Smart Consumer – Winnipeg Edition

Are you happy with your present chequing account? Regardless of whether you are or not, a better question is did you shop around before picking the account you have now? A lot of people never bother shopping around when it comes to their chequing account or bank, and there are many reasons for this. For example, did you choose which bank to open your first account in, or was it your parents? Chances are it was your parents, and quite a few people stay with their first bank for life.

Well, just because you might have been with a bank since you were young, that doesn’t mean you have to stay with them. This is especially true if you are dealing with overcharges and random fees each month. If you have dealt with banking problems before, then perhaps you have looked into other alternatives only to become overwhelmed with everything to consider. True, there are many options when it comes to bank accounts, but if you know what to look for, you can easily find the ideal chequing account.

First, I will outline the four most important factors to consider when picking a new account:

1. Convenience – this includes bank locations, branch hours, the ATM network, and services like telephone and online banking.
2. Transaction limits – do you need a smaller amount, or an unlimited amount of transactions each month?
3. Account fees – how much does your bank charge you each month to use their services? Are there any ways you can bank for free?
4. Services – does a particular bank or account have certain services that make it more attractive for you, like travel bonuses? Or perhaps you’d like to collect rewards points for your purchases.

For convenience, a close bank is wonderful. Especially if you require teller services or just enjoy dealing with people (as opposed to doing everything through an ATM). Some people, on the other hand, do prefer to do everything through an ATM. Online and telephone banking have also empowered customers to the point where they may never need to set foot in an actual bank. The importance of convenience is dependent on what you’re looking for, though, so just try to find a good balance between this and everything else.

What is the most common reason people pay too much for owning a debit card? Transaction limits. The usual way to avoid unwanted charges for going over your transaction limit is to pick a chequing account with a high number of monthly transactions. The ideal, of course, is an unlimited amount (or at the very least, about 30… although I have been known to go over this limit quite a few times). A high transaction limit is a must, especially if you make a lot of purchases using your debit card. Another way to circumvent overcharges and other fees is to utilize some type of discount.

Discounts can be found based on your age (youth, senior, etc), if you are a student, or if you keep a minimum balance in your account. In many cases they are the best way to reduce or even eliminate your account fees. These discounts become increasingly rare when you start to look at each bank’s premium or unlimited accounts, which provide specialty services.

Distinct services can make or break a good account. If you travel frequently, an excellent bonus a bank can provide is access to your money across the border or overseas. Free traveler’s cheques or a preferred rate when exchanging your cash are also useful when planning your trip. And it doesn’t end there. With some accounts you might even be eligible for a discounted or free safety deposit box. How about a bonus every time you buy something? A few banks offer rewards with their chequing accounts.

Here’s a list of which banks reward debit card purchases and how they do it:

• Bank of Montreal gives out Air Miles at a rate of 1/$40 in purchases
• PC Financial offers patrons PC points at a rate of 5/$1 in purchases at Superstore and provides multiple ways to earn more bonus PC points
• New CIBC customers receive a welcome bonus of 5000 Aeroplan Miles for opening an Unlimited Chequing Account, along with 100 bonus Aeroplan miles a month, providing they meet certain requirements
• Scotiabank rewards their account holders with 1 SCENE point for every $5 in purchases (this becomes 5 SCENE points per $1 spent at Cineplex theatres), as well as a welcome bonus of 2000 SCENE points

What does all this mean? Well, Air Miles can be redeemed for flights as well as a ton of other things– the same goes for Aeroplan Miles. PC points are great for groceries and just about everything else for sale at Superstore, and SCENE points can get you free movies at Cineplex. Each of these four banks also has a credit card you can apply for to get even more reward points or miles. However, this article isn’t about credit cards so that subject is better left for another time.

The main idea to take from this is that these banks are literally rewarding you for making Interac purchases. So even if you were to go over your transaction limit for the month and get overcharges, you’d still get a little bit back in the form of rewards. This is not the most important thing to consider when picking your chequing account, but it is something to think about along with the other factors.

To summarize all of the aforementioned points, the perfect chequing account would have the following traits:

1. Belongs to a bank that has many locations with good hours and an expansive ATM network.
2. Has unlimited (or near unlimited) transactions per month.
3. Has no account fees.
4. Has enhanced services with multiple benefits and rewards you on purchases.

Does the perfect chequing account exist with any one bank? No, not really. A few do come close, though, so depending on your needs you can probably find one perfectly suited for you. To assist you in making a decision, I’ve created a chart for everything that deserves comparison. First, the convenience of each bank is put to the test. Following that, accounts are compared based on customer groups. Read the one that applies to your demographic.

Bank convenience comparison

Youth accounts comparison

Student/Young Adult accounts comparison

Adult accounts comparison (if you require unlimited transactions)

Senior accounts comparison

Premium accounts comparison (if you require enhanced services/travel bonuses)

If you aren’t interested in all of the details and just want a general ranking, you can find that here. Keep in mind, these rankings are subjective and only reflect how I feel each bank’s offerings match up with the others.

The Top Banks and Credit Unions for Convenience:

1. TD Bank
2. RBC Royal Bank
3. Scotiabank
4. Assiniboine Credit Union
5. CIBC

The Top Chequing Accounts for Youth

1. TD Youth Account
2. CIBC Advantage  for Youth
3. Assiniboine Credit Union Youth Chequing
4. PC Financial No-Fee Bank Account
5. BMO Plus Plan Primary Chequing

The Top Chequing Accounts for Students and Young Adults:

1. PC Financial No-Fee Bank Account
2. CIBC Advantage for Students
3. BMO Plus Plan Primary Chequing
4. Scotiabank Student Banking
5. Assiniboine Credit Union CareerStart Chequing

The Top Chequing Accounts for Adults:

1. PC Financial No-Fee Bank Account
2. Scotiabank Scotia One Account
3. RBC No Limit Banking
4. BMO Performance Plan Primary Chequing
5. TD Infinity Account

The Top Chequing Accounts for Seniors:

1. BMO Performance Plan for Seniors
2. TD Plan 60 Account
3. Assiniboine Credit Union 59 Plus Chequing
4. Scotiabank Plus Program with Scotia One Account
5. CIBC 60 Plus Advantage

The Top Chequing Accounts for Frequent Travelers:

1. Scotiabank Scotia Value Account
2. TD Select Service Account
3. BMO Premium Plan Primary Chequing
4. RBC VIP Banking
5. Assiniboine Credit Union Premium Chequing

Agree/Disagree? Feel free to leave me a comment or send an email my way, I’d like to here your thoughts.

Expect a sample article of Smart Consumer – Winnipeg edition soon! The first issue of the magazine is due out in 2010.