Bank account fees and balances

[FixedGear]

Guys this is a bit off topic, but I'm wondering if you all have thoughts on bank account fees and balances. I was planning to go with BMO Premium bank account with the World Elite Cashback credit card, which are free if you keep a balance of > $6k. But then I was reading on /r/PersonalFinance_Canada that unless you use all the features of a Premium account (which I really don't), then it's financially better to get a lesser account such as BMO Plus or Performance that require $3k or $4k balance, and keep the rest in a TFSA or something. I guess the difference in interest is minimal, but then again i'm thrifty as hell LOL.

Just curious what you guys do.

[jwslam]

This quote is hidden because you are ignoring this member. Show Quote

Guys this is a bit off topic, but I'm wondering if you all have thoughts on bank account fees and balances. I was planning to go with BMO Premium bank account with the World Elite Cashback credit card, which are free if you keep a balance of > $6k. But then I was reading on /r/PersonalFinance_Canada that unless you use all the features of a Premium account (which I really don't), then it's financially better to get a lesser account such as BMO Plus or Performance that require $3k or $4k balance, and keep the rest in a TFSA or something. I guess the difference in interest is minimal, but then again i'm thrifty as hell LOL.

Just curious what you guys do.

Older thread but info hasn't really changed
https://forums.beyond.ca/threads/355...light=accounts

IMO If you're gonna use a premium credit card, the interest of putting your 2K elsewhere isn't going to compensate for the $99+ annual fee

[FixedGear]

This quote is hidden because you are ignoring this member. Show Quote

Older thread but info hasn't really changed
https://forums.beyond.ca/threads/355...light=accounts

IMO If you're gonna use a premium credit card, the interest of putting your 2K elsewhere isn't going to compensate for the $99+ annual fee

Thanks dude! will check that thread out.

[mr2mike]

If your money is just sitting... TFSA or your BMO premium... it's doing the same thing.

Personally go TFSA and get that money working for you. If you're not into learning it yourself. Find an advisor.
Many people buy ETF's or high dividend stocks within their TFSA. Gotta grow that balance.

[Star1995]

Sorry I need to point out that you spelled adviser wrong, perhaps you did it on purpose as in a "Financial advisor" Where they are sales people and not "Financial advisers"

"Various government securities acts spell out the responsibilities of “advisers” to their clients. Meanwhile, the investment industry commonly calls their salespersons “financial advisors” even if they are not registered to act as advisors."

http://www.moneysense.ca/save/invest...or-or-adviser/

[ExtraSlow]

in common usage, those two spellings are interchangeable. I know the industry tries to make some kind of distinction, but it's not meaningful to the public.

[eblend]

If you are thrifty as hell, then wth are you with BMO?

I have been with PC Financial (not Simplii for everything except credit card) since i was 16 (34 now), and haven't needed to visit a bank except for like 3 times in all that time. Having any balance sitting in chequeing account is basically paying a fee, as it's lost income from interest. All the big banks offer next to nothing on saving accounts, so no point of even using them for any kind of savings. PC Financial World Elite credit card is also free. I do use RBC for my investments mostly because that's who my work uses for our RRSP matching, but other than that, day to day banking, Simplii just works.

[Recca168]

The fee for the world elite card is $120. Since you have to keep 6k in the account could think of it as the account gives you a 2% interest rate. Plus you get a couple more features. I've been using a while now. Been annoyed the cashback/reward point have been scaled back.

[FixedGear]

This quote is hidden because you are ignoring this member. Show Quote

If you are thrifty as hell, then wth are you with BMO?

I have been with PC Financial (not Simplii for everything except credit card) since i was 16 (34 now), and haven't needed to visit a bank except for like 3 times in all that time. Having any balance sitting in chequeing account is basically paying a fee, as it's lost income from interest. All the big banks offer next to nothing on saving accounts, so no point of even using them for any kind of savings. PC Financial World Elite credit card is also free. I do use RBC for my investments mostly because that's who my work uses for our RRSP matching, but other than that, day to day banking, Simplii just works.

Good point... Guess I didn't really think about it that way. I do like bring able to go into a physical bank, but I really only do that a couple of times per year. One reason I wanted to go with BMO is I wanted to waive the $120 annual credit card fee on the World Elite cash back, but maybe I could pay that $120 using interest from a TFSA or stocks.

[muse017]

Fee is $150 for Regualr World Elite Mastercard. For now, priority pass alone worth keeping BMO World Elite card if you travel out of country regularly.

[Star1995]

This quote is hidden because you are ignoring this member. Show Quote

in common usage, those two spellings are interchangeable. I know the industry tries to make some kind of distinction, but it's not meaningful to the public.

