Which Online Savings Account Should I Open? | General comparisons | Discussion forum

No brainer to go with pcf for free chequing. I'd go with ctfs for savings. If you can wait to a week for money to be off hold. I'd say ally.ca, but they are so new that there is no history of rates yet. Ctfs is also good because you can "link" accounts for use of electronic fund transfers. Although with pcf, I'd sign up at the pavilion since at some point you need to go down there to verify your identity anyway.

I have a ctfs account now, use it to store any extra money off my pay cheques. Just signed up for an ally account (better interest right now). Plan to transfer money in between depending on how the rates are. Don't think I can directly link the two, because neither are chequing accounts. So will have to transfer to pcf (manually link both accounts to pcf) and use that as a go between.

Steve's comment is incorrect; the 3% at ING is only for their TFSA and only until the end of September (at which point it will likely match the savings acct at 1.05%).

As a fellow Citizens refugee, I chose Maxa for my long-term savings (only 1 free transfer out per month though, $1 after that). Still trying to decide on what to do for my main account (bill payments, direct deposit, etc), but I'm thinking about using this strategy:
http://www.canadiancapitalist......k-account/

WW, If you're in BC, have a look at Coast Capital for a nice no-fee chequing acct. I would have done that if I was there, but I can't open an acct with them.

Mike said:

Still trying to decide on what to do for my main account (bill payments, direct deposit, etc), but I'm thinking about using this strategy:
http://www.canadiancapitalist......k-account/

This approach you outlined above is exactly what I've chosen to do (I'm another Citizens Bank refugee). HSBC Direct Savings Account is now my primary bank account. The only thing I can't do on it is write cheques, but since I wrote so few cheques to begin with and set up EFT/pre-authorized debits now for every bill I get, it doesn't matter.

I'll just use Mastercard Cheques and put my Mastercard in a surplus position (by overpaying) before writing a Mastercard Cheque in the rare instance I absolutely must use a cheque, so that I am not charged interest for the "cash advance". I used to pay my horse board once a month by cheque, but will simply pay by cash now instead - the guy prefers cash anyway. This leaves a piddly two or three instances a year where a cheque is required and the Mastercard Cheques, which you can order from your card company, usually in sets of 20 for 50 cents each, will suffice.

The only thing I don't like about HSBC Direct is they charge you $10 for each incoming or outgoing online bank-to-bank money transfer (which they refer to as wire transfers), at least from what I gather, though I haven't tried yet. ING Direct doesn't charge for those transfers, but then, ING Direct won't let you pay bills through PAD/EFT online so ING's not useful as a primary bank account.

I definitely recommend HSBC Direct as a good new Primary Account for other Citizens Bank refugees like myself. I like them so far, even though their web interface isn't as pretty as Citizens Bank's. It's also very easy to access surcharge-free ATMs due to their partnership with Bank of Montreal.

As for the original poster in this thread, if they absolutely can't dump TD entirely due to needing to write cheques too often, then I recommend ING Direct as a good place to hold cash. Their bank-to-bank transfers are free and their web interface is easy. They do have a HOLD policy for the money (as does HSBC) but really it's no big deal as long as you are aware of it up front and plan accordingly to take it into account. I presume TD probably charges for bank-to-bank transfers too though, so no matter where you put your extra money you'll get dinged every time you move it, right? (I'm not familiar with TD but do know the main banks hit you with service fees left and right so I'm making an assumption here).

Someone else mentioned ally.ca. I recently opened an account there and as far as I can tell their bank to bank transfers are free, too, but they're a new player. Their interest rate is currently 2%! They don't seem to have HOLDS which is nice. I'd suggest them or ING Direct...

Thank you so much to all of you for sharing your advice! I knew I could count on you!

As for TDCT, as I have a long history with them, they don't hold my deposits anymore, plus they have given me a great line of credit at only 2% above prime, and if I maintain a balance of $1,000 at all times (which I treat as an emergency cash fund), there are no account fees, saving me at least $60 per year, which is more than I would make in interest if I had that $1,000 in a liquid savings account even at 3%. I also have a "Global Sustainability" RESP mutual fund account with them, which has done well recently, and a few GICs paying over 4% for 3-5 years. They are paying 1% annual interest on my TFSA, which I'm not satisfied with, but I guess is pretty competitive in today's market, and I like that I can immediately dump those funds into my regular chequing account when it comes time to make my house deposit and down payment, as well as the option to have my cheque certified, all of which is important when buying property in a hot market...

Finally, many of the virtual banks require that you link to a Big Bank, and TDCT does have really great customer service in my opinion, at least as compared with the other Big Banks. (My only experience with online banks was ING a few years ago, who royally screwed up the spelling of my name and couldn't fix it no matter how many times I brought it to their attention until I finally closed the account out of frustration, and Citizens, which had lovely customer service but was constantly misinforming me about various issues... I was loyal though because I loved Citizens' '0 emissions policy' and other 'ethical' financial options and they did have a great online interface and quite good rates until the end was nearing...)

BTW, I have heard that some credit card companies do not allow overpayments... Did those of you who are using this method confirm with your cc company what their policy is on this?

All the best, and thanks again for your thoughts.

WW

PS I'm not a BC resident.

If you're just looking for a safe place to park money until you need it for something (house, etc...), there's really not much difference between any of the so-called "high-interest savings accounts" these days. You'll get a few bucks more per month if you park at, say, CTFS (1.2%) as opposed to, say, PCF (0.75%), but your money is 100% guaranteed at all of them (up to 100K) as long as they're CDIC members. People's Choice is at or near the top right now (2.1%) but direct online account access isn't offered. Achieva Financial (1.85%) isn't CDIC-insured (although they're part of a private fund that supposedly reimburses you for all of your savings, even over 100K), and they don't offer a funds transfer interface. If you're looking to get a decent return (say anything over 3.0% in this market), you're going to have to put your money in harm's way in relatively safe (but still not guaranteed) bonds or bond funds (money market funds pay out about the same as a savings account these days), and you'll have to wait a few days (typically 3) to get at your money when you sell. Bottom-line, there's really no significant difference between any of the "high-interest" savings accounts IMHO, and it's really just a matter of getting a few more crumbs out of one vs. the other. BTW, I am also saving for a house, and I've got my savings in a couple of world equity funds, which I can switch to lower-risk bond funds at any time if the markets start tanking. The markets have added over $5,000 to my down payment since July.