Dec 1

The hardware is nice, but culture is what counts.

posted 9:07 AM Dec 1, 2011 by Peter Aceto under Culture


For the past two years now, ING DIRECT has been singled-out as one of Canada’s 50 top employers. We were also just named one of the top 10 Most Admired Corporate Cultures in Canada by Waterstone Human Capital.

Other than looking impressive on our office walls, what do these awards actually mean? That our employees love where they work? That ING DIRECT is one of the best companies in Canada to work at? Or simply that our culture is admired by our employees, the industry and our peers?

Personally, I think it’s a combination of all three.

Award panels look at companies from many different perspectives before handing out any hardware. From where I sit, I think we’ve been fortunate enough to win a few culture-based awards because we really do value culture. We operate our business transparently as if the world can read our emails; we’re not hung up on titles; and we encourage people in every corner of the company to contribute and be innovative (which has actually generated hundreds of ideas over the years).

Whether you realize it or not, every company has its own corporate culture which is shaped by the organization’s attitudes, beliefs and norms. Much like a well-thought out business plan, companies today are beginning to realize just how important a strong and distinct culture is to its bottom-line and business success.  Knowing what that culture is, ensuring it aligns with your business’ vision and goals and moulding it to achieve the outcomes you desire is one of the most under recognized management tools around.

When we launched the bank 15 years ago we knew that culture was one of the things that could set us apart, aside from our unique business model and value-based products. Our business was built on the premise that a strong and distinct culture could drive a more engaged workforce, better meet client needs and increase business results. Every new hire, employee promotion, leadership development program, performance review and coaching session adds to the foundation of our successful orange culture and great work force.

If you look at some well-known Silicon Valley companies (and this infographic from Mashable on perks at Facebook et al) you’ll see that clearly others are making big strides to keep talent in their organizations and to make coming to work fun. Some of these “perks” are slightly over the top, mind you, but it does show an emphasis on creating and sustaining workplace culture. This is something I believe we will need to see more of in Canada in the next two to three years, if businesses are to remain competitive globally.

As ING DIRECT’s CEO, helping sustain an admired culture is one of my top priorities. Companies that make it a priority will be the big winners in the future.

 

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Nov 15

Hello? It’s me, TFSA. Anybody out there?

posted 9:00 AM Nov 15, 2011 by Peter Aceto under Savings


ING DIRECT was the first bank in Canada to offer tax-free savings accounts to Canadians. When they were created, it was a really exciting time for us because we thought a whole whack of savers would relish the chance to save five thousand dollars a year, every year, tax-free. Who wouldn’t, right?

Turns out that in the three years since they first became available, many of us either haven’t opened a tax-free savings account at all or find their contribution rules confusing.

To get a better understanding about why tax-free savings accounts haven’t hit critical mass, we did a perception survey recently on Canadians­ and TFSAs. Here are some highlights from the results:

- Less than half of Canadians say they have a TFSA;

- 37 per cent of Canadians only have a vague idea of how they work; and

- A quarter of Canadians have contributed less than half of their available TFSA contribution room (which is currently $15,000).

At their core, tax-free savings accounts boil down to a simple way Canadians can save money tax-free. While similar studies suggest it is confusion about contributions rules that deter many people from using them, I think there may be something larger at play.

A big part of being in control of your financial wellbeing is about getting an understanding about relatively easy-to-use products that help you save money, one tax-free dollar at a time.

There are some huge benefits of the TFSA versus other registered products: flexibility in saving for short or long-term goals, access to the money if it’s required sooner than we had planned; and never losing contribution room even if you withdraw funds.

My sense is that many Canadians haven’t opened an account because they are put off by the $5,000 a year contribution message. While there is no minimum contribution amount required to open an account, some of us might see that number and think TFSAs aren’t for them – which simply isn’t true. You can deposit as little an amount as you’re able – $5,000 a year is simply the annual cap.   Another thing could be that people haven’t yet realized the benefit of saving tax-free over the long term. As the principal amount increases, the magic of compounding takes hold, and tax savings become more significant.

January 1st marks the start of the fourth year to make TFSA contributions. As people continue to educate themselves about their money, I hope TFSAs start to take a more prominent role in people’s financial plans.

And whether that means opening at TFSA with ING DIRECT or another bank isn’t the point at all. It’s just that more Canadians start opening them up.

 

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Nov 1

It’s beginning to sound a lot like Christmas

posted 11:04 AM Nov 1, 2011 by Peter Aceto under Savings


I read recently in Wired about a Columbia Business School study that revealed the dangers of being relaxed. Yes, it is true. Apparently being relaxed is dangerous. It has an effect on consumer spending. People who feel relaxed, the study indicates, spend far more freely than those who feel less at ease, even when emotionally, they feel no different.

