Social Icons

Saturday, December 8, 2012

My twisted plan to pay off my RRSP loan and why you should be doing the same

I did it! I had paid off my $7 605.22 RRSP loan debt. How did I do it? It was pretty twisted. I notice a super offer coming from TD Visa: 1.9% on credit card balance transfer for 6 months. My plan was to use TD Visa money at 1.9% to pay off my RRSP loan. I already had a balance of 8k ok my TD Visa, but my card is full. So I requested an increased of 16k, which was accepted.

My RBC Visa was completed paid off, but I entered an order for a credit card balance transfer from RBC Visa to TD Visa. That way, I was going to have the 8k very easily, without having to pay any interest at all on RBC Visa.

BRILLIANT – right? I taught it was the most brilliant idea of all. GEES, I AM SMART.

Well, I went to an RBC branch today (I didn’t have any time to do it earlier this week). So I asked the chita to transfer the money over my banking account. I had tried to transfer the money myself from my RBC Visa to my RBC banking account, but it wasn’t working. Why? Because even with a positive balance on the RBC Visa, the operation is being considered as cash advanced. This mean that even while having a positive balance on the credit card, as soon you withdraw an amount, even a positive amount, an excedant, you pay interest on the money withdraw on the credit card.


So I told the chick, I need the money to pay off my RRSP loan. I told her that I was trying to be smart and this was my way to not pay any interest on my RBC Visa.

So she went see her supervisor in the back. The chick return saying that I could use a RBC Visa cheque, that the interest will be lower on the cheque than on a cash advance.


I told her, I need the money! I don’t want to pay any interest. I need to pay my RRSP loan TODAY PLEASE!

The same chick calls RBC Visa on my behalf to arrange something. She came back saying that the fees will be reversed on my RBC Visa (YEAH!) and that the only fee I was going to get is a $2 for the cheque (I have big boobs but forget putting a close 8k in my bra!). LOL

Thanks to her, I happily went to a TD branch and I PAID OFF MY RRSP LOAN.

Thank you RBC chick. I LOVE U. I asked her to write down her name on my piece of paper and I am going to write to RBC CEO: YOU HAVE TO PROMOTE HER.

RBC, just continue to give me what I want ok?

Now, I am giving you the right to use the same strategy. GO AND MAKE YOUR BANKER GO NUT.



Anonymous said...

Hi Sunny-You should have realized in the first place that transferring 8K from your RBC visa to your TD visa is considered a cash advance. Even though you paid off your RRSP loan your debt still remains the same. The only thing that has changed is your interest rate. If you loose you job in the next 5 months God help you.

I'm sure you like living on the riskier side of life.

Party on girl!:)


Sunny said...

I have been in my current job for 7 months now. I feel comfortable saying that it will continue for the next 5 months at least.

My debts are the same, but the interest is lower. I no longer have the $108 to pay on my loan every month. The credit card payment for the new money borrowed is about $30. I am keeping $70 in my pockets. Kind of worth it, I think.

That I have a job or not, payments need to be made. If I lose my job, I will be getting unemployment for a while. I am safe no matter what's going to happen next. I could live on a part-time job while earning dividend if I lose my job. I am not afraid of losing it.

I had been through different kind of so many situations that I now know how to handle it all. Unemployment, laid off... Nothing afraid me.

I love the risky part of live. That's why I love to invest that much. But the risk is calculated. I am not taking more than I cannot handle.

Anonymous said...

This is ludicrous hahahaha.

The end


Ruth said...

guess i should start the blog at the top , this is in a question for , i think Mark or anonymous about the Mawer funds...i was looking at them and they are mutual funds, no load and little mer...i have 40 grand to invest and can only get a little over 1%, what do u think of the American fund with the curency ..

Sean said...

The problem with people applying for these balance transfers, is that they end up making lower monthly payments than in the past. This $70 should not be in your pocket, but re-deployed to paying down your huge pile of debt.

Anonymous said...

Ruth if I'm not mistaking you are holder and shouldn't take too much risk. You're talking about 100% safe GIC's to 100% stocks in the Mawer US Equities. I would suggest you invest in the Mawer Balance funds which is 60% stocks and 40% fixed equities; and the stock portion is invested in Canada, US, and globally and the MER is only about 1%.

Anonymous said...

Ruth, the Mawer Balanced fund is up 9.62% this year, do you know what your rate of return is for the year.

Also, you can always find some funds that have a better return for the year, but you are more than likely taking on more risk. Lots of diversified funds are up over 10% this year, but a lot of them invest in junk bonds. If the market turns bad, they could be much more volatile. The Mawer Balanced fund mostly invest in bonds with a credit rating of A and higher.

Sunny said...

I think I am going to invest in that fun :)

TIPIT said...

Sunny, don't forget that your interest paid is now tax-deductible.
As an RRSP loan it wasn't but now it is, so even lower interest rate.

Ruth said...

i have some GiC's now ,,,just running out of 5% ..been doing well with BCE, Enbridge, Bell Aliant and Interpipe , pembina..the bad stocks are sold , JE, Pengrowth...kept Rim..Manulife . i do have mutual funds that are doing well but this one you have recommended seems like a good one..will look more at it.

Ruth said...

love the speculative stock buying but oh so risky..bought SND.V..even on it. bought painted pony..hoping for a buyout, own SSL.V little down on it...what is the matter with gold anyways. bought that i was going to buy at 9 bucks but listened to others saying no airlines but am up on that one already.

Anonymous said...

Who ever said you could deduct the interest from your credit card transfer that was used to pay your RRSP loan is wrong. The loan was not made for investments that are tax deductible. The loan's purpose hasn't changed, it's still to invest in RRSP. You will need to keep track of the part that is deductible for tax reason and the part that's non deductible.

The accountant

Anonymous said...

@Ruth: I wouldn't consider SND.V and SSL.TO speculative per se. Don't forget the CEO of both is Nolan Watson, who single-handedly took Silver Wheaton from a million dollar company to a billion dollar company. He was CFO of Silver Wheaton at 26, was top of his CA class exams in all of Western Canada, and obviously he has done well with Sandstorm Gold. I am pretty risk adverse, but feel very confident in the abilities and most importantly in the integrity and honesty of Nolan Watson, who is only 33 right now, runs both companies and even carves out a lot of his time to do humanitarian work for his African school building charity. Watson is smart as a tack and Sandstorm's management team is very responsive, forthright, and values honesty and ethics. Plus, Sandstorm Gold and Metals are in the streaming business and the nature of their business offers a great inflation hedge, especially with central banks printing more money to try to stimulate economic growth. I own a fairly large position in Sandstorm Metals and Sandstorm Gold and both have offered me fantastic returns and I have added more to the positions during the recent dips.

Anonymous said...

Hey Ruth I see you are a sandstorm gold and sandstorm metals fan just like me ! What do you think of the sandstorm gold warrants ssl.wt.b that expire in 2017 at price of $14 ?


Thank you

Thank you for visiting!
Blogger Templates