Personal Finance

Moving to US, best solution for bank account and moving money?

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  • May 29th, 2020 12:26 am
[OP]
Sr. Member
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Jul 28, 2008
676 posts
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GTA

Moving to US, best solution for bank account and moving money?

I'm moving to California soon, and I'm trying to figure out the best way to handle my banking. Right now I bank with Simplii, and I have TFSA with Tangerine and additional savings and RRSP with Wealthsimple. I know I should cash out the TFSA, so I'll probably move it all to my Simplii account at first, because I will probably need the money for relocation and buying a car and just to have cash in the US until I can build up savings from my US income. I'm trying to figure out the best way to move my money from Simplii to a US bank.

I'm considering opening a US RBC account. According to their website, it appears that I can open the account from Canada so it's ready when I get there, and transfers between the Can & US RBC accounts are free. However, I can't seem to be able to open an account online because I need to have a Canadian RBC account first. My question is, is this the best way to go, to open new Canadian and US accounts at RBC, and pay the monthly fees on the Canadian account (the US acct would be free for a year I think)? I'm not used to paying monthly fees for banking, so I'm not too happy about this option, but I suppose it can work short term if there is no better option. I'm just thinking this may be easier/cheaper for moving money around quickly compared to transferring from my Simplii acct to a random US bank. Also I can open a US credit card with RBC with my Canadian credit history, so I wouldn't have to worry about starting with a secured card in the US.

What about services like XE Money Transfer or OFX (the latter was recommended by my relocation advisor). Would it be better to use this service to transfer directly from Simplii to any random US bank? Which is the best option for the best exchange rate and lowest overall cost? I would be moving around $50-70K CAD.

Any recommendations for how much of my money to move over, vs. leave in Canada, considering tax or any other implications? Obviously I'm leaving my RRSP, but what about other savings? Right now my non-TFSA, non-RRSP savings are just in a high-interest savings account at Wealthsimple, and my TFSA will be cashed out anyway.

Any other tips?
17 replies
Deal Addict
Dec 16, 2017
2541 posts
1037 upvotes
CND Brain & Hear…
1. Where in California?
2. RBC sucks.
3. Review stuff in my signature.
4. PM for some details.
Give me a J. I'm a maniac and an African expert.
Deal Addict
Aug 18, 2018
1786 posts
1367 upvotes
Bay Area
(full disclosure: I moved the US after finishing my MSc, so I had a lot less stuff to worry about)

As you mentioned, cash out the TFSA and shut it down for good unless you want to deal with reporting foreign trusts to the IRS. Tbh I wouldn't even bother with cross-border banking unless you need to transfer large sums of money between US/CAN frequently for whatever reason. Two things to keep in mind that might help you decide whether to leave money in Canada or move it all to the US:

1. You have FBAR reporting requirements if at any point during the year (even for just one day), you have more than $10K USD combined in your foreign bank and financial accounts. Additionally, if you have assets (this includes non-liquid assets such as real estate) that value over $50K USD, you additionally have FATCA reporting requirements with the IRS
2. Any interest you earn in your HISA is subject to the higher of your US or Canadian tax rate (US interest income gets taxed at your highest marginal tax bracket; not sure about Canada)

Depending on how much total assets you have and the exact details of your financial situation, your tax situation may be such that you'd need the help of an accountant anyway to do your taxes each year. Especially so if you still want to maintain your residency status in Canada and don't/can't file an exit return with CRA. Since I was a broke grad student with next to 0 assets, and because I didn't want to deal with the headaches of cross-border tax and paying $500+ for an accountant to do my taxes each year, I just completely shuttered everything when I left Canada, and started over again in the US.

