It pays to shop around in this volatile rate environment
The Bank of Canada has now raised its key interest rate by 1.25% in 2022, including its most recent 0.50% increase on June 1. Its next scheduled announcement is on July 13.
At the beginning of 2022, Wyth Financial had the top savings account interest rate at 1.55%, and has since increased it by a paltry 0.05% to sit at 1.60%. By contrast, Ontario-only Saven Financial’s savings account interest rate has increased from 1.50% on January 1 to 2.40% today. Current nationally available leader AcceleRate Financial went from a 1.10% interest rate on January 1 to 2.05% today.
If we go back to June 2021, Canadian Tire Bank sat atop our savings account comparison table, but now its rate ranks close to the bottom of the pack.
GIC rates have increased more broadly, but here too, the leaders have changed. At the beginning of 2022, Hubert Financial had the highest 1-year GIC rate at 2.00% (now 3.25%), and the highest 5-year GIC rate at 3.00% (now 4.35%). New leader Motive Financial’s 1-year rate went from 1.65% to 3.85%, and its 5-year rate went from 2.60% to 4.50%.
Are 1-year cashable GICs worth a look?
If you’re looking for a GIC, even savers who are committed to a GIC ladder might be hesitant to lock into new terms in this environment. If you’re still with one of the big banks, you could consider HSBC’s cashable 1 year GIC at 2.60% or CIBC’s cashable 1-year GIC at 2.00%.
Hubert Financial’s 1-year term, although not the highest rate, is a favourite in our discussion forum because it’s actually redeemable after every 3 months.
Where to stash your US dollars
EQ Bank’s 1.25% USD savings account often catches people’s attention, but Simplii Financial has a new USD account that earns 1.65% until September 30. Unfortunately, it does not support US dollar electronic funds transfers from other financial institutions yet.
We’ve also received a report that RBC is offering a 2.75% 1-year non-redeemable US dollar GIC.
A quartet of 3.00% promos
- Meridian Credit Union is offering 3.00% for the first 8 months in a new savings account, both registered and non-registered
- motusbank is offering 3.00% for the first 122 days in a new savings account, both registered and non-registered
- Simplii Financial’s latest new customer promo is 3.00% in a savings account until October 31, 2022
- Tangerine Bank’s latest new customer promo is 3.00% in a savings account for the first 5 months
Strategies for decumulating in retirement
Check out a recent forum discussion about strategies for decumulating in retirement, including website and book recommendations, and various factors to consider.