The best high-interest savings accounts in Canada for 2021

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by Ratehub.ca January 4, 2021 / No Comments

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When it comes to making daily purchases or common financial transactions, using chequing accounts or credit cards are undoubtedly great banking options. But if you have a plan for your future, financial goals, or a little extra money, high-interest savings accounts (HISAs) are excellent financial tools that can have your money earning money for you at a quicker rate.

A high-interest savings account is also an excellent savings tool for short and medium term savings goals; many of the best high-interest savings accounts in Canada currently offer attractive interest rates, earning anywhere from five to thirty times higher returns than a regular savings account.

The best high-interest savings accounts in Canada

Rate Account
1.50% EQ Bank EQ Bank Savings Plus Account get this rate
0.75% Wealthsimple Wealthsimple Cash get this rate
1.25% CIBC CIBC eAdvantage Savings Account get this rate
Want to see how your savings account compares to the rest? Compare Best Savings Accounts

 


Saven Financial

  • Interest Rate: 1.55%
  • Minimum deposit: None (though a $25 initial investment is required to become a Saven member)
  • Monthly fees: None
  • Insurance: Financial Services Regulatory Authority of Ontario
  • Available in Quebec: No. Only available in Ontario
  • Transactions: Free withdrawals and Interac e-transfers
Read more (+/-)

Saven is an online financial institution owned by FirstOntario, one of Ontario’s largest credit unions founded in 1939. In place of brick-and-mortar bank branches, Saven exists entirely online through its website and smartphone app, with real people available to answer your questions over the phone six days a week.

Saven Financial’s savings account climbs to the top of this list for its impressive 1.55% interest rate (which completely eclipses what the big banks offer) and for the fact it doesn’t charge any monthly transaction fees, so you can move money freely either in the form of an e-transfer, electronic funds transfer, or cheque deposit.

While there’s no minimum balance requirement, you do have to provide a $25 initial investment to become a Saven member (which acts somewhat similar to shareholder status, as is customary in credit unions), which will earn its own dividend and lets you have a say in FirstOntario’s operations by giving you the ability to vote in Board of Directors elections.

Your money is safe at Saven Financial, as it’s not only backed by one of Ontario’s oldest and largest credit unions but also provincially insured by the Financial Services Regulatory Authority of Ontario (FSRA) with up to $250,000 of your deposits protected.

Saven is only available to residents within the province of Ontario and doesn’t offer joint account options.


EQ Bank Savings Plus Account

  • Interest Rate: 1.50%
  • Minimum deposit: None
  • Monthly fees: None
  • Insurance: CDIC
  • Available in Quebec: No
  • Transactions: Free withdrawals and Interac e-transfers
Read more (+/-)

EQ Bank’s Savings Plus Accounts earns a competitive interest rate of 1.50% and requires no minimum balance. Additionally, there are no monthly account fees, no withdrawal fees, and no fees on Interac e-transfers – making it one of Canada’s best high interest savings accounts with absolutely no strings attached.

EQ Bank also offers joint account options (perfect for families or couples looking to simplify and manage their finances as one) along with the ability to send international money transfers for up to eight times cheaper compared to the big banks with TransferWise. There’s also an Electronic Funds Transfers feature, which lets you move large sums of money (we’re talking up to $30,000) between banks in one go.

EQ Bank is a trademark of Equitable Bank, Canada’s ninth-largest domestic bank with over $35 billion in assets under its management, and is federally insured by the Canada Deposit Insurance Corporation (CDIC).

An EQ Bank Savings Plus Account doesn’t come with a physical debit card or chequing account. The bank only operates online and specializes in savings accounts and GICs. EQ Bank also has an easy-to-use mobile app for your convenience.

EQ Bank is not available in Quebec.


MAXA Financial High-Interest Savings Account

  • Interest Rate: 1.20%
  • Minimum deposit: None ($5 is required to open an account with MAXA)
  • Monthly fees: None
  • Insurance: Deposit Guarantee Corporation of Manitoba
  • Available in Quebec: Yes
  • Transactions: 1 free transaction per month ($1.50 afterwards). $1.50 per Interac e-transfer
Read more (+/-)

MAXA Financial currently offers one of the best high-interest savings account in Canada, at 1.20%. As a digital bank, a MAXA Financial high-interest savings account comes with no monthly fees and one free debit transaction per month. Interest in a MAXA high-interest saving account is calculated daily and paid to customers monthly.

