By Ryan May
As the tuition deadline approaches, summer jobs end, back to school sales start, and the lines at the bookstore grow longer money is on the mind of most students both new and returning. With so much money coming in and going out bank balances will be rapidly changing; especially as service charges rapidly mount. For your consideration: a review of chequing accounts and credit cards with students in mind.
The Big Five
These banks handle the majority of personal banking in Canada. They have the advantage of national networks of branches and automatic tellers. The Canadian Deposit Insurance Corporation insures all of them; CDIC insurance covers most deposits at these institutions up to a maximum of $60,000 per person. These five institutions are also the only ones that offer direct payment of tuition from an account.
Bank of Montreal
‘The Bank of Montreal (www. bmo.com) offers a Special Discount Program for young adults (under age 21) and students (ages 21-26). The program provides a free InstaBanking Plan or a $5.50 monthly credit towards a more expensive plan. BMO’s fee structure differs from other institutions; they allow an unlimited number and type (chequing or savings/Canadian or U.S. dollars) of accounts under a plan, and simply debit any transactions on any of the accounts towards the monthly total.
The InstaBanking Plan provides 20 self-serve transactions per month and a monthly statement. Self-serve transactions include cheques, debit and automatic teller transactions, and online and telephone banking. Additional self-serve transactions are $0.60 each and transactions assisted by bank staff are $1.
BMO is a MasterCard issuer under the “Mosaik” brand, but does not offer a card specifically designed for students. They do offer a free (no annual fee) basic card that can carry a low limit, and offers either a 0.5 per cent cash back program or AirMiles (www.airmiles.ca) reward miles. The annual rate of interest is 18.4 per cent, and a number of card designs are available. A BMO ATM is located in the MacEwan Hall food court.
Canadian Imperial Bank of Commerce
The Canadian Imperial Bank of Commerce (www.cibc.com) offers the Advantage Plan for Students. The plan is available to any full-time post-secondary student, and includes both a chequing account and a credit card. In order to qualify for the plan you must present proof of enrolment at a post-secondary institution every 12 months. A CIBC automatic teller is available in the MacEwan Hall food court.
The chequing account is an Everyday Chequing Account and is provided at a 50 per cent discount. The account includes 10 transactions a month for $1.95 (after discount) with each additional transaction costing $0.30; a passbook, monthly statement, or quarterly statement is included. Electronic banking is free as are electronic account history inquiries. No monthly fee is charged if a minimum balance of $1,000 is maintained throughout the month.
CIBC’s student offerings also include the Classic Card for Students, a Visa card specifically for post-secondary students. Its features include no annual fee and a minimum $500 credit limit; an annual income of $1,200 or more is required to qualify for a card.
Royal Bank of Canada
The Royal Bank of Canada (www. royalbank.ca) offers a Student Banking Package. The package includes a chequing account, a credit card, and a free Student Price Card (www.spclive.com). The package is available to all full-time students. RBC has a small office and two automatic tellers in the commercial corridor on the lower level of Mac Hall; an additional automatic teller is available in the MacEwan Hall food court.
For $3.50 a month, RBC’s student chequing account provides 25 debit transactions (moving money out of an account); additional debit transactions are $0.50 each.
For students RBC also waives the $15 annual fee on their Visa Classic II card which offers a rewards points system and an annual interest rate of 18.5 per cent.
Bank of Nova Scotia
The Bank of Nova Scotia (www. scotiabank.com) offers the Student Banking Advantage Plan. The plan offers a discounted chequing account and credit card. The plan is available to all full-time post-secondary students.
The chequing account includes 12 non-teller transactions per month, electronic banking, and a passbook or monthly statement for $1.25 a month. Additional non-teller transactions are $0.25 and teller transactions are $0.50–both a 50 per cent savings. The monthly fee is waived if a $2,000 minimum balance is maintained during the month.
Scotia also offers its Classic Visa card without the annual fee for students. The card offers a minimum $500 credit limit, a one per cent cash back program, and an annual interest rate of 17.9 per cent.
The last Scotia ATM on campus disappeared from Mac Hall more than two years ago in unknown circumstances.
TD Canada Trust
‘TD Canada Trust (www. tdcanadatrust.com) offers both a discounted chequing account and credit card for students. All students enrolled full-time in a Canadian post-secondary institution are eligible. A TD automatic teller is available in the MacEwan Hall food court.
