Very short term - is there anything worth doing | Page 2 | General comparisons | Discussion forum

What about Simplii Financial (part of CIBC) savings account for new clients? Promo interest rate for 5 months is 6.00% p.a.

https://www.simplii.com/en/bank-accounts/high-interest-savings.html

Norman is correct that Scotia doesn't guarantee Tangerine.
When I say that most people seem to think it is safe anyway, I am condensing what I have seen posted on this forum over time. Just because a financial institution isn't rated by DBRS etc, that doesn't mean it's no good. In my view, people put too much faith in ratings services; they too do not guarantee anything and are sometimes wrong. Someone else looked at Tangerine's financials and felt they were very sound - i think it was canadaian100. That said, I am not pushing for people to invest beyond CDIC at Tangerine; it's up to you.
However, you may still have TFSA room (Tax Free Savings Acct) since you say you've not paid much attention to investments in the past. These accounts are insured separately for up to an extra 100,000. If you've never contributed before and were in Canada and at least 18 since 2009, you will have 95,000 room on January 1, 2024.
I don't know what Tangerine is offering for TFSAs but good offers often arrive in January. Be sure to be aware of any withdrawal fees.

Simplii may be a good option as it is insured as part of CIBC. I haven't read the fine print but they typically pay promotional interest sometime after the end of the offer, not monthly. This means the rate is effectively slightly less than advertised, when compared to others with monthly compounding.

There is nothing to prevent you form splitting your money among 2 or more financial institutions for better insurance coverage, but it will be a bit more work.

Norman1 said
I would not go significantly over CDIC insurance limit with Tangerine Bank because it has no current ratings from the debt rating agencies like DBRS, S&P, and Fitch. Consequently, one does not know how much risk one is taking on with uninsured Tangerine Bank deposits.

It doesn't matter that Tangerine Bank is owned by Bank of Nova Scotia. Bank of Nova Scotia is not on the hook for the Tangerine Bank deposits unless it has guaranteed them. To date, Bank of Nova Scotia has not.

In the fixed income world, unrated debt is known as "junk bonds". Having $100,000 of the $200,000, needed to pay for a property on three weeks notice, in junk bonds is not a good idea.

It is unfortunate that the TD Canada Trust is the only bank close by, daithi. For $200,000, your TD Canada Trust branch may be willing to negotiate.

TD doesn't offer a cashable variable rate GIC. But, TD does offer a 1-Year Cashable GIC. The TD 1-Year Cashable GIC can be cashed anytime after 30 days of issue, in full or in part, without penalty. Posted rate is 3% (minimum $1,000), which matches the 3% (minimum $1,000) advertised special rate for RBC's 1-year fixed-rate cashable GIC.

However, RBC offers me an unadvertised 4% special rate (minimum $1,000) for that GIC through the GIC purchase pages of their RBC Online Banking. See what your TD branch can offer for a minimum $100,000 or $200,000 in a TD 1-Year Cashable GIC.  

Of course it matters, Tang being owned by BNS, it matters to BNS's reputation.
Banking is 100% confidence, trust and integrity. One would think we are talking about W1. Look at the DUCA fiasco, that thread is still going on. Imagine the loss of a bank by the big six it would be a nation wide shock.

Norman1 , your contributions are highly respected and well earned, at least by me, but comparing Tang to "junk bonds" because Tang is unrated by credit agencies? That is way out of line.

There is too much consideration of these financial doomsday scenarios in every decision to be made on this site. Of course this is a possibility and one day this will happen. In this case. first Tang would have to be a fin. basket case , which it is not , second, BNS would have to be so troubled it could not be able to save it, again not. CDIC would cover the first 100k and like the American Fed, placed in this position, Bank of Canada or another gov. body will step in to save the uninsured deposits or there would be a massive run on Canadian banks which that would be the worst case scenario. BTW, Credit Suisse , a decade of incompetent banking was well telegraphed to its failure, and again saved by a forced acquisition to UBS. No deposits lost.

The Tangerine, Simplii or RBC strategy is the best option that I read on this thread so far. Load up the TFSA if its unused. ISA or HISA ETFS through brokerages provide liquidity but not duration certainty, while the former provides both. Avoid certified cheques is good advice. Think Tang is safe for at least 3 months without blowing up.

I personally don't have any worries with having more than the CDIC covered funds at Tang , and I do. (soaking up that 6%)

Poor daithi, head must be spinning

Tang Fin. Statement 2022/21
https://www.tangerine.ca/fberoot/pdf/en/FS/Tangerine-FS-Equity-Growth.pdf

FWIW, I would not hesitate one minute entrusting a lot of money to Tangerine, for the same reasons posted in post #26.

For reasons stated already I'm in the not-worried-about-CDIC- limits-with-Tangerine camp. Have to remember, the nature of this site means it attracts some folks on the extreme end of the security-conscious spectrum, that flavour shows up here regularly.

At the other end of the spectrum, CDIC appears to be much more cavalier, at least about moving money around. Their site says in a failure they'll mail cheques by regular Canada Post mail, i.e. "As the cheques will be sent via regular mail, we cannot provide you with a tracking number for your payment."

While BNS may not be legally obligated to bail Tangerine out, but from everyone's point of view, Tangerine is an important limb/organ of BNS. And in my mind, credit agency rating does not mean much. If there is a catastrophic failure, they will always fail to catch it quick enuf away. Lehman, Bear Stearns being a classic example.
So will BNS let Tangerine fail and not lend a hand, esp if BNS is healthy itself, its close to 0% chance in my mind.

And for those who mention Simplii, be well aware its part of CIBC legally, and share the same CDIC protection limit of $100k if that is important to you. Simplii is nothing more than a "online only" branch transit so to speak.

So for those who think having deposits at Tangerine over $100K is risky, then you must think owning shares in Scotiabank and CIBC is REALLY risky. Fair enough - each person should always assess the level of risk they feel they are assuming.

.
In the end ... it's All about staying well inside your 'Comfort Zone',
whatever that happens to be.

Good sleeps at night are Far more valuable than a X% difference
in interest rates.

Sweet Dreams

Dean

daithi said

. . . I'm not usually much of a "money guy" so this is all quite new to me.

. . .   

Not to worry ... that ⬆ can be fixed.

Stick around, participate, take notes, and
you'll be a "Money Guy" in no time at all ❗

Dean

althisa said
Also not sure of the charecterization of GIC investors as low risk. There is lots of interest rate risk unless you ladder, and are playing the guessing game of where interest rates will go and placing (GIC) long or short bets accordingly

A lot of people only think of risk as potentially losing their principal, so GIC esp with CDID protection is '100%' safe. In reality if one is earning a 3% with 100% protection, yet inflation is running at 5%, they still sleep at nite cuz its ONLY losing 2%, if they even think that way...