Keep an eye out on unusual days like “Cyber Monday” and “Black Friday” if you’re interested in unusual GIC rates.)

Making a Contribution to a RSP Investment Savings Account at Tangerine

Before starting this procedure, check to make sure you still have room to contribute to your RRSP. Remember you’ll have to pay a ridiculous level of tax on any over-contributions.

  • Log in to your Tangerine.ca account.

If You Already Have a RSP Investment Savings Account at Tangerine

  1. From the links on the left side of the screen, click on Move My Money
  2. In the Amount ($): field, type the amount you want to contribute.
  3. From the From: drop-down list choose the account from which you want to fund the RSP Investment Savings Account.
  4. From the To: drop-down list, choose your RSP Investment Savings Account.
    A message will be displayed reminding you to check your available contribution room.
  5. In the When: section, select the radio button beside
    • Now
    • Later; or
    • Ongoing

    I selected Now.

  6. Click on the Go button.
  7. Review the details. If they look ok, click on the Go button.

You’re done!

Copy the confirmation number and information and paste it into a document to save until you’re sure the transaction went through properly.

If You Don’t Already Have a RSP Investment Savings Account

  1. Click on the tab at the top of the screen called Savings.
  2. In the RSP Investment Savings Account section, click on the Open Account button.
  3. Review your name, address, date of birth and social insurance number.
  4. If they are correct, in the Amount: field, type the amount of money you want to contribute to your RRSP.
  5. If desired, type a Nickname for the account. (For example you could type: 2013 first contribution)
  6. In the Fund from this Account: section, from the drop-down list select from which account to take the money.
  7. In the Effective Date field, review the date and change it if needed.
  8. Answer the anti money-laundering and registration questions.
  9. Click on the Next button.
  10. Review all of the information. If it’s correct, to set up and fund the RSP Investment Savings Account, click on the Go button.

You’re done!

Copy the confirmation number and information and paste it into a document to save until you’re sure the transaction went through properly.

To Print Your RRSP Contribution Receipt for your Taxes

Oh crumbs. I forgot that you can’t print the 2013 contribution receipts until January 2014. I’ll have to wait. However, here’s how you would do it then:

  1. From the list of links on the left side of the screen click on the My Documents link.
  2. Click on Tax Receipts.
  3. From the drop-down list, select the year you made the contribution.
    For example, select 2013. (once you can!)
  4. Look for your name under the RSP – RRSP contributions section.
    • If you made the contribution in 2013 after February, it will say (Balance of Year).
    • If you made the contribution before March, it will say (First 60 days)

    Click on your name to open the receipt.

  5. Click to select Open with Adobe Reader, then click OK.
  6. Click on the Printer icon to print your income tax receipt.
  7. Close the document.

If You Have Finished Banking with Tangerine

  • Click on the Log me out link.
    For added security, close your browser session.

Imagine No Lining Up Till Midnight at Your Bank to Make a RRSP Contribution!

The best part about this fast, simple way to contribute is that if you suddenly realize you have a bit more money you can contribute and it’s the last contribution day, usually February 28, you can login and be done in minutes! No more walking to the bank through a snowstorm and waiting in line!

UPDATE: Please be aware that as of January 2015, Tangerine plans to start charging a fee if you transfer your RRSP or TFSA from Tangerine to another bank, credit union, brokerage or financial institution.

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Do you ever use Tangerine as a quick way to make a contribution that you then take the time to move to its final well-planned resting place later? Please share your experiences with a comment.

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