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5-year: 3.15% (non-registered & RRIF), 3¼% (TFSA & RRSP)
March 20, 2022
10:51 pm
Loonie
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Norman's strategy makes sense if you are hesitant about what the future may bring. I'd call it a mini-ladder.

I'm not sure which kind of registered plan you were considering, but Monaarch is also offering five year RSP at 3.15%. I don't know the issuer or if there is a minimum, but it may be an alternative for those who don't want to deal with ManuLife. Check transfer-out fees.
https://www.monarchwealth.ca/clients#gic

March 21, 2022
1:44 am
JenE
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Thanks, Norman1 and Loonie. TFSA GICs are what I’m looking at, so 3.25%. I like the idea of four deposits over the course of the year. I’ve contacted Manulife for more information.

March 21, 2022
6:05 am
Jim Sherat
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Norman1 said

What Jim Sherat and MattS describe are not GIC's. They are insurance contracts that resemble deposits but are not legally deposits. If they were deposits, then they would be insured by a deposit insurer, like CDIC, and not Assuris.

The issue with GIA's is their rates are lower. If one looks at the GIA's from Manufacturers Life Insurance Company, the five-year rate is 1.95% to 2.15% per annum. Note that the issuer is not Manulife Bank or Manulife Trust.

To save that one-time 1½% probate tax in Ontario, for example, one is accepting a 1% lower return each year.  

Thanks for the clarification, Norman. I guess we never questioned the meaning of "GIC" as shown in all statements issued to MIL by Manulife Investments. ie. the 'C' means Contract, not Certificate.

As she is about to turn 95, the focus has been on preservation of capital and simplifying the inevitable settlement of her estate; to that end we just had her FA sell off her last remaining non-registered mutual fund, half Dec, half Jan. and take the Capital gains hit over 2 tax years. Therefore, she now has Zero Assets subject to Probate upon her death.

Agreed there is an interest penalty with the Insurance Co. hosted GIC [Contract]s but her FA would only ever deal with the Big Five Banks, no CUs, or Online Banks, as an alternative to large Insurer like Manulife. Since no one in the family was willing or able, to take over the complete management of her assets, here we are.

Because of her age, we recently discovered, she will no longer be able to buy 5yr duration GICs going forward, so even less interest to be had.

March 21, 2022
7:58 am
Loonie
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That's a new one on me, not being allowed to buy a five year GIC because of age! I didn't know age discrimination was OK in the financial industry. Perhaps it's different for these GIAs, although I don't see why it should be.

When one dies, at any age, a five year GIC could be a pain as some FIs won't let you cash out on death with interest to date. But some will.

My mother will soon be 101 and is in decent health for her age. I won't be buying her five year GICs (as her POA), but that's my choice. No one has told me I can't. I'm curious who your MIL's FA works for and what his qualifications are.

You've got me thinking. I've been wondering why my mother didn't receive an annual statement this year from CIBC about her TFSA, which is a small savings account that is essentially useless. Maybe, once you turn 100, you sort of drop off their books somehow. I would phone and ask them but they have refused to honour her lawyer-written POA which I hold, claiming it doesn't explicitly cover "investments" - as if a savings account TFSA that pays zilch is any kind of "investment" anyway. It's a good racket if you're the bank. When I get around to it, she will sign a transfer-out form, and I'll see how far that gets us. As this is a small amount and she is very old, it's not the end of the world if I have to wait until she dies, but the gall of CIBC (and I have fared even worse at RBC) is something to behold. Fortunately, she opened a CU account recently; they are much easier to work with. Neither CIBC nor RBC will ever see another penny of her money, which has now all been redirected or is being spent down on her living expenses - except for that pesky little TFSA which I, stupidly, suggested she buy in 2009. It made sense at the time, for reasons I won't get into.

March 21, 2022
8:39 am
JenE
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WARNING!
I’ve received the following reply to my email to Manulife:

“In reply to your email asking for information re a GIC for a TFSA, I believe the information you saw was most likely fraudulent – see the ‘Alert’ below we received this morning…”

(JenE - Unfortunately the Alert won’t let me copy and paste so I’ll type the message here:)

“A fraudulent product offer is being circulated. It includes Manulife, Manulife Investment’s logo and branding and promotes inaccurate GIC rates. We’re advising clients not to share any personal information and to contact the Canadian Anti-Fraud Centre and local police authorities if they’ve been offered this product”.

