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Email this11:44 pm
October 21, 2013
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SPECIAL (not including RESP) 30 months 2.60%
SPECIAL (not including RESP) 50 months 2.85%
Applies to all other types of accounts. These are very good rates if you require these particular terms.
It appears that you can join this CU if you live outside of MB.
They do have online banking but I am not sure of the details as to how it works.
12:09 am
August 5, 2014
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Loonie, I do not know why financial institutions make it difficult to get the higher rates for RESP's that are available for GIC's, RRSP's, RRIF's, TFSA's.
I know Meridian Credit Union has 2.00% RESP savings account rates which is competitive with most other savings account rates.
Duca Credit Union has RESP GIC's but there 5 year is only 2.60%. In order to get their highest RESP rate, you have to go almost 3 years longer in maturity, 7 years at 3.00% which is 34 months more than Steinbach C.U. that offers 2.60% for 5 year RESP GIC's.
10:32 am
December 23, 2011
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Loonie said
SPECIAL (not including RESP) 30 months 2.60%
SPECIAL (not including RESP) 50 months 2.85%
Applies to all other types of accounts. These are very good rates if you require these particular terms.
It appears that you can join this CU if you live outside of MB.
They do have online banking but I am not sure of the details as to how it works.
I still consider this credit union. I have contacted them a few times and they have no problem with out of province customers....even out of country. When I worked in Calgary and knew a couple of my employes used them and just loved their service. They are often, rate wise, close to the other CU's in Manitoba but never there...but if you have to spread money around they are a consideration. They are one of the strongest CU's i Manitoba ,.... lots of farming money!
I would imagine they would use the same online platform as other CU's.
11:45 am
October 21, 2013
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I have always had a very positive impression of this CU as well, and, for that matter, the community of Steinbach, which has sometimes shown up as having the highest or one of the highest rates of charitable giving in the country. I figure the latter means they manage their money well.
I don't understand the discrimination against RESPs either. Maybe higher education is not a priority in Steinbach?
1:44 pm
August 5, 2014
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Loonie, it is not just Steinbach Credit Union. It seems almost all banks, trust companies, credit unions do not offer the same GIC rates for RESP's or they don't have GIC's eligible for RESP's.
Oaken Financial for instance, they have no 2.90%, 5 year GIC rates for RESP's or any other terms for that matter.
5:20 pm
October 21, 2013
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I think it's a really dumb decision. There is tons of future business through RESP route.
8:19 pm
August 5, 2014
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I agree Loonie. There is another type of tax deferred plan called an RDSP that I have seen too but it is not offered at many financial institutions either.
7:54 pm
October 21, 2013
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I don't know much about the Registered Disability Savings Plan, but it seems odd that it is rarely mentioned on financial insitutions' pages.
By giving an inferior rate of interest for the RESPs, it's as if the financial institutions are saying that since the gov't isn't going to tax the interest, they will do it themselves instead! Very cheeky, as the Brits would say.
(Steinbach does not discriminate against RESPs on its regular savings and GIC rates, only on these rate specials.)
Something to consider: some of the banks and credit unions offer a savings account for children which has a good rate of interest. I can't remember which one or what the age limits are but I recall that at least one of the MB CUs offers a very good rate. I remember wishing I could get it! Might be a useful vehicle in some situations.
8:00 pm
December 23, 2011
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Fat Cat. http://www.scu.mb.ca/personal-.....ings-rates
But we are toooooo old!
8:04 pm
October 21, 2013
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Only $1000! That wouldn't get anyone very far.
8:21 pm
August 5, 2014
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Loonie, other tax deferred accounts like LIRA's, LRIF's and LIF's are not widely available either for GIC's from financial institutions.
I don't know why this is because many people are transferring lump sum amounts from pensions and putting it in LIRA's and converting to LRIF's, LIF's at or before required by CRA.
10:13 pm
October 21, 2013
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Agreed. Must be a smaller market or more bureaucracy. Still, not thinking ahead.
I have noticed too that sometimes RIFs don't pay as well as RRSPs.
11:47 pm
August 9, 2014
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Loonie said
Agreed. Must be a smaller market or more bureaucracy. Still, not thinking ahead.
I have noticed too that sometimes RIFs don't pay as well as RRSPs.
