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1% transfer in promo
January 22, 2019
6:45 pm
Loonie
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JustMe2016 said

Loonie said
I'm not sure that anyone has reported being able to just do a direct deposit at Meridian, but maybe I missed it.

If by direct deposit you mean to write a cheque for $127,002 to open two TFSA accounts, then yes we did.

($63,500 X 2) + $2 for membership.  

I just want to clarify what has happened, since people are getting different messages from Meridian.

As I understand it, from your post on Jan 20, you were told on the phone by a Meridian person that you could have the 1% deal by making a direct deposit into a new TFSA but that the bonus would go into an Advantage savings account. (That is their most commonly used savings account.)

On the 19th (Saturday), you made the deposit and were told that some of the previous information was wrong and the bonus would not go into Advantage savings but would go into your TFSA.

Please let us know when the money shows up, and in which account you find it. That will confirm that someone was able to get the bonus without doing a transfer. Thanks.
It will also be helpful if anyone else reports receiving the bonus through non-transfer deposit into TFSA. To me personally, it doesn't matter as I don't have any qualifying funds by any definition.

January 22, 2019
10:51 pm
Canadianbull
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JustMe2016 said

Assuming you have more than one Meridian location in your town you should have called each branch and ask if you would get the 1% on opening a new TFSA account. Since each branch is individually managed, some Meridian employees are more smart/flexible than others.

That's exactly what I did. I don't know if the amount involved and the way it is invested matters?

I was upfront and told them on the phone my plan was 18 months GIC and you know the amount involved in my case.

Too bad you didn't open it elsewhere and then had it transferred to Meridian to get the 1%. I'm sorry for you.  

It is ok. Thanks
I live in Alberta. I have no Meridian in my province.

January 23, 2019
8:35 am
HISAhopper
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Loonie said

That's why I think it's worth asking for an exception. It makes no sense to do a two-step process when you can do one, and it's easier for all involved. You won't be very popular with a FI if you use it simply to pass your TFSA in and out again. Some will charge you an early closing fee, as they should.
I would explain to Meridian manager that this is what you must do to meet their criteria and ask if they wouldn't prefer to avoid it and get your deposit immediately instead. After all, you might change your mind or forget about it if you deposit it at Other FI first. If it is technically possible, they might be willing to accommodate you.  

Has there been any example of early closing fee on top of the transfer-out fee? how much was it?
I am also curious if there exists a min length of time the fund needs to stay in the TFSA before being transferred out to Meridian.

January 23, 2019
1:35 pm
Loonie
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Any early closing fee would be at the discretion of whichever financial institution you put it into, so would vary, but they certainly do exist. People should check these fees before they deposit. Early closing fees that I have been aware of tend to be around 3 months.
I don't think there would be any minimum time, as long as it's not in a GIC, but that again is something you need to ask the FI about.

January 23, 2019
5:00 pm
anitavirginia
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Today, funds that were transferred from 3 tfsa accounts from other institutions, were put into a 5 yr gic tfsa at 3.75% along with 1% bonus. no Problems This was initiated back a few weeks ago, on the last day of the 3.75% offer.

January 23, 2019
7:39 pm
Norman1
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HISAhopper said

Has there been any example of early closing fee on top of the transfer-out fee? how much was it?

According to Meridian Accounts and Services, Meridian CU has early closing fees:

INACTIVE ACCOUNTS AND CLOSING ACCOUNTS
Closing account $25 within 90 days of opening
RRSP/RRIF/TFSA $100 if collapsed within 90 days of opening
$50 for T2033 transfer out
January 23, 2019
7:59 pm
Canadianbull
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Norman1 said

HISAhopper said

Has there been any example of early closing fee on top of the transfer-out fee? how much was it?

According to Meridian Accounts and Services, Meridian CU has early closing fees:

INACTIVE ACCOUNTS AND CLOSING ACCOUNTS
Closing account $25 within 90 days of opening
RRSP/RRIF/TFSA $100 if collapsed within 90 days of opening
$50 for T2033 transfer out

  

Thanks for sharing sf-wink

January 23, 2019
8:06 pm
Canadianbull
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anitavirginia said
Today, funds that were transferred from 3 tfsa accounts from other institutions, were put into a 5 yr gic tfsa at 3.75% along with 1% bonus. no Problems This was initiated back a few weeks ago, on the last day of the 3.75% offer.  

