savings account

The two most popular account types are chequing and savings accounts. They are each useful for different things, with varied strengths and weaknesses catering to all kinds of people. Chequing accounts are the most common and are well suited to everyday routine purchases. Savings accounts are created to serve longer-term goals. They impose limits on withdrawals per month, allowing money to build in the account. Most banks also offer youth accounts, which usually present lower fees and high interest rates. There’s also the option of merging your finances with a separate individual, known as a joint account. Basically, every one of the big old established banks will offer these accounts and more, though other fresher options exist. Financial Tech companies are constantly growing in number, size and influence. They can often cut the usual fees because of their fully online presence, making them a great option for those looking to save money. There are many differences between chequing and savings accounts and it may seem overwhelming. This article will help you better understand the landscape of bank accounts and what the best option is for you.

Chequing Accounts

RBC offer four levels of chequing account. At $4/month, the RBC Day to Day Banking option is the most inexpensive in the range. Interac and e-Transfers are free. If you don’t make many transactions, this account could work very nicely. The levels above offer greater rebates and other small advantages here and there. At the top level for $30/month transactions worldwide are free and unlimited, whereas the others are Canada wide only.

TD chequing accounts have the same 4 level mold as RBC. Their Minimum Chequing Account comes in at $3.95/month with up to 12 free debit transactions per month, just like RBC’s Day to Day Account. One difference is that e-transfers cost $0.5-1.00 each with TD. This is not the case with their higher level accounts, which also offer boosted amounts of free monthly transactions and free annual rebates at the top two levels.

BMO chequing accounts offer a similar style of levels but have an added fifth option. Once again, the most basic account costs $4/month and comes with 12 free transactions. The accounts scale up at a similar pace to their competitors. The Plus, Performance and Premium BMO bank accounts offer $0 in monthly fees if you maintain a certain balance in the account.

This also goes for Scotiabank’s three higher level chequing accounts. Scotia’s basic account is $3.95/month with features that match all the former.

Savings Accounts

If you’re looking to save money for the future, here are some Canadian savings accounts which can help you reach your financial goals. Savings accounts offer varying interest rates which build your money but most established big banks will likely give you a lower interest rate than some newer fintech competitors. Nevertheless, they are still widespread and grow your money. RBC offers a few types savings accounts, all without monthly fees. Their High Interest account has an interest rate of 0.8%. TD’s version of the high interest savings account offers only 0.05% interest, assuming you have at least $5,000 in the account. Scotiabank’s Momentum Plus Savings Account allows you to earn higher interest the longer you save. The base rate is 0.85%, and only grows the longer you wait. This Scotiabank Savings Account is really not made for spending but within one year you can really increase your interest rate. All these banks offer generally low interest rates. Neo Financial is an entirely digital company that offers you 1.80% interest with the Neo Money Account. This interest rate is exponentially higher than average. There are no monthly fees, and it doesn’t matter how much you have in the account. Any amount generates the same interest rate. To top this, the account simultaneously acts as a chequing account. Transactions are free and unlimited. All this and more is why this is one of the best no fee bank accounts Canada has to offer.

Specialized Accounts

Though the most common, normal savings and chequing accounts are not always perfectly suited to everyone’s needs. If you find yourself in a relationship or simply in a situation where it is pertinent to merge your money with somebody, a joint account could work perfectly. They are widely offered, from RBC joint accounts to Scotiabank. If you are a parent and want to teach your child about managing their money early on, check out CIBC’s youth account. It offers 0.05% interest, unlimited transactions and no monthly fee. RBC’s student account is also a good option with similar features for those ages 13 or higher.

No Fees with FinTech

If you’re a student or senior you will likely fall under the category of discounted or no fee accounts. However, the majority of people have to pay monthly and annual fees to their banks. If you are looking to save money, point your attention to digital financial institutions. Companies like Neo and EQ Bank are able to cut many costs for their clients. This is because they spend far less than other banks as they have a completely digital presence. Fintechs avoid fees and also allow for a very comfortable and convenient banking experience through their mobile apps and websites.

Best Canadian Chequing and Savings Accounts

When deciding on what kind of account might be best for you, you need to consider all factors. Coming to a conclusion may not be simple, but even when you do you will likely have to compromise depending on the account type you choose. This is not the case with Neo’s Money Account. It is one the best no fee bank accounts in Canada. There is no need to make a compromise with this account because it combines the best of chequing and savings accounts. The comparatively enormous interest rate is fantastic for your money, and everything is manageable easily through their mobile Neo app.

All of us have long term financial goals. Everybody has something a little more expensive they’ve had their eye on and want to save up for. Sometimes you may just want to grow money that you have but aren’t spending. A high interest savings account is one of the best ways to do this. High interest savings accounts are risk and hands free, all while earning you interest on your money to help you do whatever you can dream.