Maybe we shall start a credit union ourselves that focus on those products, it seems like a market to me 
5:34 pm
August 5, 2014
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Loonie, I think the most benefit financially from Steinbach Credit Union's 2.60% 30 month, 2.85% 50 month GIC's is when they are in TFSA's.
Since you can have compound interest in TFSA's income tax free, a 2.60% rate is equivalent to 3.6% to 3.80% taxable rates. The 2.85%, 50 month rate is equivalent to a 4.00% to 4.50% taxable rates.
This is pretty good considering only investing for 2.5 to 4.17 years and lower GIC rates elsewhere. It could be good for using as part of a GIC ladder.
8:26 pm
October 21, 2013
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For TFSA, I'm going to stick with the Peoples Trust savings account. I've gotten over a year at 3% so far, so am going to take a chance on it for another year, or until it goes down. I think that even if it went down, I'd still be ahead or at least break even.
A lot of us retirees are in lower tax bracket than you suggest, Jack, so not as much tax value, but still worth doing, especially for people still in the work force. For younger people, TFSA is the way to go, I think.
8:40 pm
August 5, 2014
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Loonie, be careful about knowing your income tax rate. After $17,000 to $19,000 a year of income per person most Canadians are in a 24% tax rate.
However, when RRIF withdrawals are required by CRA, you could easily see 31% income tax rates on maybe 50% or more of that income.
This could easily bring a retiree in the 28% income tax rate on all RRIF withdrawals or higher for RRSP withdrawals if not planned.
A 2.85% TFSA GIC is equivalent to taxable 4.00% GIC's for someone in a 28% tax bracket. Most people don't understand or think about marginal income tax rates.
9:05 pm
August 5, 2014
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Loonie, even at 24% tax taxable income rates, TFSA's 3.00% at Peoples Trust or 3.00% at Duca Credit Union, Caisse Financial Group's 3.00% etc. is equivalent to taxable GIC's of 3.95%.
I think Loonie for the younger generation that are in modest to higher income tax brackets and have 15, 20, 25, 30 years to invest, longer term zero coupon bonds for TFSA's in the 3.75% to 4.25% range currently would give a bigger bang for their bucks compared to GIC's as long as they don't need liquidity and easy access.
Taxable TFSA interest rate equivalents of 8.00% to 11.00% for those in the 30% to 40% income tax brackets.
This is true especially if interest rates don't move up much in 5 to 10 years. A better time recently to do this was in September to October of 2013.
This is for fixed interest rate investors only but if you like buying dividend paying ETF's, common and preferred shares, REIT's etc, then this will probably will not interest you.
9:12 pm
October 21, 2013
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This is all true, but the 22.5% bracket in Ontario extends up to somewhere around $40,000. For a couple, with income splitting and so on, it's possible to stay within that bracket and live quite comfortably. To do this, many people who actually work out the numbers would discover that they might not need to take the kinds of risks that some brokers and "investment counsellors" suggest.
$80,000 minus 22.5% = $62,000 after tax income, which is often as much as or more than the same people took home while working.
I agree, though, that tax brackets are not well understood and can be quite confusing. It took me quite a while to figure out what it meant, and I hope I've got it straight now.
9:24 pm
August 5, 2014
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Loonie, the first $17,000 to $19,000 if there is RRIF income is not taxed and then you pay income taxes on say $21,000 or $23,000 at 24% which is at most $5,520 per person, $11,040 per couple in Ontario.
This is another risk that might exist in coming Ontario budgets, they might increase income tax rates and decrease certain benefits.
I agree that I hear it often income tax rates on interest income are said to be much higher than they really are by financial advisers, financial media.
Examples of interest income taxed at 50% are used in many examples over the last 15 years or so from different sources like brochures, pamphlets, business media etc. This is what I recall anyway.
9:27 pm
August 5, 2014
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Loonie, I just want to caution people reading on this forum that when a spouse passes away and all their RRSP's, RRIF's, TFSA's non-registered taxable accounts etc. go in one spouse's name then this can really cause future tax hits losing many benefits of income splitting and higher personal amounts that are not taxed on the first $17,000 to $19,000 of income per spouse.
Many other lost benefits could be lost as well plus other higher costs from income tax issues will creep up that I'm sure I did not mention here.
Please write your comments in the forum.