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Transferring Registered Accounts Between Institutions
January 18, 2020
7:09 pm
1nt2Save
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I was wondering if people here have had any experience with transferring their registered accounts between institutions? I have had horrible experience with Tangerine in terms of the amount of time they take to process the transfer with them as the institution that held my accounts. I was wondering if others have had similar results with their registered accounts transfer requests.

My TFSA with Tangerine was all in cash with over $60000. Tangerine was only paying 1.3% interest so in October I opened an account with Motive Financial who are offering 2.40% interest on their TFSA accounts. On October 13 2019 I sent Motive Financial via e-mail the transfer forms for them to initiate the paperwork with Tangerine to have the account moved in full to Motive. I didn't make any contact with either bank after that initial paperwork e-mail. The account was finally transferred on December 24, 2019 almost 2 and a half months after I sent the paperwork.

My second transfer request experience was with simplii to transfer a RSP account I had with Tangerine. Again I filled out the Simiplii registered account transfer forms and mailed it to them on November 11, 2019. I confirmed with them on November 21, 2019 that they had received the paperwork the on November 20, 2019 and they would initiate contact with Tangerine. Fast forward to Jan 8, 2020 and the RSP was still not transferred. I called Tangerine who said they did not receive anything from Simplii so they advised me to contact Simplii which I did. Simplii said that they did not send Tangerine my forms but they would "fast track" my paperwork in the "back office" given they dropped the ball.

Speaking with a couple people from the banks they all told me that registered account transfers usually take 4-6 weeks. They said there is paperwork that needs to go to CRA and between banks and the have to mail a cheque to transfer funds for some reason. Nonetheless given the interconnectedness between banks, and notwithstanding the fact CRA is involved, I still I think this over 1 month time to transfer accounts is unreasonable. In my personal experience has been much worse at 10 weeks to 9 weeks and counting on the second request.

Hopefully others have had a better experience than me.

January 18, 2020
7:28 pm
Bill
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A lot simpler & quicker to withdraw at end of December and contribute at new fi beginning of January.

January 18, 2020
11:28 pm
Loonie
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Int2Save, they are, frankly, bullshitting you when they say it has to take four to six weeks and blaming it on CRA. They are just in no hurry to release the money and are happy to squeeze a few more weeks out of it, especially when you are probably receiving vey low interest. They also know that you are not in a very strong position to argue with them as you don't have access to their "back room" where the work is done, however slowly.

I have experience all ends of this situation.
I was once told by someone at Scotia, in November, that they wouldn't process my cashing out (never mind a transfer) in that calendar year, even though it was entirely in cash. They tried to blame it on the government, which was garbage, I later realized. I was forced to wait until the next year! This caused me huge nuisances as I wanted it included in that tax year.

But I have also had transfers that went through in a week. I remember one went from Peoples in a week but don't remember where it went.
The best was an RSP that went from Oaken to Meridian in 3 days, start to finish, initiated in-branch.

I am willing to give them a little leeway during this busy season, but I think 3 weeks is plenty.

Recently a good friend waited over a month for a cash transfer from TDDI to credit union. He was on the phone to them regularly, hurrying them along. They finally agreed to rescind the transfer fee due to unnecessary delay.

I read once somewhere that, due to widespread complaints, the financial institutions made an informal agreement that they would all try to get the transfers done in a timely manner. There was a timeline attached to this agreement. I can't remember specifically what it was but think it was 2 or 3 weeks max.

I have transferred out of Tangerine but did not have a problem. That one took two weeks.

The real problem is likely understaffing, poor organization, and / or lack of will. They don't make any money getting rid of yours, so they are not motivated.

Perhaps someone else can find evidence of that agreement I read about. It was a few years ago.

I would ask for reimbursement of the transfer fee and compensation for lost interest if they take more than 3 weeks. I would also be on their case after 8 business days if there is no action, to ensure you are not being ignored. I was told by my rep at Meridian that the relinquishing institution is supposed to send an acknowledgement that they have received the request, within a day or so, so that is the first thing you need to find out, whether the acknowledgement was sent and received.

It's not too late to complain the the bank's ombudsman.

January 19, 2020
6:56 am
Alexandre
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Bill said
A lot simpler & quicker to withdraw at end of December and contribute at new fi beginning of January.  

