The Best High Interest Savings Accounts in Canada in November 2024

In the current high-rate environment, many individuals have been steered towards high-interest savings accounts as they now provide a viable option for one’s savings plan.

These accounts stand out from traditional savings options due to their ability to offer higher interest rates, providing savers with the opportunity for their deposits to grow more. 

Although you may not get the same level of interest you would with a GIC, a HISA ETF, or the the stock market, these savings accounts provide outstanding liquidity so that you can utilize them to grow even the shortest of short-term savings.

In 2024, Canadian financial institutions continue to offer competitive rates within these accounts. For this reason, we wanted to provide Canadians with a comprehensive list of some of the best high-interest savings accounts in Canada. That way, you can make the decision that best suits you.

Let’s dig right into it.

What are the best high-interest savings accounts in Canada right now?

Equitable Bank Personal Account

4%*

• Although the rate is lower than Simplii and possibly Wealthsimple, Equitable has by far the most functionality of the three, and this is a non-promotional rate
• *If you don’t have direct deposit, rate is 3.5%
• No account minimum
• Must have direct deposit with $500 a month minimum coming into the account
• No foreign exchange fees, USD savings account option
• Free ATM withdrawals from anywhere in Canada with the EQ Bank card
• Cash cheques straight from your phone
• Earn an additional 0.5% in cash back with purchased on the EQ Bank card

Wealthsimple Cash

5%*

• *5% is for Generation clients ($500,000+)
• You’ll earn 4% with no minimum balance. 4.5% if you have over $100,000
• You’ll get 1% cash back with the Wealthsimple card
• $300,000 instead of $100,000 in CDIC protection
• No foreign exchange fees
• Does not refund ATM fees, making access to cash more difficult than EQ Bank

Simplii Financial High Interest Savings Account

6%*

• *This rate is promotional for 5 months only
• No minimum balance
• Zero transaction fees
• Interest fees drop as low as 0.4% after the 5 month promotion
• There is no card to the account, making it more difficult in terms of access
• There is a no-fee chequing account for easier access to capital

Equitable Bank Personal Account

As of right now, EQ Bank features prominently with its Personal Account (formerly the Savings Plus Account), offering an enticing 4.00% interest if you set up automatic transfers, calculated on a daily basis.

If you don’t set up a direct deposit, you’ll earn 3.5%.

In 2023, I personally swapped all of my bank accounts to Equitable Bank, and I haven’t looked back.

Here are some of the key details:

• Interest Rate: 4.00%
• Monthly Fee: $0.00
• Transaction Fees: $0.00
• Interac E-Transfer: $0.00
• Insurance: CDIC eligible

Not only do I view the Personal Account as the best savings account in the country, but Equitable is simply the best bank in the country for Canadians. Equitable Bank’s GIC rates are tough to beat, and there is a reason they are gaining ground on the major institutions fast.

I haven’t had a single difficulty since swapping there. With the Equitable Bank Card, I get free withdrawals from anywhere in the country for free as they’ll refund your ATM fees. 

I can also exchange CAD for USD with no foreign exchange fees and also earn a high rate of interest on my USD.

If you want to get started with Equitable and have an account open in just minutes, click here.

Wealthsimple Cash

Although Wealthsimple Cash doesn’t have the full functionality that Equitable Bank does, if you’re strictly an interest rate seeker and have a bit of cash, you’ll find some of the highest rates in the country with Wealthsimple. 

Your interest rate depends on how much assets you have with the platform. If you’re a Wealthsimple Trade user, it makes the process a bit easier as they count those assets towards your overall rate.

Here are some of the key details:

• Interest Rate: 4.00% minimum, 4.5% for Premium, 5% for Generational
• Monthly Fee: $0.00
• Transaction Fees: $0.00
• Interac E-Transfer: $0.00
• Insurance: CDIC eligible

You’ll earn 4% with no minimum balance, 4.5% if you have over $100,000 in assets, and 5% if you have over $500,000 in assets.

Keep in mind, as I mentioned, this does not mean only the assets you have in Wealthsimple Cash. It could be money at Wealthsimple Trade, their RoboAdvisor platform, their Crypto platform, etc.

