Overview:

Ontario introduced a new photo card that will provide government-issued identification to more than 1.5 million Ontarians who do not drive. The Ontario photo card makes it easier for non-drivers to perform everyday activities such as cashing a cheque or returning items and goods to a store.

The Cost is $35.00

4-6 weeks for delivery

Ontario Photo Card Website: http://www.ontario.ca/government/ontario-photo-card

The benefits of the Ontario photo card?

An Ontario photo card is government-issued photo identification that allows non-drivers aged 16 years and over to access government, financial or business services that require proof of identity. This proof of identity can be used for things such as: cashing a cheque, opening a new bank account, obtaining a credit card, boarding a domestic flight, returning goods to a store, obtaining hotel accommodation and renting a home video.

Who is eligible for an Ontario photo card?

People living in Ontario who are 16 years of age or older who do not hold a driver’s license are eligible for the Ontario photo card. People with a driver’s license will have their driver’s license cancelled when they apply for a photo card as you cannot hold a valid driver’s license and a photo card at the same time.

The information needed to complete the form includes: Date of Birth, Sex, Height, a Residential address, a mailing address if different. The applicant will need to sign and date the forms. The Public Guardian and Trustee (PGT) will sign the application if it is necessary.

Tip: It is best to make an appointment at your local office. To find out information or to book an appointment for a photo card, please call 416-235-2999 or 1-800-387-3445, or TTY toll-free 1-800-268-7095.

Service Ontario Centres offering photo card services

click here

You will need to bring Acceptable Identify documentation for Ontario Photo Card to the appointment. There are three ways to satisfy this requirement:

• List 1: Only one document is required to satisfy all three data elements
• List 2: Two documents are required to satisfy all three data elements
• List 3: Support Documents

List 1: Identity Documents

List 2: Two documents are required to satisfy all three data elements

List 3: Supporting Documents

Tip: Be sure to bring the completed application form and the required identification to your appointment. It would be a good idea to bring someone you trust with you when you go to the appointment. This person can be a great support and very helpful if there is something you don’t understand or there are difficulties with your application.

If you rely on family members for help with your day to day finances, it’s possible you also rely on using a family member’s bank account for storing your money. While having someone else have control over your finances might seem to make your life easier, there are some important benefits to having your own bank account. These reasons include employment, cashing cheques, reputation, safety and accessibility. Each of these reasons is explained in more detail below.

1. Employment – Direct Deposit

   Direct Deposit means that you give permission for a person, company, or organization to deposit money into your bank account. Examples of the uses for direct deposits include: Government Benefits such as the Ontario Disability Support Program, pay cheques, and tax refunds. Direct Deposits are very convenient, as it saves you time from going into the bank, or visiting a bank machine in order to cash a cheque.

   In some cases Direct Deposits are required and there are no other options. This is true particularly when you get or have a job. If you plan to find work it is important to set up a bank account so that you can immediately begin receiving your pay. Using another person’s bank account is not an option, even if it is a family member’s account. The account holders name MUST match up with the name of the person who is receiving the money. Therefore, a person who is going to be receiving direct deposits will have to have a bank account of their own.

2. Cashing Cheques

   Sometimes it is not possible to use a direct deposit . When this is not possible, it is likely you will receive a physical cheque instead. If you have your own bank account, you will be able to deposit the cheque and then take the money out. If you do not have your own account, and you need your money right away, you will be forced to go to a cash advance company (e.g. Money Mart). A cash advance company will loan you the money until they get the money from your bank account. They will charge you a fee to do this. Using a cash advance company means that you will lose a large portion of your money to pay for the convenience of having your cheque cashed quickly. Your bank, on the other hand, will allow you to keep more of your money.

3. Creating a budget that works for you

   When you have your own bank account you have access to your money when you need it. Yet, sometimes people have difficulty managing their money. If you have trouble with budgeting, there are many options that will allow for you to control your money better. Some of these options include:

   • Pre-authorized payment planning. Pre-authorized payment means that you give your permission in advance for money to be taken out of your account to pay a bill. This can be used for your rent or cable bill.
   • Having a second trusted person with access to the account
   • Setting daily withdrawal limits. By setting a limit on how much you can take out each day, you can reduce the chance that you will spend more money than you have to spend.

   These options are only available if you have your own account.

4. Reputation

   Establishing a good reputation with your bank is very important. What is meant by “a good reputation “is that you do not spend too much money if you do not have it. It also means that if you need to borrow money from a bank or any other institution, you have shown you can pay that money back. It also means that you have shown you can pay your bills and expenses on time. Once the bank has seen you can manage your money responsibly, they will allow you greater banking freedoms and privileges. For example, the bank will be more likely to allow immediate access to your money through cheques, and allow you access to other services such as advice on Registered Disability Savings Plans or applying for a loan.

   A Registered Disability Savings Plan allows you to save money for the future and at the same time reduce the amount of income tax you pay today.
   A loan is a sum of money that banks will give to you to use for a certain period of time. A loan has to be paid back within an agreed to period of time and you will need to pay a fee for the use of this money, referred to as “interest”.

   You might not think that this will affect you now, but you do not know what the future has in store for you. It is better to develop a good reputation now, so that you have the option of using these services at a later date.

5. Accessibility and Safety

   Having your own bank account also means you can access your money from multiple locations, without having to carry a lot of cash. As technology gets better, the use of electronic banking machines and computers to do banking and buying is becoming more common. Having your own bank account allows any time access to your money through ATM machines or through Point of Sale machines (e.g. Interac). Having your own bank account means that you will not have to carry a lot of cash; as a result it is less likely your money will get lost or stolen.