If you have an Amex, doing Global Transfer is the easiest way to get a head start with credit cards in the US. You can also try your luck at Bank of America and see if they'd be willing to use your Canadian history. Otherwise if you have any Canadian CCs that don't charge FX fees, you can use those in the mean time to tide you over.
[OP]
Sr. Member
User avatar
Jul 28, 2008
676 posts
40 upvotes
GTA
dekvitaly wrote: 1. Where in California?
2. RBC sucks.
3. Review stuff in my signature.
4. PM for some details.
Does it make a difference where in CA?
Thanks for the link.
arkane wrote: (full disclosure: I moved the US after finishing my MSc, so I had a lot less stuff to worry about)

As you mentioned, cash out the TFSA and shut it down for good unless you want to deal with reporting foreign trusts to the IRS. Tbh I wouldn't even bother with cross-border banking unless you need to transfer large sums of money between US/CAN frequently for whatever reason. Two things to keep in mind that might help you decide whether to leave money in Canada or move it all to the US:

1. You have FBAR reporting requirements if at any point during the year (even for just one day), you have more than $10K USD combined in your foreign bank and financial accounts. Additionally, if you have assets (this includes non-liquid assets such as real estate) that value over $50K USD, you additionally have FATCA reporting requirements with the IRS
2. Any interest you earn in your HISA is subject to the higher of your US or Canadian tax rate (US interest income gets taxed at your highest marginal tax bracket; not sure about Canada)

Depending on how much total assets you have and the exact details of your financial situation, your tax situation may be such that you'd need the help of an accountant anyway to do your taxes each year. Especially so if you still want to maintain your residency status in Canada and don't/can't file an exit return with CRA. Since I was a broke grad student with next to 0 assets, and because I didn't want to deal with the headaches of cross-border tax and paying $500+ for an accountant to do my taxes each year, I just completely shuttered everything when I left Canada, and started over again in the US.

If you have an Amex, doing Global Transfer is the easiest way to get a head start with credit cards in the US. You can also try your luck at Bank of America and see if they'd be willing to use your Canadian history. Otherwise if you have any Canadian CCs that don't charge FX fees, you can use those in the mean time to tide you over.
Thanks for the reply, you reminded me about Amex. I had read about that but forgot. Yeah, this is all much more complicated when you're established with a career and assets. My brother did the same as you, moved there straight out of university, it's a different situation.
Jr. Member
Aug 19, 2016
164 posts
75 upvotes
Simplii will force you to close all your accounts once they learn that you are in the US. Tangerine will allow you to keep any accounts that were opened before you moved, but will not allow you to open any new ones.

You will want to check with WealthSimple and see what they are going to do. They are quite likely to close your accounts as well--but who knows.

You might want to establish a relationship with a big bank like RBC, because they will have no problem serving people living overseas, whereas the smaller companies and online banks refuse to.
[OP]
Sr. Member
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Jul 28, 2008
676 posts
40 upvotes
GTA
Really? I haven't heard that Simplii would close my accounts, I'll have to look into that, thanks for the heads up.

So this brings me back to my original question - what's my best solution for a bank with Canadian and US accounts, and a presence in California? Out of RBC, TD and HSBC, none seem to have a presence in San Diego. Even if I close my Canadian accounts eventually (except RRSP), temporarily I will need to have accounts in both countries, maybe for a year or so. I've been trying to come up with a solution for weeks before I posted this thread, and I'm still not getting anywhere.
Deal Addict
Dec 16, 2017
2541 posts
1037 upvotes
CND Brain & Hear…
If you were to be somewhat more collaborating I'd have given you certain options.

1. Canadian bank can stay the way it is. You can always move CAD to USD using KBFX or TW remotely.

2. US bank: highly recommended for now BMO Harris. US credit card: TD Cash VISA and First Arkansas MasterCard.
Once you move, open Banner Bank in San Diego, they can pull Canadian credit bureau for you.
Certain credit issuers allow Canadian residents such as IKEA VISA and Orbitz VISA by Comenity.

Amex can be obtained without Canadian Amex as of their new program - to be done once you're in California.

In short I don't have a lot more to show you. Cheers
Give me a J. I'm a maniac and an African expert.
[OP]
Sr. Member
User avatar
Jul 28, 2008
676 posts
40 upvotes
GTA
@dekvitaly I do appreciate that you're trying to help, but your recommendations aren't very useful if you don't explain why those are your recommendations. i.e. "RBC sucks," "highly recommended for now BMO Harris" is not useful to me without further justification, and sifting through dozens of pages of mostly Canadian residents wanting a card for US travel is not a good use of my time, considering all the urgent things I need to plan for my relocation. Regardless, I will look at the options you suggested, but I can't read your mind on why those are your suggestions.

@inside I called Simplii today and they said my accounts can remain open through my transition period. The rep said that while they prefer to close accounts of non-Canadian residents, there is no hard deadline, and 3-6 months sounded reasonable.

