Manulife lowered TFSA rate to 2% | Manulife Bank | Discussion forum

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Manulife lowered TFSA rate to 2%
April 5, 2012
10:00 am
malquin
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Hi.

Was looking for another place to park money since ING lowered their rate.

Just noticed that the TFSA rate went from 2.25 to 2%.

April 5, 2012
11:54 am
moneysaver
Ontario
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I think People's Trust and Canadian Direct Financial has the highest TFSA at the moment at 3% Malquin. Watch out for the withdrawal and redepositing it in the same calender year. The CRA will charge you a penalty if you go over your limit.

April 5, 2012
2:22 pm
kilarney
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DO you wonder if the CRA enables the bait and switch technique for the financial institutions? If the process of moving money was easy an investor could move assets as soon as the predictable increase happened. Restrictive rules make many just sit there and take the new rate with no response.

April 6, 2012
6:37 am
malquin
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moneysaver said:

I think People's Trust and Canadian Direct Financial has the highest TFSA at the moment at 3% Malquin. Watch out for the withdrawal and redepositing it in the same calender year. The CRA will charge you a penalty if you go over your limit.

Are you saying that one has to withdraw from a TFSA account and redeposit in the new one? Isn't it possible to just do a transfer like one does with RRSP account?

I was looking for this information on People's trust website but coudn't find anything about it...

April 6, 2012
8:19 am
Peter
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Yes, you can do a TFSA transfer, although the process (and possible fees) is different per bank.

April 6, 2012
8:47 am
moneysaver
Ontario
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I believe you can transfer it to another TFSA like a RRSP. It is a registered account with the CRA. But I am not 100% sure though. I only know about the withdrawal and redepositing penalty in the same calendar year that I read about. I never transfered it as of yet with the TFSA since its rather new with me. It started in 2009 and I didnt start contributing to it until the fall of 2010 and I usually just withdraw it in December back into my regular savings account if I am not happy with the rates and make a decision in January where to put it again for another year since every January the CRA adds another $5000 to your limit. Some banks charges for the Transfer of the funds but I think ING is free. I notice the TFSA rate with Peoples Trust is 3%. You will have to call them as I am not a client as of yet as to how their transfers work.

April 7, 2012
8:04 am
cmore
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Transferring a TFSA is rather simple and has a similar process as an RSP. The institution you want to transfer to will handle the necessary paperwork, however, some institutions also have a fee to transfer the TFSA out...so you may want to check prior to making the transfer.

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