March 21, 2022
9:06 am
Norman1
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JenE said
WARNING!
I’ve received the following reply to my email to Manulife:

“In reply to your email asking for information re a GIC for a TFSA, I believe the information you saw was most likely fraudulent – see the ‘Alert’ below we received this morning…”

Did you e-mail Manulife or Manulife Bank?

GIC's for a TFSA from the life insurance company Manulife are a fraud: Be on the lookout for fraudulent documents

But, GIC's for a TFSA from Manulife Bank are not: Manulife Bank: TFSA.

March 21, 2022
9:31 am
JenE
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I clicked on TFSA in your box, Norman1, which took me to https://www.ManulifeBank.ca, the scrolled down to “How do I open a Manulife Bank TFSA and clicked on “find an advisor”. I chose advisor and emailed her. (It appears she may be on vacation as her reply included the name of another rep to contact if I wanted to go further). I phoned and left the second person a message for her to call me.

I’m going to phone someone else to further investigate this. Perhaps the first person is wrong!!

March 21, 2022
9:55 am
JenE
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I couldn’t reach an advisor so phoned Manulife Bank directly. They directed me to their website and this is what I saw in red, at the top of the page:

“Alert: Fraudulent product offer

A fraudulent product offer is being circulated. It includes Manulife, Manulife Investment Management’s logo and branding and promotes inaccurate GIC rates. Please do not share any personal information and contact the Canadian Anti-Fraud Centre etc. etc.”

I saw that in their browser was a B+ in a black circle before the address. The web page I was directed to before had only a B in a black circle. It’s frightening how good these scammers are.

March 21, 2022
10:03 am
Dean
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Norman1 said

Line 12100 – Interest and other investment income instructions say

Completing your tax return

Complete the chart for line 12100 using your Federal Worksheet and enter the result on line 12100 of your return.

Generally, you report your share of interest from a joint investment based on how much you contributed to it.

  

'Thanks' to Norman and all you others for answering my question in Post #10.
Much Appreciated ❗ sf-smile

If you don't mind, I have a related follow-up question . . .

    How does the CRA confirm how much each spouse claims to have contributed ... or can they ?

Thanks again,

    Dean

sf-cool " Live Long, Healthy ... And Prosper! " sf-cool

March 21, 2022
10:08 am
COIN
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JenE said
A fraudulent product offer is being circulated. It includes Manulife, Manulife Investment Management’s logo and branding and promotes inaccurate GIC rates. Please do not share any personal information and contact the Canadian Anti-Fraud Centre etc. etc.”

I saw that in their browser was a B+ in a black circle before the address. The web page I was directed to before had only a B in a black circle. It’s frightening how good these scammers are.  

Never click on any link until you are 100% sure!
I recently got a $5 offer purportedly from PayPal. I called the real PayPal and was told that the offer is bogus. And then I got the same "offer" again a few days later.

March 21, 2022
10:18 am
Norman1
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Dean said

If you don't mind, I have a related follow-up question . . .

    How does the CRA confirm how much each spouse claims to have contributed ... or can they ?

If CRA suspects, CRA will ask the couple to provide evidence supporting the claimed split of contributions.

For example, wife wins lottery and has the lottery money deposited to her account. She transfers in 90% of joint account funds from her account. Husband transfers in the other 10% from his account that his pay cheques are direct deposited to. All that supports a 90/10 split.

March 21, 2022
10:21 am
Bill
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Dean, as I said CRA won't do anything if the T5 slip name and SIN re a joint investment match that person's reporting amount, they just accept it as that person's income in total.

If you do that they'll never ask. But if you split things up and thus there's not a match with the T5 info, then I suppose they could ask you to support your allocation. It wouldn't happen until a year or more later, after they run their T5 matching program for that tax year and notice one person reported less than the T5 slip bearing their name and SIN indicated (their program doesn't seem to mind if someone else reported more that the T5 slip shows, no reassessment there, in my experience). In that case they'll likely just send that person a reassessment saying they didn't report enough income and then you'll have to go through the process of explaining things to them.

