Best Place to Save Money Monthly and Earn Interest

Your savings account should pay you back. Every dollar sitting idle loses ground.

Saving feels hard when money is tight. But where you keep your money matters as much as how much you put away. The right account earns daily interest that compounds over time and charges you no fees.

In this guide, you’ll learn about high interest savings accounts, short-term investments, registered accounts like TFSAs and RRSPs, and how to match the right account to your savings goals.

What Is the Best Place to Save Money and Earn Interest in Canada?

In Canada, three types of accounts do the heavy lifting when it comes to growing your money:

1. High Interest Savings Accounts (HISAs): Easy access to your cash, with a higher interest rate than a standard savings account
2. Guaranteed Investment Certificates (GICs): Locked-in terms, predictable returns, good for a savings goal with a fixed timeline.
3. Tax-Free Savings Accounts (TFSAs): A registered account where your interest grows without being taxed.

Each one fits a different situation. A HISA works well as an emergency fund, money you can access quickly. A GIC suits savings you won’t touch for six to twelve months. A TFSA fits long-term financial goals where keeping your returns matters.

Canadian financial institutions advertise high interest rates to attract new account holders. Those rates are real, but they expire. A bonus interest offer that runs for five months tells you nothing about what the regular interest rate looks like after.

Read the fine print. Know your goal. Then pick the account that matches both.

High Interest Savings Accounts in Canada: What They Are and How They Work

A high interest savings account does one thing better than a regular savings account: it pays you more to keep your money there. Here’s how it works and why it matters for your savings goals.

What Is a High-Interest Savings Account?

A HISA is a bank account designed to grow your money faster than a standard savings account.

Most regular savings accounts in Canada pay between 0.01% and 0.05% annual interest. A high-interest savings account pays anywhere from 3% to 5%, sometimes higher during a promotional period.

The money stays accessible. You can make withdrawals, set up direct deposits, and handle everyday banking tasks. Unlike a GIC, your cash isn’t locked in.

HISAs are also protected. The Canada Deposit Insurance Corporation (CDIC) insures eligible deposits up to $100,000. That means your money is safe even if the financial institution fails.

The Difference Between a HISA and a Regular Savings Account

A standard savings account holds your money. A HISA holds your money and pays you a meaningful interest rate for doing so.

The gap matters. At 0.05%, a $5,000 deposit earns $2.50 in a year. At 4.5%, that same deposit earns $225. Same money. Same effort. Very different result.

Some HISAs charge monthly fees or require a minimum balance. Others are completely no-fee. Always check the account fees before opening an account.

How Compound Interest Works in a HISA

Compound interest means you earn interest on your interest. Your account balance grows on its own over time.

Opening deposit: $5,000

Annual interest rate: 4.5%

Daily interest calculated, paid monthly

After 12 months, your balance sits at roughly $5,229.39, without adding a single dollar.

That’s $229.39 earned passively. The longer the money stays, the faster it compounds.

Want to run the numbers on your own deposit? Use the Government of Canada’s compound interest calculator to see what your savings could look like.

What to Know About a Daily Interest Savings Account

Most HISAs calculate daily interest on your closing balance. That means every day your money sits in the account, it earns interest.

The interest posts to your account monthly. Even if the annual interest rate looks small, daily interest adds up across 365 days.

This is why a high-interest savings account outperforms a chequing account or a regular savings account for money you don’t need immediately. Your cash stays liquid, and it keeps working.

Comparing Popular High-Interest Savings Accounts

Not all high interest savings accounts are equal. Here are five worth knowing, what they offer, where they shine, and where they fall short.

EQ Bank Personal Account

Best for: Everyday banking with no fees

EQ Bank consistently offers one of the highest regular interest rates in Canada. There are no monthly fees, no minimum balance required, and no transaction fees on everyday banking. You get free Interac e-Transfer, bill payments, and direct deposit, all in one personal account.

This works best as a standalone savings account, not a chequing account replacement.

• Regular interest rate: Among the highest non-promotional rates available
• Monthly fees: None
• Minimum deposit: None
• CDIC insured: Yes

Simplii Financial High Interest Savings Account

Best for: No-fee banking with chequing account features

Simplii Financial runs a no-fee HISA with occasional promotional rates for new account holders. It connects easily to a chequing account, making transfers fast. Direct deposit, bill payments, and debit access are all included.

