Who to trust, which bank to choose ? (Canada)

[EllieStan]

This is half rant, half question.

I've been with Desjardins pretty much my entire life, but the more I'm learning to control, plan and be strategic about my personal finances, the more Desjardins frustrates me.

Yesterday, my ''financial advisor'', who never advised anything I couldn't already figure out by myself, called me to suggest I take the Visa Platinum CC for *only* $130 (annual fee). Although I repeatedly told her I was only interested in a free cashback CC and that my main goal wasn't to spend the reward on travels or theatre tickets, but  to pay off my student loans faster, she insisted the $130 wasn't that much. She argued since I wasn't a student anymore, I would ''buy more'' with my CC.

I don't want to deal with a ''bank'' that pretends to advise me and to listen to my needs, while dismissing all my responsible financial goals in order to sell expensive products to me. For years, I've been told not to worry about my student loans because : ''most students owe a lot more. You'll have 10 years to pay it off, it's not a big deal. It's not expensive on a monthly basis''. No shit!

I'd like to switch banks, but I've never done it before. I don't know who I should trust. I don't think I'm educated enough about finances to trust only myself, not yet. I have never invested, never had a mortgage, but they're short-term goals (within a 2-year timeframe). I feel Desjardins is not the right institution for those goals and I'd like to quit.

Any advice for me when ''shopping'' around for a new financial institution ? How will I know the bank I choose is right for me ? Should I ever trust the person (''advisor'') I meet, or is skepticism the way to go in anything money-related ?

[Retire-Canada]

I've been with TD Canada Trust for 30yrs. They are okay, but they are a typical CDN bank trying to suck you dry with fees. They aren't going to push the basic no fee CC at you if they think you'll go for a premium card. OTOH I don't find them pushy and you can work their system to get to a reasonable fee for service level.

Tangerine seems to have low fees if they have the services you want. I would be banking with them, but I ran into a snafu since I have no cheques and you need pre-printed personal cheques to open an account with them if you don't live by one of their limited physical locations. I'll eventually be in Vancouver with enough time to start an account with them.

If you do stay with a traditional CDN bank pay close attention to fees. Ask to have them lowered or waived when you can. A bigger balance of savings/debt/investments with them will motivate them more to help you with the fees.

Assume you are always being screwed because even if you are unsure of exactly how you probably are getting the shaft. One way to help mitigate the sting is to invest in CDN stock ETFs that hold the major banks. That way at least you get paid from those damn fees! ;)

-- Vik

[fb132]

I am with RBC and Tangerine, both are great, no complaints. I have the RBC cash back credit card and I get 10 free transactions per month with RBC...Tangerine is mainly used for my everyday withdrawals (no limit withdrawals) and better saving rates for my EF. Both compliment each other very well.

[daverobev]

Bank 'advisors' are sales people, out and out. Never take their advice without doing a double check.

I think you don't get PCF in QC (assuming you're not with the two? Desjardins Ottawa caisses), so Tangerine is probably the best bet.

Honestly, every bank is going to try and sell you their stuff - their credit cards, their mutual funds, etc. RBC is certainly no better than any other.

Plus, credit card and bank need not go together. You can get a Tangerine chequing account, and an MBNA or Amex or Chase credit card.

Lots of good sites to check out which credit card would suit you best (or cards), my favourites for no fee being MBNA SmartCash (2% gas/groc), Amex Simply Cash (1.25% flat), and the Chase Amazon.ca VISA (1% everywhere, 2% on Amazon.ca, NO FOREX FEE when used abroad).

Check out the link in my sig to GCR. Free money for signing up to cards.

If you can stomach signing up and cancelling cards, look into the Amex Gold card - the signup bonus is 25k points, which can be transferred to Aeroplan 1:1 or used for $250 statement credit against travel. No fee in the first year. Just got my wife to apply for one last night, as it happens, through GCR as well.

But yeah.. for your chequing account - one other option is to get a TD LOC and use it as a chequing account but with a massive free overdraft.

All banks will want you to get their premium card, their crappy mutual funds, etc. That's what sites like this are for - to help you avoid the bullshit. I wouldn't worry about your advisor, honestly, just maybe complain to their boss, and get a different one. Your call, of course.

[Melanie A]

I'm not that experienced with different banks and investing but for my chequing account, I use PC Financial. They don't charge you fees for every day banking. Although, I'm not the type that carries a large amount in my chequing account to not have to pay fees, which a lot of banks do. Also, PC financial MasterCard is great for a lot of free groceries with no annual fee. Groceries is always something you're going to need and it adds up quickly.

For investing, I can't say I would trust any large banks and I do need a financial advisor. I'm still doing my research in order to prepare myself and not feel like I'm getting screwed again when choosing a new financial advisor. I have RRSP's with RBC and I don't feel they have my best interest, my MER fees are insane. So I will be moving my investments. I've often read that Tangerine is good for starters with investing.

