Tag Archives: TFSA

How Long Does It Take to Transfer a TFSA from ING Direct to BMO InvestorLine?

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This is a tale of two TFSAs. Actually, it’s a tale of four Tax Free Savings Accounts. The first two TFSAs were at ING Direct. (Now called Tangerine.) ING Direct Tangerine offered 2.5% interest for a few months for savings of up to $5500 per account (one account per client) provided the savings were transferred automatically into the client’s TFSA on January 1. My husband and I took advantage of that offer. Then, on January 2, we sent in the forms to transfer our TFSAs from Tangerine to our BMO InvestorLine accounts—but how long would it take?

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.

Given that change, I would no longer recommend the Kick Start program unless you plan to keep your TFSA money at Tangerine for the long term.

How Did We Apply to Transfer Our TFSA Funds?

It’s important to transfer TFSA funds. If you actually withdraw the funds from a TFSA account, you have to wait till January 1 of the next year before you are allowed to deposit them again in the same TFSA or in a different TFSA at another financial institution. You can transfer TFSA funds at any time with no tax penalty.

Be careful to check whether there is a fee charged by the bank etc though before starting a transfer. ING Direct Tangerine does not charge transfer fees. (At least not as of when this was written in January 2014. Always check.) UPDATE: As of January 2015 Tangerine plans to start charging a fee to transfer TFSA funds to another financial institution.

To request the transfer of our TFSA funds to BMO InvestorLine, we signed into our InvestorLine accounts and filled out a T2033 each. The form is available under the Account Services tab, then the Forms link, then the Transfers tab, then the Transfer forms: Personal Accounts link.

You can read some more about this in How to Transfer Assets to a BMO InvestorLine Account from Another Bank Using a T2033 Form.

After we completed the forms, printed and signed them, we mailed them to BMO InvestorLine.

How Long Did It Take for My TFSA to Transfer from Tangerine to BMO InvestorLine?

I mailed our requests to transfer our funds in a bright red street mail box on January 2. I have no idea whether it got picked up that day or the next.

On Tuesday, January 14, my money was still in my TFSA at Tangerine.ca.
On Wednesday, January 15 it was gone!

First thing in the morning on January 17, my TFSA funds appeared in my cash balance in my BMO InvestorLine TFSA.

So it took 15 days for my funds to transfer, or 11 business days. That includes the “Canada Post” factor of getting my request delivered to InvestorLine.

How Long Did It Take for My Husband’s TFSA to Transfer from ING Direct (Tangerine) to BMO InvestorLine?

We don’t know yet.

That’s right. It’s now January 22 and his funds have not yet left Tangerine. They are sitting in a cash TFSA account which is fortunately earning 2.5% while he waits.

UPDATE: Thursday, January 23: My husband’s TFSA has now left Tangerine. It has not yet arrived in his BMO InvestorLine account as of the morning of Monday, January 27.

Ah! As of the morning of Tuesday, January 28, his cash is in his InvestorLine account.

So in his case it took 26 days, or 18 business days including the Canada Post time, to transfer.

As I said earlier, don’t expect these things to happen quickly!

The Moral of the TFSA Transfer Story?

There’s no simple answer for how quickly your TFSA transfer will take place. There’s not even any simple way to check on the status of the transfer. We’ll wait another few weeks before calling InvestorLine to see if they have received the transfer request. Phoning now, during RRSP season, is not worth my time. (We didn’t need to phone.)

If you’re hoping to have cash in a specific account to catch a short term opportunity, beware. It takes time to move things from bank to bank. Plan ahead.

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.

Given that change, I would no longer recommend the Kick Start program unless you plan to keep your TFSA money at Tangerine for the long term.

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Have you transferred TFSA funds between institutions? How long did it take? Please share your valuable experiences with a comment.

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How to Buy a GIC in a RBC Direct Investing Online Brokerage Account

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UPDATE: This article is historical, from 2013. I no longer invest with RBC Direct Investing.

We keep some of our hard-earned savings in guaranteed investment certificates. It’s true that right now the interest rates offered for them are abysmal. However, they give us a solid base for our portfolio that won’t evaporate during a market meltdown. We need that sense of security. So when I opened a RRSP account at RBC Direct Investing, I checked out how to buy a GIC in this new brokerage account.

Does RBC Direct Investing Offer a Reasonable Selection of GICs for No Fee?

Yes.

In fact, RBC Direct Investing offers GICs from some of the same financial institutions that offer the best annual rates at BMO InvestorLine. (CIBC Investor’s Edge often does not offer a GIC at the highest rate that you can get from InvestorLine or Direct Investing. They should consider fixing that!) In all, RBC Direct Investing offers GICs sold by about 20 financial institutions.

I also double-checked. I do not have to pay a fee or commission to purchase a GIC from RBC Direct Investing.