Congrats!
I did not qualify for 1% bonus because in my case it was not tfsa to tfsa transfer.

January 23, 2019
10:45 pm
Loonie
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anitavirginia said
Today, funds that were transferred from 3 tfsa accounts from other institutions, were put into a 5 yr gic tfsa at 3.75% along with 1% bonus. no Problems This was initiated back a few weeks ago, on the last day of the 3.75% offer.  

Thanks for letting us know. Well done!

January 24, 2019
5:40 am
Jim Sherat
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I see lots of comments re: Early closing fees; why not leave a few dollars (or a few hundred), in the sending TFSA(s) and leave them open ?

The Meridian TFSA receiving criteria is $10,000 to get the promo. As long as its a direct transfer [T2033], it doesn't have to be 100% of sending TFSA, but rather specify a dollar amount. The only fee would be the usual admin fee, eg. $50, that most (receiving) FIs, including Meridian, will reimburse.

Once you go through all the TFSA paperwork for Application, Beneficiary, Successor Holder, etc. why not just leave them open ? By doing so, you have a quick means to moves funds back in, going forward, if a suitable rate / promo is offered. Yes ?

My wife and I both have TFSAs at Simplii Financial, which we drew down last year, but kept open with a few dollars. I plan to use these to replenish the 'room' created, plus do 2019 contributions, $6,000ea. get the decent 3.25% rate until the last day of Feb. then get Meridian to direct transfer a specified dollar value over to the new TFSAs we will be setting up.

If anyone sees a flaw in this strategy I'd really appreciate the feedback. Thanks.

January 24, 2019
2:39 pm
Loonie
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It's a perfectly viable strategy, one that I use myself - although not often, as I don't like to have a surplus of accounts to keep track of, which can be risky with TFSAs where ins and outs must be carefully monitored (you may be, but some people aren't very good at this). You just have to make sure that the FI that you are more-or-less emptying out doesn't have a minimum deposit requirement.

January 24, 2019
2:48 pm
HISAhopper
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I have a Tangerine TFSA account with $0 for at least 2 years and there has been no issue so far.

January 25, 2019
4:33 pm
Londonguy
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My spouse and I opened new RS accounts at the local Meridian branch today, signing the paperwork to transfer in $75K each from our TD self-directed RSPs to max out the 1% bonus offer and park the funds in an 18-month 3.25% GIC. It's always a bit of a pain arranging any transfer, but IMO this one is worth it.

Between the two of us we'll lose about $46 a week in ISA interest @ 1.60% on the $150K while the transfer is in limbo (which I'm thinking could be 5 weeks) so that's a $230 hit at least. We'll also have to eat TD's transfer-out fees in excess of the $50 per account that Meridian said they'd cover. As a total package, however, still quite tolerable when compared to the $1,500 transfer bonus we're getting, plus we'll be getting a 3.25% GIC rate going forward that we could never hope to access inside our TD self-directed plans.

Hope we see more of these kinds of deals. Some people don't like to have lots of RS accounts across multiple FIs but it doesn't bother me

January 25, 2019
6:00 pm
Loonie
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Londonguy said

Hope we see more of these kinds of deals. Some people don't like to have lots of RS accounts across multiple FIs but it doesn't bother me  

It's OK while you're young but you may want to start to consolidate them as much as reasonably possible when you get near the point of switching to RIFs and wanting to close some of them down. Much better to do transfers earlier, get receiving FI to pay the fee, and avoid the process of trying to close them down. I have closed down several of them, and found it a pain. Each FI has different rules, time lines, and complications. Three of mine were difficult to actually close when i had no reason to anticipate so much difficulty, and there is nobody to reimburse you when you close them. And I guarantee that those fees will go up.

January 26, 2019
12:28 pm
Londonguy
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Loonie said

It's OK while you're young but you may want to start to consolidate them as much as reasonably possible when you get near the point of switching to RIFs and wanting to close some of them down. Much better to do transfers earlier, get receiving FI to pay the fee, and avoid the process of trying to close them down. I have closed down several of them, and found it a pain. Each FI has different rules, time lines, and complications. Three of mine were difficult to actually close when i had no reason to anticipate so much difficulty, and there is nobody to reimburse you when you close them. And I guarantee that those fees will go up.  

