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Questrade USD RRSP and Referral Promotion

We’ve all complained about those extra FOREX fees when buying US stock within an RRSP, but none of the big brokerages have done anything about it.

Complain no more because Questrade now offers the ability to hold U.S Dollars (USD) within their RRSP accounts!

What does this mean?

  • Cheaper to Invest in the US Market. Before, no Canadian Discount Brokerage would allow USD to be held within an RRSP account which resulted in heavy FOREX fees when diversifying south of the border. Now, Questrade will allow you to diversity into the US without having to worry about the FOREX gouge with every buy AND sell that can add up to around 3% round trip.
  • Now there is more incentive to hold USD dividend paying stocks. As explained my dividend taxation article, USD dividends are taxed like interest thus making it unattractive to hold outside an RRSP. However, as the taxes are unappealing outside an RRSP, the FOREX fees are also a deterrent inside an RRSP. Now, with the ability to hold USD inside an RRSP, it will mean that all RRSP US stock purchases will be slightly discounted.
  • More competition among the brokerages. With Questrade taking the big leap and meeting what investors want in an RRSP account, I expect that their client base will increase. This will hopefully force the other discount brokerages and the big banks to follow suit.

Other Notes:

Questrade charges an extra $5 /day for USD based purchases with an RRSP. As the $5 is only charged on the days that you trade with USD, you can make as many trades on that day as you like for $5. Note that commission fees apply in addition to the daily $5 surcharge.

With regards to their regular commission structure, they are among the cheapest in the (Canadian) industry. No annual or maintenance fees and a choice of commission structure. The choice being $4.95 for 495 shares or $9.95 for unlimited. Users can switch between plans once a month. In addition to the low fees, they offer free real time data and real time Canadian charts (US charts are 15 min delayed).

On the downside, there are have some complaints about their customer service and they don’t provide fraud prevention key fobs like other brokers (IB, E-Trade).

If you would like to read about my Questrade experience thus far, check out my Questrade Review.

Joining Questrade?

If you want some US market exposure within your RRSP, it may be a good bet to open an account with Questrade solely for your USD investments. My wife already has a Questrade RRSP account, but I will be opening another for myself for US dividend paying stocks.

If you want to join, check out the Questrade referral promotion below for the $50 trading credit for new members.

Questrade Referral Promotion

If you deposit at least $1k when you open an account from a referral, you will receive $50 in your account when you trade $100 worth in commissions (10-20 trades depending on your share volume/trade).

If you are considering opening a Questrade account and would like the $50 trading rebate, sign up through the link below. The link will bring you to a Questrade URL that will automatically recognize you as a referred client. If you decide to sign up later or if you’ve already started an application, you can use the Affiliate ID: MillionDollarJourney to get your $50 trading rebate.

Sign up and get the $50 trading rebate with Questrade!

If you have any questions regarding the $50 trading credit, you can contact me here.

For Webmasters:

If you are a webmaster and would like to take advantage of Questrade’s new affiliate program ($70 for every new sign up), you can join their new affiliate system here. Make sure to use MillionDollarJourney as your parent affiliate ID for quick approval.

If you would like to read more articles like this, you can sign up for my free newsletter service below (we will not spam you).

FT About the author: FT is the founder and editor of Million Dollar Journey (est. 2006). Through various financial strategies outlined on this site, he grew his net worth from $200,000 in 2006 to $1,000,000 by 2014. You can read more about him here.

{ 22 comments… add one }
  • Canadian Capitalist January 14, 2008, 9:24 am

    FT: It was Rob Carrick who broke the news. I just spread it around :)

    Thanks for the mention.

  • FourPillars January 14, 2008, 11:11 am

    Good post – that reminds me that I have to check and see if I got my $50 for opening up an account.

    Mike

  • PhilC January 14, 2008, 2:12 pm

    I reiterate. Keep in mind that the customer service is horrible.

    I completed the application process for a new account with Questrade before Christmas and my account is still not active to this day.

    Customer service assured me that opening an account takes on average 2-3 business days but my experience is closer to 20-30 days.

    I have my main accounts with a major bank and Interactive Brokers. I was basically opening this new account as a test. I’m glad I didn’t move my main account there. Can anyone afford to have their money lost in space for 30 days?