So for now I will plan on keeping my Simplii account just until I am set up with a local bank in San Diego, rather than looking for a cross-border banking option.

On a related note, in case this is useful to anyone reading this thread in the future, Wealthsimple doesn't keep accounts for non-residents, not even RRSP. The rep said I can/should keep my RRSP, just not with them. haha. So I'm looking for a new forever home for my RRSP now, as well as having to convert my DCPP that's currently with SunLife. Any suggestions are welcome.
Deal Guru
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May 8, 2009
14085 posts
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Not Leask
@starrysim our colleague @dekvitaly is a big fan of US banking, and makes recommendations based on ease of signup and value of product. For financial products we like to minimize fees, avoid minimum balances if possible, and maximize rewards wherever the situation allows.
  1. BMO Harris grants no fee US based checking accounts to Canadians. You can set it up from Canada. TD Cash is by far the best US issued VISA you can get as a cross-border applicant from Canada. It's available to US residents of the east coast, plus we Canadians who send a PDF form. It's a really good product that many Americans choose to have if they can
  2. RBC Bank has hefty min balances to waive banking fees. Most Canadians who start with them later cancel RBC since it's not too competitive. The only perk is that you can get it all setup in branch at RBC in Canada, and no need for a US address. But, the products themselves are nothing great, especially for long term use. Only welcome bonus is fee waiver for up to a year on daily banking when they roll out that promo, still nothing special
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Newbie
Oct 4, 2010
1 posts
toronto
@starrysim Hi! I am in a similar situation, looking to move to California (SF) from Toronto. Which bank did you end up going with? Also what did you do with your Sunlife DCPP? My DCPP is with Manulife, and I am looking for options to convert. Any tips would be much appreciated!
[OP]
Sr. Member
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Jul 28, 2008
676 posts
40 upvotes
GTA
gel wrote: @starrysim Hi! I am in a similar situation, looking to move to California (SF) from Toronto. Which bank did you end up going with? Also what did you do with your Sunlife DCPP? My DCPP is with Manulife, and I am looking for options to convert. Any tips would be much appreciated!
@gel Sorry, just saw this, I hope this is not too late. Maybe it will be useful to someone else.

I opened a Bank of America account the day I landed as per recommendation from my relocation consultant. She said it was the one bank that would open an account with no SIN and my work address. I'm not sure if that's true, but I had a million things to do and this was the easiest. I transferred money from my Canadian accounts using XE Money Transfer. I tried Simplii's Global Money Transfer as well, but there was an extra wire fee when it was received by B of A, so from then on I used XE and transferred money in batches whenever the exchange rate looked good.

I converted my SunLife DCPP to LIRA and kept it with SunLife, invested in low-cost index funds. There is no issue with US residency. I don't know about Manulife.
I moved my RRSP from Wealthsimple to Questrade, invested in index ETFs. No issues with US residency either, except you can't buy mutual funds (can't use Questwealth Portfolio), you can only do self-directed.
Moved all money out of TFSA, this is important (into regular chequing temporarily until transferring to US).

I'd be happy to help further, feel free to PM me as well (I changed my notification settings so I'll get an e-mail). It was a very long road to figure out how to handle all my finances for the move. Now I'm figuring out taxes and FBAR for the first time, it never ends!
Jr. Member
Nov 23, 2014
149 posts
34 upvotes
East York, ON
You can try knightsbridgefx, they are listed as a payee with rbc, so you can send funds online from anywhere in Canada or the USA and get a good rate, pretty easy to do, and then move the funds to the USA account.

starrysim wrote: I'm moving to California soon, and I'm trying to figure out the best way to handle my banking. Right now I bank with Simplii, and I have TFSA with Tangerine and additional savings and RRSP with Wealthsimple. I know I should cash out the TFSA, so I'll probably move it all to my Simplii account at first, because I will probably need the money for relocation and buying a car and just to have cash in the US until I can build up savings from my US income. I'm trying to figure out the best way to move my money from Simplii to a US bank.

