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EQ GIC Rates Continue To Go Down ? :-(
August 5, 2022
9:52 am
Dean
Valhalla Mountains, British Columbia
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.
I don't know if anyone else has noticed yet, but these are EQ's latest GIC Rate Reductions (effective yesterday) ...

    2Yr to 4.40% ... 3Yr to 4.45% ... 4Yr to 4.50% ... 5Yr to 4.65%

.
Until recently, EQ was a 'Top-Tier' GIC issuer. Now they are well down in the Bottom half of the Chart: https://www.highinterestsavings.ca/gic-rates/

For reference, EQ's rate history: https://www.highinterestsavings.ca/profile/eq-bank/gic-rate-history/

Not a good sign. sf-confused

    Dean

P.S.
Sorry about the typo in the thread title.
The '?' was not intended, and there
appears to be no title edit option
available.

sf-cool " Live Long And Prosper " sf-cool

August 5, 2022
10:50 am
cgouimet
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I don't know if it's ...

a reflection of where they see rates in general going

or

a reflection of the imbalance between their loans and deposits

Meanwhile, TNG is going the other way ...

CGO
August 5, 2022
3:35 pm
dougjp
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As we all know, its not just GICs, look at their HISA rate as a percentage of what the best are!

They, from all appearances, want to exit the deposit market for whatever internal reason, AGAIN, as they have done before. I made the mistake of putting my faith in them, by depositing significant TFSA funds, to remain highly competitive, but instead I'm getting "burned".

Therefore, as not one to forget quickly, I'm starting to make other plans for the TFSA late year withdrawal period, so I can say "buh-bye".

The main accomplishment of almost all organized protests is to
annoy people who are not in them

August 6, 2022
8:36 am
archangel
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Exact same, dougjp - I've already created myself a notify to get out at the end of the year; they try to trap you with their registered rates, trying to suck you into a GIC term that will stick you into the next calendar, trapping you into staying or the dreaded transfer.

August 6, 2022
9:11 am
canadian.100
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For you folks who have cash tfsa @ EQ. How long would it take EQ to add the accrued interest and close the tfsa. I am helping someone to do such as they want to close it out late in 2022 and then move the cash to a new tfsa elsewhere. Would it take Eq a long time just to add interest and move to Eq non-registered?
This is not a transferout to be done by Eq - the person will move it themself to the new FI.

August 6, 2022
9:22 am
phrank
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If you are closing the TFSA account you can request the FI pulling from EQ pulls the entire amount and then has the other FI close the account (full transfer vs partial). Whenever I've transferred accounts that I planned on closing the registered account (not necessarily the entire account), this has been an option on the form you submit in order to prevent small amounts here and there.

If you're not closing the TFSA account, I don't know how easy this would be to accomplish with EQ, whom I find non-responsive to customer requests.

August 6, 2022
9:28 am
Bill
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If you have a non-registered EQ HISA wouldn't you just sign in & transfer the TFSA amount over to it on the 1st of the month after interest has been credited for the previous month in the TFSA account, i.e. instantaneous?

August 6, 2022
10:13 am
canadian.100
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Bill said
If you have a non-registered EQ HISA wouldn't you just sign in & transfer the TFSA amount over to it on the 1st of the month after interest has been credited for the previous month in the TFSA account, i.e. instantaneous?  

Yes that is doable for sure on say December 1st but say I want to transfer the tfsa cash to my non reg Eq hisa on Dec 15? I have to get that accrued interest in my tfsa to Dec 15 added on and I wonder how long it would take Eq to do that.

August 6, 2022
10:16 am
HermanH
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canadian.100 said

Yes that is doable for sure on say December 1st but say I want to transfer the tfsa cash to my non reg Eq hisa on Dec 15? I have to get that accrued interest in my tfsa to Dec 15 added on and I wonder how long it would take Eq to do that.  

If you take the money out of your TFSA account and put it into your HISA on Dec 15, you would not see the accrued interest (between Dec 1-15) until the end of the month, when EQ puts the credit on your account.

If you transfer and close the TFSA, then EQ will calculate interest up to the date of transfer and add it to the transfer cheque for the receiving institution.

August 6, 2022
10:23 am
dougjp
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canadian.100 said
For you folks who have cash tfsa @ EQ. How long would it take EQ to add the accrued interest and close the tfsa. I am helping someone to do such as they want to close it out late in 2022 and then move the cash to a new tfsa elsewhere. Would it take Eq a long time just to add interest and move to Eq non-registered?
This is not a transferout to be done by Eq - the person will move it themself to the new FI.  

It should be no time at all, because all the person is doing is transferring money out of their savings (TFSA) account. Suggested actions:
Step 1: Dec 1, EQ has already posted interest on that day.
Step 2: Dec 1, transfer all funds (less a penny/dollar/whatever the person decides, which makes sure the TFSA stays open), to their non registered HISA with EQ. Why close the TFSA for the sake of a penny or so, perhaps it will become an attractive place to put money in some future year.
Step 3: Transfer from EQ to some other bank HISA
Step 4: Wait until 2023, earn taxable interest for the month at the other bank.
Step 5: In 2023 transfer EXactly the Dec 1 EQ withdrawal amount into some TFSA, not a penny more. Make the 2023 new TFSA contribution as a separate transaction. Keep an ongoing record of withdrawal and deposits in/out of TFSA's.