If this is true, Big Box stores must be the happiest, most relaxing places in Canada. While in one recently, I took note of the spending habits of some very relaxed people, something I’m prone to doing while picking up toilet paper and detergent for my family.

Another thought occurred to me while standing in line to pay for my household goods. Sixty shopping days before Christmas and I was already hearing Bing Crosby sing about snow overhead. Sixty days. The store was doing its best to trigger me into some more spending.

Luckily I got out just in time.

Being wired to spend is something I wrote about recently in a post on David Chilton, and the more I’ve thought about it since, the more I really do believe humans are wired this way, whether they are in a state of relaxation or not. Instant gratification, after all, is powerful motivator to pull out one’s wallet.

How freely we spend is most obvious around the holidays. When feeling very relaxed and festive, we tend to ignore budgets and rack up all kinds of debt, all in an attempt to make the people around us happy. I wonder if it actually works.

No, I’m not saying put away your wallet over the holidays, just to try and beware of the triggers that make us do it. Be they emotional or environmental, they can be dangerous, driving us to spend more money than we can really afford.

And while you may be more relaxed than ever  this holiday, especially while driving around parking lots and checking off your shopping list – though I doubt it – simply taking note of the triggers around you will help curb the out-of-control spending and make the saver in you that much happier as a result.

 

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Oct 17

Changing the conversation about money in Canada.

posted 9:00 AM Oct 17, 2011 by Peter Aceto under Savings


This summer, ING DIRECT put together some ideas on long-term savings and submitted them to the House of Commons Standing Committee on Finance – a Committee that gathers ideas from Canadians on the economy in advance of preparing the next year’s federal budget. They’re available here http://bit.ly/otFsDR.

Just as the government is intent on making sure the economy continues to grow, Canadians also have to be made aware of the need to make the right financial decisions now, so that their long-term financial well-being is taken care of.

I myself and ING DIRECT have long-held concerns regarding the level of consumer debt in Canada. If you read DIRECT TALK regularly, you know we believe it is a serious issue more of us have to start paying attention to, as it has a real impact on our future. Canadians should understand the implications of debt and what it means to max out credit cards or lines-of-credit, both today and tomorrow.

To make financial well-being more concrete, ING DIRECT has submitted three recommendations to this Committee. Here’s what we’ve proposed:

 

1. More education for individual Canadians on the savings needed for retirement through the creation of an annual personalized “check-up” letter;

2. Encourage RRSP participation by younger Canadians through the creation of a Canada Retirement Savings Grant (CRSG) for individuals aged 18 to 24; and
3. Proceed with the introduction of Pooled Registered Pension Plans – new, low-cost retirement savings vehicles that will help better meet the retirement objectives of Canadians.

 

I hope all Canadians will soon take note of these recommendations and that over time, retirement, as well as consumer debt and saving money regularly, become a bigger part of a larger conversation about financial well-being.

 

It is, after all, a conversation worth having, don’t you think?

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Oct 3

Fourteen years, $5 billion dollars paid and we’re just getting started

posted 10:26 AM Oct 3, 2011 by Peter Aceto under Savings


When ING DIRECT first opened its doors, it was with one simple product and one simple desire in mind: to change banking in Canada and lead Canadians back to saving. In the 5,110 days since, we’ve empowered Canadians to save their money safely, with high interest, no minimums and no fees. And because Canadians have asked for it, we’ve even added a few more products along the way to better meet the needs of savers.

We’ve just hit a major milestone; we’ve paid Canadians $5 billion dollars in interest and charged them $0 dollars in fees on their savings.  There aren’t too many banks that can say that.

While we have a lot to be proud of, we also have a lot left to do. You’ll see it in our products and marketing in the months and years to come. Canadians need to become avid savers again.  We want to see more Canadians join The Money Movement so that they get a better handle on their financial well-being and make smarter financial decisions.

Like we’ve been saying for years, saving a few dollars here and there really does add up (even to billions of dollars, it turns out). If you managed to save twenty-five dollars a week compounded over the last 10 years (average interest rate of 2.53%), that discipline would have yielded close to $15,000 today, which is a great start.

Maybe you’re reading this and thinking “small potatoes,” but it’s not when you think about how tough it is to save 10 per cent of your income every month (an ideal amount a lot of people strive for), especially when most banks are still paying insignificant interest rates and charging sky-high service fees. (As an aside, Canadians on average pay $185 in bank fees per year– among the highest in the world.) Think about it.

So, to the clients who’ve chosen to do business with ING DIRECT, thank you. To the dedicated employees who make ING DIRECT what it is and make all this possible, thank you. And to all Canadians, let’s start a money revolution. Let’s get better educated so that financial planning becomes more simple, so that you’re in control of your money, and your decisions aren’t outsourced to people who are incented to sell you stuff, not build a comfortable life for you and your family. We still have a lot of saving and earning left to do, so let’s get to it and show the world what financial autonomy really looks like.

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