Personal Finance

Simplii (ex PCF) ... 3% new deposits promo: Nov 1, 2017 - February 28, 2018

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  • Jul 13th, 2018 10:51 am
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Dec 14, 2007
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bylo wrote:
Nov 2nd, 2017 12:17 pm
I don't disagree with the general points you've made above, especially since they echo what I just said upthread ;)

However I take issue about how many people "here putting the BULK of their growth portfolio in a HISA," especially the "growth" qualifier which strikes me as a kind of non sequitur. If the bulk of their assets are in an HISA then, by definition, it's not a growth portfolio ;) I doubt many people are confused on that distinction.
Yes, agreed... although for many, they only see the increases and don't take into consideration inflation or taxation.

It's reminds me of that friend who looks at the condo that they purchased for $250,000 looks at their $180,000 mortgage and think they are earning a $100,000 windfall if they can sell it for $280,000. In reality, they don't include the $60,000 downpayment ( not part of the investment ) $15,000 in transactional fees and other hidden costs.
Some more points:

1. Many (most?) people who think they can handle investment risks like market volatility do so having never actually experienced it. Then the first time there's a correction, let alone a crash like 2008, or the 2000 Internet bubble burst, or the 1987 crash, etc. usually panic and sell--at the worst possible time. Suddenly they realize that their previously-held swagger was just hubris. IMO there's no other way to determine one's risk tolerance but to live through a major crash. Some of those who do and who learn from it, vow to steer clear of equities in the future. Whether that's rational or not is immaterial. It's their money. It's also their good night's sleep.

2. There are many people who don't need to invest in equities at all. Between pensions, CPP/OAS and their portfolio of GICs, they have more than enough to live on, including provision for emergencies, without having to take any equity risk. Consider a retired couple with $2M in GICs. Even at 2% interest there's $40k income in addition to perhaps $30k in CPP/OAS, not to mention private pension plans. Why should they want to invest in equities when they don't need to?

3. These days even 5-year GICs pay around 2%. (Yes some pay more, but others, especially the big-5 banks pay even less.) With interest rates set to rise (at least according to the experts) I suspect many people are hesitant to lock in for 5 years at such low rates, especially when they can wait it out for 3 months AND earn 50% higher rates, e.g. 2.75% (TING) or 3% (Simplii.) In this situation they're holding large amounts in HISAs, not out of ignorance or inertia, but rather deliberately to earn higher-than-GIC rates as well as in the expectation of rising rates. Moreover with all the HISA players competing with promo rates on HISAs it's likely this situation will continue well into 2018. My contention is that in this climate holding HISAs at promo rates at TING and Simplii is more rational than buying 5-year GICs at 1.8% from their owners BNS and CIBC.
Some great points. Thanks for sharing. And yes... and totally agree about GICs. It's a bit more work, but HISAs make way more sense for the GIC crowd. However, your points to lend themselves well to my original point, that if you're playing around with $300,000+ in HISAs you likely have the bulk of your wealth elsewhere ( equities, pensions, fixed income, portfolio ).

Is there anyone here using HISAs as the BULK of their wealth, though? That's what I was initially curious about. Interesting conversation, all.
I'd love to write history... in advance.
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it.beaulieu wrote:
Nov 2nd, 2017 1:35 pm
Not available in Qc..
If you know someone outside of Quebec, you can open your account with that address then switch it to your Quebec one and continue using.
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peli33 wrote:
Nov 2nd, 2017 4:05 pm
If you know someone outside of Quebec, you can open your account with that address then switch it to your Quebec one and continue using.
So as long as you open it in a province other than Quebec you can use the account if you move to Quebec?

Do all financial institutions which don't do business with Quebeckers work this way?
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mkl38s wrote:
Nov 1st, 2017 9:34 pm
you should be fine as today is Nov 1 and the Simplii looks at Oct 31st balance
It was more a question of, does it qualify as a new deposit to savings account if it is first deposited to the chequing account and then transferred in?
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minimalist wrote:
Nov 2nd, 2017 5:33 pm
So as long as you open it in a province other than Quebec you can use the account if you move to Quebec?

Do all financial institutions which don't do business with Quebeckers work this way?
Better confirm with each institution. EQ does allow and Simplii as well. You may have to call them to manually update your address as website may not allow.

You may have limitations such as inability to open new accounts.
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How long does it take to push money from Tangerine to Simplii? showing up the same day money disappears from Tangerine or 1 day later?
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mkl38s wrote:
Nov 2nd, 2017 7:36 pm
How long does it take to push money from Tangerine to Simplii? showing up the same day money disappears from Tangerine or 1 day later?
two business days.
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Jul 17, 2008
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Hope this isn't as miss-managed as pc financial promos. Had a promo where the bonus wasn't even given.