Point understood, but in my particular case, even after any future closure fees 6-7 years down the line, by jumping on this Meridian deal I'm still going to be way ahead of the game compared to what I can make on that same $150K buying uncompetitively priced GICs inside my self-directed RSP. Sadly, 1-year rates being offered within a TD SDRSP are at least 60bps below what you can get on the open market -- toss in a 1% transfer bonus and it makes it a no-brainer IMO

January 29, 2019
2:26 am
Jim Sherat
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Good move, Londonguy !
Like you and your spouse, my wife and I also have self directed RSPs, with TDDI, BUT, unlike you, I got us trapped in a bunch of 2.x % 1 and 2 year GICs, so am unable to take advantage of the Meridian promo, at this time.
Wishing I would have left some funds in that 1.6% TBD8150 fund for flexibility. 🙁

This is also my RSP > RIF year (my wife has 4 more yrs), which I guess would have complicated things further. Not sure how the mandatory Minimum withdrawal works, once the RSP is converted to a RIF, when account is comprised of 100% non redeemable GICs? Wondering if the min.% amount gets pulled from every GIC, or can you select one? or must you maintain an accessible HISA account within the RIF, and direct that the min. withdrawal come from there (and leave the GICs intact). Sorry, a bit off topic here, but thought you, or 'Loonie' might know?

Back to the topic, I hope to transfer some accessible TFSA funds for both of us, once the Meridian paperwork is completed, and prior to the Feb 28 end to the promo. Hey, it won't be the max, but some at 4.25% for 18 mths, is a lot better than nothing.

January 29, 2019
3:32 am
Loonie
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jim S - each financial institution has its own rules as to where it takes the mandatory minimums from, and they do vary. So you need to ask. i think TDDI gives you the option to choose, but not sure.

If it's all in GICs, it will come out of the GICs one way or another. Some take it out of the interest earned to date; others take it out of the one with the lowest interest rate. No doubt there are other variations as well.

One thing you can be sure of is that CRA will get what's due! It doesn't matter that the GICs appear to be locked in.

January 29, 2019
7:17 am
Norman1
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Jim Sherat said

…, my wife and I also have self directed RSPs, with TDDI, BUT, unlike you, I got us trapped in a bunch of 2.x % 1 and 2 year GICs, …

This is also my RSP > RIF year (my wife has 4 more yrs), which I guess would have complicated things further. Not sure how the mandatory Minimum withdrawal works, once the RSP is converted to a RIF, when account is comprised of 100% non redeemable GICs? …

According to CRA: Registered Retirement Income Fund (RRIF), the first minimum RIF withdrawal has to be made "in the year following the year the RRIF is entered into."

I think it would be good to contact TD Direct Investing now to see what the options are. Brokerage firm RRSP accounts are usually set up as a trust and not as a deposit contract. The GIC's they hold may be the same as unregistered GIC's and are not partially cashable annually to allow for RRIF withdrawals. RIF GIC's are different that way.

The situation could be problematic. I wrote my guess in the previous discussion Question about transition from RRSP to RRIF about what could happen.

January 29, 2019
8:02 am
Loonie
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Norman has a good point. I was thinking that you were planning on moving it out of TDDi.

January 29, 2019
9:05 am
Londonguy
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Jim Sherat said

Back to the topic, I hope to transfer some accessible TFSA funds for both of us, once the Meridian paperwork is completed, and prior to the Feb 28 end to the promo. Hey, it won't be the max, but some at 4.25% for 18 mths, is a lot better than nothing.  

Just to be clear, it's closer to a 3.95% effective annual rate on the transferred capital after you include the bonus because it's an 18-month GIC.

(((75000+750)*0.0325*1.5)+750)/1.5/75000=0.0394916667 or 3.95%

That figure also excludes the negative impact of transfer-out fees & the lost opportunity cost of idly sitting in cash for a short spell, both of which eat into your returns -- the exact amount of that friction will vary among relinquishing institutions and how long they take to process your transfer.

Net net net I estimate I'll end up making 3.65% APR over the 18 months

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