Personal Finance

Big 6 High-Interest Cash Funds/Accts [4.25% - 3.25%] [CAD/USD] [CDIC: Yes!] [i.e. HISAs for the discerning saver/client]

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  • Jan 28th, 2023 4:31 pm
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Newbie
Jun 21, 2022
3 posts
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Montreal
If I chose to reinvest automatically on CIBC IE, would it still count as interest, canadian dividend or capital gain? Wonder about tax consequences relative to other investment vehicles.
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Jan 11, 2020
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Torontois @ 宇宙中心
blackhat8287 wrote: These funds pay monthly dividends, right? What happens if I withdraw my money halfway throughout the cycle - do I lose the dividends for the whole month?
You'd have to read the terms and conditions of the specific one you're buying.

Don't call them dividends, it'll confuse you at tax time, they're interest payments/distributions.

For instance, TD https://www.td.com/ca/en/asset-manageme ... ons-EN.pdf:
5. Interest
The interest payable by the Bank on the TD ISA is calculated daily
on the opening credit balance and paid monthly by way of credit to
the TD ISA on the last Business Day of each month.


Daily interest will be accrued beginning on the Business Day
following the deposit in the TD ISA and ending on the Business
Day on which the order to withdraw funds in the TD ISA is
received from your Dealer. The interest rate is an annual rate and
the interest calculation is a simple interest calculation.
Interest
rates are subject to change at any time without notice at the Bank's
sole discretion. The current interest rates applicable to the TD ISA
may be obtained by visiting www.tdassetmanagement.com/isa.
Last edited by ADenariusSaved on Jan 15th, 2023 3:17 pm, edited 4 times in total.
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Jan 11, 2020
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Yongoh wrote: If I chose to reinvest automatically on CIBC IE, would it still count as interest, canadian dividend or capital gain? Wonder about tax consequences relative to other investment vehicles.
I haven't filed taxes on these myself, but I would surmise that this is interest payment. Dividends have associated credits because a corporation had already been taxed on the profits from which the dividends arrived. These are bank deposits generating deposit interest. Though, I don't know why they call them ISAs, maybe to distinguish them from their shittier "savings account" products?

Yep deposit, check TD's terms and conditions - though definitely read the T&C of the ISA you want to buy, this is an example:
https://www.td.com/ca/en/asset-manageme ... ons-EN.pdf
10. Deposit Insurance
The Bank is a member of Canada Deposit Insurance Corporation
(CDIC) and the TD ISA is a "deposit" within the meaning of the
Canada Deposit Insurance Corporation Act. To determine the
eligibility of your deposit for CDIC coverage, you should contact
the CDIC at [email protected] or 1-800-461-2342.
In tax shelters, I usually DRIP shit, but not in taxable accounts. It just helps me track things a bit better to have it come in cash. I increase the compounding period this way though, which isn't the greatest if rates are decent. 5% cash rates are mind boggling to me as I grew up in a ZIRP world. These elevated interest rates threw my "100% equities" investment model in a tailspin. Next thing you know, I might be buying bonds and GICs...Never thought that'd happen...
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Very good point! I guess I always have money scattered in random places that go over the threshold minimums somehow. Guess when you're at this for over a decade you forget what you did, where, when, why...and how? So this isn't a free place after all.

Low Activity Account Administration Fee2 $25.00 per quarter
https://www.scotiaitrade.com/content/da ... nglish.pdf
"2. The Low Activity Account Administration Fee (“LAAA Fee”) is charged on a per account basis each calendar quarter. This fee will be assessed based on the client’s account balances, trading activity and age at the close of business on each of March 15, June 15, September 15 and December 15 of each year. The LAAA Fee will be waived; i) for new clients who have opened their first account at Scotia iTRADE within the 6 preceding months, ii) for client accounts where at least 1 commission-generating trade was executed in any one or more of client’s Scotia iTRADE accounts during the preceding 3 months, iii) for Registered Plan accounts (RRSP, RIF, LIRA, LIF, RESP, TFSA), iv) for Cash Optimizer Investment Accounts, v) for clients with total account equity at Scotia iTRADE greater than $10,000, vi) for accounts of clients who have achieved the age of majority but are under 26 years of age at any point during the year for which LAAA Fees are assessed and vii) for Unclaimed Accounts, provided that in each of (i), (ii), (iii), (iv), (v) and (vi), all accounts of the client are fully activated and the client has a valid and current mailing address on file with Scotia iTRADE.