The regular interest rate is competitive but not the highest on the market. Watch for limited-time bonus interest offers. They run for a set number of business days, then drop to the standard rate.

• Regular interest rate: Moderate
• Monthly fees: None
• Minimum balance required: None
• CDIC insured: Yes

Scotiabank Momentum Plus Savings Account

Best for: Existing Scotiabank customers building short-term savings

Scotiabank’s Momentum Plus rewards account holders who leave their money untouched. The longer your closing balance stays put, the higher your bonus interest climbs. This makes it a solid option for short-term savings goals with a fixed timeline.

ATM withdrawals and excess transactions trigger fees, so this account punishes frequent access. Keep withdrawals low, and the account performs well.

• Regular interest rate: Low base, higher with momentum bonus.
• Monthly fees: None
• Minimum balance required: None
• CDIC insured: Yes

RBC High Interest eSavings

Best for: Existing RBC personal banking customers

The RBC High Interest eSavings account pairs well with an existing RBC chequing account. Transfers between accounts happen fast. Online banking access is straightforward, and the account carries no monthly fees.

The regular interest rate sits below what digital-only banks offer. RBC makes up for it with convenience; everything lives inside one personal banking dashboard. For someone already deep in the RBC ecosystem, it removes friction from saving.

• Regular interest rate: Below average compared to online banks
• Monthly fees: None
• Minimum balance: None
• CDIC insured: Yes

Tangerine Savings Account

Best for: Promotional rate chasers with discipline

Tangerine regularly offers strong promotional rates for new account holders and existing clients moving money into savings. The bonus interest period runs for a limited time, typically a few months, before settling at the regular interest rate.

If you track expiry dates and move funds strategically, Tangerine rewards you; if you set it and forget it, the rate drops without warning.

• Regular interest rate: Low after promo ends
• Monthly fees: None
• Minimum balance required: None
• CDIC insured: Yes

Account

Best For

Monthly Fees

Promo Rate Available

EQ Bank

Highest ongoing rate

None

No

Simplii Financial

No-fee everyday banking

None

Yes

Scotiabank Momentum Plus

Short-term savings goals

None

Yes (momentum bonus)

RBC High Interest eSavings

Existing RBC customers

None

Occasional

Tangerine

Bonus rate strategy

None

Yes

Best Short-Term Investments in Canada

Sometimes a savings account isn’t the right tool. When you have a fixed goal and a set timeline, locking your money in often earns you more.

Guaranteed Investment Certificates (GICs)

A GIC is a contract with a financial institution. You deposit money for a fixed term. In return, you get a guaranteed interest rate.

There are two types worth knowing:

• Cashable GICs let you withdraw before the term ends. The annual interest rate is lower, but your money stays accessible. Good for savings goals with soft deadlines.
• Non-redeemable GICs lock your money in completely. The rate is higher, and the tradeoff is simple: touch the money early, and you forfeit the interest. These suit a hard deadline, like saving for a car in 12 months.

GICs are also protected by the Canada Deposit Insurance Corporation (CDIC) up to $100,000. That makes them one of the safest short-term investments in Canada.

Current GIC interest rates vary by term length and financial institution. Longer terms typically earn higher rates. Shop around before committing.

Notice Savings Accounts

A notice savings account sits between a HISA and a GIC. You earn a higher interest rate than in a standard savings account. But to make a withdrawal, you give the bank advance notice, usually 10 to 30 business days.

This structure works well for money you plan to use but not immediately. It rewards patience without fully locking you in. Think of it as a middle ground for disciplined savers.

TFSAs as Investment Vehicles

Most people treat a Tax-Free Savings Account as a regular savings account. That undersells it.

A TFSA holds more than cash. You can hold GICs, index funds, and other investments inside it. Interest, dividends, and gains remain tax-free. Every dollar of growth belongs to you.

For short-term financial goals, a TFSA holding a GIC is a strong combination. You get the locked-in rate of the GIC, plus the tax advantages of a registered account.

Contribution limits apply. For 2024, the annual limit is $7,000. Unused room carries forward, so check your total eligibility before depositing.

HISAs vs. Short-Term Investments: Which Makes Sense?

Liquidity is the deciding factor. A HISA gives you easy access. A GIC or notice account gives you a better rate in exchange for less flexibility.