Sometimes, your financial situation gets so out of hand that you don’t know what to do. You have not been watching your spending and it creeps up on you.

You might realize that there is a problem only when you get a letter from the phone company, the bank or the collection agency. In one situation, for example, a problem with unpaid taxes was only noticed when the property bills were found in the person’s drawer while she was in the hospital.

There might be other factors that contribute to problems with money. Here is another example of someone`s spending being excessive. This person was found to have an anxiety disorder. It took this person a while to discover that buying DVDs relieved his anxiety. If a DVD set was coming out or one needed to be replaced, the person would not be able to wait and plan the purchase. He would immediately go out, often spending more than he should to buy the items. It seemed like it was just poor judgment that was contributing to his budgeting problems until the real issue was realized. He had 22 copies of the same DVD of his favourite TV show. His only explanation was that he really enjoyed this show. That’s when it was realized that he had a mental health issue and help from a mental health agency was sought.

The one silver lining of living on a disability pension or a low paying job is that you can never really get into a large amount of debt. However, to someone on a low or fixed income, a debt of $4000, $1500 or even less can seem like a lot.

What is the effect on the Disability Pension? The Ontario Disability Support Program (ODSP) in Ontario

The law does not allow ODSP payments or proceeds from ODSP in the bank to be taken by companies to pay for bills that you owe. It means that you will still have the money to keep paying rent and buying food.

The down side, though, is that for those who choose to ignore paying the debt off, it lets the person off the hook without taking responsibility for their spending habits and they do not learn how to better manage their finances.

Collection Agency

After many attempts at collecting the money someone owes them, a company will often hire a collection agency to attempt to get the money owed. An example of this is when someone has not paid their cell phone or cable bills for several months and after warnings from the service provider. In another case, someone stopped making his contractual monthly payments to a Fitness Centre he joined.

There is usually a letter from the company indicating that the bill must be paid or it will go to the collection agency. The company owed the money will usually make contact by mail and/or phone. If the person does not make the required payment in the time provided, the account gets sent (sold really) to a collection agency. The Collection agency then contacts the person asking or demanding payment.

Common situations and possible solutions

The most common problems people have are excessive cell phone and cable TV bills. It is often very hard to understand the contracts and the additional usage fees. Getting a local fixed rate or pay as you go 24/7 talk and text monthly plan with one of the budget carriers will solve this problem. With providers like Public Mobile and Wind, you can pay upfront and there are no overuse costs or hidden costs. The next month, the phone gets turned off if payment is not received – this tells you that you have not remained within your budget.

One strategy that is sometimes used is to suggest to the company that the sales person should not have sold the person the plan in the first place, because their understanding of the contract was questionable. Let them know that the law does not allow them to garnish disability pension benefits.

In the Fitness Centre example, a support worker wrote a letter noting the person’s fixed income, the law about garnishing and criticized them for having a commissioned sales person who sold a pricey membership to someone who really didn’t have the ability to understand what he was signing.

Credit cards, even with low limits can become a problem. The interest rates are so high that the person just gets deeper into debt. The first step should always be to cut up all cards so the situation does not get worse. For credit card amounts, a solution could be to make minimum monthly payments. Alternatively, a family member can pay off the amount and the person slowly pays back the family member.

For the property tax arrears example, an option is for the person or a family member to take out a small mortgage and pay off the taxes. Total up the monthly payments: taxes, mortgage, utilities and report that amount to ODSP so there would be the proper adjustment to the shelter allowance. Next, set up pre-authorized payments for all those expenses.

Sometimes, when someone opens a bank account they will get overdraft protection. Over time, the amount of the overdraft can gradually be increased to where the person is using it so often that they live in overdraft. After several months of this, the bank will often call to put a stop to it. A possible solution would be to lower the overdraft amount and have someone, perhaps a family member, give the person money to get them out of overdraft. The person can slowly pay back the family member.

Here are some other options:

You could use the ‘You can’t get blood from a stone’ analogy and suggest that there is no money available to pay the bill.

You could offer a few very low monthly payments. Often, the company will drop the case.

An option is to let it go to a collection agency. If the person ignores the attempts made by the collection agency to collect, eventually the collection agency might stop mailing and calling them.

The collection agency does have the right to contact revenue Canada. However, once they find out the person is on ODSP they often no longer pursue it.

If the calls get to the point of harassment then the person can write a letter and send it by registered mail. The letter should state that they dispute the amount owing and would like the matter taken to court. It is also a good idea to state that the collection agency is not to forward the account to another collection agency. Once the letter is sent via registered mail, the collection agency is not allowed to call to ask for payment but only to ask about a court date. This is when the collection agency usually drops the case.

The person could also change his phone number and have it unlisted. He might get a couple more letters before all efforts to collect stop.

The company or collection agency might threaten to go to court but the amounts are usually small enough that it is not worth their while to take it any further.

If the person agrees to be assessed and is deemed not competent to handle finances, the Office of the Public Guardian and Trustee can take over finances. For more information, see the article Guardianship: Office of the Public Guardian and Trustee

Another option is for a family member to agree to be the trustee to handle finances.

Credit Canada Debt Solutions is a great resource that provides you with credit counselling and helps put your finances in order. http://creditcanada.com/toronto?_vsrefdom=gppctor&gclid=CJveh__t7LMCFao7MgodpUEAGQ

There are always options to help you get out of debt when everything seems to have gone wrong. Once you figure out that you have a problem, it is important to talk to someone you trust to help you get the help you need.

It is also a good idea to talk with your trusted person about your financial situation every once in a while to help ensure that your financial situation never gets out of hand.

