Tag Archives: emergency fund

Is It Safe to Use Oaken Financial for My GICs? Does It Work? How Can I Add a Joint-Owner to a GIC?

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Like many Canadians, I’m a bit nervous letting an “unknown” financial institution handle my money. Still, when I was looking for a place to put our emergency fund into a series of GICs so that one would mature each month for a year, Oaken Financial had the best on-going rates available with the most convenience for me. Still, I wondered if it would be safe to use it, whether it would work, and especially whether there would be any problems when the certificates matured.

What Maturity Instructions Could I Choose for a GIC with Oaken Financial?

When I bought the first guaranteed investment certificate last year, I asked to have the interest and principal paid out to my Oaken Savings Account at maturity. I was a bit nervous because I’d had bad experiences in the past with one of the Big Five Canadian banks not putting those instructions properly on file and my GICs rolling over to new terms and lower rates.

I checked the GIC certificate that Oaken had mailed me, and I checked my certificate details online and both said that the principal and interest would go into my savings account at maturity.

(I could also have asked them to mail me a cheque, or to re-invest the principal and/or interest at maturity.)

Will Oaken Warn Me That I Have a GIC About to Mature?

I was pleased to get a letter from Oaken more than a month ahead of time warning me that I had a GIC coming up for maturity. It offered me the option of changing my instructions for the cash. I left the instructions standing.

Did My Oaken GIC Mature Properly?

Still, it wasn’t till today, when the first certificate matured that I finally knew it would work. Yep, the cash is now in my Oaken Savings Account. Phew!

Will I Use Oaken Financial to Buy My Next GIC?

Yes. I actually am re-investing this 1/12 of our emergency fund today so that it will mature in another year’s time. Our expectation is that if we need this emergency fund, we will need it to pay monthly bills and property taxes etc so we won’t need it all in one chunk: we’ll use it in monthly chunks. I’m keeping a series of 12 GICs, one maturing each month, to keep the money earning some interest, hopefully enough to keep up with, almost, inflation.

What Rate is Oaken Financial Offering for a Non-Registered GIC Today, November 24, 2105?

The current rate for a non-cashable one-year GIC is 1.95%. A cashable is paying 1.75% which is more than most savings accounts. We don’t need to have cash handy here, since we have it elsewhere, so we’ll go with the non-redeemable GIC. The rate for 18 months and more is over 2%.

Adding a Joint Owner to a New GIC at Oaken Financial

This time, when buying a GIC, I wanted to add a Joint Owner, my husband.
I followed  my own instructions for buying a GIC, then clicked Yes when asked if I wanted to add a joint-owner.

The Joint Owner Details Section Opened

  1. I clicked to select Yes for Is the joint owner an existing customer?
  2. I typed in his Oaken Client Number.
  3. From the list of titles, I selected Mr.
  4. I typed in his first and last name in the appropriate text boxes.
  5. I clicked to select No for the question is he a US citizen or US resident for tax purposes?
  6. I typed in an optional email address for him.
  7. I clicked No to answer the question Has his personal information changed?
  8. I clicked No to answer whether I wished to add an additional joint-owner.
  9. I then continued with usual procedure by clicking on the Next button.

If you need to add a Joint-owner to an existing GIC, you could try talking directly to an Oaken Financial support person. I am not sure if it is possible or not.

Are My Oaken Financial GICs Insured by CDIC?

Today, November 24, 2015, they are listed as a member of CDIC and therefore the GICs are secured. It’s always a good idea to check the CDIC status of any institution again just before placing an order in case anything has changed.

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Do you keep your emergency fund in cash or GICs? Where do you stash it? Please share your strategy with a comment.

What Will Happen When My Oaken Financial GIC Matures?

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A year ago, we decided to divide our emergency fund into 12 parts, and invest the money in a series of GICs that would mature one per month for a year. We knew we wouldn’t need the emergency money all at once but rather in monthly amounts to replace a pay cheque. We looked for GICs offering a good interest rate with CDIC insurance and easy online purchase access. We chose to buy our GICs from Oaken Financial and now the first GIC is maturing and I wondered what will happen.

Setting the Instructions for a GIC with Oaken Financial

When I purchased a GIC from Oaken, both online and by phone, I was asked what I wanted to happen to the principal and the interest when the term ended. I decided to have both the principal and interest deposited to our Oaken Savings account. This instruction was listed on the confirmation certificate I received in the mail for my GIC.

Why Did I Get a Letter from Oaken Asking Me to Send Them Instructions for My Maturing GIC Investment?

I was a bit surprised to receive a letter in the mail from Oaken a few weeks before my first GIC matured. It correctly described the instructions on file to pay out my GIC at maturity, both principal and interest, to my savings account. But it also said “Please indicate your instructions for your maturing investment.” And in the fine print under PLEASE NOTE it said “If no maturity instructions have been received…the mature investment may be…renewed for the same terms and conditions as the existing investment…”

Red alert! I hate having GICs rollover. I like to re-invest the funds myself if and when I choose.

Were my instructions properly on file? Or did I need to check a few boxes on this form and return it in the provided pre-paid return envelope? I phoned Oaken Financial to check.

The Renewal Letter is a Courtesy to Customers

I was reassured to find out that the renewal instructions letter is primarily a courtesy to customers. It reminds them that they have a GIC maturing (which could be forgotten after 5 years!) and offers them the variety of choices at maturity such as reinvesting at various terms in both cashable and non-redeemable GICs, or re-investing only part of the funds, or sending a partial or total payment by mail.

Because I already have the instructions I want on my file, I do NOT need to send in the letter.

So it’s all good.

I will watch my Oaken Savings account, however, later in the month to see if the principal and interest are paid out as instructed. If so, I will probably just re-invest the principal for another year: but I will enjoy the security of choosing at that time.
UPDATE: The results are in; the first GIC has matured.

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Does your bank or trust company warn you in writing (no annoying phone calls!) that a GIC is maturing? Is it easy to get your instructions on file? Please share your experience with a comment.