Teen Money Canada

Canada certainly has a fair number of banks, and choosing the right one can be a daunting prospect — especially for a teen. Contrary to popular belief, the BIGGEST is not always the best. Since I had enough money to open an account, I’ve done business with ‘Presidents Choice Financial’, which is a branch of CIBC. It is purely online banking, which is both an advantage and disadvantage.

ADVANTAGES

Higher Interest Rates than top 5 banks (0.75% with an Interest Plus Savings account)

Typically better customer (phone) service

Easy online banking

You can use CIBC bank machines at no charge

DISADVANTAGES

No tellers are available to talk to (online only).

Few Presidents Choice Financial locations — they are only located in Superstores.

Now compare this to a larger bank, such as Toronto Dominion

ADVANTAGES

Tellers/Clerks available to talk to in person

Locations all over Canada

Online Banking, albeit with few features than PC

DISADVANTAGES

Comparatively LOW interest rates — take a look at this chart: http://www.tdcanadatrust.com/accounts/compare_savings.jsp

Charges for various transactions, including: debit (after the first two monthly free ones), cheques and bill paying, though the last element of fees shouldn’t be a problem for most teens.

These ‘features’ are basically true to each of Big Five Banks, those being CIBC, TD, BMO, RBC and SB.

As you can see, Presidents Choice Financial offers higher interest rates to those who do not have a minimum of $5000 to get a lower interest rate than you would get with $1000 at PC.

If you’re willing to sacrifice tellers, and perhaps lots of bank machine locations, I say DEFINITELY go for PC Financial. You make the most money long term, especially when you have under $5000 (a necessity for reasonably high interest rates with the ‘big banks’). If you don’t have a Superstore near you, you may end up needing to choose one of the ‘big banks’.

Out of the Big Five, CIBC is likely the best choice, as it not only has the highest interest rates, but also (in my opinion) has the best level of customer service & lowest average fees.

There you have it. PC Financial is a great online based bank with no fees & high interest rates. It does have some ’sales associates’ in Superstores all over Canada — they can answer most of your basic questions if you prefer person to person talking rather than the phone. If you’re unable/unwilling to get an online bank account, CIBC is most certainly the next best choice.

Austen.