Spending money is something everyone does. Spending is a combination of things we have to pay for and things we want. Every month we have to make sure we leave enough for necessities. Necessities are the things we have to pay for, such as rent and groceries. A good strategy to help you pay for your necessities is to make a budget at the start of each month. A budget is a plan of how you will spend your money and how to make your money last while covering all of your expenses.

To begin a budget you need to know how much money you will be receiving and how much your bills will cost. Bills might include your rent, utilities, phone bill, cable TV bill and cell phone bills. Food and groceries are another expense most of us have each month.

After you set money aside for your bills and groceries you can see how much is leftover, and plan for how you want to spend your remaining money. This list is different for each person. It might include new clothes, cigarettes, entertainment, such as movies and bowling, restaurant meals and even savings.

For more information on budgets see the article Creating A Budget.

Making your budget is the easy part. The harder part is sticking to your budget. There are many stores and places you can spend money. Businesses are very good at convincing people to spend their money. You will need to find strategies to slow down the buying process. Sometimes you walk into a store or see an ad on TV, and the item you are looking at looks so good you think you absolutely have to buy it. There is nothing wrong with buying something new, but you must first make sure that if you do buy that item, you will still have enough money left for the things you need (our necessities). If you spend a lot of money on one thing, you might not have the money to buy other things you want. Slow down and give yourself time to think about whether you really want to buy something.

Seeing something you want and buying it right away is called impulse buying. Instead of doing this, you might want to take some time and think about it before spending the money. You could ‘sleep on it’. That would mean not buying the item right away and taking a day to think about the good reasons and the bad reasons about buying it. Talk to someone you trust about your reasons for and against buying something. Do not talk to the sales person, because they might not give you a straight answer. Remember, the salesperson earns money when you buy something from them. After talking to someone you trust and taking the time to think about it, you may decide you do want the item and you will spend your money on it. Or you may decide you do not actually want the item and would rather keep your money for other things.

Buyer Beware

Similar items can cost different prices at different places. It is a wise idea to shop around which means to look for similar items at different stores. To make sure you get the best possible price, look for an item at different stores before buying it. For example, when buying groceries using flyers will help you see what is on sale, and can help you make decisions that will leave you with more money in your pocket. A can of soup may cost $1.50 at one store and only cost $1.00 at another store.

Businesses want you to buy their products. It is your job to make sure you want and need what they are trying to sell you. Similar items can be different prices because they are not really the same. For example, one camera might cost $25 and another camera might cost $300. It could be that the $300 camera does more things and is better quality. If that is what you need and have budgeted the money to buy it, then you may decide the more expensive camera would be a good thing to buy. However, you may decide that you do not have enough money for the $300 camera and that the $25 one is good enough for your needs. We do not always need the most expensive item to have an item that suits our needs.

The Real Price

Companies and salespeople are not always upfront with us when they are trying to get us to buy something. Most are honest, but remember they all make money when you buy something from them. It is your responsibility to make sure you understand the real price of the item or service you agreed to pay for.

Some companies and salespeople use tricks to make you think something is cheaper than it really is. You need to focus on the real cost. On some bills you receive in the mail, the real amount you have to pay is written smaller than the line that tells you how much you saved this month. In large bold lettering the bill might say “YOU SAVED $17.50 THIS MONTH.”

On some credit card bills, the minimum monthly payment is easier to find than the line that tells you how much you actually owe. If you only pay the minimum payment, the credit card company will charge you interest on the outstanding balance. When you do not pay the entire amount on your bill, companies charge you extra money. You are really borrowing the rest of the money you need in order to pay the bill and the company is charging you to use their money. This is called interest. If your interest charges are high, you will have less money for other things you want and need.

When using services, you should try to focus on ‘the fine print’. That means you have to understand all the details about how much an item or service will really cost you. Sometimes a company will advertise their product for a cheap sounding price. This is meant to make us interested and walk into their store or get on the phone with one of their salespeople. In their advertisement they do not always make it clear that other costs will be charged to you when you purchase their item or service. It is your responsibility to make sure you understand and are able to pay the real cost before you agree to buy something. For example, a cell phone company might offer you a free phone. When you go to get your free phone you discover they have added all sorts of other charges, such as activation fees, fees for airtime and texting, taxes and other service fees. This so called ‘free phone’ could end up costing you hundreds of dollars every month.

If you sign into a contract with a company for services, such as cell phone plans, they often offer good looking deals. This deal may or may not be the right plan for you. Before you sign anything think about it and have a person you trust look it over. Once you agree to enter into a contract with a company you have to pay them ever month until the contract is over. The contract could last for as long as three years. If you cancel the contract before the term is up you could be charged an ‘early cancellation fee.’ These fees range from $200 to $500 on average.

There are many hidden costs a company or salesperson may not make clear to you. If you are unsure, bring someone you trust with you before agreeing to make your purchase, especially if this purchase could end up costing you a lot more than you originally planned.

Sales Tax Explained

The sticker price you see on the product does not include sales tax. The sales tax will be added at the sales desk when you pay for the item. In Ontario, most products have a 13% sales tax added.

Telephone Sales Calls

Companies want your business. They want you to buy stuff from them. This is how they make their money. Phone calls to your home or cell phone are one way they try to convince you to spend your money. Be very careful about agreeing to purchase an item or service from a company over the phone. When you give your verbal consent, this means you say ‘yes’ to buying something without signing a contract. Saying ‘yes’ over the phone to them means you agree to the terms of their contract. When you answer these calls the person on the phone wants you to say ‘yes’ right away. You do not have the opportunity to think it over or talk about it with someone you trust. You also are not given any written information to look over.

When on the phone with a telephone salesperson you can tell them ‘no’, you are not interested. You can also hang up the phone. They can be very pushy and persuasive. Do not be pressured into agreeing to buy something you really do not want. Say NO and hang up.

