Whether we’re saving for a new car, home or even planning for retirement, we all want to know that our money is safe in the bank for our future plans.
November is Financial Literacy Month, so it’s the perfect time to find out.
The Canada Deposit Insurance Corporation (CDIC) keeps deposits safe in Canadian banks up to $100,000 per category, per member institution.
But you might be asking yourself, how do I maximize the safety of my money in the bank?
Here are some things to consider:
Personal accounts/joint accounts. If you’re looking to maximize your deposit insurance protection, remember that CDIC protects deposits held in one name separately from those held jointly. That means that if you have personal deposits, your spouse has personal deposits, and you own deposits jointly, that is a total possible coverage of $300,000.
Trust deposits. CDIC insures trust deposits separately from deposits held personally by the trustee or the beneficiary. In this instance, the deposits are separately insured per beneficiary not per depositor. So a trust account in which your five grandchildren have an equal share could be protected up to $500,000.
Spousal RRSPs. CDIC ensures eligible deposits held in an RRSP separately from other eligible deposits. In the case of a spousal RRSP, the contributor and the owner are different people. Eligible contributions are added to other registered deposits in the name of the spouse or common-law partner for whom the plan is established – not with deposits in the contributor’s name.
Foreign currency. If you are a snowbird or considering becoming one, it is important to remember that CDIC does not insure foreign currency, including US dollar accounts.
Talk to your financial advisor or financial institution about deposit insurance, or visit cdic.ca.
– News Canada