  • FrugalTrader January 14, 2008, 2:17 pm

    Phil, when I signed up many months ago, the registration when opening an account was quite painless. That was also the general consensus among my friends that I referred also. You should contact Emil directly to see what’s going on.

    Emil Vojkollari
    Client Acquisitions Supervisor

    Phone: (416) 227-9876 ext.380
    Toll Free: 1-888-783-7866 ext.380

  • FourPillars January 14, 2008, 2:39 pm

    I didn’t have any problems opening an account either. And I opened up two accounts – one non-reg and one rrsp. The rrsp account setup, including a transfer-in from another broker (for funding) didn’t take anywhere near a month.

    Mike

  • T January 14, 2008, 2:57 pm

    My only negative experience with Questrade was with their live help chat, specifically “***” who is a complete idiot and always provides misinformation to simple questions.

    edited – please no accusations or insults without justification

  • PhilC January 14, 2008, 6:54 pm

    Thanks, I will contact Emil directly.

    I find that part of the problem at Questrade is the fact that the support employees are not given enough information about issues. Their line is always “I will contact Finance and explain the situation” or “I will email Funding and ask”. If they had the power to escalate issues where clients could actually speak to finance, compliance or funding, it would make the problematic situation a lot less frustrating.

  • Deborah January 14, 2008, 10:49 pm

    I decided I wanted to move some money out of Questrade to diversify my holdings. I do not like the idea that money in a brokerage is insured by their own system. They have some of the easiest lending standards for trades, allowing margin to start at $1.50 shares. So, I wanted to reduce should they get themselves in trouble somehow.

    Legally withdrawal requests are supposed to be processed in 5 business day. After 3 weeks I had the bank manager where I was transferring to call them and send the stuff in again. They told her they I had to contact them. When I contacted them they had no record, yet by that time the bank manager when I was moving it to said she’d sent the request in 3 times. I let Questrade I expected the transfer to be done immediately and I stated that if it wasn’t done I would file a complaint with the securities commission.

    It was done and I did file a complaint. I had put in two different transfers and two weeks later one showed up and it was another week before the last one showed. They made me so nervous about having my money there I decided to completely close one account and it has been 5 weeks on that one. They actually did close the account, I have no online access to it anymore, however, they never forwarded the funds to me. I emailed them about 3-4 weeks later and they say my money is sitting in the account. I can no longer get onto the broker, but I filed an electronic transfer as a second attempt to get my money out of there.

    It still hasn’t shown up…

  • WhereDoesAllMyMoneyGo.com January 15, 2008, 1:33 am

    I’m not allowed to use Questrade, so I don’t have any direct experience with them. But: it might be worthwhile to contact them through Mr. Vojkollari and perhaps provide a link to all the posts on this and other blogs that talk about people’s service experience with them.

    Seeing as how they seem to have the best pricing, it would be nice if they could see that they are losing out through sporadic customer service experiences. While it might not fix anything, it certainly wouldn’t hurt, don’t you think?

  • PhilC January 18, 2008, 12:48 pm

    I feel your pain Deborah. All the time I was waiting for my money to appear in my account at Questrade I kept imagining how impatient I would get if I was executing the opposite transaction and the money was slow to show up on the other side.

    I’m scared that the commissions and fees that Questrade charges might be too low to assure good business continuity. It might not be feasible in Canada to charge so low on registered accounts. I’d love to read their business plan and find out how many accounts they have to win just to break even.

    There is a reason why big banks charge 75$ annual fees for registered account. It’s because there is a lot of paper work, compliance issues and interaction with government agencies. A lot of this stuff you can’t automate with computers. You need to hire and that’s expensive.

    It will be interesting to see if Questrade (and other low cost brokers) can win enough accounts to make banks rethink the annual fees. In the mean time, you get what you pay for.

    If it happens, Questrade will have so many clients it will be able to hire more people and service will be smooth. There is huge demand for low cost registered brokerage in Canada. It seems like Questrade is having trouble meeting this demand. But of all the business challenges that exist, “high demand” is a pretty good problem to have.

    By the way my account was activated last night. I can finally trade. Total time for account opening: 30 days (19 business days) starting on the date of the 5$ deposit.

    Not bad, but not perfect.