In addition to this, the company places your money in trust at 3 CDIC member institutions so that you get triple the coverage.

Simplii Financial

You may be wondering why I view Wealthsimple Cash and Equitable Bank as better savings accounts despite having a lower rate of interest. The main reason is because Simplii’s 6% interest rate is a promotional offer for 5 months.

After the bonus interest rate, you’ll return to their regular interest rate, which pales in comparison to the other two unless you have over a million dollars in them.

• Interest Rate: 5% for six months, and then variable rate depending on the size of your account
• Monthly Fee: $0.00
• Transaction Fees: $0.00
• Insurance: CDIC eligible

The value in Simplii Financial will be if you’re willing to take the time and jump around to earn a few extra percent on your savings. In this day and age, it certainly doesn’t take much to transfer accounts. So, whether that would be worth it to you is completely up to you.

Scotiabank Momentum PLUS Savings Account 

Scotia is the only big bank to make our featured list of top savings accounts. However, much like Simplii, their 5.6% is a limited-time rate that you’re only eligible for for 3 months. After that, your rate is going to be cut in half, at minimum. Scotia is also popular when it comes to advertisements for attractive promotional GIC rates.

Suppose you’re a stickler for putting your money at a major institution, or you’re someone who is not afraid to jump around in terms of accounts to take advantage of premium periods. In that case, you may find value in the Scotia Momentum account, however.

Key features of the Scotiabank offering include:

• Interest Rate: Up to 5.60% (conditions apply)
• Monthly Fee: $0.00
• Transaction Fees: $0.00
• E-Transfer: $0.00
• Insurance: CDIC eligible

A list of high-interest savings accounts in Canada

**Rates are updated as of January 22nd, 2024. Subject to change. Please check with the institution for their most recent rates.

Why choose a high-interest savings account?

Savvy savers are drawn to high-interest savings accounts for their combination of safety and liquidity. You may choose something like a high-interest savings account over a Guaranteed Investment Certificate when you feel there is a chance you may need the money over the short term. 

This is because GICs are, in most cases, locked in until maturity. You’ll need to prove significant financial hardship to access funds prior to that. With a HISA, however, you can pull it out whenever you’d like.

While the Bank of Canada’s interest rate decisions influence the rates across the board for savings accounts, individual banks and financial institutions provide a variety of offerings that include different structures of fees and bonuses. 

Choosing the best high-interest savings account can depend on several factors, including the frequency of transactions, the amount being saved, account fees, and the desired accessibility to funds.

What should be placed in a high-interest savings account?

An emergency fund

An emergency fund should be money that you need for just that, an emergency. Locking an emergency fund into a GIC can be a recipe for disaster, as if you need the money, you will not have it available. For this reason, HISAs are an outstanding option for an emergency fund.

Alternatively, HISA ETFs have become extremely popular and often offer a bit more interest than an outright HISA.

Although they are completely liquid, and you can buy and sell them as long as the stock market is open, they may require a few days to be sold and withdrawn from your brokerage account. So, take this into account if you’re going to buy one.

Planned events

If you’re looking to buy a car, a house, a vacation, or possibly get married and have a set date for the event that is going to occur, it makes sense to park it in a HISA.

You don’t want to invest this money into riskier assets because you may approach the date of your event and be forced to sell your investments at a loss to cover the expense.

Or, in the worst-case scenario, you won’t even have enough money to buy that car or house or have your dream wedding if you don’t have a high enough savings rate to offset the decline in investment.

What exactly is a high-interest savings account?

A High-Interest Savings Account (HISA) is a type of savings account that offers significantly higher interest rates compared to traditional savings accounts. 

The appeal of a HISA lies in its higher earning potential and liquidity, making it an attractive option for Canadians looking to maximize their savings but still wanting access to the capital in case of an emergency. 

Unlike regular savings accounts, which may offer interest rates just above zero, HISAs provide a superior rate, making them highly sought after for short-term savings and emergency funds, especially when policy rates are high.

