Opening a bank account

[RiCHC3]

Sign up with ING Direct (online banking, but you can deposit and withdraw from ABMs)

You get a free chequing account, a free set of cheques (most banks charge $20 or so), a sign up bonus of $25-50 if another member refers you, and another bonus of $100 if you setup your direct deposit (payroll) to go there. In addition, you get email money transfers, a $250 "oops" protection which means you can overdraft without getting dinged.

Sounds like a sales pitch, but I thoroughly enjoy it. I use ING most of the time, but Vancity Credit Union when I need a place with a brick and motars location.

If you want a referral, let me know in private, but otherwise enjoy, congrats, and good luck.

[silverpig]

Hello everyone, I have a quick question.

I recently got my very first part-time job (a tad delayed at the age of 17, but better late than never) and now I'm looking to open a bank account somewhere, but I don't know which bank I should sign up at or what kind of account I should open.

Would anyone here be able to help me out, as well as give me some financial advice on saving my money and using it effectively so I don't blow through it within 5 seconds?

Thank you.

[Nuxfanabroad]

You can find a no-fee account at any number of banks or credit unions.

Set up your paycheque to be credited electronically to your bank account.

Set yourself up on your bank or credit unions online banking service.

Start saving right away. Set up an electronic transfer to transfer 10% of each paycheque to a separate savings account. It's called pay yourself first before you spend the money.

Pay cash for everything. Credit cards might help build your credit, but they can be evil and lead to overspending.

Read The Wealthy Barber and The Wealthy Barber Returns by David Chilton.

[silverpig]

Savings accounts, including tax free savings accounts are a bad way to save your money for any amount over a couple thousand dollars. They pay practically no interest so the tax free part of the tax free savings is useless as well.

Savings account pays 1.2% to 1.5%. This will barely if even cover inflation. So you are making nothing on your money. Investing in the TSX is easy and can bring 9-10% yield without too much difficulty. Christ even corporate bond yields are over 6% and rock solid. Pay capitol gains taxes on 6% or "Tax free" on 1.5%. Its an easy choice.Over the years the difference will multiply with the savings account still treading water and the investments paying interest on the interest on the interest.

Go to a bank or credit union that has a financial dept. Ask to talk to someone there about long term investments and savings goals. You can talk to a professional for free.. Banks like 17-18 year olds because they see a possible lifetime client who will be looking for a mortgage and investment options down the road.

I bank at TD Canada Trust and trade through TD Waterhouse. Go to a TD bank that has a waterhouse dept and ask to talk to someone. They can be quite helpful.

[key2thecup]

Coast Capital FTW.

[:D]

I'll hold your money for you

[Pavel_Bure 10]

^^

lol

[aGENT]

DO NOT GO WITH THE SCUM OF THE EARTH RBC

[Mastaj]

Now I can buy everything I want without any fear of paying it back! :D

Thank you to everyone that has answered so far. One question though - what is the main difference between a credit union and a bank? I'm currently looking at Coast Capital's websites and it seems to me that aside from not having ATM's and branches everywhere, there is really no downside in joining them and not a big branch. Is this really the case or are there other hidden costs involved?

[Likewise]

I've had RBC my entire life and never had any issues with them. I've always received excellent service, no service fees, they beat the lowest mortgage rate I could find elsewhere (staff rate at Scotia Bank, where my wife works) etc.

That said most of the banks are pretty much the same/have little in the way of major differences, so go with whichever you feel most comfortable. The bigger banks tend to have more ABM's and more investment options, TD is open more days/later hours, Credit unions (Coast Capital etc) tend to have more friendly/"small town" like atmospheres in my experience and tend to default to no fees etc where as bigger banks might make you have things like credit card and/or other services for them to "give" you no fees.

And OP...how the hell are you 17 and you don't have a freaking bank account?! My kids are 8 months old and have savings accounts and RESP's for cripes sake!

[LostViking]

Make sure to open a TFSA account. You don't have to put any money in it, just open the account. If your bank is trying to charge you any fees for the TFSA or requires a monthly balance, then consider opening a TFSA with ING Direct, but then doing your regular banking with your original bank.

Basically there is a limit to how much you can put into your TFSA, if you go over the limit, you pay a lot of tax. However, for every year you have a TFSA your limit will increase, so it is best to open one as soon as possible. As stated above, anyone who opened a TFSA right away in 2009 when they were introduced can now put up to $25,500 into the account, if you open one today you can only put a max of $5,500. This may be useful later on because you can buy investments and pay no tax on the interest they make.

[Likewise]

Make sure to open a TFSA account. You don't have to put any money in it, just open the account. If your bank is trying to charge you any fees for the TFSA or requires a monthly balance, then consider opening a TFSA with ING Direct, but then doing your regular banking with your original bank.

