Why should I get a new account at a new bank?

Monday, September 11, 2017 - 21:44

Money Management


There is nothing worse than having your bank freeze your account, taking money from your account without your permission or having your pay cheque constantly be applied to overdraft.

When we consider our relationship with a bank we think of having numerous and separate accounts with them. For example, we may have a chequing account, a savings account, a line of credit and a Visa or MasterCard with our bank. Although it may appear that these are separate accounts, the fact of the matter is that they are all sub-accounts under a singular account (you).

It is important to understand this aspect of your relationship with your bank because it gives the bank certain abilities that we are largely unaware of. Specifically the ability that the bank has that will cause you some very big problems when you are run into financial difficulty is the ability to exercise the right of Set-Off.

Set-Off is the ability to move money from one account that has a positive balance to another account that has a negative balance. The bank can do this without a Court Order and without your consent. If you have ever had this happen to you, you can certainly attest to how frustrating and frightening this can be – it absolutely turns your budget upside-down.

If you owe your bank money for an unsecured debt (credit card, line of credit, overdraft, etc.) we recommend that you move to a new bank that you don’t owe any money to (or a bank that you have a secured debt with that you are planning on continuing to pay – car loan, mortgage, etc.). Make sure you don’t forget to speak with your employer about having your wage directly deposited into your new bank account.

Latest Posts

Tax Season For the Self-Employed

This year the deadlines for filing your 2017 tax return are as follows: April 30, 2018 for personal returns and June 15, 2018 for self-employed persons. Keep in mind, however, that any tax owing must still be paid by April 30, 2018.

February 15, 2018

Business Concerns

Q and A: Tax Season

With income tax season in full swing, I thought it would be a good time to answer some common questions that I hear regarding government debt and tax returns.

February 10, 2018

Government Debt

Duties of a Bankrupt

Personal bankruptcy laws in Canada are governed by the Bankruptcy & Insolvency Act. Failure to complete your duties will delay your bankruptcy discharge so it is important you fully understand your requirements once you declare bankruptcy.

February 5, 2018

Bankruptcy