How HISAs work

HISAs operate on the principle of paying out interest, which is typically calculated daily and paid monthly. Here’s what one needs to know:

• Interest rates: HISAs offer variable rates, often subject to change based on economic conditions.
• Compound interest: Many HISAs feature compound interest, where the interest earned itself earns interest, amplifying the growth of savings over time.

To understand the calculation:

• Daily Interest: If a HISA offers a 2% annual interest rate, the daily rate is roughly 0.0054% (2% divided by 365 days).
• Monthly Payouts: The interest calculated daily is totalled and paid out at the end of each month.

The advantage of this frequent calculation is that it allows depositors to benefit from compound growth rather than simple interest, as each day’s interest adds to the principal on which future interest is calculated. 

It’s this compounding effect that can make a HISA particularly powerful for saving over time. Speaking of this compounding effect, let’s roll right into some of the major benefits of a HISA.

Benefits of high-interest savings accounts

Better interest rates

One of the main benefits of high-interest savings accounts is the higher interest rate. Unlike traditional savings accounts, which may offer lower returns, high-interest savings accounts enable individuals to earn more interest over time. 

In Canada, most institutions provide these accounts with no monthly fees and the opportunity for unlimited self-service transfers, a plus for users looking to maximize their returns without incurring additional costs.

Compounding interest

The power of compound interest is another significant advantage of high-interest savings accounts. 

Interest on these accounts is usually calculated daily and paid monthly, allowing the earnings to be reinvested and earn interest themselves. This compounding effect can substantially increase the growth of one’s savings over time, contributing to faster attainment of financial milestones. 

Liquidity

Access to your money, especially when you need it the most, is key. If you’re planning to buy a house in 6 months, you wouldn’t go and put your down payment in a 1-year GIC. At least, I hope you wouldn’t because the lack of liquidity would make it so you’d have to wait a year to buy a house.

A HISA, on the other hand, has full liquidity. If you need the money next week, it won’t be an issue. If you needed the money this afternoon, it wouldn’t even be an issue.

Sure, you’ll earn lower returns than a GIC or a bond. However, the ability to have access to your capital whenever you’d like is appealing to some.

And, speaking of GICs, let’s start talking about HISAs relative to other savings and investment options.

Comparing HISAs to other savings options

HISAs vs traditional savings accounts

High-interest savings accounts offer significantly higher interest rates compared with traditional savings accounts, leading to faster growth of one’s savings. For instance, you may find traditional savings accounts typically offer rates below 1%. Some of them are even as low as 0.25%.

A HISA, especially at an online institution like Equitable or Wealthsimple, could offer you 4% or better.

To be completely honest, there is very little reason to choose a traditional savings account over a HISA.

HISAs vs GICs

Guaranteed Investment Certificates (GICs) are similar to HISAs in that they offer a secure investment, but the two differ primarily in terms of liquidity. 

A GIC locks in the investment for a predetermined period, usually at a fixed interest rate and one that is typically higher than an HISA, but with no access to the funds, except in the case of a redeemable GIC. 

This makes GICs appealing to those with a longer-term horizon who do not require immediate access to their funds. Contrastingly, HISAs provide more immediate access, making them better suited for emergency funds or short-term savings goals.

You give up returns to get liquidity, for the most part.

HISAs vs bonds

Bonds typically offer fixed coupon rates, so many may think they’re similar to HISAs. However, they are very different. In fact, although you aren’t necessarily taking on stock market-level risk with bonds, especially high-grade ones, you’re still taking on risk and price volatility. As such, bonds are more for long-term savings.

Although a bond will pay you a set coupon rate up until maturity, what happens in between then can be anyone’s guess. Bond prices don’t fluctuate as much as stocks, but they still do fluctuate.

For this reason, they shouldn’t be considered savings vehicles but investments, and they should be owned in investment accounts with no plans to touch the capital in the short term. 

However, I put bonds in here because of the confusion between the two.

Key things to look for when picking a HISA

Interest rates and calculations

Interest Rates: Make sure you understand the interest rate you’ll be paid on a HISA. Outside of promotional rates, HISA rates often fluctuate with the bank’s prime rate.

When the Bank of Canada increases or decreases interest rates, your rate should also increase or decrease. This may not be immediate, and some banks have been known to delay increases (but typically never decreases.)

