There are over 6 million single women in Canada – never married, separated, divorced, or widowed. Many of us are dealing with pay inequality, low income, unemployment, and are caregivers to children or aging parents. Whether we’re just starting out, or suddenly single, we have to become confident at handling finances.
There is no rule that says you have to do your banking at the same place your parents banked. There is also no rule that limits you to only one financial institution.
If you’ve been with one bank forever and aren’t happy, you can open an account somewhere else. If you’ve never opened a bank account on your own or you’ve been at the same bank for decades, keep reading to find out what single women need to know about banking.
Bank or credit union
Banks and credit unions are places to keep your money. They both have tellers to assist you with deposits, withdrawals, and paying bills. The branches have ATMs so you can deposit and withdraw money at the machine instead of coming inside. You can apply for mortgages, loans, and buy financial products like term deposits and mutual funds.
For your money needs, banks and credit unions are pretty similar.
Banks are profit oriented. They want to make money off you. Correction. They want to make money off big businesses. The big accounts are where the money is. Little guys like us aren’t of much interest to them, no matter how much they try to protest how important every customer is to them. Nope. If you have a problem, banks don’t care.
You don’t need to be a union employee to get an account with a credit union. It’s just part of their name. If your employment is stopping you from looking into this type of financial institution – get over that myth! Credit unions generally refer to their banking customers as members. You buy shares to open an account, usually $5, and that will give you voting shares at the annual general meetings. Credit unions claim to be more people oriented than banks and provide better personalized assistance.
A little credit union tidbit
In Canada if you’re a credit union member and have a debit card, you can make ATM deposits and withdrawals at just about every credit union in Canada. No service fees charged!
That’s right.
Say I’m in Nova Scotia with a cheque in hand that I’d like to deposit. I don’t need to wait to get back home. All I need to do is find a credit union that’s on The Exchange and I can make an envelope deposit at their ATM. No charge to me!
Yes!
Being a member has its benefits.
Loyalty
Just because your parents did their financial business with a certain bank is no reason for you to stick it out there. Your parents may have signed you up as a kid so you’d have a place to save your allowance and Christmas money. Banking there as an adult sounds like an easy choice.
When I was a baby my mother opened up an account for me at Surrey Credit Union, which has since morphed into Coast Capital Savings. Years ago I wanted to close my account with them. My father advised me to keep my account open because one day they might be able to help me.
Still waiting for that day!
Here’s the thing. Customer loyalty is a thing of the past. These days people take their business where they get the best deal and the least amount of hassle.
That might not be the bank you’re feeling loyal to.
If that’s the bank you and your husband did business with and you’re no longer together, you shouldn’t feel obligated to continue your relationship with that bank if it’s not the best deal for you. Cut as many relationship ties as you need to when getting divorced.
Fees
Just about every bank has free accounts for children. Watch out when you turn 18! All of a sudden you’ll be paying monthly fees. $10 to $15/month are pretty average banking fees. That gives you a chequing/checking account that earns no or very little interest, withdrawals, writing cheques/checks, debit card access. There may be monthly caps on all of these and once you’ve reached it, you’re charged per transaction.
It’s very important that you understand how fees work. Especially if you’re just turning 18 and get a nasty whammy when you look at your bank statement.
Whether it’s a bank or a credit union, they all offer pretty much the same services to their clients.
Why pay for something you can get for free?
Are you paying fees at your financial institution when another financial institution can offer you the exact same thing for free?
Jump ship!
Ladies – we have to be smart with our money! That means not spending it unnecessarily. Shop around until you find the best deal. You are most likely to find credit unions and online banks offering no fee banking services with no strings attached.
Some banks don’t charge fees as long as you keep a minimum amount deposit in that account which is usually in the thousands of dollars. If your balance dips below that, you’re charged the monthly fee. Ouch! You want to avoid an account with minimum balance rules. These financial institutions just want to gouge you and nickel and dime you to death.
Convenience
In this day and age of electronic banking, it doesn’t matter so much where your financial institution’s branch is located. Until you actually need to go in.
It’s best to choose a branch that’s close to your home.
Opening hours are probably going to be huge in your decision.
