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Transferring Registered Accounts Between Institutions
January 20, 2020
5:29 am
Loonie
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Thanks, kw. Good to know.
Perhaps I misunderstood Rick.

January 20, 2020
6:32 am
GR
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Quote from Loonie:
"I did not know that Motive only pays interest annually."

I believe that Motive will pay GIC interest MONTHLY for seniors at same rate as posted annual rate.

January 20, 2020
3:42 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.  

I didn't realize that DICO insures registered funds differently than non registered, you learn something new every day 🙂

I read their brochure and it states that in order for them to insure your deposit, you have to be a member of the credit union it's with. So I'm wondering Bill, if one has a
GIC with a GIC broker that's issued by a credit union, is there any guarantee at all?

January 20, 2020
3:44 pm
Briguy
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Loonie said
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.  

No worries, my fault, I just never read the fine print about registered funds below the 250,000 larger print about non-registered funds.

January 20, 2020
4:56 pm
Loonie
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Briguy said

I read their brochure and it states that in order for them to insure your deposit, you have to be a member of the credit union it's with. So I'm wondering Bill, if one has a
GIC with a GIC broker that's issued by a credit union, is there any guarantee at all?  

Excellent question, BriGuy! Are you going to pose it to DICO and/or deposit broker?

Deposit brokers do advertise that their products are insured by CDIC /DICO.

January 20, 2020
5:18 pm
Briguy
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Loonie said

Excellent question, BriGuy! Are you going to pose it to DICO and/or deposit broker?

Deposit brokers do advertise that their products are insured by CDIC /DICO.  

I checked the GIC Wealth Management website and it says their GICs issued by banks are insured by CDIC, GICs from CUs by DICO, and GICs from insurance companies by Assuris.

Not particulary reassuring to see that GIC Wealth Management still lists 100,000 as DICO limit on the website. I'll paste from their website below:
"All credit unions in Ontario are insured by the Deposit Insurance Organization of Ontario (DICO); which is a provincially owned organization and insures all term deposits up to $100,000.00. To learn more about DICO coverage, please visit http://www.dico.com."

I don't have any plans to use a GIC broker so can't be bothered calling DICO or GIC Wealth Management, but was hoping someone here knew the answer 🙂
I was just surprised when I read this in the DICO brochure:
"To be eligible for deposit insurance coverage,
you must be a member of the credit union. "

January 20, 2020
6:57 pm
Bill
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Sorry, Briguy, I've no experience with buying GICs from credit unions via brokers, but the DICO material is pretty clear and specifically makes that point, i.e. that you have to be a member to be covered. So I guess it's essentially a question to ask the broker, how are we meeting that requirement for DICO coverage? Maybe behind the scenes the credit union takes the $5 or whatever it is out of the broker's commission and registers you as a member prior to selling a GIC to someone who they don't see on their membership roster, I don't know.

January 20, 2020
8:40 pm
christinad
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What a timely topic. I submitted a form to td direct investing and apparently there were some deficiencies, whatever that means. The td direct investing guy i talked to said to go in branch. My sense of it is its going to be simpler to transfer the money to the saskatchewan pension plan.

I agree a different transfer i made from peoples trust was painless.

Another lesson is don't leave any orphan money in an account. I intended to build a rrsp gic ladder with this money, but never did.

January 20, 2020
11:30 pm
Rick
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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?  

Their RSP HISA is the only one that pays yearly (that I know of). That's why I moved my ladder funds to Hubert...am able to use the monthly interest when it's time to buy a GIC. That, and Motive's interest rate on that account is only 1.25%.
Rest of their accounts pay monthly.
Go ahead and open a Savvy savings joint...no worries. Rate has held pretty steady for over a year now.

January 20, 2020
11:32 pm
Rick
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GR said
Quote from Loonie:
"I did not know that Motive only pays interest annually."

I believe that Motive will pay GIC interest MONTHLY for seniors at same rate as posted annual rate.  

