5 Tips to Help You Understand Your Financial Rights
We’re wrapping up Financial Literacy Month by discussing how important is to understand your financial rights and the legal protections you have as a consumer.
Let’s get started with the basics. When you complete a financial transaction for personal goods and services, you are now a consumer. And, as a consumer, you have both legal rights and responsibilities when you purchase items and when you borrow or loan money.
So, what are your financial rights? We’ve put together a list of our top tips that will help you better understand (and practice!) your rights as a consumer.
1. You have the right to open a bank account
Every singe person has a right to a bank account. The only thing required to open an account is a piece of Government ID—your driver’s license, passport, birth certificate, or Social Insurance Number card.
2. Government of Canada cheques can be cashed at any bank for free
Many financial institutions will charge you a fee for completing a transaction, but it’s important to know that you can always deposit a Government of Canada cheque at any financial institution free of charge. You can also cash it at any bank as long as it’s less than $1750 (temporarily increased to $2000) and you can provide valid ID.
3. Financial institutions need your formal consent
Before raising your credit-limit or sending you a new credit card in the mail, your bank needs to get your formal permission. You are absolutely under no obligation to activate and use a new card or access the new limit offered.
4. Banks must be upfront with fees and communicate changes
Your financial institution should always be up front with all fees and costs associated with opening a new account. It’s up to your bank to lay it all the charges, but it’s up to you to read everything and fully understand that rates, terms, and penalties.
If at any time there are changes to your bank fees or charges, you have the right to be informed. Your bank can communicate these changes with you electronically, so check your emails frequently, and read emails from your bank carefully!
5. Ultimately, it’s up to you to keep a close eye on your finances
It’s on you to stay informed and aware of your rights and overall financial situation. Don’t just rely on the total numbers you see in your app or online. Make sure to go through your statements, line by line, and regularly, so you can let your bank know immediately if there’s an error—this happens a lot more than you might think.
Here’s a great resource from the Financial Consumer Agency that breaks down your financial rights and responsibilities by mortgages, credit cards, credit and loans, banking, savings and investments, prepaid cards, and more.
It also provides you with information on how to file a complaint about financial products and services.
There’s a ton of information to learn when it comes to understanding your financial rights and responsibilities and this can all feel very overwhelming. Just be sure to ask questions, read the fine print before signing any loans and agreements, and trust your gut. If you feel that a bank or institution is offering you some that that’s too good to be true, it probably is!
If you have any questions about your financial rights, or need some advice about your financial situation, book a free consultation with our of our experts.