I'm guessing amounts have to be above a certain threshold for them to care. Long ago I did allocate, i.e. reporting did not match T5s, and nothing ever happened. But recently I was reassessed for 2020 for close to $10K in additional income due to an unmatched slip, that amount they caught.

March 21, 2022
10:25 am
Norman1
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JenE said
I couldn’t reach an advisor so phoned Manulife Bank directly. They directed me to their website and this is what I saw in red, at the top of the page:

“Alert: Fraudulent product offer

A fraudulent product offer is being circulated. It includes Manulife, Manulife Investment Management’s logo and branding and promotes inaccurate GIC rates. Please do not share any personal information and contact the Canadian Anti-Fraud Centre etc. etc.”

I saw that in their browser was a B+ in a black circle before the address. The web page I was directed to before had only a B in a black circle. It’s frightening how good these scammers are.  

That sounds like the Manulife Bank site at

https://www.manulifebank.ca/personal-banking.html

That's not a B but a lock symbol to the left of address!

One can find the five-year 3¼% TFSA rate by clicking "Investments" on the left sidebar and then "Tax Free Savings Account (TFSA)".

Not sure why that first agent though it was a scam. Perhaps, the agent was wearing their Manulife insurance hat instead of Manulife Bank hat. The 5-year Manulife GIA rate (1.95% - 2.15%) is currently nowhere near the 3¼% rate for the Manulife Bank TFSA GIC.

March 21, 2022
10:26 am
savemoresaveoften
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Bill said
Dean, as I said CRA won't do anything if the T5 slip name and SIN re a joint investment match that person's reporting amount, they just accept it as that person's income in total.

Dont have any joint acct yet but will do soon. Are you saying as long as the T5 shows both my name and my spouse, then CRA assumes its even splitting to begin with without evidence/proof ?

March 21, 2022
11:02 am
JenE
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Norman1, the site you suggest does show 3.25%, BUT it doesn’t show the B+ in the browser (I use a mini iPad so perhaps that’s why I show a B). It does show, however, a B. After speaking with Manulife Bank customer service, I can only conclude that the site you suggest is fraudulent. Which is really too bad! I was all set to invest a largish sum. I still haven’t had a call back from an advisor.

March 21, 2022
11:29 am
Bill
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No, smso, I didn't mean that. T5 for joint account has only ever shown the name and SIN of primary person, in my experience, so that's where CRA's computer expects to see the income being reported. Anything else and CRA might be asking why they're not seeing what they expect to see and it'll be up to you to satisfy their questions.

Though I also wouldn't be surprised if their computer looked to the spouse's return in the case of an anomoly, maybe if they see the totals for spouses tie in to the T5 they're good with it.

March 21, 2022
12:17 pm
COIN
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Norman1 said
Perhaps, the agent was wearing their Manulife insurance hat instead of Manulife Bank hat.   

Many years ago, I was on a brief secondment to an insurance brokerage firm. Their commission for selling insurance products was 10% (maybe more now). So, insurance brokers might have a greater economic interest in selling insurance (not bank) products.

March 21, 2022
1:29 pm
Loonie
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All our joint accounts are reported to CRA as 50:50 split, no matter who is the primary accont holder, and have been for many years. I actually do make sure that contributions are equal, so this is an honest reporting. I do have a paper trail that could trace the money back through several moves if necessary, but it would be time-consuming to do so.
I have never been asked to prove this split.

I imagine a great many people don't even know they are supposed to report it this way, i.e. according to contributions. And I know there are people out there who don't even know there is such a thing as a joint account with right of survivorship that avoids probate on the first death.

March 21, 2022
2:42 pm
Jim Sherat
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Sorry removing my comments, re T5 splitting, as I realize that was not the Topic intended in this thread ...

March 21, 2022
4:00 pm
Bill
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Loonie's experience, i.e. never being questioned by CRA about using 50/50 split no matter what names are on T5s, is surprising to me. I do the opposite, report it based on whoever's name is on the T slip, and also never been questioned. Maybe CRA doesn't care about allocation between spouses which, if true, suggests it might be an idea to always have the spouse in the lower tax bracket (if it's always the same spouse) be the primary on joint accounts.

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