Although I have yet to receive a notice from Tangerine either by email or by the message system they use within your bank account online, it appears to be official that Tangerine will be charging a $45 fee to transfer out your RRSP or TFSA balance.
UPDATE: I received a email notice inside my Tangerine account messages section on December 20 that advised that as of January 19 2015 I would have to pay a $45 fee to transfer out a RRSP or TFSA.
I updated my website with warnings when the rumour of this fee first appeared back in mid-October 2014. To date, I still have received no information directly from Tangerine about this new fee.
Tangerine Will Charge a $45 Fee to Transfer Out a RRSP
In the Frequently Asked Questions on the Tangerine site, it says they charge $45 to transfer out a RRSP. It does not say when this new fee is applicable! I was told on the phone that it would be in January 2015 but that is not clear here.
Will Tangerine Charge a Fee to Transfer Out a TFSA?
At this point, Tangerine has not yet said anything about a TFSA transfer out fee on their website. Nor have I received any notice by mail, email or message.
For a TFSA, one way to avoid a fee is to wait till December. Instead of transferring your funds, withdraw them. Then on January 1 of the next year and NOT BEFORE you can contribute them into your TFSA at another institution. If you deposit them in the same year you withdraw them you will be fined 1% a month by the CRA. You MUST wait till January 1 of the next year.
Will Tangerine Now Refund a Fee Charged by Another Bank for Transferring a TFSA or RRSP into Tangerine?
In the past, I moved a cash RRSP into Tangerine (when it was called ING Direct.) I asked if they would pay me back the fee that the other bank charged me for moving out my RRSP. They replied that because they did not charge a fee for transferring a RRSP away from Tangerine, they also would not pay a refund for a fee charged for transferring a RRSP in to Tangerine.
So has that now changed? Will they pay up to $45 to cover the fee paid to transfer a RRSP from another bank into Tangerine?
I’ve sent that question to Tangerine and will update this article when they reply.
UPDATE: Ok the reply so far is not encouraging. I emailed to inquire and was told that because I have an account with Tangerine I have to phone them to discuss this. That suggests they don’t have a formal policy yet although if you are interested in transferring in, I would suggest you call and see if they will reimburse your fee.
The worrying part was they also said that owners of registered products had been notified of the “transfer out” change via the messaging system within their account. I have several registered products and have not received any type of notice!
I’ll provide additional updates if/when I can get them.
Can Tangerine Start Charging a Transfer Out Fee Without Any Formal Notice to Customers?
Usually banks warn you a few weeks or months ahead of time when they are changing their fees.
So far I have not received any notice from Tangerine about this new fee. I have not received a letter, an email, a message when I sign in to my accounts, a message on the message system inside my account, or even a few words written in my October banking statements about it.
Do they have to give notice of this fee?
That’s hard to find out! In the USA, they clearly do. The US Government Consumer Financial Protection Bureau website says “a bank or credit union can start charging you fees…[if they notify] you in writing at least 30 days before it starts charging fees….”
I wrote the Canadian Bankers Association, CBA, on November 18, 2014 to ask if there is any required notice for new fees. Unfortunately, they chose to respond that I should direct my question to the federal government’s Financial Consumer Agency.
The (federal) Department of Finance Canada appears to be working on a new Financial Consumer Protection framework, judging by a consultation paper from December 2013 posted online. It’s not clear to me whether this is one of the issues that may be included.
I will update this article if I get any further information about requirements from the Financial Consumer Agency.
UPDATE 1: They have replied that I should expect to wait 10 business days for a reply.
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Have you recently been zinged with a new or an increased banking fee? Did they warn you in advance or was it a total shock? Please share your experiences with a comment.