  • bobloblaw January 24, 2008, 1:18 am

    interesting…anyone know if you can transfer funds from interactive brokers? would be great to have the benefits of low exchange rate for USD with IB and then be able to make all transactions in USD inside questrade RRSP account.

  • FrugalTrader January 24, 2008, 9:01 am

    Hey BobLoblaw (great name), yes you can transfer your US funds from IB to a US savings account providing that you have them connected. From there, you can connect that same USD account to your Questrade RRSP account and transfer away.

    My disclaimer is that i’ve never done this, but it should work

  • QandA February 6, 2008, 4:29 am

    I signed up for a Questrade account about a month ago and the CSR I spoke with said one can’t EFT USD from a US dollar account to a Questrade Account, but one could EFT USD from a Questrade account to a US dollar account. Would anyone know if this is true or was I lied to?
    Note: my Questrade Account was a brokerage account (no margin trading), and the external US dollar account was a TD-Canada Trust US Chequing Account.

    Thanks everyone.

  • Victor January 13, 2009, 5:26 pm

    I opened my account back in mid Dec. at Questrade after reading on few of the canadian blogs and entered the four pillar discount coupon but I have not seen the deposit of $50 into my account, so I contacted the customer service 3 times in regards to this and now they are saying that they do not see that I entered coupon when I filled out the application, I know I did because that was one of the reason I got interested to open Questrdae account. So it is now my word againt their word…

    They are not honouring the promise, this is false advertisement.

    Has anybody else who opened an account with Questrade last month got $50 discount on their trade fees?

    Please reply.

  • Mark R January 15, 2009, 1:44 am

    I would have to concur with those who say that you get what you pay for with this company. I was very excited to open their new TFSA, however the excitement quickly turned to disappointment and then frustration.

    I had completed my application online following their instructions and then patiently waited a few days for it to be processed. After I received no status update I sent an email to inquire on the status of my account, a couple days later I was informed that I needed to digitally sign the application form which I had already done and received confirmation that is was completed successfully. I wrote the service rep back and informed him/her that this was already done and also provided the confirmation number. This repeated many, many times, each time I got a generic response back telling me to fill out a form that was already completed, trying to fill it out again was not possible with this system. After it became very obvious that email was not working, I called the service rep, he logged into the account and confirmed that I had indeed signed the form properly and it was likely a ‘glitch’ in their system but everything was ok and my account was to be opened in the next day or two. This came and went when I decided to try the live chat support on the website, this person refused to help telling me my only option at this point was to mail the paper copy in and wait until that was processed. The unfortunate part of this was that I already funded my account as I had thought everything was resolved. I will update everyone on whether I end up getting my money back or getting an account set up. At least I’m still optimistic that it’s one of those two actions.

  • Nick January 23, 2009, 7:05 pm

    I opened an unregistered trading account with Questrade in mid-2008. I worked my way through the somewhat frustrating application process, but the account was finally opened.

    So, applied for TFSA account this year. Not going as well. Transfered money to account more than 2 weeks ago. Still waiting, and waiting….

    Usual story. Questrade is cheap, but very slow. I’ll be moving my accounts elsewhere – once I decide where.

  • Chris April 12, 2010, 11:50 pm

    Just got my March statement from RBCDI and it came with good news: starting later this spring, they will allow US$ to be held inside their RRSP (and TFSA) accounts. This means no more currency conversion commissions when trading and receiving dividents. It took a while (they had first promised it for 2009), but it’s finally here.

  • James Ward April 26, 2010, 4:49 pm

    I’m a little confused by this and want to make sure I understand it correctly. It seems like If I am buying and selling USD equities I will never have to change that money and pay a ForEx fee. That is great. What I am unsure about is weather or not I can transfer USD into the account directly from a bank account within the United States. I have income in Canada and in US and try to avoid moving money between the two to avoid paying exchange fees and would be very interested in being able to put USD directly into my RRSP without converting it to CAD first. My US checking account is with M&T Bank if that makes any difference.

  • Chris April 26, 2010, 9:53 pm

    I don’t know about contributing US$ directly: you’ll have to ask them, but I can say that a few months ago I made a contribution in kind consisting of US stocks (it had to be done over the phone; no fees as it came from my cash account) and they only did a paper (theoritical) conversion so as to quantify the C$ contribution for tax purposes.

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