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Peoples Trust: bad experience
April 3, 2013
2:12 pm
Stan
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So . . . with Peoples dropping their interest rate to 1.4%, it's probably time to move on. But retrieving your hard earned $$$ could be an unexpected challenge of a lifetime.

So what we have learned: no matter what, never mention that you want to withdraw your funds and close your account!! If you do that, they will transfer you to "Michelle" to close out your account. Of course, "Michelle" doesn't really exist. No matter what time of day you call, she has already gone home for the day!! Even 10 minutes after morning coffee, she has already left for the day; and any message you leave is NEVER returned!!!

So . . . with chequing being abandoned, I figured that the best way to circumvent these bastards, was to simply request a transfer of funds. Wow!! Talk about a total waste of time!!! To transfer a mere $6500 from my Peoples Savings account to my home bank, took a complicated 22 minutes on the telephone to address the matter.

So . . . I could have used email??? Nope! If you want to deal with them by email, you are cautioned to refrain from providing them with your bank account number, or any other personal information! How useful can that be!??!

Meanwhile, I'm waiting with a great deal of scepticism that, my bank account will ever see any funds transferrred from Peoples!!!

April 3, 2013
4:04 pm
doc
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just checked the site and the e savings account is at 1.9%. when are they changing to 1.4%

April 3, 2013
4:45 pm
jeremywong
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Stan:

Peoples is holding the rate at 1.9% for e-Savings, but is dropping the rate for the old savings account to encourage switching to e-Savings. The old savings account is being phased out. e-Savings operates like ING Direct, so you will need to create a linked account (to a chequing account) in e-Savings to move your money. (You cannot create a link in your chequing account to e-Savings, because e-Savings has no cheques. Once you switch to e-Savings, destroy your Peoples cheques.)

What I find troubling is your method of moving money from the old savings account. The way to do it is to write a cheque on your old savings account, or to transfer it out electronically using another bank account. (You should already have created a link in your chequing account to your Peoples old savings account.) Never call the bank for routine transactions, especially withdrawals. Peoples doesn't have the staff for taking phone calls. If you call Peoples for transactions that can be done without human interaction, you are asking for frustration.

April 3, 2013
7:41 pm
Stan
Toronto
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jeremywong said
What I find troubling is your method of moving money from the old savings account. The way to do it is to write a cheque on your old savings account, or to transfer it out electronically using another bank account.

Well, exactly: I would NEVER EVER invest in an institution, where I couldn't merely write a cheque to access funds!! But we were stuck with a TFSA account that didn't respond to the usual bank withdrawl sf-cool

It was Peoples who changed the rules; not us; and to that end, we chose to terminate our association with Peoples forever!!! But there was NO WAY they were about to allow us to depart peacefully with our $$$!!!

Until recently, we had well over the $200,000 CDIC limit invested with Peoples. When interest rates dropped, we wrote a cheques for $200,000 in favour of our stock market account at TD Waterhouse. Without even considering dividends running over 5%, we have already realized over 5% annualized in mere capital appreciation alone over the past six months with TD!!

Now that Peoples has dropped chequing privileges, they really have you between a rock and a hard place!! Their only online communication medium forbids revelation of account numbers or password data!! Now really!!! How can you deal with bank without revealing your account number!!!!

After realizing their scam in hijacking any attempt to close an account; and after the third failed day on the telephone, attempting to retrieve our $$$, I went the simple "transfer of funds" route. Wow!!!!! After the third failed day in attempting to retrieve our $$$, we were on the telephone with Peoples for a full twenty-two minutes in an effort to transfer a mere $6500 to our primary bank account !!!!!!

So much for online banking, or any other kind of account where you can't merely write a cheque!!!!!

April 4, 2013
8:05 am
Winnie
Ontario
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I had only positive experience with Peoples Trust for many years thru emails and phone calls.

April 4, 2013
8:11 am
Peter
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Editorial note: I changed Stan's topic title to be less harsh but hopefully retaining the description of his experience.