This is going to be a pain tracking if they correctly give out the bonus or not
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Apr 17, 2014
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Messerschmitt wrote:
Nov 2nd, 2017 9:07 pm
Hope this isn't as miss-managed as pc financial promos. Had a promo where the bonus wasn't even given.
Then you probably didn't qualify for it. I never had any problems with bonuses.
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Nov 1, 2017
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Tangerine doesn't allow incoming wire transfers, but Simplii does.

For international wire transfer of funds to a Simplii Financial bank account from everywhere in the world, except from the United States, you must provide the initiating institution with the following information:

- Pay to: Canadian Imperial Bank of Commerce Toronto, Canada - Swift code : CIBCCATT - Beneficiary's account number - Beneficiary bank: //CC001030800

Simplii Financial 305 Milner Avenue 5th Floor Scarborough, Ontario Canada M1B 3V4

- Financial institution number: 010
-Simplii Financial's transit number: 30800
- Beneficiary account number
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Nov 1, 2017
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Anyone with PCF, when was your bonus interest paid out ? Did you guys already receive the promo rate for the recent Oct 31 ended 2.5 % rate from PCF ?

So how & when will the Bonus 2 % interest be paid out by Simplii Financial ?

I am guessing we will get 1 % regular interest at the end of each & every month. Am I right ? Or will the entire 3 % paid out in March and no 1 % at end of each month ?

And the bonus promotional l 2 % interest for 4 months will be paid in one lump sum in March, 2018. Does any one know when in March the bonus rate will be paid out ? Like March 5, March 10 , March 15 or something like that ?

When did the bonus interest with PC Financial arrive ? 1 week after the promotion ended or something like that ?
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fasterfeney wrote:
Nov 3rd, 2017 1:45 am
Anyone with PCF, when was your bonus interest paid out ?
The bonus came as a lump sum one or two weeks after the promo period ended. The exact day varied. Regular interest was paid monthly, promo or not.

One benefit of delaying the bonus payment to 2018 is that you don't have to pay income tax on it until the end of April 2019.
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bylo wrote:
Nov 3rd, 2017 7:34 am
The bonus came as a lump sum one or two weeks after the promo period ended. The exact day varied. Regular interest was paid monthly, promo or not.

One benefit of delaying the bonus payment to 2018 is that you don't have to pay income tax on it until the end of April 2019.
I wonder how many are actually claiming the interest on their taxes, especially when interest earned is <$50 and no T5 is issued by the bank --> interesting fact, banks must still report all interest, even if a T5 isn't issued.

So for those that are moving money multiple times per year, are you using spreadsheets to track deposits, interest, etc...What are you doing at tax time if you're not keeping track??

I've been taking money in/out of noth a TD money market fund and a HISA all year, not tracking the numbers at all. I presume I'm going to have a nightmare trying to sort it all out in the spring.

Also, for anyone interested, here's an RFD thread on this topic
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hebsie wrote:
Nov 3rd, 2017 8:09 am
I wonder how many are actually claiming the interest on their taxes, especially when interest earned is <$50 and no T5 is issued by the bank --> interesting fact, banks must still report all interest, even if a T5 isn't issued.
Yes, you have to report all interest even if less than $50.

However, those who are earning less than $50/year even when there's a promo like this don't have much on deposit ($1,666 x 3% = $50 per year.) This promo probably isn't worth the effort for them of opening up a new account and transferring money, etc.
What are you doing at tax time if you're not keeping track?
Financial institutions are required to issue T5 slips on amounts over $50. Copies of the T5 go to CRA. There's no practical way to avoid this or avoid paying tax on it.

If you distrust the banks' calculations then by all means track the payments by spreadsheet. I've done it a few times in the past and every time my numbers matched the T5 to the penny.
TD money market fund and a HISA all year, not tracking the numbers at all. I presume I'm going to have a nightmare trying to sort it all out in the spring.
TD will issue a T5 for the MMF. There's no capital gain/loss on a MMF because the share value stays at a constant $10 so there's nothing but interest to track.

HISAs and RRSPs, etc. are even easier because they're tax sheltered so there's no tax on interest. Again nothing to track or report as long as the money stays inside the HISA, RRSP, etc.

What can get complicated is when a couple pools their money into a single HISA, perhaps because one spouse got a bonus promo offer and the other didn't. In that situation each spouse has to report the interest earned on their contributions to the account. This gets further complicated because only one T5 gets issued for the entire amount of interest earned to the first name on the account. In that case the two spice have to split the amounts accordingly and may be required to share their calculations with CRA. ("May" means typically when the amounts are large.) But this is way beyond the scope of this thread.
Last edited by bylo on Nov 3rd, 2017 8:24 am, edited 2 times in total.
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