It doesn't matter if they are interchangeable in the public, they're not interchangeable in the financial industry and it is meaningful or should I say it should be meaningful to the public. The banks call their employees "advisors" on purpose and purposely mislead the public by spelling it "advisor" If you have any investments that you buy or bought using an adviser just check the spelling and you'll know if they have your best interest in mind or not. Advisors are sales people, just ask them why they spell it the way they do.

[FixedGear]

This quote is hidden because you are ignoring this member. Show Quote

Fee is $150 for Regualr World Elite Mastercard. For now, priority pass alone worth keeping BMO World Elite card if you travel out of country regularly.

I do travel internationally quite often - does priority pass lounge access come standard with the World Elite cards (for the cash back one too)?

[rx7boi]

This quote is hidden because you are ignoring this member. Show Quote

It doesn't matter if they are interchangeable in the public, they're not interchangeable in the financial industry and it is meaningful or should I say it should be meaningful to the public. The banks call their employees "advisors" on purpose and purposely mislead the public by spelling it "advisor" If you have any investments that you buy or bought using an adviser just check the spelling and you'll know if they have your best interest in mind or not. Advisors are sales people, just ask them why they spell it the way they do.

+1 on what Star said. The reason it is "interchangeable" to the public is mainly due to ignorance. Advisers have a fiduciary responsibility and often have a professional designation where average joe blow can work to become an advisor but they are really more of a representative with quotas. As such, advisors will typically give you suitable advice so they can move a unit (product) and get it out of the way, but it is not always advice that is in your best interest. Suitable advice doesn't always get you to where you need to be.

When I meet with advisors I typically ask dummy questions to get a sense of what kind of person they are, but no matter which one I get at TD, they always end with a "so I'm looking at your account and I think we have a couple things to suggest....." spiel.

[Xtrema]

Why would you try to get a card with only 1.5% cash back with that many hoops to jump thru?

Much like eblend, PC Mastercard Elite here and I can clear that on grocery easy and it's free. Everyone got to eat, it's it's not hard to blow $500-$800 of points I earn per year at Loblaws/Superstore.

[sabad66]

The regular WE travel comes with 4 visits per year and guests can use them. The WE air miles comes with 2 or 4, but pretty sure the cashback doesn’t come with any.

Personally I would recommend the premium plan... it’s not that hard to keep 6000 in there once you’re financially stable. I consider it part of my emergency cash fund. Realistically even if I didn’t have this plan I would always keep 3000 buffer in my chequing account anyways so it’s really only 3000 extra to have all banking features and a waived premium card.

[sabad66]

This quote is hidden because you are ignoring this member. Show Quote

Why would you try to get a card with only 1.5% cash back with that many hoops to jump thru?

Much like eblend, PC Mastercard Elite here and I can clear that on grocery easy and it's free. Everyone got to eat, it's it's not hard to blow $500-$800 of points I earn per year at Loblaws/Superstore.

What are all these hoops you’re talking about? It’s simple...maintain 6000 in your chequing account

Also if you’re only using that card at superstore and earning 500-800 that means you’re spending 17-26k at superstore a year. I guess that’s do-able if you have a decent sized family but for most that’s not a realistic expectation.

[Xtrema]

This quote is hidden because you are ignoring this member. Show Quote

What are all these hoops you’re talking about? It’s simple...maintain 6000 in your chequing account

Also if you’re only using that card at superstore and earning 500-800 that means you’re spending 17-26k at superstore a year. I guess that’s do-able if you have a decent sized family but for most that’s not a realistic expectation.

Based on $30K per year, not at Superstore but all MC spendings. Refund around $300, which can be around $400 if you shop at Superstore often. According to BMO, you would get around $450 back on $30K.

All the hassle to move $6K to a bank to get may be $200 more at best is a lot of hassle for little return. Now all I read is 1.5% but if there are other perks, it may be worth it. I'm straight comparing on cash. If you already bank at BMO, then it's not an hassle.

[FixedGear]

This quote is hidden because you are ignoring this member. Show Quote

The regular WE travel comes with 4 visits per year and guests can use them. The WE air miles comes with 2 or 4, but pretty sure the cashback doesn’t come with any.

Personally I would recommend the premium plan... it’s not that hard to keep 6000 in there once you’re financially stable. I consider it part of my emergency cash fund. Realistically even if I didn’t have this plan I would always keep 3000 buffer in my chequing account anyways so it’s really only 3000 extra to have all banking features and a waived premium card.

Yeah I usually keep $10k in my bank account as a buffer for paying bills, etc., and anything over $10k gets transferred into high interest or stocks. So the $6k would be no problem for me. That said, I'm starting to reconsider keeping a $10k balance, because really I never use more than $3k/month and it gets replenished by direct deposits anyway. So basically I have $7k sitting there for no reason and I could be making a little bit of profit from that if invested elsewhere.