The best saving accounts in Canada for 2024

Our guide to the best savings accounts in Canada

A savings account is a common type of deposit bank account that can earn interest on it’s balance. This type of account is perfect for specific goals such as an emergency fund, wedding or an upcoming expensive purchase. 

There are a few things to look for when searching for a new savings account. We’ve outlined these key features below. 

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% - 4%.

With a savings account, you can separate money that is in surplus to your day-to-day requirement and earn a little extra. 

What to look for in a savings account:

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.

Transaction fees

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.

Monthly fees

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.

Deposit insurance

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.

Extras

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.

Convenience

Choosing a savings account that's convenient and has your banking preferences in mind is important. Things to keep in mind before choosing a new financial institution:

• If you prefer going into a physical location, ensure you bank with an institution with physical branches.
• If you prefer online banking, it may be wise to go with an online-only bank. If this is the case, ensure the digital experience offers everything you may need, including customer service for questions. 
• Many people enjoy having their chequings and savings account with the same financial institution
• It's important to ensure that when needed, you're able to easily withdraw money. Can you use a debit card at an ATM or do you need to transfer funds to another bank prior to withdrawal? 

What types of savings accounts are available?

There are a number of different types of savings accounts available to Canadians, each with a different intended purpose. A few different types of savings accounts are:

High interest savings accounts

High interest savings accounts are savings accounts that pay a high rate of interest compared to other savings accounts available on the market. In Canada, you’re required to pay income tax on the money you earn in a non-registered high-interest savings account.

Tax-free savings accounts

The name tax-free savings account (TFSA) actually refers to a tax shelter that can be used with a number of different investment products, but there are savings accounts available as a TFSA. TFSA savings accounts typically offer a lower interest rate than high interest savings accounts, but as the name suggests interest earned is tax-free. You can only open a TFSA if you’re a Canadian citizen age 18 or over. TFSAs also have a contribution limit.

Youth savings accounts

Many banks and financial institutions offer special savings accounts just for children. Youth savings accounts sometimes offer special incentives and educational tools to teach kids how to save money and how to bank.

Seniors savings accounts

Less common than children’s accounts, seniors savings accounts can offer special interest rates or reduced fees for Canadians who are 65 and over.

Regular savings accounts vs. registered savings and investment accounts

There are many different registered savings and investment plans available to Canadians for various financial goals; such as the Tax Free Savings Account (TFSA), Registered Retirement Savings Plan (RRSP), First Home Savings Account (FHSA) and of course, a regular savings account. You might be wondering, what is the difference between a TFSA vs. a savings account? What should you use each account type for? We explain in the table below.