Yes, banks in Canada charge various types of fee within RRSP such as account opening or closing fees, administration fees, transaction costs etc. Let’s dig deeper into the different fee that banks usually charge for RRSP Canada.
RRSP with a Canadian Bank
RRSP is the Registered Retirement Savings Plan and you can open an account with any financial institution such as a bank, credit union, trust or an insurance provider. It is a common tendency for people to rely on banks to open an investment account considering the safety of funds.
In addition, every Canadian will have a bank account and it is easy for them to open a RRSP with the same institution owing to ease in verification, fund transfer and tracking process.
Do banks charge fees for RRSPs in Canada?
Yes, not just banks but all the financial institutions charge various fees for investing in RRSP and they are listed below:
Account opening fee:
Although most banks are not charging this for the sake of marketing, there are a few banks that charge you for opening a RRSP with them.
Administration fee:
The banks charge fees for administering and reporting status of your funds. This could be monthly, quarterly, half yearly or on an annual basis depending on the service provider. Some banks charge a tiered fee based on the funds invested, whereas, some banks charge a fixed fee.
Investment Cost:
If you invest your RRSP in an ETF or a mutual fund, then the fund managers charge investment management costs, that is generally a percentage of your investment balance.
Transaction costs:
You will be required to pay brokerage to the banks when you buy or sell a share or an ETF. It could be percentage based or a fixed fee.
Account closing fee: Some banks charge a fee when you close your RRSP or when you want to transfer your RRSP to another service provider.
Fees for RRSPs in Canada
It is important that you do a complete research of the bank’s RRSP brochure before you open an account with them.
If you wish to change your mind, then there might be implications and you might end up paying more fees than what you had actually earned within the RRSP.