Canadian Personal Finance Blog

Archive for September, 2005

So, you were fool-hardy enough to actually change banks, because of something you read on a blog, eh? What are you crazy? Just kidding folks, but here are a few things to remember if or WHEN you take the big step:

• Watch out for auto-withdraw bills in your OLD bank accounts. In Ottawa the power company is the only one I had, but make sure that is SWUNG before you make a final move of any kind.
• RRSP contributions or automagic savings you have set up at your old bank. I had weekly allowance moves, and a Christmas fund auto-saving thing, so it was important to remember these and re-institute them at the NEW bank.
• Mortgage payments, VERY IMPORTANT! Make sure your old bank and new bank transfer your mortgage correctly and you know when you need to make payments. Had a bank employee tell me a horror story about how one clients Credit Rating got Blitz’ed because they had been making their Mortgage payments on the 23rd of the month, but they were due on the 15th (and it kept showing their account being in arrears). Watch out for this one!
• Direct Deposits, you must time your move to make sure that when your pay cheque moves to your new bank, all of your banking goes with it.
• Safety Deposit box, you may as well move that to your new bank, why would you keep it at your old bank?
• Credit Cards, never hurts to use your bank’s credit cards, unless you have 1 that you prefer to use. Make sure you can pay that bill at your new bank as well.

It’s a treacherous dance for about a month or two when you first change banks making sure all of your bills continue to get paid and you don’t lose anything along the way. Inevitably you will miss one thing, just make sure it isn’t something BIG!!!

Once you’ve done it once, it’s much easier the SECOND time too!

–C8j

A friend was talking to me about her families exorbitant Bank Fees and that she was looking at changing banks but was afraid of how complicated that might be. I told her the “parable” of my own reasons for changing banks a while ago, and it goes something like this.

When I bought my first home, we were sure that interest rates would never get below 11% ever again in our life time, so we locked in at 11% for five years (stop snickering, it is rude to laugh at the blogger). Needless to say that wasn’t the first nor will it be the last financial blunder I made in my financial career. Five years passed and we FINALLY were able to get a lower interest rate.

We went in to talk to the nice lady at the Bank of Montreal (BMO) when it was time to renew, and she suggested that we go int the other direction and get a 6 month term, which would give us the lowest rate they had, and she even knocked it down by another 1/4 of a percent. Sweet! I was deliriously happy! My mortgage payments dropped, wonderful stuff.

When the 6 months were up, we went in to talk to the nice lady, same deal again, WONDERFUL! Another 6 months and again, another great deal.

Finally another six months pass, I saunter into my BMO branch, go up ask for the nice lady, the stern woman at the “help” desk said she wasn’t there, but that she could help. I figure, what the heck, I said I’d like my standard deal please, I get this vacuous glare back, and was asked to explain what I meant. I explained that I would like to renew for 6 months and get my customary 0.25% drop in rate as well. “Sir we do not discount that rate, it is our lowest rate”, was the stern response I got back. I pointed out that in fact I had been getting that for the past 3 times, and started getting worried. Mrs. Stern glared back and again assured me that I was wrong (remember sales people or service folk, being RIGHT is never a good thing if you PISS OFF your customer). This argument got quite heated and after 15 minutes, I left, and I was vowing to myself I’d not stand for this (normally this means I go home and vent at my wife, and then I procrastinate for about 2 weeks and then do nothing).

HOWEVER, this time something had gone off in me, and I drove by the Canada Trust (which is now part of TD), and dropped in and asked them, “What can you do for me?”. Well 60 minutes later, I had decided to move ALL of my business over to CT, and I no longer had a mortgage I had a secured line of credit (which cost nothing to set up). I had changed banks!

Yes, I had to sew up a lot of loose ends, like having my pay deposited to the CT account, get a new credit card, but I also moved my RRSPs over and set up RESPs and a trading account too! They even gave me FREE banking (which I have managed to keep until now, we shall see whether it continues) too!

The moral of the story? If a lazy, procrastinating and fat (at the time) bastard like me can change banks on a whim, anyone can, and anyone SHOULD! It is YOUR money, and paying bank fees, and too much for your mortgage is taking money out of your pocket. Don’t let them do this!!!

–C8j

Well, if you are E-Bay, then yes it is (to the tune of over $4B wow!).

What is Skype? Skype is a “point to point” Voice over IP client that will allow you to talk to folks around the world for free. What do you need to do this?

1. Skype software client, get that from their web site
2. Preferably a high speed internet access link up (DSL, or Cable is just fine)
3. A sound card on your PC (most PC’s have them, and if you can play MP3’s on your computer you have a sound card), that has a microphone IN and Speaker OUT port
4. A headset is useful (you can get really expensive USB ones for around $50.00 or cheapy ones that plug into the sound card ports for $15.00).

That’s about it. Follow the configurations and GO! Don’t get hung up on SKYPE either, you can use this with Yahoo IM, AOL IM and MSN IM clients as well.

What does this have to do with Canadian Finances? Well, firstly, it’s part of my job right now (Voice Over IP at least), secondly this is FREE.

When I was in first year at my Alma Mater, I had a great roommate who had a girlfriend who was out of town. He called her diligently after 11:00 PM and he still racked up $120/month phone bills (yikes). With this, a co-worker is able to talk to her son in Granada for FREE (ok the quality ain’t fantastic, but for FREE what do you want?). Astounding how things have changed in 25 years eh?

Keep that money in your own pocket and reduce your debt.

–C8j

The Carnival of Personal Finance for this week has linked to my “Don’t Pass it to the Other Team” article from last week. They also have some really good other articles from some smart folks, go on over and have a look!

This is how we learn folks, read, digest and apply to our own lives! –C8j

The following link is a heart wrenching story for me, seeing folks who’s lives have been uprooted, and destroyed by an act of nature, that are now being forced to do damage to their financial lives, because of that disaster. Think of it, your house destroyed, your job maybe gone with it, and you still have to support your family, and try to piece your life back together again? That is more than I think I could take.

CNN (another site I read daily if not hourly), has set up the following web site, with phone numbers and links for folks who are helping, and how you can help. America is one of the greatest countries in the world (next to a small nation just North of it, of course), and one of it’s strengths is it’s ability to band together when times are tough. New Orleans will return, and it will be thanks to the American People’s legendary generosity.

My financial comment here? Can you plan for a hurricane? No, (and it would be crass to point any fingers right now too) but if you are carrying little debt (better still NO debt), have insurance (and hopefully some help from the government), and have some money put aside for a rainy day (in this case a rainy and windy day), things might not be as bad. Natural disasters can happen anywhere folks (even where I live), for all of us this is a case of “There but for the grace of God, go I”. Keep that in mind.

–C8j