Frugal Focus Bank Shopping Part 2 - Fees
Picking up the thread from the previous post on this topic, I spent some time comparing fees. Using my current TD Canada Trust Infinity account as the control, I looked at BMO and PC Financial.
My first observation is that BMO offers many plans, with basic permutations based on account activity requirements, overdraft needs, and travel and out-of-Canada services. PC Financial on the other hand, true to its marketing model, offers just one everyday account plan. For the purposes of my investigation, I chose BMO's i.connect plan as it most closely reflected my needs.
Here are how the fees look:
Based on these numbers, I estimated my annual fees would be $51.80 with TD and $44 with BMO, assuming my balance drops below the required minimum 4 months of the year. With PC Financial I would pay no fees at all.These costs assume that I wouldn't go over the 60 transaction limit with BMO, that I limit my ATM usage to the home bank (as I do now) and that I waive the cheque return/monthly paper statement. As I do all my banking online, I'm also not concerned with assisted service fees.
After this initial pass, its obvious PC Financial is the front runner. I still need to weigh the benefit of incentive programs (Air Miles vs. PC Points) and look at online banking.
If you are a BMO or PC Financial client and I've gotten the fees wrong, please let me know.
By Humble Investor - Frugal Focus Bank Shopping Part 2 - Fees: 12:07 AM
4 comments
4 Comments:
One other thing to consider is that with PC Financial's no minimum balance a part of that $3000.00 could be sitting in a savings (or other) account earning higher interest.
For example, keeping a personal minimum of $500 in the chequing account and dumping the other $2500 into an ING savings account tied to the the chequing account might not be a bad idea.
I've been using PC Financial for a while now. So far, I've paid $0 in fees (even cheques are free).
I still keep a checking account at the big bank because occassionally I need to get a bank draft and I like to drop into the branch to get it.
CC,
I can see how keeping a 'big bank' account active for infrequent special requests is a good idea. I'm going to need a bank to guarantee my signature to start a DRIP, for example.
Greg - you're absolutely right. I'll try and factor this is with as few assumptions as I can when I look at the 'benefit' side of my cost/benefit analysis.
I use PC Financial for my daily banking (ie. cheques come out of here, debits, etc...). I keep a minimum amount of money there and transfer most of it up to ING. Then, as I pay bills, I move money back down to my PC Financial account. It is great not having to leave $1,000 or more just to avoid fees. With my system, I have never paid any fees and get a decent return on my short-term money at ING.
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