I think regardless of which bank you choose, you will always have someone who's going to try and sell you their products. I usually just say no to their offers and do my own research.

[Jouer]

I think key point #1 is to remember that many client facing staff at any bank are salespeople. They are using sales tactics to get you to buy their products and services. They are not who you rely on for financial advice - they are who you rely on to take care of the logistics of handling your money.

Having said that, I think any of the big 5 banks will be fine if you understand Key Point #1 from above. I mean, I haven't been to my branch in 4 years - in a year I'll pop back in to re-up the mortgage, if I they continue to win my business.

I've not dealt with them but have heard only good things about Tangerine. Low fees. Good service. I would bank with them if I was just starting out (my bank drops almost all fees, including $120 high-end credit card yearly fee, because of the extra services I have with them).

[Financial Planner Dude]

I've been gone too long to suggest a specific bank but the only thing, at the moment anyways, you should probably focus on is the one with the least fees. Do be careful with the housing market softening one can expect banks to focus more on service charges

Now having mentioned that I noticed TD had just changed the minimum deposit for my account so rather than bumping up what I put in pulled it all out and added it to my Emerra DRIP

Here's the math

3.95 x 12 = 47.50 per year

$2000 @ 4% current yeild = 80 per year plus compounding

So at the moment I'm happy to pay the fees

[swick]

Tangerine seems to have low fees if they have the services you want. I would be banking with them, but I ran into a snafu since I have no cheques and you need pre-printed personal cheques to open an account with them if you don't live by one of their limited physical locations. I'll eventually be in Vancouver with enough time to start an account with them.

You can go to your bank and get them to print off one cheque for you, might cost a couple of bucks, was free at my credit union.

I think Tangerine is the way to go, I have been with them since ING basically first opened up. Their customer service is AWESOME. We have chequings, savings and are on our second mortgage through them.  It makes it much easier when applying for a mortgage if you have a history with them and they offer some of the best prepayment terms in Canada. My mom works for a mortgage broker and she said nothing else  out there can compete.

They also offer great sign up bonuses and are always running a promotion to get your paycheques direct deposited. Right now it is extra payday Fridays where they give you an extra 10.00 a week up to 120.00.  It's free money. They also frequently run "bonus interest" events - while their interest rates have gone down over they years, they are still better then banks. Oh, and it is very easy to transfer money to Questrade too!

My Orange code referral # is in my Signature, if you feel like using it :)

[Prairie Stash]

They also offer great sign up bonuses and are always running a promotion to get your paycheques direct deposited. Right now it is extra payday Fridays where they give you an extra 10.00 a week up to 120.00.  It's free money. They also frequently run "bonus interest" events - while their interest rates have gone down over they years, they are still better then banks. Oh, and it is very easy to transfer money to Questrade too!
[/quote]
Free money beats fees every day!

Tangerine is the nicest online bank (owned by Scotia Bank). PC Financial is nice online and has some outlets located in their grocery stores (partnered with CIBC). I also use RBC mostly from habit.

I would consider opening up multiple accounts; one at tangerine (free), PC Financial (free), and RBC (Free under certain conditions). Try them out and learn the differences. If Desjardins is also free keep it to compare, keep in mind most banks offer better interest rates on mortgages to long term clients. Consider it a free class on banking; you'll get much better value than some of your classes you took out loans for ;)

[brycedoula]

I'm in Manitoba. I have an old chequing account & few term deposits with the biggest credit union in the province (Assiniboine Credit Union). My husband uses PC Financial as his main financial institution(no fees); I'm slowly sun-setting my credit union stuff to merge finances 100% with his. The PC Financial MasterCard is pretty great too; no annual fee, and we earn "PC Points" that go towards free groceries @ the local SuperStore.

Our mortgage is thru another credit union, Cambrian Credit Union. When our mortgage was up for renewal they had the lowest mortgage interest rates by far. They also advertise the "UnFee" - I believe you can get no-fee banking there as long as you have your paycheque direct-deposited, or something similar.

Dealing with local credit unions is pretty painless. Their hours are generally waaaaaaaaay better than the "Big 5" bank branches(one credit union even has Sunday hours!!), and I don't have the credit unions calling me up to sell me anything (whereas ScotiaBank calls me at least monthly re: the Visa I have with them). Also all credit unions in MB have reciprocity, so I can withdraw funds from any credit union ATM in the province with no fee. That is certainly NOT the case when dealing with a bank.

Have you considered opening an account with a credit union, or are you adamant about staying with a bank?

[EllieStan]

Thank you all for your answers and advice. Somehow it makes me feel better to be told the ''advisors'' are really salespeople. I am still learning to detach from the emotional aspect of managing my finances. I feel like I'm a bad customer when I contradict my financial advisor, but sometimes what she suggests is just plain ridiculous. I don't want to make her feel bad, I understand it's her job, but it's frustrating to rely on a person who doesn't seem to know her products too well, to understand my priorities and to help me find the most efficient way to achieve my goals. I've had several advisors over the last decade and only 1 has been truly helpful.

