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Natasha Macmillan, Business Unit Director - Everyday Banking
Our guide to the best savings accounts in Canada
There are a few things to look for when searching for a new savings account. We've outlined these key features below.
Top saving rates in Canada
Rate of return
When you deposit money in a savings account, you earn interest on the amount you deposit. Some accounts offer everyday high interest rates, and some offer “teaser” rates that start off high and then drop off after a certain length of time. Ignore flashy looking interest rates that don’t last for long, and look instead for accounts that offer the highest first-year return.
Some savings accounts charge fees for transactions including deposits, withdrawals, and transfers to and from other accounts. Look for savings accounts that offer a number of free transactions every month, especially if you know you’ll be making a lot of transactions.
There are lots of great high-interest savings accounts available that don’t charge monthly fees even if you don’t have a lot of money saved. Don’t get tricked into thinking you need to pay a monthly charge for the privilege of earning a high interest rate on your savings.
When you deposit money in a bank account in Canada, it’s usually federally protected by the Canadian Deposit Insurance Corporation (CDIC). Some financial institutions aren’t covered by CDIC insurance, however, so make sure you know how your money is protected.
Sometimes banks will offer extras to stand out from their competitors. Keep an eye out for special offers like introductory interest rates and cash bonuses, but be aware that another savings account without those gimmicks might earn you more interest in the long run. Better extras to look for are free transactions, free Interac® e-Transfers, and better online/mobile banking experiences.
Why you should open a savings account
Savings accounts typically pay a higher rate of interest compared to chequing accounts. Major Canadian banks pay 0% interest on chequing accounts, whereas savings accounts can pay between 1.5% - 2.5%.
With a savings account, you can separate money that is in surplus to your day-to-day requirement and earn a little extra. This can support you in your financial goals, for example, saving for the down payment on your first home, escaping on that dream vacation, or building an emergency fund for unexpected expenses.
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Natasha Macmillan, Business Director of Everyday Banking
With over a decade of experience in the finance industry, Natasha works closely with Canada's top financial institutions - from banks to credit unions - to help Ratehub.ca's 1,200,000 monthly users get matched with the right banking products. read full bio
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