An Ode to Big Banks

Let me tell you a few things about big banks. They make lots of money because they can.

I'll explain. I opened my account at the Credit Union almost two weeks ago and finally found the time to transfer funds today. This takes time. I had to change my automatic deposits - then I ventured to CIBC to close out my accounts. Chequing and savings - not too onerous. GIC? Well - I have to wait until next year when it comes due. Still no big deal.

Then we arrive at the crux of the matter: RRSP's. I have to wait until they mature. At that point I have to transfer them. I can't put them into a chequing account because then I would have to pay a wallop of taxes. Eventually they will go into a RIFF and I will take money out gradually and all will be good.

But how do I get my RRSP's from CIBC to the Credit Union? Simple - a transfer. Now, like most folks, I buy an RRSP every year and over the years I've accumulated a fair share, all of them maturing at different times over a period of about 18 months. Every single time I transfer one of these (well over a dozen) CIBC charges me a fee of $100!!!!!!

Excuse me? I said to the nice man on the phone. But that transfer is only two keystrokes on your computer. Yes, he agrees. So why 100? To paraphrase his answer (and not too much at that) "Because we can."

And that is just one way big banks make money.

Yes, there's a workaround - put each one in a daily interest saving account until all my RRSPs are in once account and then transfer that one account for a one time $100 charge. (yipee) The catch? I earn virtually no interest for 18 months or so. They've got me either way. I'll just have to wait until I'm 71 and have to put everything in one RIFF - do my transfer then.

And they wanted to know - why am I leaving the bank and moving to a Credit Union? - this might be part of the answer.