If they are offering something you may actually want, it is still a good idea not to say ‘yes’ right away. Tell them to send you information or to call back another time, when you have a trusted person to assist you with the phone call.

Adding your phone number to the “no call list” should stop most of these calls from telephone salespeople. This is a national list and companies are not allowed to call phone numbers on this list to try to sell things to them. For more information on the “No Call List” click here: https://www.lnnte-dncl.gc.ca/index-eng

Money Marts and Rent to Own

An easy way to enable you to buy something quickly, even if you do not have the money, is to buy it using services such as Money Mart or Cash 4 You. THESE SERVICES CAN COST A LOT OF MONEY. They let you borrow money but they also charge you a lot of interest. This means you end up having to pay them back a lot more money than you originally borrowed. These services also let you cash your cheque early or will cash it without putting a hold on the cheque, as banks often do. They take money off of your cheque to do this. It may be convenient, but it is also expensive.

Rent to Own stores are also an easy way to purchase something, when you do not have money to pay for it. These stores let you have the item you want right away, but make you sign a contract to make payments every month. The contracts are for two to three years. Once you finish all your payments, the item you purchased will end up costing close to three times the amount you could have bought it for at a regular store.

When it comes to spending your money, ALWAYS work with or consult someone you trust to help you plan ahead. This could be a parent or a worker. By budgeting you can set money aside each month until you have enough to buy it. If you live by the rule ‘Don’t buy something until you can afford it!’, you will never have to pay companies money for interest. You will have more money for yourself and for the things you really want and need.

For tips on how to save money to buy something you want check out the article Simple Strategies to Help You Save Your Money.

Choosing a Bank

The first thing to consider when opening a bank account is which bank you will choose. Think about what is important for you. It is important to consider how you get your money and your daily schedule and routines. Consider the following:

• Where are the branches located?
• What services does the bank offer?
• What are the charges or fees for each service?
• What time does the bank open and close?
• Does the bank have a location close to your home and/ or work
• Where does the bank have ATM’s (Automated Teller Machine) available?

Parent Tip: If you are considering opening a joint account with your son or daughter, choose a bank that you do not have an account with. When you have a joint account with the same bank as your personal accounts, there is the possibility of money being automatically shifted from one account to another. This kind of situation can arise when one account does not have enough money to pay for a cheque or automatic withdrawal.

Choosing an Account

It is also important to consider what you will be using the bank account for. Most banks have different types of accounts. Savings accounts are for storing money and gaining some interest. Interest is the money the bank gives you for keeping your money in the bank. Chequing accounts are for daily banking needs like paying bills or taking out money. Most bank accounts usually have service fees. Service fees are charges set by banks and paid by customers of the bank when they use specific services. There are some low fees or no fee accounts available.

Useful Online resources

Here are some good online resources that can help you when choosing both the bank and account that suits you best.

What kind of bank accounts are there?

Instructions in 11 languages http://www.settlement.org/sys/faqs_detail.asp?k=PERSFIN_BANK&faq_id=4001365

Choosing the Right Chequing Account and Banking package http://www.fcac-acfc.gc.ca/eng/resources/publications/banking/TScheqchose-eng.asp#What

Banking Package Selector tool:

The Financial Consumer Agency of Canada has a good online tool to help choose a bank and package that meets your needs for banking. http://www.fcac-acfc.gc.ca/eng/resources/toolCalculator/banking/bankingPackage/BanStep1-eng.asp

Best no fee chequing accounts in Canada. http://www.nofeebanking.ca/forum/content.php?183-best-no-fee-chequing-accounts-in-canada&s=97c8877a97e45b3be07fe0f1e6f8a001

Opening a Bank Account

To open a bank account, you may be asked to provide information about where you live, your job if you have one and credit history. However, you do not have to have a job to open a bank account. A credit history is the record of the money you owe and the records of when and how much you pay back. A good credit history means that you have always paid your bills and money that you owe on time. If you have a good credit history it will make it easier to get a loan or a credit card in the future.

No money is necessary to open an account. The bank may ask you to deposit money into the account if you are ordering cheques. This money will be used to pay for the cheques.

To open a bank account you are required to present two pieces of personal identification (see below). The identification you provide must be original, which means that it is not a photocopy. Your name must be the same on all documents. If your name has changed, you must bring a certificate showing the name change. Regardless of what form of identification you present, you will be required to provide your date of birth, if it is not included in the identification you provide.
There are different combinations of ID you can use.

You have three choices.

• • Choice 1 – Show two pieces of ID from List A:

List A

• • • Canadian driver’s license
    • Current Canadian passport
    • Canadian birth certificate
    • Social Insurance Number (SIN) card
    • Old Age Security card with your Social Insurance Number (SIN) on it
    • Certificate of Indian Status
    • Provincial or territorial health insurance card (this cannot be used in Ontario, Prince Edward Island or Manitoba)
    • Certificate of Canadian Citizenship or Certification of Naturalization
    • Permanent Resident card or a Citizenship and Immigration Canada form IMM 1000, IMM 1442, or IMM 5292
    • Document or card, with your picture and signature on it, issued by one of the following authorities:
      • Insurance Corporation of British Columbia
      • Alberta Registries
      • Saskatchewan Government Insurance
      • Department of Service Nova Scotia and Municipal Relations
      • Department of Transportation and Infrastructure of the province of Prince Edward Island
      • Service New Brunswick
      • Service NL of the province of Newfoundland and Labrador
      • Department of Transportation of North West Territories
      • Department of Community Government and Transportation of Nunavut

If you don’t have two pieces of ID from List A above, you can:

• • Choice 2 – Show one piece of ID from List A and one piece of ID from List B, below:

List B

• • • Employee ID card with your picture on it
    • Debit card or bank card with your name and signature on it
    • Canadian credit card with your name and signature on it
    • Client card from the Canadian National Institute for the Blind with your picture and signature on it
    • Current foreign passport

OR

• • Choice 3 – Show one piece of ID from List A and have someone the bank knows confirm that you are who you say you are.

