Q&A: Can’t get RRSP money
Question: I have $20,000 in an RRSP which matured in June. I did not hear from my bank so I thought the money was still sitting there. When I went over to the bank to withdraw some money because I needed it, they told me that they could not get in touch with me so they put the cash into a GIC which is locked in until next July. I have lived at the same address for many years and still have the same phone number. I did not hear from the bank regarding these funds. Can the bank do that? I need my money now. Thanks a lot. – Charles
Gordon Pape answers: Yes, they can do that. Nor did they need to contact you first. This is one of the aspects of GICs that few people know about. At maturity, certificates are automatically rolled over for another term at the current interest rate. It is up to the investor to give the bank instructions to the contrary. To prevent this happening in future, give your bank a letter now saying that in future no GIC is to be rolled over without your authorization. Then ask a manager whether the bank is willing to cash in the GIC now because of the extenuating circumstances. You will probably lose any interest but it won’t amount to much.
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