With respect to (vi), if applicable, the LAAA Fees will be charged for the year subsequent to the year during which the client turns 26 years of age. Commission-generating trades are buys and sells of: Equities, Options, Mutual Funds subject to commissions, and Fixed Income instruments. Buys and Sells of GICs, ETFs which do not generate a commission, Canada Savings Bonds and Provincial Savings Bonds, are examples of trades that do not generate commissions."
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Oct 23, 2005
186 posts
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Ottawa
ADenariusSaved wrote: Very good point! I guess I always have money scattered in random places that go over the threshold minimums somehow. Guess when you're at this for over a decade you forget what you did, where, when, why...and how? So this isn't a free place after all.

Low Activity Account Administration Fee2 $25.00 per quarter
https://www.scotiaitrade.com/content/da ... nglish.pdf
I've re-read it a few times and I can't figure out if I'll be charged a fee for DYN6004.. have $14,000 save there for my TFSA.. so am I going to be charged a fee come March?

Thanks!
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Dec 23, 2019
144 posts
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Anyone able to buy DYN6004 on NBDB? It shows up on there but I haven't tried buying it yet.
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crackerjack wrote: I've re-read it a few times and I can't figure out if I'll be charged a fee for DYN6004.. have $14,000 save there for my TFSA.. so am I going to be charged a fee come March?

Thanks!
You seem good, see the highlights. You can call to confirm, just uhh...use a speaker phone and read/watch tv/play some video games while you wait.

2
The Low Activity Account Administration Fee (“LAAA Fee”) is charged on a per account basis each calendar quarter. This fee will be assessed based on the client’s account balances, trading activity and age at the close of business on
each of March 15, June 15, September 15 and December 15 of each year. The LAAA Fee will be waived; i) for new clients who have opened their first account at Scotia iTRADE within the 6 preceding months, ii) for client accounts where
at least 1 commission-generating trade was executed in any one or more of client’s Scotia iTRADE accounts during the preceding 3 months, iii) for Registered Plan accounts (RRSP, RIF, LIRA, LIF, RESP, TFSA, iv) for Cash Optimizer
Investment Accounts, v) for clients with total account equity at Scotia iTRADE greater than $10,000, vi) for accounts of clients who have achieved the age of majority but are under 26 years of age at any point during the year for which LAAA Fees are assessed and vii) for Unclaimed Accounts, provided that in each of (i), (ii), (iii), (iv), (v) and (vi), all accounts of the client are fully activated and the client has a valid and current mailing address on file with Scotia iTRADE.
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Oct 13, 2006
2792 posts
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Burnaby
sznsws wrote: Anyone able to buy DYN6004 on NBDB? It shows up on there but I haven't tried buying it yet.
It says you have to call in, that's where I stopped I haven't enquired.
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Feb 24, 2008
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mike20002019 wrote: Correction: It seems that CIBC allow to buy other bank ISA. The order to buy Scotia DYN6000 is accepted without commission (DYN6004 with commission), pending for confirmation. RBC DI for sure, it does not allow. When an order was placed, it gave the error "You have entered an invalid mutual fund symbol. Please enter a valid mutual fund symbol and try again."
Did your DYN6000 order at CIBC IE change from pending to confirmed? If so, how long did it take? I placed mine during business hours yesterday, and it says "contracted", not sure what it means or if it will even go thru.
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May 3, 2008
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Markham
kulb wrote: Did your DYN6000 order at CIBC IE change from pending to confirmed? If so, how long did it take? I placed mine during business hours yesterday, and it says "contracted", not sure what it means or if it will even go thru.
Takes 2 days. IE allows dyn6000, can’t do dyn6004. You will be fine,
Jr. Member
Nov 26, 2019
163 posts
111 upvotes
ADenariusSaved wrote: You'd have to read the terms and conditions of the specific one you're buying.

