There are many saving accounts available on the market, choosing the best one can be a difficult task considering all the factors and choices you have to consider. Before we divulge into that, let’s explain what is a savings account.
A savings account is a secure area where you can deposit your money while generating interest on your balance. Though it may earn interest like an investment, a savings account is more secure as it is insured by the Canadian Deposit Insurance Corporation (CDIC), meaning your money is protected (up to $100,000) in the event the bank collapses.
The biggest difference between a high-interest savings account and a regular savings account is the interest rate. The former typically offers much higher interest rates, allowing you to earn more money in interest compared to the latter. Generally speaking, high-interest savings accounts come with interest rates that are as high as 2.5% or more, compared to regular savings accounts that usually offer no more than a half percent on average.
Learn about Tax-Free Savings Account (TSFA).
A savings account is a way of growing money with cash that is just “sitting” around. When you open a savings account, the money you store in it is used by the banks to invest and lend to other people and businesses. In return for using your savings, the bank pays you interest. Of course, that doesn’t mean you can’t access your money whenever you want. Your money is always available to you and is also insured by the Canadian Deposit Insurance Corporation (CDIC) as mentioned above.
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Why put your money in a high-interest savings account over other types of accounts? Here are a few benefits to consider:
In addition to the perks of a high-interest savings account, there are some drawbacks to consider.
With all the high-interest savings accounts in Canada, how do you choose one that best meets your needs?
A savings account is typically meant to store your money for long periods of time. Over time you may withdraw or deposit more money. However, in general, transactions, withdrawals, and transfers are typically limited with savings accounts. Depending on your own personal banking habits and needs, figure out how many withdrawals and transactions you need. Some banks offer a free transaction once a month while others require a fee.
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Depending on if you choose an online or traditional savings account, your accessibility will range accordingly. For online savings accounts, you will likely be restricted to dealing with your money through electronic means. If you require access to an ABM or a teller, then a traditional savings account will suit you better.
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When choosing a savings account whether through a traditional bank or an online financial institution be sure to choose a rate that is higher than the current Canadian inflation rate. Inflation affects your purchasing power, by matching your interest rate with the inflation rate your savings won’t lose its purchasing power.
Listed are 5 of the best online high-interest savings accounts in Canada. All of the following savings accounts have no minimum balance and monthly fee.
| Interest Rate | Monthly Fee | Extra Features | Insured | |
| Neo Money Account | 1.8%* | None | – Hybrid chequing and Savings Account. – Free Interac e-Transfer®. – No minimum balance required. | CDIC |
| Tangerine Savings Account | 0.10% | None | – Unlimited withdrawals, deposits and transactions. – RSP, TSFA, RIF and U.S savings account available. | CDIC |
| Wealthsimple Cash | 0.90% | None | – Unlimited withdrawals, deposits, transfers and transactions. – RRSP & TFSA available – Hybrid chequing and Savings Account | CIPF |
| Alterna Bank High eSavings Account | 1.5% | None | – Unlimited free Interac e-Transfer® and bill payments. – RRSP & TFSA available | CDIC |
| Oaken Savings Account | 1.5% | None | – Unlimited withdrawal, transfers. – ABMs available | CDIC |
| EQ Bank Savings Account Plus | 1.50%* | None | – Free Interac e-Transfer®, transactions, and bill payments. – TFSA, RSP and GICs available. | CDIC |
| MAXA Financial High-Interest Savings Account | 1.60% | None | – RRSPs, TFSAs, and RRIFs available. | DGCM |
| Laurentian Bank Digital High-Interest Savings Account | 1.5% | None | – Interac e-Transfers®, automatic withdrawals, pre-authorized debits and wire transfers available. | CDIC |
*Interest is paid monthly and calculated daily on the total closing balance. Rates are subject to change without notice
Neo Financial is a tech company in Canada that has been challenging the status quo by changing the way Canadians traditionally bank. Through their Neo Money Account, Canadians can now save, spend and earn rewards all from the same account. With it, you can earn a high-interest rate of 1.8%* on your balance without any annual or monthly fees. Interest is paid monthly and there are no minimum balance requirements. However, there is a cap of $200,000.
The Neo Money Account is a hybrid between a high-interest savings account and a no-fee chequing account. You can use it to save money, pay bills and send Interac e-transfers for free. Other perks include unlimited free transactions, CDIC deposit protection1 (up to $100,000), and easy funding. You can fund your account through e-transfer, direct deposit or by linking an external bank account to your Neo account.