With the current worldwide economic situation improving as we near the end of the global pandemic, interest rates are rising at many Canadian banks. This means that it is a great time to put your money somewhere where it can appreciate. There are things you have to watch out for though. Many banks’ marketing strategies involve a tactic which temporarily boosts the interest rate of a given HISA (High Interest Savings Account) to make it more desirable. After the first few months the rate decreases to the usual and comparatively miniscule interest percentage. As long as you know that the normal interest rate is still good, you won’t be unpleasantly surprised.

You may be asking yourself why people have regular savings accounts if the high interest counterparts earn more interest. High interest accounts oftentimes have some drawbacks or conditions when compared to normal savings accounts. These can include a limited amount of monthly withdrawals or a minimum account balance.

TD High Interest Savings Accounts

TD has two accounts that fall under high interest. The first offers an interest rate of 0.05% as long as your balance is over $5000. The second account is called the ePremium savings account. It offers 0. 5% but your balance has to be double at $10,000. If you have the ability to maintain such a balance, this account could work for you. The account offers unlimited free online transfers to other TD accounts. Although transaction fees are high with the regular high savings account, if you plan on keeping the money there and not spending it too much, it can work just fine.

RBC High Interest eSavings Account

RBC’s eSavings account offers an interest rate of 0.5%. This is the same as TD’s ePremium account. Both accounts have no monthly fees but RBC has the big advantage of not requiring a minimum account balance. Transfers to other RBC accounts are free and you even get one ATM withdrawal per month, free of charge. If you sign up by August 31 2022 you can get a promotional interest rate of 3.0% for the first three months.

BMO High Interest Savings Accounts

BMO has a fairly simple account called the BMO smart saver account which has similar features to TD’s simpler account. It has the same interest rate of 0.05% and no monthly fees but it beats out TD as it does not present a minimum balance. There is a higher interest option available: The BMO savings builder account has an interesting mechanic. Although it offers a going interest rate of 0.1%, you can earn the bonus rate of 0.6% as long as you invest $200 into the account every month. There is no minimum account balance and as with most accounts mentioned in this article you have one free outgoing transfer per month, every other one costing you $5.

Scotiabank Momentum Plus Savings Account

The Scotiabank savings account is a special type of account. It is a tiered-interest account, which simply means that depending on how long you hold money in the account for you will earn more interest. The tiers start with a 0.35% interest rate. If you leave the money in the account untouched for 90 days then the rate jumps to 0.85%. For 180 days you get 0.9%, for 270 days you get 0.95%. If you wait a full 360 days, you get an even 1%. There is one important thing to note. This offer of increasing interest rates is up to one year and after that period you will only earn a base 0.85%. The account has no monthly fees but it also has no free transactions. Every single one will cost you $5. However, if you are signing up for this account you are likely looking to let the money build unspent so that you can accumulate interest rate during the one year period.

CIBC eAdvantage Savings Account

The CIBC savings account has an interest rate of 0.35% and no minimum balance. It also has a similar gimmick to BMO’s savings builder account. If you deposit $200 every month you get an additional 0.25% of interest. Once again there are no monthly fees. Like with Scotiabank every transaction you make will cost you $5 dollars.

Tangerine High Interest Savings Account

Tangerine’s savings account has a fairly competitive interest rate of 0.1%. This comes at the cost of no monthly fees too. Until October 13^th 2022 new clients can get a promotional interest rate of 3.25% for the first five months. As usual moving money to and from other Tangerine accounts is free of charge. All this makes the Tangerine savings account a good option. However, although they are an online bank, they do not offer interest rates that are as high as their other exclusively digital competitors.

Neo Money Account

Almost all the banks listed above are established big banks in Canada. They offer fairly similar and low interest rates on their Canadian high interest savings accounts. If you are looking for something with higher interest rates, digital finance is your answer. Companies like Neo offer comparatively astronomical interest rates on their savings accounts. The Neo money account has an interest rate of 1.8%. It also has no minimum balance and entirely free transactions. This account is flexible and has attributes of both a chequing and a savings account. If you are in Canada and looking for a no fee account with a great interest rate Neo might be worth your time.

The Verdict

There is no one account that is superior to all the others. Every single one has its own advantages and drawbacks. Tiered accounts like Scotiabank’s momentum plus are fantastic for the first year where interest rate grows and even after that, their rate of 0.85% is quite competitive. If the only thing you are looking for is a high interest, then Neo could be your answer. There are other factors too of course, such as transaction costs. Most typical high interest savings accounts will allow for one free transaction per month, charging after that. Once again, Neo presents an advantage in this category, as they have completely free transactions. However, you may already be a client of another bank. This may make it more convenient to setup a high interest savings account with the same bank to allow for free transactions to and from your accounts.