It wasn’t all that long ago that banks were only open between 10am and 3pm. On Fridays they stayed open until 5pm. Forget weekends. They were closed. Talk about inconvenient to do your banking if you worked a 9 to 5 job. You had to do your banking on your lunch break or leave work early on Friday.
And the line ups back in those days! Horrible! It wasn’t one long line the way it is now and you waited for the first teller. You had to choose a line up from four or five tellers. Some lines moved faster than other lines. Not usually the line up I was stuck in! I learned at a young age you didn’t want to get into a line that had old people in it because they took a really long time!
Canada Trust was one of the first banks to be open late and on Saturdays. Yay! The working person’s bank! These days many banks and credit unions have slightly longer working hours. They open at 9 or 9:30 in the morning and most are open until at least 5pm. Some are open until 7 or 8 in the evening. Most are open on Saturdays.
Many financial institutions have phone banking and their hours might be longer than the branch hours, so you can call and speak with someone. Wait times are usually horrendous. People complain of waiting an hour or more to speak with a real person.
Opening the account
Once you’ve decided where to do your banking business, you’ll have to open an account. You’ll sit down with a staff member and provide information: name, address, phone number, email, birthday, and your social insurance number. That would be social security number in the states. Bring your ID. They’ll probably scan your driver’s license onto your account.
If you’re opening an online bank account, you fill out a form on their website, and it’ll take a few days to get approved.
Opening an account in person, you’ll either be approved or declined within minutes.
Hunh? Say what? I have to get approved to do my banking there?! What do you mean?
A financial institution is going to run a credit check on you and decide whether or not they want your business. If you’ve been financially irresponsible, most banks don’t want to deal with you. That means if you have a recent bankruptcy on your credit report or if you’ve committed fraud, they don’t want you.
If you have a low credit rating, a financial institution might still open an account, but will place a hold on your deposits, so it might be a week or more before you have access to money you deposit.
If you have a bankruptcy on your credit report and need a bank account, you can open a joint account with a person who is in good standing. Make sure it’s someone you trust. Even though that account is being opened for your sole use, that other person will have full access to the funds if they choose to withdraw them.
And vice versa, by the way, if someone you know asks you to be a joint on their bank account. If they overdraw it or do something bad, you’ll be just as responsible to pay back the money.
Funding the new account
Do you need to put cash in your new account right away?
Well, that all depends on the financial institution. If you signed up with a big bank that requires a minimum amount in the account to avoid a service fee, I’d say so!
If you opened an account with a credit union, they require members to buy a small amount of shares, usually $5. You’ll need this at the time of opening the account. If you have $20 in your wallet, you could buy the shares and put the rest into the saving account.
Some people want to close down their account at another financial institution and transfer that money in to the new bank or credit union. The staff member who is opening your new account will have paperwork for you to fill out, and they’ll take care of it for you. They’ll send the request to your current bank to have that account closed and all funds transferred. It usually takes a few weeks to see that money in your new account.
If you’re employed, you can start funding your account on your next pay day. Most employers do direct deposits and the money is electronically transferred to your bank account. Ask the person who’s opening your account for counter cheques. It looks just like a regular cheque, except your name and address is missing from the left hand corner. The bank’s information and your account number are on the cheque. Give this to your payroll department.
Speaking of cheques (checks), if you write them every now and then, your new financial institution can order them for you. Price varies. Go for the cheapest option.
What accounts and services do I need?
I’m going to do another post about how your financial institution can help you with loans and investing, but for now let’s just deal with the person who is opening an account for you.
At this time all you need is a chequing account, a saving account, and a debit card to access one or both of them. You’ll also choose your PIN at the time of receiving your debit card and the staff member will make sure it’s working at their ATM before you leave.
The staff member might also recommend you make an appointment with a financial advisor. That’s free, so go ahead and do it whether or not you’re planning to do anything else with this financial institution. You might get some ideas.
You want to be cautious about bringing all your banking business to one place. See how it goes with this bank or credit union. You might find it’s really inconvenient keeping your money there and end up closing your account after a few months.
Your first bank visit should be opening the account, setting up chequing/checking and saving accounts, and getting a debit card.
Don’t get pressured into other bank services too quickly. You know. The ones where they can really make money off you.
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