Material Sourced from: http://www.fcac-acfc.gc.ca/eng/resources/publications/banking/TSOpenBankAcc-eng.asp

IMPORTANT TIP FOR THOSE IN ONTARIO: In July 2011 Ontario introduced a new photo card that will provide government-issued identification to more than 1.5 million Ontarians who do not drive. The Ontario photo card makes it easier for non-drivers to perform everyday transactions such as cashing a cheque or returning something you bought to a store. The voluntary card was launched on July 25, 2011 and is available to individuals 16 years of age and over who do not hold a driver’s license. http://www.ontario.ca/government/ontario-photo-card

See article “How to get an Ontario photo card”.

Useful Online Resources

How do I open a bank account instructions in 11 languages http://www.settlement.org/sys/faqs_detail.asp?faq_id=4000068

When you receive a cheque, you need to cash it. The best way to do this is through your own bank account. If you do not yet have a bank account, see the article titled “How to open a bank account” for instructions.

Depending on the account you have, cashing cheques will not cost you additional money. You can cash the cheque at either the teller at your bank branch or by using an Automated Teller Machine (ATM) at your bank.

When cashing a cheque you need two things:

1. Your bank card
2. Identification

Most banks have a 5 day holding period before you can get your money. When you cash a cheque, the bank returns the cheque to the bank of the person who wrote the cheque. Then the money is transferred from that bank to your bank. If there is enough money in that person’s account, the money will be transferred to your bank and put into your account. If there is not enough money in that person’s account, the cheque but not the money will be sent back to your bank and you will not get your money. It usually takes 5 days to do all of this.

There are ways to minimize the holding period. Get to know your branch and the staff. You may be able to get the holding period reduced, if they know you and trust that they will get the money from the person who wrote the cheque.

All banks must cash a government of Canada cheque for free, even if you do not have an account with the bank. This includes GST/HST rebates and income tax refunds. You will need to take proper ID with you to the bank. This would be one piece of ID with both your photo and your signature. You should check to see if your province issues a photo ID card for those who do not drive, such as the Ontario Photo Card (see article titled “Ontario Photo Card”). If you don’t have any ID that has both, you will have to show 2 pieces of ID. In Toronto, any Royal Bank of Canada branch will cash your Ontario Works cheque (http://www.toronto.ca/socialservices/faq.htm#cash )

A good option, if it is possible, is to have your pay or pension (for example, Ontario Disability Support Program (ODSP) in Ontario) deposited directly into your bank account. The money is immediately available to use and there is no cost to you.

As a last resort, you can use a cash advance store to cash your cheque. These stores will cash your cheque immediately, as long as you have proper identification. It will cost you to use this service. The most common fee is about 3% of the total amount you want cashed. There is also a $3.00 fee per cheque. So, it would cost you $18 to cash a $500 cheque. This might not seem like much. However, if you did this each month for a year it would add up to $216 that you could have used to buy something else.

You will need to sign your cheque on the back in order to cash it. You should never sign it in advance. Once the cheque is signed, it is the same as cash. If it is lost or stolen, anyone can cash it once it is signed. Always sign your name the same way. This will help, if someone steals your cheque and cashes it. If the signature is not the same as you use, it proves that you did not cash it.

It is not recommended that you sign a cheque over to someone else (that is giving a cheque made out to you to someone else to cash). Remember that once it has been signed by you it is the same as cash. If the person loses it or it is stolen, the chances are that the money will be gone.

If you are writing a cheque to cash yourself, do not make the cheque out to “cash”. Instead, make it payable to yourself. That is, put your own name on the “payable to” line.

Here are some other tips on writing a cheque:

1. Always use a pen (never a pencil) to write a cheque so that it can not be erased and changed.
2. Never sign a cheque that does not have the name of the person it is payable to written on it.
3. Always sign a cheque with the same signature.
4. When filling in the dollar amount (both in number form and letter form) always draw a line through any blank space so no one can add or change the amount.

For more tips on “How to write a cheque safely”: http://banking.about.com/od/checkingaccounts/a/how2writeacheck.htm

For a visual example of how to write a cheque: http://banking.about.com/od/checkingaccounts/ig/How-to-Write-a-Check

For more tips on Cheques in Canada:

Identifying the bank, branch and account numbers printed on a cheque. http://www.tdcanadatrust.com/lending/cheque.html

In today’s world we have many different choices on how we can pay for something we want to buy. This section will explain many of the options people have to do this.

Cash

The one that is most familiar to all of us is to pay for a purchase using cash. We simply reach into our pocket or open our wallet and if we have enough money we can buy the things we want or need. Be careful to keep your money in a safe place. If you lose your money there is no way to get it back. For safety reasons it is a good idea to never carry too much money with you. If you lose too much cash you may not have enough to pay all of your expenses.

