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Email this12:36 am
After some research and the advice i received on this site i decided to open a direct savings account and use it in conjunction with PC no-fee account for my main banking needs.
One thing i have found is that transfers to HSBC are on hold for quite a long time. It takes a week before funds from a bank to bank transfer are available. Same with depositing cheques. This is generally not a big deal as i have my pay deposited directly to the account, and once i move my money out of the account i don't usually move it back.
But every now and then i need to consolidate funds from various accounts into once place, i was hoping the HSBC account would be useful for that (for paying large bills and stuff like that). However having to wait a week+ till the funds have cleared is very inconvenient for this purpose.
Overall though i am pretty happy with the hybrid chequing/High Int savings nature of the account and i suppose there had to be a compromise somewhere.
9:18 am
A 5-7 day hold time is an industry standard for bank-to-bank domestic electronic transfers. The online banks will all tell you that they do that because the transferring bank has the right to recall the funds from the receiving bank within 5-7 days of the transfer. Personally, I think the holds have more to do with allowing the banks to make short-term investments with our money than anything else.
The interesting thing is that the hold time only applies when you transfer funds OUT of a chequing account INTO an online savings account, but not vice-versa (in my case at least). For example, if I transfer funds from my RBC chequing account to my ING Direct savings account, ING puts a 5 day hold on those funds. But if I transfer those same funds from ING Direct back to my RBC chequing account, RBC does not put a hold on them and the funds are available for use immediately. I've always wondered about that.
12:27 pm
So a 7 business day hold time means on average i can't touch my money for 7 - 9 days. That is really annoying, especially because the money is deducted from the other account pretty much the next day, even cheques.
Guess i will hold on to my TD chequing account for depositing cheques and stuff. At least while I'm still considered a student and they don't charge fee's.
Do we still earn interest while the funds are on hold?
12:36 pm
Yeah you do, that's why it doesn't really matter to me.
Sacrifice mobility for 4.75% interest? Of course I'll do it.
3:01 pm
December 12, 2008
Offline
Exactly (about the 5-7 day industry standard hold time).
I have the exact same setup as the OP (PCFinancial No Fees Chequing with the Direct Savings account from HSBC).
I use the HSBC account for my main banking needs account (I have my payroll deposited into this account as well). I use it to make Interac debit purchases / bill payments etc.
The only reason why I have the PCFinancial No Fees chequing is because I can't get cheque for the Direct savings account. So If I need to write someone a cheque (ie, my landlord), I write it with the free cheques from my No Fees Chequing account, then run to an ATM (HSBC, National Bank of Canada, Alterna, Bank of Montreal, etc) to widthdraw the funs and then deposit it into an ATM with CIBC/PC Financial to cover the cheque. I do it this way, because if I do a bank to bank transfer, I'll get the 5-7 day hold, whereas depositing money into my account at an ATM, I have no holds. This only needs to be done once a month for my banking needs.
But other than that, all other daily transactions are with the direct savings account.
8:02 pm
djino do you mean thats funds deposited at an ATM clear faster then a bank to bank transfer from HSBC to PC?
I wonder how long the bank to bank transfer to my TD account will take. Guess there is only one way to find out.
5:47 pm
December 12, 2008
Offline
Nope. I mean the following:
If I initiated a Bank to Bank Transfer from HSBC to PC Financial (or vice versa), It would take a day or two for the receiving bank to show the funds and they would place a 5-7 day hold on the funds while they clear.
If I instead goto an ATM to deposit the cash (or cheque), HSBC (and PC Financial) will NOT place a hold on what I have deposited. Which this is the better route around Bank to Bank Transfers. This way you are not waiting for the funds to show up in the other account at the other bank and there will not be any hold time.
djino
"yup, Direct Savings Account & PC Financial No Fees Chequing best combo to go, they satisfy all banking needs"
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