The online bank offers a high-interest savings account that is insured by the Deposit Guarantee Corporation of Manitoba (DGCM). MAXA Financial products are available to all Canadian citizens.


Motive Financial High-Interest Savings Account

  • Interest Rate: 1.55%
  • Minimum deposit: None
  • Monthly fees: None
  • Insurance: CDIC
  • Available in Quebec: No
  • Transactions: 2 free withdrawals per month ($5 after that) and $1 per Interac e-transfer
Read more (+/-)

A division of Canadian Western Bank, Motive Financial is an online-only bank that serves customers through its website and mobile app. It currently offers an exceptional high-interest savings account with an interest rate of 1.55%.

The Motive Savvy Savings Account has no minimum balance requirements, no monthly account fees, and no fees for depositing money. Plus, the account is CDIC insured, so up to $100,000 of the cash deposited into your savings account is insured by the federal government.

In terms of account transactions: two withdrawals are included for free every month but making extra withdrawals will result in an additional $5 fee (unless you’re moving money to another Motive bank account). Interac e-transfers are also $1 each.

Motive Financial is an online-only bank also offers a joint savings account option, along with widely loved chequing account and GIC options that provide enhanced flexibility and various banking options to its customers.

Motive Financial is not available to citizens of Quebec.


Alterna Bank High-Interest eSavings Account

  • Interest Rate: 1.20%
  • Minimum deposit: None
  • Monthly fees: None
  • Insurance: CDIC
  • Available in Quebec: Yes
  • Transactions: Free withdrawals and Interac e-transfers
Read more (+/-)

Alterna Bank is a division of Ottawa-based Alterna Savings, one of Canada’s oldest Credit Unions. The online bank offers an interest rate of 1.20%. An Alterna Bank HISA is CDIC insured, comes with no monthly or annual fees, and offers unlimited transactions and internal transfers. The digital bank offers joint account options too.

Each month, clients can use two free Interac e-Transfers to move their money from the account, but transfers from an Alterna Bank chequing account are unlimited. Alterna Bank customers can access any ATM in the EXCHANGE Network, which includes ATMs from the National Bank of Canada.

Alterna Savings is available to all Canadian citizens.

 


Wealthsimple Cash

  • Interest Rate: 0.75%
  • Minimum deposit: None
  • Monthly fees: None
  • Insurance: CIPF
  • Available in Quebec: Yes
  • Transactions: Free withdrawals
More details about the Wealthsimple Cash

You probably know Wealthsimple, primarily as one of the best robo-advisors in Canada. Still, the wealth management platform offers much more than managing ETF portfolios and other types of trading, saving, and investment products.Wealthsimple recently switched its high-interest savings account into an incredibly versatile prepaid account known as Wealthsimple Cash. It still works exactly the same as the Wealthsimple Save High-Interest Savings Account, except now, customers can use it like a chequing account and enjoy an interest rate of 0.75%.

The account works like a savings and chequing account combined (also known as hybrid accounts). To make the package sweeter, there are no monthly fees or minimum deposit requirements. Wealthsimple also offers joint accounts with the same interest rate.

Wealthsimple is available to all Canadian residents.


Oaken Financial High-Interest Savings Account

  • Interest Rate: 1.25%
  • Minimum deposit: None
  • Monthly fees: None
  • Insurance: CDIC
  • Available in Quebec: No
  • Transactions: Free withdrawals and Interac e-transfers
Read more (+/-)

Oaken Financial is a CDIC-insured bank that operates exclusively online and a subsidiary of its parent company, Home Trust. An Oaken Financial high-interest savings account offers an interest rate of 1.25% on deposits and comes with unlimited withdrawals and transfers. The savings account also comes with no minimum deposit requirement.

Interest is calculated daily and paid out to customers monthly. An Oaken Financial high-interest saving account also comes unlimited Interac e-transfers, internal transfers, and no additional fees for external ATM use. Oaken Financial also offers joint bank account options.