Buying a GIC from RBC Direct Investing

  1. Go to the RBC Direct Investing website.
    1. Click on the Sign In button.
    2. In the Client Card Number: field, type your card number.
    3. In the Password: field, type in your password.
    4. Click on the Sign in button.
  2. Click on the Trade tab.
  3. From the list of links across the top of the Trade tabbed page, click on Fixed Income.
    The highest rate for GICs with 1- to 5-year-terms will be shown as a link. The table of links displays the best rate for Compound interest, Annual Interest, Semi-Annual interest, Quarterly interest and Monthly interest.The minimum purchase required for a Registered Account is $3,500.
    The Minimum purchase required for a Non-registered Account depends on the term: It is $20,000 for a 1-year term; but drops to $15,000 for 2; $10,000 for 3, $5,000 for 4, and $3500 for 5 years.You can also perform a search for GICs using the Fixed Income Search table.
  4. I just clicked the interest rate link to select an Annual pay, 1-year term certificate for today’s test.
  5. The Fixed Income Search screen opens.
    To see the best offered interest rate, I clicked on the light grey downward-pointing arrowhead beside Interest Rate in the table of results. When you hover over this arrowhead, the message says “Sort on this column in descending order.”Eeeww. Bug!
    Instead of re-sorting the table, it opened the Fixed Income Search box again with no data selected. It has not even got the GICs radio button selected.Doggedly, I use the browser back button and try again. Same thing happens. And again.
  6. So I decide to fill in the Fixed Income Search box again. So I:
    1. Click to select the radio button for: GICs
    2. From the Type drop-down list, select: Annual
    3. For the Maturity, from the drop-down list, select: 1 yr
    4. And click the Find button.
  7. And it just gets me back where I was with the GICs still not sorted by highest rate to lowest!
    THIS time, though, when I click on the downward arrowhead beside Interest Rate, it sorts the table properly. Interesting!
  8. To check this again,
    I left the Fixed Income screens entirely by clicking on my Home tab.
    Then started over again. I clicked on the Trade tab and etc.
    The bug repeated.It seems it will only allow me to use that downward-pointing arrowhead to sort the table of GICs by rate if I run a customized fixed income search first.I checked that it sorts properly if you do a customized search right from the beginning. To do so, I:

    1. Clicked on the Trade tab.
    2. From the list of links across the top of the screen, clicked on Fixed Income
    3. Instead of picking the highest listed interest rate for the certificate I wanted on the first screen, I completed a Fixed Income Search:
    4. Click to select the radio button for: GICs
    5. From the Type drop-down list, select: Annual
    6. For the Maturity, from the drop-down list, select: 1 yr
    7. And click the Find button.
    8. From the resulting table, I can immediately click to sort by descending interest rate.

Why am I bothering with trying to sort the table by descending interest rate?

  • To avoid missing a higher interest rate when scanning down the table. I could have mistaken or forgotten the highest rate I saw on the first screen.
  • To see which companies are offering the best rate. Often there may be 2 or 3 financial institutions offering the same highest rate. I might prefer one company over another, especially if I am at the CDIC maximum insurable $100,000 limit for one institution but not for another.

So now I finally know from which institution I want to buy my GIC.

To Buy the GIC at RBC Direct Investing

  1. From the Fixed Income Advanced Search Results table sorted by Interest Rate in descending order:
    Click on the linked name of the financial institution offering the GIC.
  2. A “Financial Institution’s Name” Buy screen will open. For example, the screen may be titled: Equitable Trust.
    Review the

    • security type (GIC),
    • payment frequency (annual),
    • maturity date (today’s date plus one year), and
    • Interest Rate (should be the high one you’re looking for)

    If they are all ok,
    Click on the Buy button

    Which was a bit unnerving as I had not entered how large of a certificate to buy!
    Ah. That’s because I’m not done.

  3. Review the info again. Then:
    • From the Account #: drop-down list, select which account to fund the purchase.
      For RRSPs be careful to select the CAD account, not the USD one, if so desired.
    • In the PAR Value of Purchase: field, type the cost of the certificate you want to purchase. For a RRSP account, the minimum purchase is $3500.
    • In the Contact Phone field, type your phone number.

    Click on the Continue button.

  4. If you tried to trick it, like me, it will reply:
    “The minimum Par Value for purchasing a GIC is $3,500. Please see the Fixed Income Order FAQ for more details before trying again.”If you put in the proper amount, it will take you to the Confirm Transaction Step 2 of 3 screen.
    Review the “Important Notice” and the details of your purchase.
    If it all looks ok, click on the Confirm button.
  5. The Transaction Complete Step 3 of 3 screen will be displayed.
    Make note of your Order ID number by writing it down, or by copying the entire order confirmation and terms into a document and saving it.
  6. To check what’s been updated:
    • Click on the My Portfolios tab.
    • Check your Available Funds.
      Interesting. So far it has not removed the $3,500 from my available cash even though it says this is my “available cash as of the time it actually is now.”
    • Under the list of links for the My Portfolios tab, click on the Order Status link.
      There’s the order. All is as expected. The Status Action is “Pending.”
    • So I guess I’ll just have to make a note to not spend that $3,500 while waiting for them to drop my Available balance.
  7. Click on the Sign Out button.
    For added security clear your browser cache and close your browser session.

How Did the Purchase Compare to Buying a GIC at InvestorLine or Investor’s Edge?

BMO InvestorLine automatically sorts its table of GIC offers from the highest to lowest interest rate. That seems sensible. It does mean that the BMO GIC product offerings are not at the top of the list.

Investor’s Edge makes you sort the list of GICs you can buy, like RBC Direct Investing does.

On the possible plus side, RBC Direct Investing lets me buy a smaller GIC in a registered account, with a $3500 minimum versus $5000 at InvestorLine and Investor’s Edge.

It’s easiest to buy a GIC at InvestorLine. It takes more steps at RBC Direct Investing, even if it didn’t have any programming bugs.

It’s most profitable to buy a GIC at InvestorLine or RBC Direct Investing as they offer GICs from financial institutions with better rates than those at Investor’s Edge.

Given that InvestorLine sorts the rates for me and requires fewer screens to make a purchase while still offering the same high rates as RBC Direct Investing, I’d say InvestorLine is slightly better for purchasing GICs.

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Have you encountered any computer hiccups when buying GICs at your online brokerage? Did you ever really screw up and buy one of those very-low-rate GICs offered directly by your own Big 5 bank within your self-directed brokerage account? (I’m just wondering if they ever truly catch anyone by putting their own products at the top of the list.) Please share your experiences with a comment.