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Tangerine Retention Rates/Winter Promo Q1(Jan) 2018
January 7, 2018
1:32 pm
DavidAlta13
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Marie said
First time posting. Moved all monies into Simplii 3% until Feb 28 out of tangerine on Jan 01,2018, for tax reasons. Will wait to activate new saving at tangerine until bank of Canada rate decision on January 17. Then only one of my savings account will I activate to see if better rates come from Tangerine, after the January 31 dead line. Also BOC still has another rate decision on March 07, Does anyone else think this could happen better rates coming if BOC raises rates?
Marie  

See my post 134; In particular, as I am going to include my opinion about how much rates will go up, and when, please note that just like all economists' forecasts, mine will be wrong. The thing is, I don't know whether rates will change more or less, or faster or slower, than expected.

Below is a table of 6 banks' Dec '17 forecast of 2018 quarterly & total interest rate changes, with mine at the bottom. For what it's worth:

Only one of these 6 banks was forecasting a full 0.25% rate hike by Mar 31/18; and

Since interest rates were lowered in 2009, all the banks' forecasts for interest rate hikes have been way too high and too early. Interest rates have increased at a much slower pace than anyone had predicted.

This is a major factor in my prediction that it will take over 4 years for rates to go up a total of 2%, with 0.25% increases in 2018 & 2022 & 0.50% a year for 2019-21.

My shorter term factors are
(i) NAFTA uncertainty,
(ii) although the BoC is concerned about Canadian's high debt levels & the Toronto / Vancouver housing markets and might want to raise rates to curb those trends, the rest of Canada's housing markets don't appear to be over heated, and raising rates would lift our dollar, negatively impacting exports and our GDP, and
(iii) inflation doesn't appear to be headed much over the BoC's 2% target that would trigger rate hikes.

Rate-Hikes-2018-2.png

January 7, 2018
1:33 pm
dougjp
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Marie said
First time posting. Moved all monies into Simplii 3% until Feb 28 out of tangerine on Jan 01,2018, for tax reasons. Will wait to activate new saving at tangerine until bank of Canada rate decision on January 17. Then only one of my savings account will I activate to see if better rates come from Tangerine, after the January 31 dead line. Also BOC still has another rate decision on March 07, Does anyone else think this could happen better rates coming if BOC raises rates?
Marie  

A quarter point, if done once only, no. Simplii has, IMHO, distorted the market. Some of the others who haven't been competitive may get back in the game, but not as market leaders.

January 7, 2018
1:55 pm
semi-retired
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Happy New Year to all. Did not receive an offer at all.This was a first.Had emptied savings into checking Jan.02.Called in this morning.No wait time.Told them 1% wasn't going to cut it.Was immediately offered the 2.5% promo till May/31.Hole process took less than 3 minutes.Was going to EQ as a back-up plan for 2.3%.No worries for 5 months.If rates do go up,money is liquid.

January 7, 2018
2:29 pm
dentgal
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Doug, where are you finding 3% on a GIC??
TIA!!

January 7, 2018
2:33 pm
Top It Up
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3.00% GICs

https://idealsavings.ca/rates/

ALSO @ Hubert, Motive, Oaken, and Steinbach

January 7, 2018
2:39 pm
Loonie
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3% at Hubert
https://www.happysavings.ca/rates/

and at Motive
https://www.motivefinancial.com/Rates/

Also at DUCA for 80 months if that appeals.

These could change at any time, of course.

January 7, 2018
2:51 pm
RicksBank
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http://www.financialpost.com/p.....nnual.html
Click on the column headings to sort.
Also 3% at Implicity.

January 7, 2018
3:01 pm
DavidAlta13
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RicksBank, Thanks for the link to the Financial Post's GIC rates table.
For some reason. Hubert (Sunova Credit Union) is not included:
Hubert's rates for 1 - 5 year GIC's are 2.25%, 2.40%, 2.45%, 2.70% and 3.00%
https://www.happysavings.ca/rates/

If you have existing registered accounts (RRSP, TFSA, etc.) with a broker (as I have w TD Waterhouse), and don't want the hassle of opening registered accounts at other FI's offering higher rates, the best GIC rates today are EQ Bank's; for 1 - 5 year GIC's, EQ Bank's rates are 1.81%, 2.25%, 2.46%, 2.55% & 2.77%.

January 7, 2018
3:26 pm
dougjp
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I dunno, as we all know there are at least 4 Fi's paying 2.3% or more right now, payable/compounding monthly. Why lock in to GICs at these rates right now getting annual interest and no flexibility while, at least in 2018, we are in a rising rate market? What am I missing?

I recently had a 5 year Ally/RBC GIC come due and some Peoples Trust GICs issued back when they were competitive, but for at least 1 1/2 years if not more, GICs haven't competed with savings (but traditionally they do, and should!).

January 7, 2018
3:42 pm
DavidAlta13
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Agreed, dougjp, hopefully the frustrating gap between long term GIC's & HISA's will be resolved over 2018.
While I am largely sticking to the HISA route for my non-registered funds, the RRSP & TFSA options aren't as flexible, due to the hassles of moving RRSP $'s between institutions, and the CRA's one year lag between TFSA's withdrawals and re-deposits.
Since the banks' registered account rates are so low, I have gone ahead and locked in most of my registered accounts' funds into GIC's with maturities spread over 1-5 years, a "ladder", so about 1/5 of the money matures every year. At least the interest income is tax free...