April 4, 2013
4:40 pm
Rick
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Initiated a substantial transfer from PT on Monday (a STAT holiday) and it was in my account this morning. No prob-lame-o. Assume no problem moving it back after ING's promo is over. I think my bank gave me a book of cheques when I opened an account there. Don't recall ever using one....must be around here somewhere. Telephone??? Is that that thing my parents had plugged into the wall when I was a kid that you talk to other people on? Do they still make those? It is 2013...right?!?

April 4, 2013
7:07 pm
jeremywong
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Stan:

Peoples pays 3% on TFSA. The rate hasn't dropped.

I have never figured out how to withdraw from Peoples TFSA, which is why I never opened one, despite having a savings account there. Have you finally made your withdrawal?

April 5, 2013
1:03 pm
DcR
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I have had nothing but success and good communications with Peoples' Trust since 2009. I have never ever phoned and probably never will need to now with the easy switch from the old HISA with cheques to the esavings online account.I have a TFSA and esavings.The only conclusion I can draw from a bad experience is not being familiar with the way they can do things for you.

April 5, 2013
3:36 pm
jeremywong
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Winnie:

Requiring human interaction to withdraw isn't good enough. Peoples lets you deposit to TFSA online, but it hasn't made it as easy to withdraw, as Stan found out much to his chagrin. The gold standard is to be able to enter a transfer order at anytime, not waiting on the phone for the next available service rep during banking hours. The minimum standard Peoples should meet is to make withdrawals as easy as deposits, and it hasn't done that.

Banking by e-mail is unsafe, and not part of accepted banking procedures. Banks are not obligated to obey e-mailed transfer orders, and all banks discourage them. Stan tried to withdraw by e-mail, and it didn't work.

April 5, 2013
5:52 pm
malquin
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I now have a savings account with PT and I'm thinking of transfering my TFSA from ING to PT. 3% is better that 1.4%. (but for how long...)

Not that I ever have but how do one has to proceed to withdraw funds from a TFSA account with PT?

April 5, 2013
8:18 pm
Rick
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malquin said

I now have a savings account with PT and I'm thinking of transfering my TFSA from ING to PT. 3% is better that 1.4%. (but for how long...)

Not that I ever have but how do one has to proceed to withdraw funds from a TFSA account with PT?

I have transferred TFSA funds between institutions several times. It is a long slow process that usually takes weeks. You have to go to the institution you want to transfer the funds to, fill out the forms, your last statement helps, account number, institution name and address, etc. If you are transferring to brick and mortar, go into the branch, e-banks usually have the forms on line but it is all done through the mail so it takes longer. The bank you are moving the funds into sends the forms to whoever you are taking the money out of, and they send a transfer to your new bank...less any fee they may charge for doing it. I got my mother to just transfer her funds into a regular saving account at the end of December, then go back in January and walk a bank transfer over to the new bank. No transfer fees and her contribution room wasn't affected as she took out the funds in 2012 and redeposited them in 2013 when her contribution room was reinstated. Hope that helps.

April 5, 2013
10:29 pm
GS1
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Rick is right about the December withdrawal from institution 1 and the January deposit to institution 2. Due to the timing you end up with a small balance on December 31st which needs to be withdrawn Jnauary 2nd and then depending on wheter or not you are maxed out, either deposited in instituion 2 or tracked till the following year to be deposited then.

For folks saving for something, using a HISA inside a TFSA probably makes sense. But, for my money, (so to speak), to be at the mercy of the institutions' whim as to what interest rate will be charged seems silly. If I were leery of the equity markets I would want to purchase a GIC or a strip bond, so I would KNOW what I was going to end up with -- no surprises. The problem with both a GIC and a strip bond is that they do eventually mature and you then need to be able to re-invest them.

I have my TFSA in the same firm that holds my RSP and trading accounts. I do not hold any of my HISA funds in a registered (RSP, TFSA) account as I simply don't want to be "locked in".

YMMV

Greg

April 6, 2013
9:49 am
Rick
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GS said

Rick is right about the December withdrawal from institution 1 and the January deposit to institution 2. Due to the timing you end up with a small balance on December 31st which needs to be withdrawn Jnauary 2nd and then depending on wheter or not you are maxed out, either deposited in instituion 2 or tracked till the following year to be deposited then.