The chequing account offered is a self-serve account, but with more than a 50 per cent discount off the monthly fee. The account costs $3.45 a month and offers 20 self-serve transactions a month, and a monthly statement; additional self-serve transactions are $0.50 and full-serve transactions are $1. The monthly fee is waived if a minimum monthly balance of $1,500 is maintained.
TD offers two cards for students: the TD Green Visa Card, and the GM Card. Both offer a minimum $500 credit limit, an annual interest rate of 18.5 per cent, and have no annual fee. The TD Green Card is a basic credit card while the GM Card allows you to collect three per cent of your spending to put towards the purchase or lease of a new GM vehicle (up to $3,500 per vehicle).
Although neither of these financial institutions are actually banks they both offer a full range of personal banking services. While they lack national coverage they do tend to offer more personalized and attentive service. Both have all their deposits fully guaranteed by the Alberta government.
Alberta Treasury Branches
Alberta Treasury Branches (www. atb.com) offers the Students First Account discount chequing account and a student credit card. They are available to full-time classroom post-secondary students. Currently, opening either a Students First Account or applying for a student credit card or line of credit enters you to win one of ten $1,000 bursaries. An ATB automatic teller is available in the MacEwan Hall food court.
The Students First Account is $2.95 a month and includes 40 transactions, a monthly statement, and 20 free telephone account inquiries. Additional transaction charges range from $0.50 to $0.85 each.
ATB also offers the Students First MasterCard with no annual fee, a minimum $500 credit limit, and an annual interest rate of 17.9 per cent.
First Calgary Savings
First Calgary Savings (www. 1stcalgary.com) is a credit union, and as such requires you to become a member-owner by buying a small number of shares (five for students at $1 each) in the credit union before opening an account with them. At the end of each year, 1st Calgary pays dividends in the form of shares to its member- owners based on their individual transactions with the bank. 1st Calgary offers a Student Package including both a chequing account and a credit card.
The chequing account offered is the Future Account which is free for anyone under 23. The account includes 20 debit transactions (excluding automatic funds transfers), unlimited automatic funds transfers, unlimited electronic account inquiries, and a monthly statement. Additional electronic debit transactions are $0.55, and in-branch (live person) debits are $0.55 to $1.50 each.
For students over the age of 23, 1st Calgary offers the 1st Rate Chequing Account free of charge. This account offers no free transactions, every transaction is charged on an individual basis ranging from free to $1.50 each. The account also includes a monthly statement; 15 free transactions are provided if an average monthly balance of $1,500 or more is maintained. The next lowest cost chequing account carries an $8.95 monthly fee.
1st Calgary also offers a Student MasterCard with no annual fee, a $1,000 maximum credit limit, and an annual interest rate of 18.75 per cent.
President’s Choice Financial
President’s Choice Financial (www.pcfinancial.ca) is a bank and is CDIC insured. However, it does not have traditional branches; phone, Internet, and mail are used to process transactions and provide service. Service kiosks inside Superstore locations are also used to deliver service, but not to perform transactions. PCF is the newest institution featured in this article and is the only one that does not offer a plan or account designed specifically for students. Its infrastructure is provided by Amicus Bank, a division of CIBC, so PCF clients can use CIBC automatic tellers free of charge. A CIBC automatic teller is available in the Mac Hall food court.
PCF offers the No Fee Bank Account with no monthly fee and no transaction fees. The account also includes free cheques, free online monthly statements, and the ability to earn PC Points (www.pcpoints.ca) that can be redeemed for free merchandise.
PCF also offers The President’s Choice Financial MasterCard with no annual fee, PC Points, and an annual interest rate of 17.97 per cent.
There is a wide range of banking options available to students. In order to choose the right products individual needs and preferences must be considered. Based on cost and convenience PCF’s No Fee Bank Account appears to be the best option, but its lack of full-fledged branches may be a factor. BMO and 1st Calgary both offer attractive free accounts with no minimum balance, but they put a cap on the age of qualifying students. Several other institutions offer to waive their monthly fees if a minimum balance is maintained, but this could be difficult for many students on fixed incomes.
There is less variety in the credit cards offered to students. All have no annual fee, and similar annual interest rates. A few stand out for offering cash back or ties to rewards programs such as AirMiles. For students saving for a vehicle the TD GM Card may be ideal, frequent Superstore shoppers will appreciate the PC Points on their PCF MasterCard, and AirMiles collectors will rack up points faster with a BMO MasterCard.
Financial choices are personal, and a plan or package that fits one person perfectly could be completely wrong for someone else. You do not have to be tied to one intuition for all your banking needs–mix and match products from various institutions to get the most out of your money.