The main accomplishment of almost all organized protests is to
annoy people who are not in them

August 6, 2022
10:41 am
Bill
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If I want to empty out any TFSA HISA then Dec 1 is the day to do it, why mess around to get a few more days tax-free interest which won't be received until Jan 1 of the next TFSA year? And I've never bothered to officially close these empty TFSA accounts, is there a point to that?

August 6, 2022
11:58 am
canadian.100
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Bill said
If I want to empty out any TFSA HISA then Dec 1 is the day to do it, why mess around to get a few more days tax-free interest which won't be received until Jan 1 of the next TFSA year? And I've never bothered to officially close these empty TFSA accounts, is there a point to that?  

The point was simply to keep records simple and clean as possible, and not have another account hanging with .01 (see last sentence below - amount would be $3.62 not .01. One can always open a new TFSA in future at EQ if the rates actually improve. I had thought that if one directs EQ to close the TFSA on Dec 15 they would add on the accrued interest to Dec 15 - manually perhaps, close the TFSA and then move the total to the nonreg HISA at EQ as per request.
Thanks for your suggestions.

PS - by the way the amount would not be .01 for the one day - their TFSA is approx 80K so 1 day @ .0165 would be $3.62. so $3.62 would stay in limbo at EQ.

August 6, 2022
12:42 pm
Bill
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When I've had small bits of interest after November 30 for empty TFSA accounts I've removed it on Jan 1 and just added it to my calculations for the year following that one's contribution.

My Tangerine TFSA account stills shows there when I sign in, balance zero for years now.

August 6, 2022
1:34 pm
Vatox
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Perhaps EQ is betting that the BoC won’t go through with higher rates because they see the economic downturn that it’s creating. EQ does have a view into Equitable Bank and the subprime market. And that’s probably where problems will start.

August 6, 2022
1:44 pm
Dean
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What Bill said (Post #13), about Zero balance SAs.

At three different FIs, I have SAs with Zero balances ... two are TFSAs.

In case I want to use them again at sometime in the future, I just keep them open & active by directly accessing each of those accounts, ~ every 6 months.

It seems to work just fine, and has proven handy in the past.

    Dean

sf-cool " Live Long And Prosper " sf-cool

August 7, 2022
4:18 am
RetirEd
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Some recent posts seem to be a bit confusing. Let's try to keep the language clear - TRANSFERING registered amounts is complicated, often involves a fee and takes time.

WITHDRAWING non-registered funds is usually quick and no trouble, just like any bank withdrawal. GICs can usually not be moved to another institution at all, save for cases like Ally where they were bought out.

WITHDRAWING registered funds is where timing comes in, because they can't be put back into registered status until the next year. Here's where a GIC maturing early in the year would have to sit in a lower-earning savings account before being withdrawn in December and redeposited in January. One has to balance that against the transfer fee for registered deposits.
RetirEd

August 7, 2022
4:41 am
canadian.100
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RetirEd - I was not talking about a transfer done by the FIs and incurring a fee and a time delay. I was talking about closing a TFSA at EQ in Dec, putting the funds in the non registered EQ HISA at that point and then in Jan opening a new TFSA at another FI paying more than the 1.65% at EQ and moving myself those funds into the new TFSA.
I simply wanted to get the accrued interest added to the TFSA to closing date (say Dec 15) by EQ agent probably by a manual intervention and get rid of that EQ TFSA even with a 0 balance just to keep records simple and clean. Hope this is clearer to you.

August 7, 2022
10:13 am
Loonie
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I once closed an RSP at Tangerine in December. I made it clear I wanted it closed and made the mistake of thinking they would automatically calculate interest to date, as that's what "closed" means. (It was in savings at that point.)
They didn't, and I ended up with a dollar or two on the books in January still. A nuisance as I had to carry that piddly bit of income into the next year, for which of course they sent a tax slip.

September 5, 2022
6:01 am
RetirEd
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Loonie: I thought they don't send T5s for less than $50, though one has to report the income even without a T5? Or did you have other income from them that added up to more than $50?

Canadian.100: I guess you could always close the account in November, if the loss of tax-free status for one month wouldn't be a significant amount. Or if you're below the tax minimums, as many older folks are.
RetirEd

September 5, 2022
6:26 am
canadian.100
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RetirEd said

Canadian.100: I guess you could always close the account in November, if the loss of tax-free status for one month wouldn't be a significant amount. Or if you're below the tax minimums, as many older folks are

Yes - that is the plan. Close out (not do a transfer to another FI) the EQ TFSA HISA in late 2022 - exact date to be determined - need to speak to EQ to see how quickly they can add the accrued interest and close out to non-registered HISA. If it only takes a day or two, then later in December will work.

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