Wednesday, September 20, 2017

Transferring into TD Direct Investing and reimbursing account transfer fee

Disclaimer: I don’t work for any financial institute. I am just sharing my experience.


This is post to walk through my experience of transferring an TFSA investment account with Questrade and combining it with a TD Direct Investing (TDDI) TFSA account. If you are not already a TD client, the process will be very similar except you’ll have to sign a few more paperwork to open a TD Direct Investing account.


When the Canadian government first introduced the TFSA, I opened a TFSA with TDDI but the fee back then was a hefty ~$29 per trade. If you do the math, the fee added up very quickly. As online brokerage became more and more popular over the years, I decided to give them a try and opened an account with Questrade for a low ~$5 per trade (back in around 2012). Their fees were alright for while until they started increasing them to effectively ~$10 per trade and introduced an inactivity fee of ~$25 per quarter if your balance is below $5K and don’t perform a trade. As the same time, TD caught up with the pack and decreased their fee to ~$10 per trade but also started charging an $25 quarterly fee if your balance is below $15K.


$5K balance was not a big amount to maintenance but ever since the drop in oil price (my holding in Questrade was oil heavy), my holding balance went below that threshold. As a result, I was left with two options: 1) increase my balance with Questrade so I don’t have to pay the quarterly fee or 2) transfer out. I don’t want to simplifying close the account because that means selling all the stocks, withdrawing the amount, and affect my TFSA contribution.


Both Questrade and TDDI have a comparable online trading interface but since I do majority of my banking with TD and they have a lot of retail location I can go to, I decided to transfer my Questrade account to TDDI and combine everything together.


Step 1: Call or go online and book an appointment with TD
I decided to call TDDI because I want to see if TD can cover the $150+tax account transfer fee Questrade will charge me when I transfer out. The agent on the other side of line told me that won’t be a problem so I booked an appointment with an advisor at a TD investment centre. You could book an appointment with any retail location but the advisors at their investment centre should have more knowledge in performing an account transfer.


Step 2: Ensure there are enough cash in your account to cover the fee
Ensure there are enough cash to cover the transfer fee in your transfer-out account. If you already have a TDDI account, you can just have enough cash to in your TDDI instead (this was my scenario, I only have ~$10 in my questrade account so they took money from my TDDI cash instead). If you don’t have enough cash, they will sell some of your stock.


Step 2: Bring all the necessary document to the appointment
If you are going to be a new TD client, bring the necessary document to open a TDDI account. For me, I just have to bring my TD client card. To perform the transfer, you’ll also need to bring the most recent investment account statement from the other investment broker. The statement need to have your account number, your name, and your holding/balance.


Step 3: Confirm with the advisor if the transfer fee will be reimbursed
I double checked with the advisor about reimbursing the account transfer out fee and he told  me it shouldn’t be a problem if the fee is less than $200.


Step 4: Sign the account transfer form
When I gave my account statement to the advisor, he asked me if I want the transfer to be “in-cash” (sell the stock and get cash) or “in-kind” (keep everything in stock). I decided to just do a “in-kind” stock transfer because I intend to keep holding them. I signed the transfer form afterward and done.


Step 5: Wait for the transfer and ask for reimbursement of the transfer fee
The transfer process can take upto 2 weeks according to my TD advisor but it only took 2 days in my case. After I saw everything in my TDDI account, I simply took a screenshot of the transfer-out fee that I got charged, e-mailed it to my TD advisor, and asked him to process a reimbursement. Within a day, he reimbursed that amount and now all of my holdings are with TDDI.

Bonus: By default, TDDI only deal in CAD. However, if you want to deal in USD, you can call them and set up a USD account over the phone so you won’t get caught in currency trade. You can also transfer-in stocks from other exchange, such as Europe or Asia, and sell them from your TD account. However, you can’t buy oversea stock directly from your TD account.

Sunday, September 17, 2017

Thrifty Salaryman - Mid-Sep Net Worth Update

The past few months has been busy but I finally got some time to write an update for this blog. A few thing happened from June until now: I opened a TD e-Series RSP account to take advantage of the low MER, invested into some e-Series index fund, and combined my Questrade investment account with TD Direct Investing.

My current net worth is now $44,489.54, an increase of 18% from my June update. The market has been very volatile this past few months and impact some of my investment negatively.

Cash $7,746.13:
$2,878.69 - TD Chequing
$109.59 ($89.86 USD) - TD USD Chequing
$3,198.29 - RBC Chequing
$1,431.55 ($1173.79 USD) - Bank of America USD Chequing
$128.01 - Cash - TD Direct Investing TFSA
$422.32 - PC Financial Saving

Investment $38,910.60:
$23,259.64 - Equity (Corporate Stock) - TD Direct Investing TFSA
$4,438.94 - Canadian Index Fund - RBC TFSA Mutual Fund Account - MER 0.72%
$8,886.13 - Canadian Bond Fund - TD e-Series RSP Mutual Fund Account - MER 0.50%
$1536.85 - US Equity Index Fund - Employer Pension Plan - MER 0.15%
$789.04 - Canada Equity Index Fund - Employer RRSP - MER 0.15%

Liability:

$2,589.51 - Credit Card Balance (Still within grace period)

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Sunday, September 3, 2017

Neighbour Joe - September 2017 Net Worth

Hi everyone, it's time for another monthly update of my net worth. This month I finalized the sale of my old house and got about $93,000 in cash. I immediately paid off my bridge loan, my line of credit, as well as put the maximum annual pre-payment amount into my mortgage ($26,880). I then invested about $1500 into MasterCard and put the remainder of the money into a savings account.  


Asset 
Chequing: $1,834.96

Savings: $21,890.73
TFSA Investment: $36,296.53
TFSA Mutual Fund: $3,532.67
Real Estate: $224,000 (Purchase Price of my new house)

Work Pension: ~$153,000 (I checked in Jul 2017 but I can't remember the exact amount)

*Automobile is not included 
**Link to my investment portfolio as of 13 August 2017

Liabilities 

Mortgage: $151,064.89

*Credit Card is paid in full every month
Current Net Worth: $289,490 (+1.4%)

The cash in my savings are only staying there till January 2018 where I will then put it into my mortgage. I have also recently doubled my mortgage payment and is now at $1,735.64 per months. As you can see my current strategy is to get my mortgage down as fast as possible to minimize my exposure to interest rate hike. If you have been following the news lately, there has been a lot of speculation that Bank of Canada will once again increase their interest rate.