Ask one question: Will you need this money fast? If yes, a HISA fits. If the answer is no and the timeline is fixed, a short-term investment is more profitable.

Pick based on your timeline, not the advertised rate.

What to Watch Out For: Fees, Promo Rates, and Fine Print

Banks compete for your deposits. The offers look good on the surface, until you read the details.

Promotional Rates That Expire

A promotional rate grabs attention. A financial institution advertises a high interest rate, sometimes 5% or higher, to pull in new account holders.

That rate has an expiry date.

Most bonus interest offers last 3 to 5 months. After that, the account reverts to the regular interest rate. That rate is often much lower. Sometimes as low as 0.01%.

Before opening any account, ask one question: What is the rate after the promotional period ends? That number tells you what the account is actually worth.

Minimum Balance Requirements

Some accounts require a minimum balance to earn the advertised interest rate. Drop that threshold below, and the rate drops with it.

Check two numbers before signing up:

• Minimum deposit — the amount needed to open the account
• Minimum balance required — the amount needed to keep earning the full rate

A high interest savings account that requires $5,000 to earn its top rate stops working the moment your account balance dips below that mark.

Monthly Fees and Account Fees

Monthly fees quietly cancel out interest earned. A $10 monthly fee on an account earning $8 in interest leaves you behind every single month.

Look for no-fee accounts. Many online banking options offer them. If an account charges fees, calculate whether the interest rate covers them. If the math doesn’t work in your favour, move on.

Transaction Fees and Withdrawal Limits

Some high-interest savings accounts restrict how often you can transfer money. Exceed the limit, and transaction fees apply. ATM withdrawals may trigger additional charges.

This matters for an emergency fund. An account that penalises withdrawals creates friction when you need fast access to cash.

Read the terms around transfers, bill payments, and ATM withdrawals before committing.

CDIC Coverage and Eligibility

Not every account carries deposit protection. The Canada Deposit Insurance Corporation covers eligible deposits up to $100,000 per depositor per member institution.

Confirm your account qualifies. Most personal banking accounts at CDIC member institutions do. But some account types and foreign currency deposits, like U.S. dollar accounts, fall outside standard coverage.

Know what protection you have before you deposit money.

FAQs

Is my money protected in a Canadian savings account?

Yes. Most savings accounts at Canadian banks and credit unions are protected by the Canada Deposit Insurance Corporation (CDIC). Coverage goes up to $100,000 per depositor, per category. That includes personal accounts, joint accounts, and registered accounts like RRSPs and TFSAs, each covered separately. Check that your financial institution is a CDIC member before opening an account.

Can I hold a savings account in U.S. dollars?

Several Canadian banks offer U.S. dollar savings accounts for account holders who earn, spend, or save in American currency. These accounts earn interest, too, though the rates differ from those of Canadian dollar accounts. They help avoid conversion fees on everyday banking and work well if you travel frequently or do business across the border.

Do high interest savings accounts charge monthly fees?

Some do, some don’t. No-fee HISAs exist and are worth prioritizing. Monthly fees quietly eat into the interest you earn, especially on a low account balance. Before opening any account, check for transaction fees, ATM withdrawal charges, and minimum balance requirements. A high interest rate means little if account fees cancel it out.

How does direct deposit affect my savings account?

Some financial institutions offer a bonus interest rate when you set up direct deposit into your account. This increases your regular interest rate, sometimes significantly. It’s a legitimate way to earn more on the same balance. Read the eligibility conditions carefully. Some offers require a minimum deposit amount or a closing balance threshold to qualify each month.

What is the difference between an RRSP and a TFSA for saving?

Both are registered accounts that shelter your money from certain taxes, but they work differently. A Registered Retirement Savings Plan (RRSP) gives you a tax deduction on contributions now, but you pay tax on withdrawals later. A Tax-Free Savings Account lets you deposit after-tax dollars and withdraw anytime, tax-free. For short-term savings goals, a TFSA offers more flexibility. For long-term retirement-focused planning, an RRSP often makes more sense.

Start Saving Smarter: Get Fast Cash When You Need It at My Canada Payday

A solid savings plan takes time to build. HISAs, GICs, TFSAs, etc, grow your money steadily. But even the best financial planning can’t predict everything.

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