I'm considering opening a US RBC account. According to their website, it appears that I can open the account from Canada so it's ready when I get there, and transfers between the Can & US RBC accounts are free. However, I can't seem to be able to open an account online because I need to have a Canadian RBC account first. My question is, is this the best way to go, to open new Canadian and US accounts at RBC, and pay the monthly fees on the Canadian account (the US acct would be free for a year I think)? I'm not used to paying monthly fees for banking, so I'm not too happy about this option, but I suppose it can work short term if there is no better option. I'm just thinking this may be easier/cheaper for moving money around quickly compared to transferring from my Simplii acct to a random US bank. Also I can open a US credit card with RBC with my Canadian credit history, so I wouldn't have to worry about starting with a secured card in the US.

What about services like XE Money Transfer or OFX (the latter was recommended by my relocation advisor). Would it be better to use this service to transfer directly from Simplii to any random US bank? Which is the best option for the best exchange rate and lowest overall cost? I would be moving around $50-70K CAD.

Any recommendations for how much of my money to move over, vs. leave in Canada, considering tax or any other implications? Obviously I'm leaving my RRSP, but what about other savings? Right now my non-TFSA, non-RRSP savings are just in a high-interest savings account at Wealthsimple, and my TFSA will be cashed out anyway.

Any other tips?
Jr. Member
Jul 17, 2018
198 posts
109 upvotes
Are you planning on closing all of your Canadian bank accounts? It not, why not open a US bank account that would be convenient for you there? If you have immigration documents (whether it is school or work) and a physical US address you should be able to open a bank account without SIN no problem.
Member
Feb 13, 2011
267 posts
30 upvotes
I opened a TD Bank account in the US and linked it to my TD Canada Trust account. Transferring money back and forth has been super easy. Highly recommend it.
Newbie
Jan 21, 2018
26 posts
12 upvotes
Lots of great tips here so far. I ultimately went with RBC cross border since they offer instant cross border transfers in both directions with no fees. I do the multi-product rebate with Royal Bank by loading my Amazon account once a month with a credit card and setting up auto contribute to a TFSA of $0.01. So yeah you do need to open minimum three products with RBC first but it’s not too bad and then there are no fees after that. You can also open a USD savings account on the Canadian side if you don’t want to convert right away and you can either get one transfer free per month or switch to the $2 a month plan if you do more than that. On the RBC Bank side, I opened a money market since that was the only savings account I could open online and I parked $1000 there to avoid fees. You get 6 withdrawals a month (a US regulation thing) and unlimited transfers into the money market. I was able to do everything online except for one phone call I had to make to link my US and CAD online banking accounts together.

For actually converting currencies though, I wouldn’t do that with a big 5 bank, but rather with Tangerine or a discount brokerage/online transfer company etc.

Schwab’s online checking account is popular with Americans for their no fx debit card and worldwide atm fee refunds, but they perform a credit check so you might have problems getting this right away. You could try opening a TD Ameritrade account online which comes with a debit card and is almost as good.

Unlike Canada with its etransfers, there are numerous services for sending money electronically in the US. Personally I like Google Pay and Zelle the best, or Apple Pay/Cash if you are an iPhone user. It really depends on your situation and what works with your bank so there really isn’t a best one to use for all people.

If you’re looking for no fx Cad credit cards or prepaid cards, there are numerous other threads on this topic. I went with Brim.
Jr. Member
Jan 24, 2013
195 posts
167 upvotes
Rainy River
I have the $300.00 minimum balance RBC Bank Georgia personal savings account and it works great. It used to be you could open up either of the savings account and pay no monthly fee with either a $300.00 min balance for the savings or $1000.00 for the preferred money market account. According to the footnote on the website you now have to have a checking account first in order to open up a savings account.

I think there used to be a way, check old threads that you could open up the preferred money market account online and they wouldn't require you to open up the fee based checking account. Don't know if that still works or not. Also some people had luck by calling RBC Bank Georgia directly and opening up the account with them directly.

If none of that works HSBC is a good alternative if you have 100 K in your online brokerage accounts. BMO Harris and BMO isn't bad although you'd have to carry a minimum balance to avoid fees, don't really know much about TD as I've never liked them. CIBC has something as well with CIBC in the US but you need a big minimum balance $3500 US I believe to avoid monthly fees.
Jr. Member
Jan 24, 2013
195 posts
167 upvotes
Rainy River
CIBC US Smart Account is actually $3000.00 US minimum balance to waive fees, sorry about that.

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