For folks saving for something, using a HISA inside a TFSA probably makes sense. But, for my money, (so to speak), to be at the mercy of the institutions' whim as to what interest rate will be charged seems silly. If I were leery of the equity markets I would want to purchase a GIC or a strip bond, so I would KNOW what I was going to end up with -- no surprises. The problem with both a GIC and a strip bond is that they do eventually mature and you then need to be able to re-invest them.

I have my TFSA in the same firm that holds my RSP and trading accounts. I do not hold any of my HISA funds in a registered (RSP, TFSA) account as I simply don't want to be "locked in".

YMMV

Greg

Interesting points GS. On the small balance at the end of the year...when you transfer the funds from your TFSA to a reg savings, actually close the TFSA account and they will pay the interest to date so there is no small amount left over Jan 1. Currently, none of the institutions I use GIC's can beat the 3% PT is offering in it's hi-interest TFSA so why lock it in to any term? If their whims make it inconvenient, I'll simply move my funds where it is more convenient. So far PT's rate seems pretty stable. I am very leery of funds and currently have my RSP's laddered in GIC's in a couple of institutions. Reinvesting them is not really an issue other than the low rates on long term GIC's. but that won't last forever. Due to the claw back of OAS based on income in retirement, I encourage both my kids to focus on saving for retirement using TFSA's instead of RSP's. Should be a nice nest egg in 30 or 40 years. Little late for me as they are relatively new and I've only got 6 years before retirement, but I am maxing them out. I am curious what do you you keep your TFSA funds in if not HISA?

April 6, 2013
3:11 pm
GS1
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Rick said

[snip]

I am curious what do you you keep your TFSA funds in if not HISA?

XBB - iShares DEX Universe Bond Index Fund - an Exchange Traded Fund that RBC Direct Investing has on their dividend reinvestment program. Each month XBB pays out a dividend and RBC take that dividend and buy however many full shares they can with it and leave the balance in my account. I also have a small HISA account "fund" (RBF2010 - Investment Savings Account) in the TFSA and use the small cash balance from the XBB reinvestment to buy RBF2010 to keep myself fully invested. TBF2010 currently pays 1.25% but it is a small holding and I want it to be fluid as when I am ready to add more to the TFSA account I sell almost all the RBF2010 to get my cash back, add my new contribution and buy more XBB.

I can sell XBB any time I want if I think there is a need, such as when interest rates are about to rise.

I started buying XBB for the TFSA on April 1, 2010. Since then it has an IRR of 7% for 2010, 8% for 2011, 2.75% for 2012 and an annualized 7.35% for this year.

Please remember the use of XBB in my TFSA is just a portion of my total asset allocation. I am retired and have no new funds coming in. One cannot claim a capital loss inside a registered plan and so I try to keep assets that are more likely to not lose money inside my TFSA and RSP.

Greg

April 7, 2013
8:26 am
Rick
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Thanx for sharing

April 7, 2013
10:47 am
kanaka
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Rick said

Thanx for sharing

I have XBB in my TFSA too along with a few other ETF's. All doing well and better than GIC rates. And what makes it better, no declaring dividends or capital gains.

April 7, 2013
3:22 pm
GS1
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kanaka said

[snip]

no declaring dividends or capital gains.

Or tracking Return of Capital.

April 7, 2013
8:21 pm
kanaka
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GS said

kanaka said

[snip]

no declaring dividends or capital gains.

Or tracking Return of Capital

Ok GS.....what is Return of Capital and why do you have to track it? I am planning on phasing out my RRSP investments over the next 10 years and moving to stocks or etfs that are dividend oriented.

Thanks

April 7, 2013
8:32 pm
Dennis
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kanaka said

GS said

kanaka said

[snip]

no declaring dividends or capital gains.

Or tracking Return of Capital

Ok GS.....what is Return of Capital and why do you have to track it? I am planning on phasing out my RRSP investments over the next 10 years and moving to stocks or etfs that are dividend oriented.

Thanks

"Return of Capital" is a kind of distribution, but you don't pay the tax for ROC when you receive it. However it need to be used to calculate adjusted cost base (subtract) when you sell funds. That is way you need to track ROC.

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