Using cash can be a good way to control your spending. Take only a predetermined amount of cash and limit your spending to that amount. To learn about Canadian coins and how to make change try ConnectABILITY.ca’s Money Magic arcade game https://connectability.ca/2010/10/01/money-magic

Cheques

Cheques are one way to pay for purchases or bills when you do not have the cash on hand or would like to have a record of your spending. With the increased popularity of credit and debit cards (mentioned below) cheque payment is not as common as it once was. Cheques are still useful for making payments when cash is not a good way to pay, such as making a payment through the mail. Never send cash in the mail. This is because there is a higher risk it could be lost or stolen. If you send money in the mail you do not receive a receipt right away, as you do when you buy something in a store. Before writing a cheque, make sure there is enough money in your bank account to cover the cheque. When the cheque is cashed money will be taken out of your bank account. If there is not enough money in your account, you will be charged a NSF (Non-Sufficient Funds) fee of $15 to $45 by your bank. If the cheque was for a company or store, they may also charge you a NSF fee of $15 to $30. Writing a cheque and not having enough money in your bank to cover the cheque could cost you a lot of money.

Credit Cards

A credit card allows you to go into a store and buy something even if you do not have the cash to pay for it right now. Credit cards are issued by banks to people. In order to receive a credit card you must fill out an application. The bank will then review the information on the application to determine if you qualify to get one. The bank looks at how much money you have and how much you earn to decide if you are a person who will have enough money to pay for the stuff you purchase with your credit card.

Credit cards are plastic cards that fit into your wallet. To buy something with a credit card your card is swiped in a machine with the store teller. You must then sign your name on a receipt to show you approve of the purchase. You may also put the card into the machine. If you have a computer chip card, insert it into the machine and use the PIN, you will not be required to sign the receipt.

The machine reads information on the card and you then enter a PIN (Personal Identification Number) that only you know. Entering your PIN is good security because nobody else should know what your PIN is and will not be able buy anything with your card. You should never give your PIN to anybody. You can set the PIN on your card using the ATM-bank machine. If you are unsure how to do this you can ask the bank teller and they will assist you.

Credit cards make buying things easy. But, be careful! When you use a credit card you are spending money and will have to pay the credit card company when the bill comes in the mail. If you have bought too much on your credit card you may not have enough money to pay the bill and all of your other expenses. When you do not pay the credit card bill by the due date you are charged interest. Interest is extra money you have to pay the credit card company. Interest rates can be as high as 20%. That means for every $100 you spend with your credit card you will have to pay an extra $20. So, the $100 purchase is now costing you $120.

Be very careful when using a credit card because it is very easy to spend too much and end up owing a lot of money!

If you are unable to make the full payment, it is very important to pay at least the minimum monthly payment each and every month so that you will continue to have a good credit history. Your credit history could have an impact on a number of areas including renting an apartment.

Debit Cards

Debit cards look very similar to credit cards. The big difference is that debit cards allow you to buy things by taking the money you have in your bank account and transferring it to the store. You can only make purchases with a debit card if you have the money in your bank account. If you do not have enough money in the bank, you cannot buy what you intended to.

An advantage with debit cards is that you can never spend more than you have in the bank. That means you will not end up owing a lot of money for things you purchased.

It is still very important to make sure you do not over spend with your debit card. If you buy something using your debit card, make sure you leave enough money in the bank to pay for other expenses you have, such as groceries, rent, phone, cable TV and other bills.

Debit cards are used the same way as credit cards. They are either swiped or put into a machine at the cashier and you then enter your PIN. Just like credit cards- Never give your PIN to anyone!

For more information on debit cards and safety see the article “Debit cards, Online Banking and other Bank Account Information”.

Pre-Loaded (Pre-Paid) Credit Cards

Pre-loaded credit cards are used just like a regular credit card except you must pay money on the card before you use it. So, if you have one of these cards you go to the bank and give the teller money or have the money transferred from your account to the card. You can then buy things with the card until you spend all the money you loaded on the card. The advantage of having a credit card like this is that you can put just as much money as you can afford on the card. It works well when you are budgeting, as you can make sure you leave enough money in the bank to pay your other expenses. Also, like a regular credit or debit card you need to enter a PIN when making a purchase. This means that if you lose the card nobody else will be able to use it. There are often service fees that you will be charged when using a pre-paid credit card so check with the bank before making this decision.

Before you start using a credit card, pre-paid credit card or a debit card make sure you understand what fees you may be charged. If you need help understanding what the fees are and how much it will cost you to use it, bring someone you trust with you. This person can be a family member or a support staff who can help you make an informed decision.

What Happens if I Lose my Bank Card, Credit Card, or Pre-Paid Credit Card?

From time to time bank cards can be lost or stolen. It is helpful to record your card numbers and keep them in a safe place so you can call the credit card company or bank if you lose the card. The card will then be cancelled and nobody who finds it will be able to use it. You will then be sent a new card with a different number on it. You will also be sent a letter in the mail with a new temporary PIN number. You can change your PIN number at a later date so that it is a number that is easily remembered and unique to you. Never write your PIN on the card because if someone finds your card they will have the PIN and be able to use it.

Useful resources about Pre-paid Credit Cards:

Canada’s Best Prepaid Mastercard and Visa Cards: Reloadable and Non-Reloadable “Credit Cards” http://dan.matan.ca/Canadian-Prepaid-Mastercard-Visa-Card-Reviews-Information

Credit Cards, Financial and Consumer Agency of Canada

https://www.canada.ca/en/financial-consumer-agency/services/credit-cards.html

Store Cards, Grocery Cards & Gift Cards

Store, grocery and gift cards are basically the same thing. They are used just like a pre-paid credit card. Money is loaded on the card and the card can be used until all the money is spent. The main difference between these cards and pre-paid credit cards is that they can only be spent at the store they were issued at. For example, a Wal Mart gift/ store card can only be used at a Wal Mart. These cards do not require a PIN. So, if you lose the card anyone can use it.

Purchasing grocery cards is a good way to make sure you have enough money set aside to buy the food you will need for the month. If you buy $200 in grocery cards for No Frills or Food Basics you can only use the card at that store. This means you cannot spend the money at other places. Using these cards is a good way to help budget your money.