Don't call them dividends, it'll confuse you at tax time, they're interest payments/distributions.

For instance, TD https://www.td.com/ca/en/asset-manageme ... ons-EN.pdf:
It is still confusing. For example, if I buy 1k dollars on the 1st day of month, and sell 1k dollars on 15th of month, will I get a half month interest payment at the month end?
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Jan 31, 2007
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kulb wrote: Did your DYN6000 order at CIBC IE change from pending to confirmed? If so, how long did it take? I placed mine during business hours yesterday, and it says "contracted", not sure what it means or if it will even go thru.
Can you share how you find it in CIBC IE? I can't find any ISA
******************************************************
Bright side of RFD: Often find good deal
Dark side of RFD: Tons of stuff that I don't need but still got them because of RFD
******************************************************
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Jan 11, 2020
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mike20002019 wrote: It is still confusing. For example, if I buy 1k dollars on the 1st day of month, and sell 1k dollars on 15th of month, will I get a half month interest payment at the month end?
Seems like it, but interest will start accruing on the day after your deposit. It will stop accruing once TDDI tells the TDB8150 that you're withdrawing. I haven't used this one before, and I'm still too new to DYN6004 to see its inner workings.
5. Interest
The interest payable by the Bank on the TD ISA is calculated daily
on the opening credit balance and paid monthly by way of credit to
the TD ISA on the last Business Day of each month.

Daily interest will be accrued beginning on the Business Day
following the deposit in the TD ISA
and ending on the Business
Day on which the order to withdraw funds in the TD ISA is
received from your Dealer.
The interest rate is an annual rate and
the interest calculation is a simple interest calculation. Interest
rates are subject to change at any time without notice at the Bank's
sole discretion. The current interest rates applicable to the TD ISA
may be obtained by visiting www.tdassetmanagement.com/isa.
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Jan 11, 2020
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cheapshopper wrote: Can you share how you find it in CIBC IE? I can't find any ISA
In the other brokers I have, I had to go into the mutual funds section. CIBC is one of the few brokers I don't have in Canada =/.
Jr. Member
Nov 26, 2019
163 posts
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ADenariusSaved wrote: Seems like it, but interest will start accruing on the day after your deposit. It will stop accruing once TDDI tells the TDB8150 that you're withdrawing. I haven't used this one before, and I'm still too new to DYN6004 to see its inner workings.
I just bought DYN6000 and sold it after two days. So I will know the answer by the end of month.
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May 3, 2008
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Markham
mike20002019 wrote: I just bought DYN6000 and sold it after two days. So I will know the answer by the end of month.
Actually think they pay out the interest after you sold, dont have to wait month end. Pls report back if that is the case and you rec 2 days worth of interest.
Thanks
Jr. Member
Nov 26, 2019
163 posts
111 upvotes
savemoresaveoften wrote: Actually think they pay out the interest after you sold, dont have to wait month end. Pls report back if that is the case and you rec 2 days worth of interest.
Thanks
I will report this by early next month here.

Just wondering if someone can do a try test on money market mutual fund. I sold DYN6000 and bought CIB237 (money market fund) because of CIB237 has a higher return (4.5%). I am wondering if the similar interest payout will be the same as DYN6000?

In the CIB237 document, it says "strives to maintain a NAV per unit of $10 by allocating income daily and distributing it monthly...", "The Fund allocates net income daily and distributes it monthly". It does not use "accrue" wording here like ISA. If it is same, for CIB237, you may see some amount of CIB237 will show up again in the beginning of next month after you sell it.

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