Tangerine is an online bank in Canada that was formerly known as ING Direct. They are a subsidiary of Scotiabank; a well-known multinational bank in Canada. They offer a number of products and services like GICs, mortgages, mutual funds, and different savings accounts. Their savings account has an interest rate of 0.10% and does not require a minimum balance or a service fee. They are also easily accessible even though they don’t have branches. You can gain access to your account online and through mobile banking as well as their automated banking machines (ABMs) on the Scotiabank network. They also have an Automatic Savings Program (ASP) to help you reach your financial goals.
Wealthsimple is an online investment firm in Canada that was established in 2014. They manage investments through their Robo advisors and manage money to help their clients save. Now, they’ve launched Wealthsimple Cash, which is a hybrid of a chequing and savings account. This allows you to earn high interest on your money while having the freedom of a chequing account, which includes unlimited transactions with no fees. Wealthsimple also has TSFA and RRSP if you prefer to save using those accounts. Unlike the other online banks mentioned, Wealthsimple is not insured by the CDIC but by the Canadian Investor Protection Fund (CIPF) for up to 1 million.
Alterna is a digital bank in Canada that is a wholly-owned subsidiary of Alterna Savings; a credit union in Ontario. They offer mortgages and high-interest savings accounts in Canada. You can earn 1.5% on your savings with Alterna, however, the cap balance is set at $250,000. Unlike traditional savings accounts, there is no fee or minimum balance and you have unlimited transactions and Interac e-Transfers®.
Oaken is a digital banking company that is powered by the Home Trust Company. They were first established in 2013 to provide a savings product that the customers could control. Hence, Oaken does not charge any fees or require a minimum balance. They also have unlimited withdrawals, transfers, and deposits. Their savings account also has one of the highest interest rates available (1.5%), along with Equitable Bank (2.00%). If you’re looking for different sorts of savings accounts, Oaken also offers high-interest TFSA and RRSP. They also offer GICs for those looking to invest.
EQ Bank is an online subsidiary of Equitable Bank; one of Canada’s largest Schedule I Banks. They’ve been in business for over 40 years and are insured by the CDIC, making them a creditable financial institution. They currently offer a variety of high-interest savings accounts including the following:
These accounts come with one of the highest rates of 1.50%*. Unlike traditional savings accounts, EQ Bank’s Savings Plus Account, GICs and registered savings accounts come with no monthly fee and no minimum balance. Moreover the EQ Bank’s Savings Plus Account also comes with free transfers, transactions, and bill payments. They also give you the ability to connect to your other bank accounts so you can automate bill payments and transfer funds more seamlessly.
*Interest is paid monthly and calculated daily on the total closing balance. Rates are subject to change without notice
MAXA Financial is a division of Manitoba-based Westoba Credit Union, so all deposits held with the bank are guaranteed by the Deposit Guarantee Corporation of Manitoba. MAXA’s high-interest savings accounts are available for savings accounts including RRSPs, TFSAs, and RRIFs. Currently, MAXA’s interest rate for its high-interest savings account stands at 1.60%, which is a pretty competitive rate.
Clients holding these accounts won’t have to be subject to any monthly fees, nor any minimum balance requirements. Plus, they come with MemberCards that can be used to withdraw cash at ATMs and make in-store purchases.
Laurentian Bank has been around for over a century and a half and has LBC Digital under its umbrella, which is the bank’s online banking arm. In addition to GICs and a no-fee chequing account, Laurentian Bank also offers a high-interest savings account that comes with a healthy rate of 1.65%.
There is no minimum balance required to maintain, nor are there any monthly fees to pay. There’s no need to sign up, as you can link your savings account with another bank. Otherwise, you can transfer funds from your LBC Digital Chequing Account if you so desire. Plus, all eligible deposits up to $100,000 are protected under the CDIC.