January 7, 2018
3:51 pm
dougjp
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DavidAlta13 said
Agreed, dougjp, hopefully the frustrating gap between long term GIC's & HISA's will be resolved over 2018.
While I am largely sticking to the HISA route for my non-registered funds, the RRSP & TFSA options aren't as flexible, due to the hassles of moving RRSP $'s between institutions, and the CRA's one year lag between TFSA's withdrawals and re-deposits.
Since the banks' registered account rates are so low, I have gone ahead and locked in most of my registered accounts' funds into GIC's with maturities spread over 1-5 years, a "ladder", so about 1/5 of the money matures every year. At least the interest income is tax free...  

I totally agree with that approach inside an RRSP. I can't believe how we get fleeced inside an RRSP on rates. 0.95% savings? Really?

January 7, 2018
3:59 pm
DavidAlta13
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So far my only answer to getting fleeced by the banks, since the extra profit goes to shareholders' via dividends & capital gains, is to be one of those shareholders and own some bank stocks. Thank goodness for dividend tax credits lowering my marginal tax rate from 30.5% on interest to 7.5% on dividends.

January 8, 2018
2:28 pm
toto
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Interesting, I got the 2.5 promotion today January 8th. My promotion starts Jan. 8th to May 31. When I saw my fellow bloggers got the promo January 4th , I had come to the conclusion that they missed me again, then Jan. 8th, my husband and I both got it.

January 8, 2018
2:38 pm
smayer97
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toto said
Interesting, I got the 2.5 promotion today January 8th. My promotion starts Jan. 8th to May 31. When I saw my fellow bloggers got the promo January 4th , I had come to the conclusion that they missed me again, then Jan. 8th, my husband and I both got it.  

Because of that I decided to check again...my wife still did not get it; nothing in Insights, nothing in Bonuses :-\

January 8, 2018
3:48 pm
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DavidAlta13 said
So far my only answer to getting fleeced by the banks, since the extra profit goes to shareholders' via dividends & capital gains, is to be one of those shareholders and own some bank stocks. Thank goodness for dividend tax credits lowering my marginal tax rate from 30.5% on interest to 7.5% on dividends.  

Like the old saying goes, if you want to know what stocks to buy, look at who's making the most money off you.

Ii can appreciate the strategy.

It becomes somewhat more problematic in retirement due to the gross-up which accompanies the dividend tax credit. This will affect the Age Amount credit, possibly the OAS clawback, possibility of moving you up to another tax bracket if you're really unlucky, and effect on other income-based arrangements to which you may be entitled. However, this only dilutes the usefulness, as investment income will still come from somewhere.

I prefer to look at Average Tax rather than Marginal Tax to get a sense of where I'm at with tax. This measures tax paid against income, without the marginalia. It reflects what you actually pay rather than what you would pay on an imaginary next investment if you were to make it, and can allow for all your tax credits.

I find that too much attention is paid to marginal rate by journalists and financial advisors who seem to enjoy instilling panic and extreme anti-tax sentiment. Have you ever noticed how many journalists' articles use as a starting point a marginal rate of 40-50%? - without ever acknowledging that this only applies to a relatively small minority of taxpayers. It makes for a dramatic story, however, and may contribute to certain political goals.

January 10, 2018
6:34 am
DavidAlta13
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Follow up to post 148 about Hubert's 4 business day hold, where I showed a screen shot of Hubert's hold on a deposit made Jan 4/18.
The hold was there 4 business days: the day of the deposit, Jan 4, plus 3 more, Jan 5, 8 & 9.
It is now Jan 10 and there is no hold:

Davids-Hubert-No-Holds-1.png

Hubert-4-day-hold-transaction.png

January 11, 2018
5:43 am
GreatWhiteNorth
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DavidAlta13 said
Follow up to post 148 about Hubert's 4 business day hold, where I showed a screen shot of Hubert's hold on a deposit made Jan 4/18.
The hold was there 4 business days: the day of the deposit, Jan 4, plus 3 more, Jan 5, 8 & 9.
It is now Jan 10 and there is no hold:
  

LOL, never doubted it; seems ironic that the only one asking for proof is the one making the most unsupported postulations 🙂

January 15, 2018
7:10 pm
moneyman
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I agree GreatWhiteNorth

Looks like DavidAlta13 has done another Screenshot Slam Dunk of TRUTH

DavidAlta I also bank with TD and I've never been offered a promo on their TD high interest account

How has your luck been with them?

January 15, 2018
8:04 pm
DavidAlta13
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My experience is TD's rates on deposits are only competitive w the other big banks, and they are so much lower than all the institutions listed in this site's comparison chart that they don't even show up.

As I wrote previously, my answer to the big banks being so profitable (a kind way of saying they pay less on deposits and charge more on loans & mortgages) is to own some of their shares and get my little cut of their big pies.

What I do with TD is keep a minimum balance of $5,000 in the "All-Inclusive Banking" chequing account:
This results in them waiving the monthly $29.95 account fees.
I have other reasons for doing this, but my math is this:
If I could find a place to earn 10.34% on my $5,000, that would be $517.12.
After I paid the tax on that, I'd be left w $359.40.
$359.40 / 12 = $29.95.
So I like to think TD is effectively paying me 10.34% on my $5,000.

I am sure that now I am over 60, I could find an account with no fees, but with the TD chequing plan I am on, I get instant links with my brokerage accounts (a huge convenience for transferring dividends twice a month, &/ after buying/selling securities & moving $ to/from Tang via the linked chequing account). My $85 annual safety deposit box rental fee is waived. And if I need to use any bank's ATM in Canada, USA or Mexico, there's no fee.

January 18, 2018
8:19 am
DavidAlta13
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I was wrong on the timing of the BoC's next 0.25% rate hike. I was forecasting the next one for 2018 Q4.
As shown in post 161, of the big banks, only 1 was forecasting an increase in 2018 Q1, so at least my prediction was as good as those of the biggest 5 banks.
It will be interesting to see how HISA rates change.

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