Luckily, I have choice when it comes to competitors. I work in a part of town where pretty much all major banks have branches:
- TD
- Scotia
- RBC
- BNC
- Laurentian
- BMO
- CIBC
...

I'll also take a look at Tangerine. My main apprehension is that it's not a ''brick and mortar'' bank, but I've heard and read good reviews about them.

I unfortunately don't earn enough to get a MBNA Smart Cash. So far, my choices of CC would be :
- TD Cashback Mastercard (0.75% any purchase), no fees
- RBC Mastercard Cashback (2% groceries and 0.5% other purchases), no fees
- RBC Visa Cashback (1% any purchase), $19 annual fees

[EllieStan]

They also offer great sign up bonuses and are always running a promotion to get your paycheques direct deposited. Right now it is extra payday Fridays where they give you an extra 10.00 a week up to 120.00.  It's free money. They also frequently run "bonus interest" events - while their interest rates have gone down over they years, they are still better then banks. Oh, and it is very easy to transfer money to Questrade too!

Free money beats fees every day!

Tangerine is the nicest online bank (owned by Scotia Bank). PC Financial is nice online and has some outlets located in their grocery stores (partnered with CIBC). I also use RBC mostly from habit.

I would consider opening up multiple accounts; one at tangerine (free), PC Financial (free), and RBC (Free under certain conditions). Try them out and learn the differences. If Desjardins is also free keep it to compare, keep in mind most banks offer better interest rates on mortgages to long term clients. Consider it a free class on banking; you'll get much better value than some of your classes you took out loans for ;)
[/quote]

I'm not sure I understand the logistic of having multiple accounts. How to manage/split paycheck deposits ? If I remember well, it costs $20/transaction whenever I want to send money from my checking account to another institution. I don't have many accounts currently.

1. Checking account (paychecks go in it, and I have pre-authorized insurance payments and such).
2. TFSA
3. Student LOC
4. Provincial student loans (managed by Desjardins)
5. I have my CC, but will probably switch to another one.

I'm not sure how I can make it work with 2 or 3 accounts in different banks ?

[daverobev]

It costs 'a transaction' to send from one linked bank acct to another. You link your own accounts by a void cheque, usually. You can have as many accounts as you like, but some institutions limit the number of links.

Then just set up a regular transfer from one to another.

Note that RBC in particular is changing its fees and rebate requirements this year. God knows if they will start treating 'pulls' from other accounts as transactions. You need an actively used credit card plus active investment or over a certain amount invested with them in order to keep the monthly fee rebate.

I prefer PCF over Tangerine because you get free cheques with PCF.

[Prairie Stash]

They also offer great sign up bonuses and are always running a promotion to get your paycheques direct deposited. Right now it is extra payday Fridays where they give you an extra 10.00 a week up to 120.00.  It's free money. They also frequently run "bonus interest" events - while their interest rates have gone down over they years, they are still better then banks. Oh, and it is very easy to transfer money to Questrade too!

Free money beats fees every day!

Tangerine is the nicest online bank (owned by Scotia Bank). PC Financial is nice online and has some outlets located in their grocery stores (partnered with CIBC). I also use RBC mostly from habit.

I would consider opening up multiple accounts; one at tangerine (free), PC Financial (free), and RBC (Free under certain conditions). Try them out and learn the differences. If Desjardins is also free keep it to compare, keep in mind most banks offer better interest rates on mortgages to long term clients. Consider it a free class on banking; you'll get much better value than some of your classes you took out loans for ;)

I'm not sure I understand the logistic of having multiple accounts. How to manage/split paycheck deposits ? If I remember well, it costs $20/transaction whenever I want to send money from my checking account to another institution. I don't have many accounts currently.

1. Checking account (paychecks go in it, and I have pre-authorized insurance payments and such).
2. TFSA
3. Student LOC
4. Provincial student loans (managed by Desjardins)
5. I have my CC, but will probably switch to another one.

I'm not sure how I can make it work with 2 or 3 accounts in different banks ?
[/quote]
The primary point of multiple accounts is to force yourself to learn about multiple banks. In practice some people use a primary bank for regular use. Then the secondary bank is a good place for the extra cash you might be saving (e-fund) or it might have some other special niche. For example if your TFSA is mostly cash other banks will offer you higher interest rates; more money in your pockets. If you get creative you'll end up richer, if you stick with the one you'll end up a loyal client. Start with one more for now, try it for six months.

I also found that RBC offered a substantially lower mortgage rate to me because I was a client; lower than the mortgage broker and much lower than other banks. If you want a house its an easy way of securing a better rate in a few years. Most banks reward long term clients with better rates.