Only on non-registered products.

January 21, 2020
1:43 am
Loonie
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Thanks, Rick.

I've never bought a CU GIC from a deposit broker either. And I've never been offered one. I suppose it's possible they don't even know they might not be covered.

I suppose that if it turned out, on further inquiry, to be an issue, one way around it would be to go to the CU in question and simply sign up as a member, open savings account or whatever and put $100 in it. Then go buy the GIC where you can get the best rate, assuming they won't give it to you directly. You would be a member then, but buying the GIC independently, so you'd be covered.
Anyone who has an existing CU GIC from a broker could probably go and join now and be covered going forward.

I doubt a broker could sign you up without your explicit knowledge and consent. I don't think the CU would accept it. But I suppose it's possible, although unlikely, that the broker could do so explicitly, by arrangement with the CU, as their agent or representative.

I'm wondering if Stephen (Nehpets) or gicjunkie have any experience in this regard.

January 21, 2020
7:02 am
GR
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My understanding is that when someone purchases a credit union GIC from an agent or broker, the credit union covers the cost of the necessary share(s) so that the GIC purchaser is a member. The value of the share(s) is not refundable to the GIC purchaser, of course.

January 21, 2020
7:25 am
JenE
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About 8-10 years ago I purchased a GIC through a broker with Coast Capital in B.C. I had to sign a form and pay $1 membership fee to do this. After maturity I didn’t renew the GIC. A year or so ago Coast Capital offered a 33 month, 4% GIC, for B.C. residents only. Based on my previous account I asked if I was eligible to take advantage of this offer, but was told no, it was for B.C. residents only. It seems to me that one has to join a CU to purchase a GIC, whether or not one is made aware of this by the broker. Also, that a CU can allow or disallow non-residents to do so.

January 21, 2020
10:43 am
gicjunkie
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Loonie said
Thanks, Rick.

I've never bought a CU GIC from a deposit broker either. And I've never been offered one. I suppose it's possible they don't even know they might not be covered.

I suppose that if it turned out, on further inquiry, to be an issue, one way around it would be to go to the CU in question and simply sign up as a member, open savings account or whatever and put $100 in it. Then go buy the GIC where you can get the best rate, assuming they won't give it to you directly. You would be a member then, but buying the GIC independently, so you'd be covered.
Anyone who has an existing CU GIC from a broker could probably go and join now and be covered going forward.

I doubt a broker could sign you up without your explicit knowledge and consent. I don't think the CU would accept it. But I suppose it's possible, although unlikely, that the broker could do so explicitly, by arrangement with the CU, as their agent or representative.

I'm wondering if Stephen (Nehpets) or gicjunkie have any experience in this regard.  

According to GIC Wealth, it doesn't matter how you purchase your credit union GIC. The product is insured up to the allowable limits if purchased direct or through a broker.

January 21, 2020
12:08 pm
Bill
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gicjunkie, the insurer (DICO) says you need to be a credit union member to have the GIC insured. The question I'd be asking GIC Wealth, how is that requirement met if I buy through you?

January 21, 2020
1:08 pm
Briguy
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I agree that as mentioned the CU probably donates a free share to you, but if I ever do buy a GIC from a CU through a broker, I'll definitely ask that question.

January 21, 2020
5:11 pm
Loonie
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I met with my Meridian rep today and asked this question, since it was on my mind. FWIW, he said it would be impossible to buy a Meridian GIC without a membership - which is only one dollar. He said that even if you are only getting a credit card from them, you must join.

January 22, 2020
7:32 am
gicjunkie
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Bill said
gicjunkie, the insurer (DICO) says you need to be a credit union member to have the GIC insured. The question I'd be asking GIC Wealth, how is that requirement met if I buy through you?  

The broker creates a membership for each client with the credit union because one cannot invest in a credit union without membership. The client enrollment is part of the arrangement each broker has with the credit union. Therefore, the broker's client is covered by deposit insurance. This info was confirmed with a broker.

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