Automatic Withdrawals (Preauthorized Withdrawals)

You can also set it up to have money taken directly out of your account to pay a bill. This can only happen with your permission. Automatic withdrawals, also known as pre-authorized withdrawals, are a way to pay for bills or services directly from your bank account. To set up this arrangement you must provide your bank account information to the company you want to pay. This is often done by giving the company a cheque with your account number on it and the word VOID written across the cheque. Writing VOID on the cheque will prevent anyone else from using that cheque to take money from your bank account. Also, most banks have a pre –authorized payment form that can be used in place of a void cheque. This form is free of charge and contains the institution number, transit number and account to help direct deposits to or take payments from your account.

Automatic withdrawals are normally used for bills that are paid on a regular basis, such as phone, cable TV, internet service, magazine subscriptions, etc. This type of payment arrangement is not normally done for one time purchases.

It is a convenient way to pay bills. It prevents you from forgetting to pay your bills on time. However, it is important that you make sure you leave enough money in your bank account to pay the bill. You must never forget that the bill needs to be paid or take too much money out of the bank. In these situations, when the company attempts to withdraw the payment there would not be enough money to cover the cost. If you do not leave the proper amount of money in your account to cover the bill the bank and the company you owe money to will charge you a NSF (Non-Sufficient Funds) fee. This can range from $15 to $45 from both the bank and the company you owe. That means not having enough money in your bank account to pay for the bill could cost you a lot of money!

Pay as you go plan

Pay as you go plans have increased in popularity recently. These monthly payment plans do not require you to sign a term contract. In a term contract you agree to pay a monthly fee for services such as cell phones or fitness clubs. With pay as you go plans you receive the service for the month. If you do not have the money or choose not to continue with the service the following month there is no penalty or early cancellation fee. If you decided to continue with the service, such as a cell phone, you simply need to make the payment for the month and the service will be restarted. You have the freedom and flexibility to start and stop whenever you decide.

Bank Access Card and Debit Card

When you open a bank account, you will be given a bank card that you can use to access your money. This is also called a “debit card”. When you receive the card, you will be asked to choose a four digit Personal Identification Number (PIN) that you will key in whenever you use your debit card. Protect your PIN number by not writing it down. Be sure to memorize the number and remember to never share it with anyone else.

Your debit card and PIN number is used to:

• Access your bank account when visiting the bank
• Access money through an Automated Teller Machine (ATM)
• Pay for goods and services from stores and service providers that accept Interac Direct Payment. Payment comes directly from your account.

Debit Card Safety Tips

• Sign the back of your cards as soon as you get them. This is a safety measure to help ensure that if your card is lost or stolen, it can be returned to you. Signing your card also confirms your signature.
• Keep your card number or a photocopy of your card and the contact number of your bank in a secure place in case your card is lost or stolen. It is important that this information is kept in a different place than where you normally keep cards, for example at home in a safe box or drawer where you won’t lose it.
• Set up a maximum daily withdrawal limit with your bank. This means you can only take out a certain amount of money from the bank machine at a time. You can choose the withdrawal limit. This will help you if your PIN is stolen, or if you are robbed while withdrawing money.
• Cut up any old debit cards that you are no longer using before throwing them away.
• Your debit card has a computer chip built into it. Insert your card into the debit card point-of-sale machine. If the point-of-sale device is not chip capable it will prompt you to swipe your card. It is important to avoid any unnecessary swipe of the card. This will reduce the possibility of your card information being taken by someone trying to steal your information.
• Use your hand or body to hide the key board when you are putting in your PIN during every transaction conducted at an Automated Teller Machine (ATM) or at the checkout.
• Keep an eye on your debit card when using it to buy something at the checkout to make sure someone is not trying to copy the information on your chip card.
• The bank will provide you with a monthly list of all the money that goes into and goes out of your bank account. This can be on a computer or a paper copy that is mailed to you. Check this banking statement regularly and contact your bank immediately if you detect any unusual activity, for example, purchases you did not make or missing charges.
• Let your bank know immediately, if your debit card is lost, stolen or stuck in an Automated Teller Machine (ATM).
• Memorize your PIN – only you should know it. If you suspect that someone knows your PIN, even a friend or family member, change it immediately.
• Choose a unique PIN. Never use obvious information, such as, your telephone number, date of birth, address or Social Insurance Number. These numbers are often stored in the same place as your debit card which can allow others to easily guess your PIN.
• Be aware of who is around you when you are taking out money. Try to only use well lit areas. Using the bank during the day when the bank is open and there are bank employees around is smart thinking.
• When using an Automated Teller Machine (ATM), if you suspect anything unusual do not use the machine and report it to your bank immediately.
• Remember to take back and put away your debit card after each use.
• Be alert. If someone is watching you or makes you feel uncomfortable, you can cancel the transaction and use a different machine.

Material sourced from https://www.interac.ca/

Tip: When using an Automated Teller Machine (ATM) try to use a machine from your own bank. If you use a machine from another bank, there will be a transaction fee of $1.50 or more charged each time you use the Automated Teller Machine (ATM).

What is an NSF (Non- Sufficient funds)?

If someone tries to cash a cheque that you have written and you do not have enough money in your account, banks do not have to pay it. The cheque is then returned to the person or company who tried to cash it through their bank letting them know that there is not enough money to cash the cheque.

In this situation, the fee that would be charged for an NSF cheque could be from $25.00 to $45.00 (labeled NSF Fee on your statement). The company that you wrote the cheque to may also charge you a fee for this.

