Selling property - how to park money for 6 months

Jumpityjump wrote: ↑ We've decided to sell our home and then just rent for a while. I understand the risks but this is not what the post is about !

I wanted to know. If we net 1.1M from the home sale, and leave it in the bank for about 6 months before I make a next move, how would you split the money?

I'm thinking some high interest account offers (3%) but I need to split it for CDIC insurance purposes. CDIC only insure 100K.

Any ideas?

Thanks

smartie wrote: ↑ Do you worry TD will bankrupt in 6 months?

sw1ft wrote: ↑ This is a common misconception - CDIC insures $100,000.00 for each Insurance Determination Category.
I implemented CDIC (from an IT-standpoint) when it first launched. Take a look at the graphic here:

cdic.png

https://www.cdic.ca/your-coverage/prote ... r-deposit/

That said, it's possible to setup multiple accounts under different product categories and have them all insured by CDIC insurance.

Type of account (I.e. Basic, Joint, Trust) x Insurance Determination Category (e.g. Saving, Chequing, GIC, RRSP, TFSA, RRIF, etc.) all have their own separate $100,000.00 insurable amount.


Basic (Individual account - you) x Saving Account = $100,000.00 coverage
Basic (Individual account - wife) x Saving Account = $100,000.00 coverage
Basic (Individual account - you) x Chequing Account = $100,000.00 coverage
Basic (Individual account - wife) x Chequing Account = $100,000.00 coverage
Joint (You and your wife) x Saving account = $100,000.00 coverage
Joint (You and your wife) x Chequing account = $100,000.00 coverage
Basic (Individual account - you) x TFSA Account = $100,000.00 coverage
Basic (Individual account - wife) x TFSA Account = $100,000.00 coverage
etc.

xiaobao wrote: ↑ I did something similar (I sold but wanted to buy right away but took a few months due to the market being crazy). just be vary that it can cause alot of pain down the road if you start transferring the money everywhere and want to get a mortgage. My mortgage broker failed to tell me they need 90 days of statements, even though every single cent for my down payment was account for via the lawyer documents. But apparently that was not good enough.


All of sudden I had to get tons of statements from multiple bank accounts and banks showing where all the money went (did this during subject removal it was so stressful) and Canadian Tire bank has/had a bug where it does not print your name on the statement (so my lender said they could not use that amount till they see a name on it), so that lead to calling them multiple times a day till they finally sent by fax the statements.

It was a huge mess, then I had to transfer everything back to Scotia to get a bank draft and since EQ only allows 30K per transaction but unlimited times, it got flagged by the teller and I was there for like 30mins while he ran around the entire branch getting approval till in the end the branch manager had to come and talk to me before he released the funds.

sw1ft wrote: ↑ This is a common misconception - CDIC insures $100,000.00 for each Insurance Determination Category.
I implemented CDIC (from an IT-standpoint) when it first launched. Take a look at the graphic here:

cdic.png

https://www.cdic.ca/your-coverage/prote ... r-deposit/

That said, it's possible to setup multiple accounts under different product categories and have them all insured by CDIC insurance.

Type of account (I.e. Basic, Joint, Trust) x Insurance Determination Category (e.g. Saving, Chequing, GIC, RRSP, TFSA, RRIF, etc.) all have their own separate $100,000.00 insurable amount.


Basic (Individual account - you) x Saving Account = $100,000.00 coverage
Basic (Individual account - wife) x Saving Account = $100,000.00 coverage
Basic (Individual account - you) x Chequing Account = $100,000.00 coverage
Basic (Individual account - wife) x Chequing Account = $100,000.00 coverage
Joint (You and your wife) x Saving account = $100,000.00 coverage
Joint (You and your wife) x Chequing account = $100,000.00 coverage
Basic (Individual account - you) x TFSA Account = $100,000.00 coverage
Basic (Individual account - wife) x TFSA Account = $100,000.00 coverage
etc.

CanadianLurker wrote: ↑ @Jumpityjump in addition to using the approach in the chart to spread deposit amongst different account types and different account registrations you should also know that all of the larger CDIC Members have multiple memberships from previous acquisitions and separate subsidiaries.

In your example with TD they can layer your accounts amongst the following separately covered legal entities:

— Canada Trust Company (The)
— TD Mortgage Corporation
— TD Pacific Mortgage Corporation
— Toronto-Dominion Bank (The)

https://www.cdic.ca/your-coverage/list- ... ALw_wcB#TT


So, just looking at a simple Savings account as an example you could have:

— 1 Savings account in your name only in each entity = $400,000 coverage
— 1 Savings account in spouse’s name only in each entity = $400,000 coverage
— 1 Savings account in joint names in each entity = $400,000 coverage

Grand Total of 12 Savings accounts between 4 entities = $1,200,000

Obviously you can do some mixing and matching where maybe some is in a high yield savings account and maybe some is in a series of 30/60/90 day term deposits.