Canadian savers are often enticed by attractive interest rates; higher rates mean one’s savings can grow more rapidly over time. However, it is crucial you make sure you’re not wasting all of your time on a short-term promotional rate and possibly giving up a lower, albeit fixed, rate in the process.

Calculations: Interest is typically calculated daily on the closing balance and paid monthly, ensuring that every dollar earns interest throughout the month. Complex calculations are handled by the institutions, so you don’t exactly need to know the nuances here. But still, it’s important you understand what and how you’re getting paid.

Transaction and account fees

Transaction Fees: While many HISAs offer unlimited transactions, some may have associated costs, especially for in-branch or assisted transactions. Review the fee structure for activities like fund transfers, bill payments, and ATM withdrawals and see if there are any hidden charges.

Monthly Account Fees: A significant advantage of HISAs can be their low or zero monthly fees. If the institution you’re looking at charges a monthly fee to have the HISA run unless the interest rate is out of this world good. There is zero reason we should be paying fees on savings accounts in this day and age.

In the realm of savings accounts, I cannot stand fees. They shouldn’t exist, but they do.

All of the HISAs we highlighted at the top of this article have zero fees and high-interest rates.

Access to funds

Online Banking: HISAs are often linked to a bank’s online platform, offering 24/7 access to funds and the ability to transfer money between one’s HISA and chequing account easily. However, before you open an account, make sure this is the case.

Withdrawals: Customers can usually make withdrawals from their HISA via online banking, ATMs, or in-person at a branch. While many such transactions are free, make sure you confirm with the bank, as some types of withdrawals may incur fees.

Convenience

The choice of a HISA is not solely about the numbers; convenience plays a significant role. Many Canadian banks offer efficient online banking services that make managing one’s account straightforward, allowing customers to deposit or withdraw funds effortlessly.

For this reason, it doesn’t make much sense to chase marginally higher interest rates at other institutions when you can grab a similar rate on your own. For example, if you’re with Bank A and they offer 4%, is it worth it to move the capital to Bank B to earn 4.1%?

This is something to consider, as everyone will have a different threshold of convenience.

How to Open a HISA

Make sure you’re eligible and have the right documents

To open a HISA, individuals need to meet the basic eligibility criteria. Typically, one must be a Canadian resident and have reached the age of majority in their province or territory. The necessary documentation often includes:

• Personal identification: Usually, two forms of government-issued ID are required.
• Social Insurance Number (SIN): Mandatory for account setup and tax purposes.
• Proof of address: This could be a recent utility bill or any official document stating your address.

The specific documents accepted can vary between banks, so it’s advisable to check with the bank for their acceptable IDs and documents list.

Online application process

Most banks in Canada provide a streamlined online application process for opening a HISA. However, you may find some that do require you to visit a branch. They are few and far between these days.

Here’s what the typical online process entails:

1. Visit the bank’s website: I’d recommend getting started with Equitable Bank, as it currently offers the widest functionality when it comes to their accounts.
2. Fill out the application: Provide your personal information, including your name, address, and SIN.
3. Verify your identity: This may be done through secure online verification systems.
4. Initial deposit: Many HISAs require an initial deposit, which can be transferred from your online banking or another account. Equitable makes depositing capital very easy.
5. Await confirmation: After submitting the application and deposit, the bank will typically review your application before the account opening is finalized.

When I opened my account with Equitable Bank, it took very little time to actually be approved. The best part about it as well is the fact the bank lets you earn interest on deposits even while they’re pending.

Let’s talk about the safety of a high-interest savings account

In Canada, the safety of individuals’ savings in financial institutions is guaranteed by a structured deposit insurance program. Although you don’t need to be an expert, you at least need to know what it is.

Let’s go over it.

What Is CDIC deposit insurance?

The Canada Deposit Insurance Corporation (CDIC) is a federal Crown corporation created to protect the money Canadians deposit in member financial institutions. In the event that a member institution fails, CDIC ensures that depositors’ eligible funds are safeguarded up to $100,000. 

