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Email this10:29 am
February 17, 2013
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I noticed earlier in the week that the branch I drive by has lowered the TFSA from 2.25 to 2%. Web site now shows the same, although as of today, their on-line affiliate, Canadian Direct Financial, still shows 2.25% on their TFSA HISA.
4:17 pm
August 9, 2014
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Almost time for me to switch to implicity, just waiting for my GIC to mature.
5:32 pm
August 5, 2014
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Rick and Jon, Peoples Trust Company still has a 3.00% TFSA savings account rate but it makes you think if they will lower that too.
They have a good track record of keeping that 3.00% TFSA savings account rate for more than 5.5 years now. I guess this is the chance you take with higher interest savings accounts that are variable and not fixed like GIC's.
6:16 pm
October 27, 2013
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This is mostly a break even, or loss leader, for PT to get the more industry competitive GIC and HISA business. Given TFSA limitations, PT is committing to accounts not more than $31.5k each at the moment.
6:40 pm
August 5, 2014
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AltaRed, I suspect that too. I guess once they hit a certain amount of TFSA deposits or all deposits, they may cut rates or find some other way of making a profit somewhere else.
The last 5.5 years for liquid, risk free TFSA money 3.00% was a good investment.
7:08 pm
August 5, 2014
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Canadian Tire Bank dropped their TFSA savings rate too from 1.90% to 1.60%. Maybe this is another reason that CWB cut their rate 25 basis points to 2.00%.
There is less competition for higher TFSA savings account rates near 2.00%.
7:49 pm
December 23, 2011
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Jack Manning said
Rick and Jon, Peoples Trust Company still has a 3.00% TFSA savings account rate but it makes you think if they will lower that too.
They have a good track record of keeping that 3.00% TFSA savings account rate for more than 5.5 years now. I guess this is the chance you take with higher interest savings accounts that are variable and not fixed like GIC's.
I hear what everyone is saying. The rate has been unchanged for 5 years and some times that 3% would have been lower than a GIC. So they and the consumer have been on a roller coaster of give and take and while you should net more based on intereste calculated daily, paid monthly vs a 3% GIC. So not a bad deal. But they must be aware if their rate the did go lower it is so easy to move the funds to a non registered account in December and reinvest elsewhere in January at a competitive rate and bypass waiting for funds to mature and no transfer fee.
7:49 pm
October 21, 2013
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Peoples could lose a lot of those TFSA depositors whom they have so carefully cultivated if they lower their rate. I don't think they would want to do that, so I think there is an incentive for them to maintain the rate as long as they reasonably can.
I like the fact that their strategy seems consistent. It gives me more confidence in them.
8:00 pm
August 5, 2014
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Kanaka and Loonie, I hope they keep that 3.00% TFSA savings account rate but the wild card is always if financial institutions get bought out or change hands.
I don't see this happening but ING Direct and Canada Trust are 2 examples that I thought would never happen. We used to have a $20,000 6.45% 5 year GIC paying monthly interest at Maple Trust Company in 2000 but was later bought out by Scotia Bank.
We obviously had to move our matured GIC money because of much lower GIC rates compared to other financial institutions.
10:22 pm
October 21, 2013
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Yes, I suppose that's a good point, that Peoples could be bought out. Their website says they've been around since mid-'80s, but Canada Trust was around a lot longer than that.
Website also says they "decided to concentrate our resources on a carefully selected suite of financial products and services". It seems to me that's part of the strategy in regards to TFSAs.
On the other hand, if they sell out, the buyer gets a strong TFSA portfolio but with no commitments, so it's up to the new owner to retain the customers. But we know that a significant percentage of customers anywhere are lazy and won't be in any hurry to move their money.
Good deal for both seller and buyer, fetches a great price, and everybody except us goes home happy.
Hmmm.
10:52 pm
August 5, 2014
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Loonie, I guess if Peoples Trust Company gets into a bind or if they can make a huge profit by selling to another financial institution then it is a possibility.
Loonie, more competition is what we really need and sustained, real rise in savings, GIC's, bond rates of at least 1% point even if it takes 1 to 2 years. It looks like this will not happen.
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