Oaken Financial products are available to all Canadian citizens.


Tangerine Savings Account

  • Interest Rate: 2.10% for the first 5 months. 0.1% afterwards
  • Minimum deposit: None
  • Monthly fees: None
  • Insurance: CDIC
  • Available in Quebec: Yes
  • Transactions: Free withdrawals and Interac e-transfers
Read more (+/-)

Tangerine, Scotiabank’s direct-to-customer bank, offers high-interest savings account with an interest rate of 0.10%. New clients can enjoy a promotional interest rate of 2.10% for the first five months.

The account requires no minimum balances or monthly fees. Tangerine offers a variety of other financial products, and even allows cardholders to use Scotiabank ATMs, should they choose to open a chequing account and withdraw liquid cash.

Tangerine products are available to all Canadian citizens.


Laurentian Bank of Canada (LBC Direct) Digital High-Interest Savings Account

  • Interest Rate: 1.40% (up to and including $500,000); 0.4% on deposits above $500,000
  • Minimum deposit: None
  • Monthly fees: None
  • Insurance: CDIC
  • Available in Quebec: Yes
  • Transactions: Free withdrawals and Interac e-transfers
Read more (+/-)

The Laurentian Bank of Canada (LBC), also known as LBC Direct, offers its Digital High-Interest Savings Account with the best savings account rate Canadians have seen in years.

Canadians investing $500,000 or less can take advantage of an interest rate of 1.40%. Investments once cent over the half-a-million-dollar mark will receive an interest rate of 0.40%. This is not a promotional rate, either, meaning LBC Direct customers can enjoy this rate for quite some time.

The best part? There is no minimum balance requirement or monthly account fees. That means basically anyone can get a piece of the high-interest action.

LBC Direct savings accounts include CDIC insurance. The Quebec-based bank also offers various additional banking products and proudly calls itself a member of the EXCHANGE Network.

The Laurentian Bank of Canada Digital High-Interest Savings Account is open to all Canadian citizens.


What is a high-interest savings account?

In the most basic terms, a high-interest savings account is a bank account that pays interest on deposits. Funds in a high-interest savings account are accessible at your own will. Cash in a savings account is not locked in the account.

Depending on the type of savings account you use, the number of free onthly transactions allowed to you may be limited.That said, savings accounts are ideal for both short-term and long-term savings goals, such as a vacation, wedding, down payment, or retirement. 

They also serve as an excellent option for building an emergency fund, known commonly as a rainy-day fund. The purpose of any savings account is to keep savings parked or untouched until needed.

How do high-interest savings accounts work?

A high-interest savings account works like a regular savings account. Generally, a high-interest saving account only differs by its provided interest rate. However, savings accounts (and all financial products) differ in terms and conditions from other institutions. The most significant differences between savings accounts generally lie in the number of withdrawals it allows its customers to make.

Some banks and credit unions permit unlimited transactions each month, while other institutions place a limit on transactions. Others offer variations on their accounts, depending on flexibility and transfers.

Banks and credit unions also differ significantly depending on the interest rates, offering fixed rates (one rate that never changes) or a tiered-interest rate option.

What types of savings accounts can you open in Canada?

There are many different types of savings accounts available to Canadians, all of which come with their own unique advantages.

Savings Accounts are accounts meant for saving money that also provide interest.

High-Interest Savings Accounts operate in the same manner as traditional savings accounts but have an interest rate higher than 1.00%.

Tax-Free Savings Accounts (TFSAs) are saving and investing accounts that earn tax-free interest on cash, dividends, and savings. A TFSA comes with a yearly contribution limit that increases each year for all Canadian citizens. It allows people to earn untaxed interest and gains on their investments.

Registered Retirement Savings Plan (RRSP) is a government-registered account purposed for retirement savings. It is a registered savings account that also earns tax-free interest and comes with a contribution limit.

U.S. Savings Accounts are savings accounts that hold American money. These accounts are available with most major banks and ideal for citizens with dual citizenship or ones who visit the United States often.

Hybrid Savings Account is a savings account that offers the flexibility of a chequing account. Typically, a hybrid account allows customers to make transactions and transfers while providing high-interest and additional features like Interac e-transfers and bill payments, along with high interest.

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