Basically there is a limit to how much you can put into your TFSA, if you go over the limit, you pay a lot of tax. However, for every year you have a TFSA your limit will increase, so it is best to open one as soon as possible. As stated above, anyone who opened a TFSA right away in 2009 when they were introduced can now put up to $25,500 into the account, if you open one today you can only put a max of $5,500. This may be useful later on because you can buy investments and pay no tax on the interest they make.

[silverpig]

Make sure to open a TFSA account. You don't have to put any money in it, just open the account. If your bank is trying to charge you any fees for the TFSA or requires a monthly balance, then consider opening a TFSA with ING Direct, but then doing your regular banking with your original bank.

Basically there is a limit to how much you can put into your TFSA, if you go over the limit, you pay a lot of tax. However, for every year you have a TFSA your limit will increase, so it is best to open one as soon as possible. As stated above, anyone who opened a TFSA right away in 2009 when they were introduced can now put up to $25,500 into the account, if you open one today you can only put a max of $5,500. This may be useful later on because you can buy investments and pay no tax on the interest they make.

[KoreanHockeyFan]

Try opening accounts with multiple banks.

My account with PC is solely for spending/blowing cash off. I have a simple no fee, chequing account.

My account with TD is solely for savings/investments. Try some mutual funds or GICs or something like that. It's better than leaving thousands of dollars in a regular savings account that give terribly low returns. I locked some money in for three years in a GIC right when I got my first job when I was 15 and I ended up getting a modest 17% return. I'm trying some mutual funds right now and it's doing alright, but I believe the returns are surely higher than that of GICs. Bottom line, put your money to work, don't just leave it sitting in a savings account, that's my biggest advice.

Oh and, open a TFSA when you turn 18, you can store some money in there and it won't be taxable, might as well do it.

[Fit_Shaced84]

Savings accounts, including tax free savings accounts are a bad way to save your money for any amount over a couple thousand dollars. They pay practically no interest so the tax free part of the tax free savings is useless as well.

Savings account pays 1.2% to 1.5%. This will barely if even cover inflation. So you are making nothing on your money. Investing in the TSX is easy and can bring 9-10% yield without too much difficulty. Christ even corporate bond yields are over 6% and rock solid. Pay capitol gains taxes on 6% or "Tax free" on 1.5%. Its an easy choice.Over the years the difference will multiply with the savings account still treading water and the investments paying interest on the interest on the interest.

Go to a bank or credit union that has a financial dept. Ask to talk to someone there about long term investments and savings goals. You can talk to a professional for free.. Banks like 17-18 year olds because they see a possible lifetime client who will be looking for a mortgage and investment options down the road.

I bank at TD Canada Trust and trade through TD Waterhouse. Go to a TD bank that has a waterhouse dept and ask to talk to someone. They can be quite helpful.

[kanucks25]

Like some others have already suggested, I would recommend using Coast Capital. I opened a savings account there around your age and really like it. Good interest rate, no fees on anything, transactions at ATMs and with tellers are quick and efficient and the online service is useful and simple (I transfer money from my CC savings account to pay off my RBC credit card; it takes 2-3 days and again no fee).

I've recently started using my credit card for all my transactions. I was able to get 1% cash back on everything Visa with no initial or annual fees (decent for a starter, IMO). I don't believe credit cards are a bad idea... it depends on the person. Some people are responsible with money, some aren't. If you think you'll spend all the money that is available to you, a credit card probably isn't the best idea because you're essentially borrowing the bank's money. If you know you'll spend what you can, when you can, then get a credit card and build some credit

[aGENT]

I've recently started using my credit card for all my transactions. I was able to get 1% cash back on everything Visa with no initial or annual fees (decent for a starter, IMO). I don't believe credit cards are a bad idea... it depends on the person. Some people are responsible with money, some aren't. If you think you'll spend all the money that is available to you, a credit card probably isn't the best idea because you're essentially borrowing the bank's money. If you know you'll spend what you can, when you can, then get a credit card and build some credit

[ahzdeen]

RRSP

Many people are down on RRSP's these days since the TFSA has been made available but for young people they are a great idea! You can have the bank invest your money in a mutual fund (very entry level investment and you don't need much money to start investing) which doesn't pay great these days but better than 1.5% and the bonus is it's not easy to take out your money again reducing the temptation. Also the government has programs that allow you to withdraw the money tax free for school later on or to use as a down payment on your first home purchase. Also if you are putting aside 25% of your pay cheque into an RRSP chances are you will be looking at a nice tax refund at the end of the year($1000.00 or so depending on how much you make)