Eligible deposits typically include savings and chequing accounts, guaranteed investment certificates (GICs) with terms of five years or less, and certain other deposit products that are payable in Canada. Make sure the HISA you have opened is with a CDIC member.

• Membership: Financial institutions must be members of the CDIC to offer this insurance to their clients.
• Coverage limits: Coverage is up to $100,000 per category, per depositor, at each member institution.

Each depositor could be insured for up to $100,000 per insured category at each member institution. This protection is automatic and free of charge.

What is eligible and what’s not

Deposit insurance is designed to protect a range of deposit types, but it’s important to understand what is specifically covered:

• Eligible Deposits: Accounts such as savings, chequing, and GICs with terms no longer than five years are insured.
• Non-Eligible Products: It should be noted that stocks, bonds, mutual funds, and the funds on deposit in a credit card account are not insured by the CDIC.

Tips for earning the most from your HISA

Follow interest rates closely

Canadian savers should regularly check the interest rates provided by their financial institutions, as these can fluctuate. It’s essential to be aware of both the standard rate and any promotional interest rate offers.

If you’re willing to put in the effort and shift accounts around, you can increase the earnings on your HISAs. Some institutions will offer large promotional rates for short periods of time in an effort to get more clients. Savvy savers can move money from account to account to take advantage of promotions.

The threshold and which you do this will solely depend on you. Some may not find it worth the effort to swap over 0.2%-0.5%, while some might.

Avoid fees at all costs

In this day and age, a HISA should not charge fees, period. Unless there is a significant boost in interest to the point where it’s worth it, however, I have yet to find an account that offers this.

Potential account holders need to look for accounts with no monthly fees or minimum balance requirements that could otherwise reduce the yield on their savings.

It’s also wise to check for other possible costs, such as transaction fees, which can quickly accumulate with frequent withdrawals. One should read the fine print and choose accounts that support their savings strategy without imposing unnecessary charges.

Important tax information when it comes to your HISA

HISA earnings are taxed fully as interest income

In Canada, the interest earned from a HISA is considered taxable income outside of registered accounts. Individuals are required to report any interest earned on their tax return. 

For example, if someone earns $500 of interest income on their non-registered HISA, they will receive a tax slip from their bank, which needs to be included in their tax return. The interest rate directly affects the amount of taxable income generated from these savings.

Interest income is the worst form of investment income, taxed fully at your nominal tax rate. 

Registered HISAs can eliminate the tax, but may not be for everyone

Not all HISAs are subject to tax on the interest; savings held within a Tax-Free Savings Account (TFSA) or a Registered Retirement Savings Plan (RRSP) accrue interest tax-free. These registered accounts offer significant tax advantages:

• TFSA: The attractive feature of a Tax-Free Savings Account is its flexibility when it comes to liquidity.
• RRSP: Designed primarily for retirement savings, an RRSP allows individuals to defer the taxes owed on interest until withdrawal, often at a lower rate post-retirement. It is not advisable to place money you could possibly need over the short term into an RRSP.

Online banks and their dominance in HISA offerings

In Canada, High-Interest Savings Accounts (HISAs) have become increasingly accessible through online banks, offering advantageous rates, particularly when compared to many major brick-and-mortar institutions. 

Some popular institutions include Simplii Financial, EQ Bank, and Tangerine Bank. These banks are purely digital, allowing them to have low overhead and, as such, can operate at tighter spreads.

Advantages of online banks

Digital banks are favoured for their lower service charges and higher interest rates compared to traditional brick-and-mortar banks. Clients of Simplii Financial, Tangerine, and EQ Bank, for instance, benefit significantly from no monthly fees and competitive interest rates.

Furthermore, most of these banks have outstanding mobile apps which offer a complete banking experience right from their smartphones. 

Here’s a list of the perks offered by online banks:

• No Monthly Fees: A standard benefit across digital banking institutions like Simplii Financial.
• Higher Interest Rates: Online banks provide more attractive rates on HISAs, with EQ Bank often leading in the market.
• Convenient Mobile Apps: Banking apps from entities like Tangerine Bank allow quick and seamless account management on the go.
• Reduced Overhead: Digital banks save on physical spaces, passing on the savings to their customers.