You need to be more specific, Bill. What you said works for TFSA but might not be advisable for RRSP. OP discussed both types of transfers.

My story.

I transferred my RRSP from Simplii somewhere else. It took about 1 month to complete transfer. I lost interest from that account on that 1 month, as Simplii removed funds the day they got copy of transfer request, but funds appeared at my other bank 1 month later. This was nail biting month for me: my RRSP funds were somewhere in limbo. Was very relieved when they appeared at destination bank.

I also got promise from that other bank they'll cover Simplii RRSP transfer fees. They didn't not.

So, if there is an attractive RRSP rate at another bank, it may be worth transferring funds. Just like it was with my case. Even then, be prepared.

January 19, 2020
8:15 am
Norman1
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The chartered banks and brokerage firms had some commitments about transfer times years ago. I mentioned them in this previous post.

CRA is not involved in the transfers. But, there can be screw ups.

Receiving financial institution tries to transfer a locked-in RSP to one that's not locked-in or locked-in under different pension legislation. Receiving financial institution tries to transfer a spousal RSP to a non-spousal one.

We discussed one case here in TD RRIF mutual fund execution time where an internal transfer was done with the wrong form and the wrong form had the wrong financial institution of the TD group as the location of the account. The rejected form likely then went back to the wrong side of the TD branch!

January 19, 2020
9:34 am
Alexandra
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For a tax free savings, what I would have done is simply cash it in as you were only getting the 1.4%. Then put in Motive's 2.8% High interest DISA . Keep it in there til around the end of January the following year and then re-invest the money in a TFSA with an institution offering the best rate for you.

If RRSP's you are going to pretty much lose a good 4-6 weeks interest. If you have a few RRSP's or RRIF's with the same bank and maturing within a few weeks of each other, put them all in a DISA and then when they have all been deposited, forward the entire amount to the other bank. This way you only pay the one transfer fee. sf-laugh

January 19, 2020
9:38 am
Winnie
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Norman1 said
Receiving financial institution tries to transfer a locked-in RSP to one that's not locked-in or locked-in under different pension legislation. Receiving financial institution tries to transfer a spousal RSP to a non-spousal one. 

Absolutely correct. In my case, receiving financial institution not only tried, but actually successfully transferred my spousal RRSP to a regular non-spousal one. It took me a lot of time and effort (proving documents, etc) later with branch manager to reverse that mistake. They finally apologized.

January 19, 2020
10:43 am
Londonguy
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Two weeks is plenty if the paperwork is complete and accurate. Unfortunately it's easy for an inexperienced, careless or sloppy rep to bugger it up. Sometimes it can be as simple as the receiving institution sending the transfer documents to the wrong address of the relinquishing institution, which is an easy mistake to make if they don't realize that the address on the client's statement is probably not where the transfer requests are supposed to go. Make sure the rep phones and confirms the correct information.

Not sure what to tell you in terms of what you can do about a transfer caught in limbo. The receiving FI should be advocating on your behalf, but their options are limited too. If however you're the kind of person to take the direct approach yourself and you still have other assets at the relinquishing FI, they should feel a continuing obligation to you that can be leveraged to nag them about it until it gets resolved (I had to do this last year with TDDI) but YMMV

January 19, 2020
12:06 pm
AltaRed
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My view is not to transfer registered accounts, especially RRSP/RRIF. Pick an institution you will likely be happy with for potentially decades.

January 19, 2020
2:21 pm
Briguy
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Agree with AltaRed, stick with one FI for RRSP, in my case Hubert.

Peoples Trust is an easy FI to transfer RRSP out of. They don't charge any fees, and if you phone Peoples, they will tell you to put their fax number and other details on the form you give to the receiving FI. The receiving FI can then fax your signed form to Peoples Trust instead of mailing it in.

January 19, 2020
4:38 pm
Bill
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Agree, try to stick with one fi for RRSPs. I transferred my RRSP once many years ago and that experience made me realize it's not something I want to do regularly. Plus if it's with a bank the CDIC coverage is limited to $100K so at some point you'll have to open another account elsewhere if you want to stay insured and then you're dealing with multiple banks as time goes on, no? In that case the credit unions (Ontario) are better as their insurance is unlimited and so no need for more than one account/fi.