| Interest Rate | Cost | Min Balance | Extra Perks | CDIC Insured | |
| Scotiabank Momentum PLUS Savings Account | – Up to 2.70% (limited time offer) -0.05% base + premium period interest | No monthly fee | No minimum balance | – Unlimited self-service transfers – Automatic savings plan | Yes |
| TD High Interest Savings Account | – 0.05% | No monthly fee | $5,000+ | – Unlimited transactions – Automatic savings program | Yes |
| BMO Smart Builder Savings Account | – Up to 0.50% – 0.05% base interest + 0.45% bonus interest | No monthly fee | $200+ per month | – 1 free transfer out of account | Yes |
| CIBC eAdvantage Savings Account | – Up to 2.10% (limited time offer) – 0.10% base | No monthly fee | No minimum balance | – | Yes |
| RBC high-interest savings account | – 0.05% | No monthly fee | No minimum balance | – No minimum deposit required – 1 Free ABM cash withdrawal per month – Automated savings program | Yes |
TD is one of the biggest and most well-known banks in Canada. It was founded over 65 years ago and since then has grown into a multinational financial institution. They have over 1,100 branches and serve over 10 million Canadians. They offer a range of products and services like credit cards, mortgages, insurance, GICs, savings accounts, and much more. Their high-interest savings account offers an interest rate of 0.05% if you have a balance of $5,000 or more. Anything less will result in an interest rate of 0%. This account does not charge a monthly fee, however, there are a few transactions fees you should note:
These transaction fees can be waived if you maintain a monthly balance of $25,000. When you bank with TD, you also have access to mobile deposits, TD’s spending tracker app, automated savings programs, and more.
Scotiabank is one of the largest banks in Canada. They have a wide range of products and services like credit cards, loans, mortgages, insurance, investments, savings accounts, and more. Their high-interest savings account is called the Momentum Plus Savings account; a savings account to help you meet all your savings goals. This savings account tracks your earnings and rewards you with higher interest rates the longer you save. They pay you a regular interest of 0.05% monthly plus a Premium period interest if no debit transactions were made during the premium period. This premium interest is designed in a way that compels you to not touch your money unless you have no choice. The rise in interest is an advantageous reward that you can work toward. There is no monthly fee, however, there is a $5.00 charge for every debit transaction that is not a self-service transfer.
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The Bank of Montreal (BMO) is a multinational financial institution that offers a number of financial products and services like credit cards, insurance, mortgages, lines of credit, savings accounts, and more. BMO’s Smart Builder Savings Account is a great account for those consumers who are looking for extra motivation to save. It’s designed in a way that compels you to continuously put money into your savings. If not, you lose out on a whole percent of earnings on interest. The BMO savings account has a base interest rate of 0.05% plus 0.45% if you deposit $200 or more every month. There is no monthly fee and you are granted 1 free transfer out of the account every month. However, if you require any more withdrawals, it will cost you $5 per withdrawal.
Like the other big banks, CIBC offers a wide variety of financial products and services like credit cards, mortgages, loans, insurance, investments, savings accounts, and more. Their eAdvantage savings account offers a 0.10% interest rate with no monthly fee. However, there is a 5$ charge for any transaction like debit purchases, withdrawals, bill payments, branch transfers, Interac e-Transfers®, and cheques.
The Royal Bank of Canada (RBC) offers numerous financial products and services. Their High-Interest eSavings account allows you to earn 0.05% interest on every dollar, which is a fairly balanced rate in comparison to the other banks. No monthly fees or deposits are required in order for you to earn interest on your savings. You also have unlimited transfers between this account and your other accounts with RBC. They also offer an automated savings program called Save Matic, which can help regulate your savings so that you can reach your savings goals faster.
As with any other account, the money you have deposited in your high-interest savings account is safe as long as the financial institution that you have your account with is reputable. These accounts are typically eligible to be insured by the Canada Deposit Insurance Corporation (CDIC), so even if the bank you are with goes under, your money would be safe.
Plus, the interest rate with a high-interest savings account is fixed, so you are guaranteed to earn that amount of interest for that month on the funds you have deposited, which is much safer than playing your odds with stock investing.
Whether you choose to go with an online or traditional savings account, having one, in general, is most important. Proactively working on building your savings is key to managing unexpected expenses and future financial crises. A savings account will not only help keep your money secure but will grow your money and help you meet your future financial goals. The list above will help you narrow your options and choose a savings account that best suits your needs.
Neo Money is provided by Concentra Bank.
*Interest is calculated daily on the total closing balance and paid monthly. Rates are per annum and subject to change without notice.
1 The Neo Money account is provided by Concentra Bank, a CDIC member institution, and is eligible for CDIC deposit protection. Deposits held in Neo Money accounts are combined with eligible deposits held at Concentra Bank, for up to $100,000 of deposit protection, per category, per depositor. For more information about CDIC deposit insurance, please consult CDIC’s website cdic.ca.
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Lisa has been working as a personal finance writer for more than a decade, creating unique content that helps to educate Canadian consumers in the realms of real estate, mortgages, investing and financial health. For years, she held her real estate license in Toronto, Ontario before giving it up to pursue writing within this realm and related niches. Lisa is very serious about smart money management and helping others do the same.
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