We all have to have a bank account, but we rarely spend much time thinking about where we should do our banking. In some cases you may have opened your account because your parents banked there or they were having a promotional offer at the time (a free Frisbee!).
Most of the big banks in Canada (RBC, TD Canada Trust, Bank of Montreal) operate in the same way and offer comparable banking services with fees associated with them. This may be the best choice since most of these fees are now avoidable. These fees may be small but they add up to a lot and really you aren't getting much value for it. For instance if you are paying $20 in bank fee every month, that is $240 you're spending each year. Invest that money at 8% interest for 30 years and you end up with $27, 188! So that's why banks have those fancy offices in those big beautiful sky scrappers.
Today we have the option of choosing an electronic banks (President's Choice Financial, Ally, ING Direct) which have shed away all the bricks and mortar of conventional banks. These banks are able to offer great value because they don't have a huge building with lots of overhead, such as clerks and expensive office space. This does have the disadvantage of not being able to do complex banking transactions easily but for most of your day to day banking needs electronic banking is great. Here are 4 reasons to open an account today:
1) No Fees - as mentioned earlier you can avoid fees by having an electronic bank account. PC offers a great chequing account where you can pay your bills online, withdrawal money, make interac transactions all without any fees.
2) Free Cheques - on top of not paying transaction and other account fees you can also get cheques for free. Banks usually charge anywhere from $30 to $40 per booklet so there's a potential for big savings here.
3) Highest Interest for Saving Account - hands down the interest rates on savings account will always be higher than any conventional bank. This is because they avoid the high expenses banks have to deal with. PC is currently offering a promotion where their interest rate on savings is 2% until October. There base interest rate for is currently 1.5% which is better than any interest rate you can get at a conventional bank. I know that 1.5% is nothing to brag about, but the idea here is that electronic banks always offer the highest rates. So you don't have to do a bunch of research and move your money around.
4) Accessibility - finally a PC account is better than Ally or ING because your money is very accessible. Since PC has some agreement with CIBC you can access your money anywhere there is a CIBC atm machine without any fees.
PC is the electronic bank I'm most familiar with, however Ally and ING also offer similar banking options. The important thing is that we have a choice, stop lining your banker's pocket with your hard earned cash. Make the switch today!
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