January 19, 2020
6:02 pm
Briguy
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It seems we are on a similar page Bill- one FI for RRSP and many FI for non registered funds of which only a few with the highest rates are in play at any one time.

Small correction- insurance at DICO (Ontario) is 250,000, whereas at Manitoba Credit Unions it's unlimited.

There's 2 banks with potentially 200,000 CDIC - Peoples and Oaken, since GICs can be with each of their 2 entities.

Of course you have to consider what they offer in RRIFs before you decide to use a particular FI. And Loonie would like credit union to be an Ontario one to ease burden on trustee.

January 19, 2020
6:08 pm
Bill
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Registered plan deposits in Ontario credit unions have no limit, at least that's what it says here:
https://www.dico.com/design/0_0_Eng.html

My RRSP is with a discount broker, various investments in it.

January 19, 2020
6:19 pm
Briguy
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Bill said
Registered plan deposits in Ontario credit unions have no limit, at least that's what it says here:
https://www.dico.com/design/0_0_Eng.html

My RRSP is with a discount broker, various investments in it.  

It says 250,000 on the main page

I have some money also at Saskatchewan Pension Plan, since I plan to convert it to an annuity later, and they have the best rates

January 19, 2020
6:45 pm
semi-retired
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Briguy said

It says 250,000 on the main page

I have some money also at Saskatchewan Pension Plan, since I plan to convert it to an annuity later, and they have the best rates  

Bill is right as usual.Under the 250,000 it says unlimited registered fund coverage,& that is what the thread is about.

January 19, 2020
11:21 pm
Rick
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Don't move registered funds around much. Just yank any TFS cash out in Dec and redeposit elsewhere in Jan should the need arise.
Wanted my RSP cash in an account that paid monthly interest (Motive pays yearly) so dedide to move it to Hubert. On Jan 2 of last year, I emailed Hubert a RSP Transfer request with: "ATTENTION HUBERT/MOTIVE - FUNDS WILL BE AVAILABLE FROM GIC MATURING JAN 13" scrawled across the top. Hubert forwarded it and Motive transferred out the funds Jan 13, the day the GIC matured, and they were in my Hubert account Jan 17. 4 days, but cost me $50 xfr fee.
Sent an email to Motive with a RSP transfer request from Hubert on Oct 17. Was credited to my account Nov 5.... 19 days from request to deposit, but it was free.
Strange thing about Motive...can't open an RSP GIC online using funds in your RSP HISA. You can open a RSP GIC with non-registered funds, just not funds sitting in your registered savings. Have to phone in and get one of the friendly, helpful CSR's to do it. Did that Dec 10. A phone call a week for 5 weeks, 2 emails and it still wasn't set up. Took longer to set up my GIC from within Motive than it did to get the funds out of Hubert. All back dated of course.
Your results may vary.

January 20, 2020
2:24 am
Loonie
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re: DICO. I recall from when they updated the legislation a year or so ago that they did allow unlimited registered funds. I remember being surprised since this had not been in the original proposal. Perhaps I misled you at that time, BriGuy. Sorry.

January 20, 2020
2:42 am
Loonie
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Thanks for the details, Rick. While it's true that our results may vary, they ought not to, all things being equal. Making the transfer unpredictable serves to discourage people from making them, but it is our right to do so and is not inherently a complicated process.

Good idea to add a note to the form to move things along. I have sometimes added sticky notes and they seem to help too.

I did not know that Motive only pays interest annually. I was just about to open a joint account there. Should I go ahead?

January 20, 2020
3:10 am
Loonie
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thanks for the link, Norman. They are important. That must be where I read about the time limits earlier.
Evidently they are still being ignored at TDDI. My friend did not initate the transfer until after settlement, just to be safe. On his third phone call to TDDI, the fellow he spoke to told him that four to six weeks was "normal". The right word would have been "unacceptable'.

January 20, 2020
3:47 am
krwilson
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Loonie said
I did not know that Motive only pays interest annually. I was just about to open a joint account there. Should I go ahead?  

I am in the process of moving some money there for the first time so you made me look. The fine print says interest is paid monthly for the savvy savings account.

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