Did you know that there is a ton of money on deposit in financial institutions that is never claimed? Bank accounts, investments, negotiable instruments, all hanging around waiting for someone to claim. As a matter of fact, $973 million in unclaimed balances at the end of 2020 in Canada. Is any of this yours? A parents? Grandparents?
What is a Dormant Account?
An account goes “dormant” when there hasn’t been any customer-initiated activity for 2 years. A financial institution sends a notice to a customer when this happens. The notice asks the customer to acknowledge the account and if they do that, it’s no longer dormant. For those accounts that aren’t acknowledged, another notice gets sent at 5 years, then 10. After 10 years, the financial institution sends the money off to the Bank of Canada and it officially becomes an Unclaimed Balance. Why is there so much money sitting unclaimed at the Bank of Canada?
The main reasons for this are; people move, they forget, and people pass away without sharing any records with their family or executors. Most of the money is in bank accounts, but there’s also some investments and negotiable instruments such as bank drafts or money orders that are unclaimed.
What Happens When an Account is Dormant?
Bank employees actually put quite a bit of time and effort into trying to find the owner’s of these accounts. Branch employees get reports and try to track down the owners through directories, internet searches and families. Every so often with a bit of detective work we would find the owner. That always felt great! But with no forwarding address, invalid phone numbers or email addresses, it’s pretty difficult to find people so a lot of money remains unclaimed.
Service charges eventually drain lot’s of the small accounts. Fee’s are charged for each of the 2, 5, and 10 year notices. Then there’s monthly service charges collected. So unfortunately, many accounts just get closed out because the funds have been depleted by service charges. Think of it – people’s hard earned money slowly draining away! For those accounts that still have money in them after 10 years, off they go to the Bank of Canada.
TIP✅: Remember to update any change of address, phone and email with ALL financial institutions you deal with. This includes banks, insurance companies, brokers, old pension plans; basically anywhere you have any money on deposit or invested.
How to Claim the Money
If you receive a dormant notice, contact the financial institution right away. They’ll help activate your account and reverse the notice fee for you if you ask them to.
After 10 years, you won’t receive any more notices. You’ll need to contact the Bank of Canada for accounts or other deposits that have been sent as an unclaimed balance. Here’s the link for more information and process to do that.
TIP✅: Do a search of unclaimed balances each year. For yourself, parents, grandparents, or anyone you look after. It only takes a minute and why on earth would you want to leave anyone’s money sitting at the bank to be written off? Here’s the link.
It can take a minute to load the page – be patient! All you need is the person’s name to do the search. I found an account balance for my father-in-law who passed away over 10 years ago. Anyone who is an executor can claim the amount for an estate. And if you’ve changed your name, don’t forget to search under any previous names.
So what are you waiting for? Do a search and find some money, or help someone else out. Then share this link with everyone you know and please comment if this helped you!