Last year, a friend of mine started working at Investors Group in Winnipeg. She was supposed to bring clients with her so I made an appointment to meet her there to discuss finances.
She had her adviser with her during the meeting to help out since she was still learning. I ended up setting up 2 transactions with them. I started a tax free savings account with pre-authorized payments coming out of my back account. This was to save for my trip to Africa. I also had a large RRSP coming up for renewal and I arranged to have that transferred over to Investors.
The tax free account was fine. When it was time for my trip, I gave them a call and the money was transferred into my account back at Cambrian Credit Union where I do all my banking. It didn’t make much interest and possibly not as much as if I had set it up at Cambrian in the first place, but it was available and ready to exchange it into African Rand to take with me.
The RRSP was a different story. I had sent over $10,000. to Investors from Cambrian and Cambrian did not take anything in the way of fees for this transfer. After it had been with Investors for over a year, I compared what I was making with it there with what I had made the previous year with Cambrian and it was very similar. With Investors, you also get tons of emails and calls because they were looking to take over my mortgage as well as more money. They made it obvious they wanted to be my financial institution. I didn’t have any intention of sending any more money their way and found the constant calls and emails annoying.
My friend had left after just a few months, so I had been placed with the adviser who had been with her when I made these transactions. I didn’t feel any need to leave my money with Investors with my friend gone, so I arranged to have it moved back to Cambrian. At Cambrian, I know what interest rate I will be receiving so there isn’t the need to watch it closely (not that watching it really helps anyway).
After the money moved back to Cambrian, I got a letter from Investors letting me know the money had been transferred and that they had taken fees that were over 90% of the interest that had been made while they had it. So, they had my money for a year and they where the only ones who benefited from it!
I’m obviously not thrilled with my friend who failed to let me know about the fees. There were tons of papers to be signed and I didn’t read the small print like I should have because I was dealing with a friend. Even after she left there, she didn’t let me know about the fees or suggest that I get my money out before the costs add up. That money was a big chunk of the savings that I have to put towards my retirement income.
This business has been around for many years and it amazes me now that it is. Are people just embarrassed to say that even though their money made money while there, that the company took most of it for themselves? I don’t know how they determine how much they will take in fees either. Is it just that 90% of what is made or is it a set amount. For instance if my money had not made enough, would they have taken the fees from the RRSP itself and sent back less than I deposited with them? I don’t know the answers to these questions, but I can guarantee that I will never do business with Investors Group again.
Ultimately, I can only blame myself for not reading all the papers that I signed.
I need some Africam time now that Chester and I are back from our walk.