Overdraft protection

At times you might accidently write a cheque for an amount that you do not have in your chequing account. Because this can happen from time to time, many banks have what is called overdraft protection. It is a good idea to get overdraft protection on your chequing account. Instead of getting charged from $25 to $42 for an NSF cheque, overdraft protection will allow you to avoid this charge. Overdraft will provide the account holder with an instant loan. A loan is a sum of money that banks will give to you to use for a certain period of time. A loan has to be paid back within an agreed to period of time and you will need to pay a fee for the use of this money, referred to as “interest”. The interest rate will be extremely high. However, if it is paid off quickly it is usually much less expensive than the NSF cheque fee. Some banks do charge a fee when an account balance falls below zero even if the account holder has overdraft protection. The good news is that it’s still significantly less than the NSF cheque fee.

5 day holding policy for cheque deposits

A bank may apply a 5 day “hold” on the funds you deposit by cheque. This means that you cannot take out or spend the money for 5 days after you deposit the cheque. This is done for several reasons, including the following:

• To make sure that the person or company who wrote the cheque has enough funds to cover the cheque
• To make sure that the person or company who wrote the cheque has not put a “stop payment order” on the cheque. A “stop payment order” means that, for some reason, the person or company does not want the cheque to be cashed.
• To check the cheque details with the person or company who wrote the cheque, to make sure that it has not been altered.

If the cheque has to be returned to your bank because it can’t be paid (because of non-sufficient funds; because the account is closed or because of a stop payment; etc.), your bank will take back the money that was put into your account when you cashed the cheque. This can happen even after the hold period has expired. You are financially responsible for any cheques deposited or cashed both before and after the hold period.

Tip: Instead of using cheques, you may want to have deposits made to your account electronically (direct deposit). This will mean that the funds deposited are not held and are immediately available.

Depending on your relationship with your bank, the bank may release the funds to you before the cheque clears. However, if it does this; it is actually extending a loan to you. If there is not enough money in the account of the person who wrote the cheque to cover it, the cheque will be returned to your bank because of non-sufficient funds (NSF). If the cheque writer’s bank is located in Canada, it takes about five to six business days for a cheque to clear and be returned because of non-sufficient funds.

Tip: When you open a bank account, you have the right to get a copy, in writing of the bank’s policy on holds on funds deposited by cheque and any other location specific banking policies.

Material sourced from Financial Consumer Agency of Canada http://www.fcac-acfc.gc.ca/eng/resources/faq/qaview-eng.asp?id=256

Online banking

Setting up online banking:

You should go to your bank’s website for information. Every bank has easy to follow instructions on how to set up online banking on their website.

There are many advantages to using online banking:

• It is fast, safe and convenient.
• There is no more need to travel to your nearest bank for basic services any longer.
• You can do your banking anytime – 24 hours per day, 7 days per week (24/7).
• No need to wait for a financial statement to come in the mail. All you have to do is login online and download a copy of your statement.
• With online banking there is no need to visit your bank to ask them to transfer funds from one account to another.

There are also some disadvantages of using online banking:

• Online banking has reduced personal interactions, since all the transactions are handled by the customer through the internet.
• When using online banking there is always a chance that the information may be stolen by someone who has been able to sign into your account. Banks have good security systems to guard such thefts but there still is a risk.
• When you are using online banking keeping your information safe and private is a big problem faced by many banks. So the customer must be aware of the security issues and protect their identity and other personal details from hackers. Hackers are people who steal personal information using computers or other electronic devices.

To make online banking a safe and secure banking experience you need to follow these steps:

• Avoid accessing your bank account from a public place with computers and internet access or a computer that is shared by a lot of people. If you happen to do so, then change your password as soon as you finish your banking transaction.
• Every time you finish using your online banking session, you need to sign out from the site rather then just closing the browser.
• Change your internet banking password after your first login and then do this regularly.
• Use a difficult password that makes it difficult for others to guess.
• Use a different I.D. and password for different internet accounts.
• Never share your passwords or login details with anybody.
• View your account often and check it with your receipts or records of what should have been deposited and taken out of your account. If there is anything which does not match with your records then inform your bank immediately.

Safety Tip

If a company or government organization requests a copy of your bank statements, it is best to ask a staff at the bank if this is a reasonable request. The bank staff will provide you with the safest way in which to provide the information being requested.

Choosing a secure password for online banking:

• Do not use words or phrases that have personal importance.
• Mix letters, numbers and symbols, and use case sensitivity (upper and lower case letters)… (i.e. instead of “password,” try “pAsS34%(6*2woRd,” etc.)
• Find a good way to remember your password. A good way to do this is to choose the first letters of a sentence that you will remember. e.g. “I have 2 dogs called Rover and Fido” gives: Ih2dcRaF. Use punctuation to your advantage. To incorporate a colon into the previous example, remember the sentence as “I have 2 dogs: Rover and Fido”, which would give: Ih2d:RaF 4
• Try to memorize the password, and avoid writing it down. Somebody could very easily find the slip of paper that the password is written on.
• The longer the better. Don’t make a password that’s less than 6 numbers /letters. Anything less than this can easily be found out by using computer programs.
• Take the street you grew up on, and your first pet/something hard to guess from your past, put a number sign in between, substitute some letters for numbers, and, voila! A great password. For example: Bill grew up on Ocean Avenue, and his first pet was Rocky. His password would be: 0c3an#r0cky. You can add random capitals to make it more secure.
• Do not use the same password for everything. If someone finds this password, they would have access to everything. At the very least, make at least one password for sensitive things (i.e. online banking, etc.) and one for everything else (i.e. email, etc.).
• One other way is to use a word, for example, wikihow, and move your fingers up one row on the keyboard. Wikihow becomes 28i8y92.

Material sourced from http://www.wikihow.com/Choose-a-Secure-Password